Shri Raj Kumar Kukreja, Bhopal V. The ACIT, 3(1), Bhopal

ITSSA 61/IND/2012

• Counselvise Citation: [2012] 124 COUNSELVISE.COM (IT) 7475 (ITAT-INDORE)
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-05-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2002-2003
• Appeal Filed On: 16-02-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: KESHAV SAXENA
• Assessee Lawyers: S S DESHPANDE
• Keywords: Business income; Income from undisclosed sources
• Section: 142(1); 153A; 68; 132

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER IT(SS)A NOS. 54 TO 59/IND/2012 A.YS. 2001-02 TO 2006-07 DILIP KUMAR KUKREJA BHOPAL PAN ABLPK 3484C :: APPELLANT VS ASSTT. COMMISSIONER OF INCOME TAX 3(1), BHOPAL :: RESPONDENT IT(SS)A NOS. 60 TO 65/IND/2012 A.YS. 2001-02 TO 2006-07 RAJ KUMAR KUKREJA BHOPAL PAN ABLPK 3486A :: APPELLANT VS ASSTT. COMMISSIONER OF INCOME TAX 3(1), BHOPAL :: RESPONDENT 2 APPELLANT BY SHRI S.S. DESHPANDE RESPONDENT BY SHRI KESHAV SAXENA DATE OF HEARING 1.05.2012 DATE OF PRONOUNCEMENT 2.05.2012 O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER THIS BUNCH OF 12 APPEALS IS BY DIFFERENT ASSESSEES CHALLENGING THE IMPUGNED ORDERS DATED 1.11.2011 AND 8.12.2011, RESPECTIVELY. IN THE CASE OF SHRI DILIP KUMAR KUKR EJA (A.Y. 2001- 02 TO 2006-07) (IT(SS) A. NOS. 54 TO 59/IND/2012) F OLLOWING COMMON GROUNDS HAVE BEEN RAISED :- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ASSESS MENT PROCEEDINGS AND THE ASSESSMENT ARE NOT ILLEGAL, INV ALID AND BAD IN LAW. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LEARNED CIT(A) WAS NOT JUSTIFIED IN HOLDING THA T THE INCOME OF WIFE OF THE ASSESSEE BELONGS TO THE ASSES SEE AND CONFIRMING THE ACTION OF THE AO OF ADDING HER INCOM E IN THE HANDS OF THE ASSESSEE. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE UNSECURED LOANS OF RS. 1 LAC A.Y. 2004-05) AND RS. 3,50,000/- (A.Y. 2006-07) AND CONFIRMING SUCH UNSEC URED LOANS AS INCOME OF THE ASSESSEE. 2. DURING HEARING OF THESE APPEALS, WE HAVE HEARD S HRI S.S. DESHPANDE, LD. COUNSEL FOR THE ASSESSEE AND SHRI KE SHAV SAXENA, LEARNED CIT DR. SO FAR AS THE FIRST GROUND IS CONCERNED, 3 THE SAME WAS NOT CONTESTED BY THE ASSESSEE, BEING G ENERAL IN NATURE, THEREFORE, THE SAME IS DISMISSED AS NOT PRE SSED. 3. THE NEXT GROUND PERTAINS TO ASSESSING THE INCOME OF THE WIFE OF THE ASSESSEE IN THE HANDS OF THE ASSESSEE A S INCOME FROM OTHER SOURCES. THE LD. COUNSEL FOR THE ASSESSEE ASS ERTED THAT PRIOR TO SEARCH, THE DEPARTMENT HAD BEEN ACCEPTING RETURNS OF WIFE FROM IDENTICAL SOURCE AS THEIR INCOME FOR THE LAST ABOUT MORE THAN 15 YEARS, THEREFORE, THE LEARNED AO IS NOT JUS TIFIED TO TREAT THE SAME AS INCOME OF THE ASSESSEE BY HOLDING THAT THE WIFE OF THE ASSESSEE IS HAVING NO INCOME AT ALL. THE LEARN ED CIT DR THOUGH DEFENDED THE IMPUGNED ORDER BUT DID NOT CONT ROVERT THE ASSERTION OF THE ASSESSEE THAT THE DEPARTMENT HAD B EEN ACCEPTING THE INCOME OF THE ASSESSEE AS HAS BEEN CLAIMED BY T HE LD. COUNSEL FOR THE ASSESSEE. 3.1 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE, AN INDIVIDUAL, IS REGULARLY ASSESSED TO T AX. THE ASSESSEE IS PRIMARILY ENGAGED IN MANUFACTURING AND SALE OF C OOKING MASALA WITH THE BRAND NAME VIP MASALA. THE ASSES SEE WAS ALSO INVESTING IN REAL ESTATE BUSINESS. A SEARCH AN D SEIZURE OPERATION U/S 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF 4 KUKREJA GROUP OF CASES ON 5.1.2007. THE ASSESSEE IS SON OF SHRI VISHNUKUMAR KUKREJA. AS PER THE REVENUE, CERTAIN DO CUMENTS, WHICH RELATE TO THE ASSESSEE, WERE FOUND. PURSUANC E TO THE NOTICE U/S 142(1) READ WITH SECTION 153A OF THE ACT , ISSUED TO THE ASSESSEE, THE ASSESSEE FILED THE RETURN ON 20.3 .2008 WITH THE SUBMISSION TO TREAT HIS RETURN, FILED U/S 139, AS H IS RETURN U/S 153A OF THE ACT DECLARING INCOME OF RS.73,058/- AND AGRICULTURAL INCOME OF RS.40,850/-. THE INCOME OF THE ASSESSEE I S SUMMARIZED AS UNDER :- SL.NO. ASSESSMENT YEAR RETURNED INCOME (IN RUPEES) ADDITION MADE BY AO (IN RS) 1 2001-02 73058 70130 2 2002-03 90273 71,345 3 2003-04 85043 76815 4 2004-05 84580 83035 5 2005-06 95630 94445 6 2006-07 430729 82,835 THE IMPUGNED ADDITIONS WERE MADE BY THE AO ON THE G ROUND THAT IN THE KUKREJA GROUP ONLY THE APPELLANT, HIS FATHER AND TWO BROTHERS ARE HAVING BUSINESS INCOME AND THESE PERSO NS CREATED CAPITAL IN THE NAMES OF THEIR WIVES AND THE LADIES (WIVES) HAVE NO 5 SOURCE OF INCOME. HOWEVER, THE FACT REMAINS THAT T HE WIVES OF THE RESPECTIVE ASSESSEES HAD BEEN FILING INCOME TAX RET URNS SHOWING INCOME FROM MAKING BADI, PAPAD, ACHAR AND SEWING, E TC. AND THE SAME HAD BEEN ACCEPTED BY THE DEPARTMENT FOR THE LA ST ABOUT SO MANY YEARS THAT TOO PRIOR TO SEARCH, THEREFORE, IN OUR OPINION, THERE IS NO JUSTIFICATION TO TREAT SUCH INCOME AS I NCOME OF THEIR HUSBANDS THAT TOO WITHOUT BRINGING ANY CONTRARY MAT ERIAL ON RECORD. NO EVIDENCE HAS BEEN BROUGHT ON RECORD EIT HER TO CONTROVERT THE ASSERTION OF THE ASSESSEE OR TO PROV E THAT THE UNACCOUNTED INCOME OF THE WIFE WAS THE UNACCOUNTED INCOME OF THEIR HUSBANDS. THE IMPUGNED ADDITIONS HAVE BEEN MA DE MERELY ON THE BASIS OF SURMISES AND PRESUMPTION, THEREFORE , THE LEARNED AO IS DIRECTED TO DELETE THE ADDITIONS MADE IN THE HANDS OF THE PRESENT ASSESSEE, CONSEQUENTLY, THIS GROUND OF THE ASSESSEE IN RESPECTIVE APPEALS IS ALLOWED. 4. FOR THE A.YS. 2004-05 AND 2006-07 ANOTHER GROUND CONFIRMING UNSECURED LOAN OF RS.1 LAC AND RS.3,50,0 00/-, RESPECTIVELY, HAVE BEEN RAISED. THE CONTENTION OF T HE ASSESSEE IS THAT CONFIRMATIONS WERE FILED AND SPECIFIC REQUEST WAS MADE TO THE AO TO ISSUE SUMMONS TO THE CREDITORS. THE LEAR NED CIT DR DEFENDED THE ADDITION. 6 4.1 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE CLAIMED TO HAVE RECEIVED LOAN OF RS.3 LACS FROM OM PURSHOTTAMDAS GURBANI AND RS. 50,000/- FROM MAHENDR AKUMAR. THE IMPUGNED ADDITIONS WERE MADE ON THE GROUND THAT THE ASSESSEE COULD NOT PRODUCE THE COPY OF BANK STATEME NT AND RETURN OF INCOME OF THE CREDITORS, THEREFORE, IT WA S HELD THAT THE IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF TRAN SACTION COULD NOT BE PROVED, THEREFORE, THE ADDITIONS WERE MADE U /S 68 OF THE ACT. KEEPING IN VIEW THE PRINCIPLE OF NATURAL JUST ICE, ASSERTION OF THE LD. COUNSEL FOR THE ASSESSEE AND THE FACTS AVAI LABLE ON RECORD, WE ARE OF THE VIEW THAT NO PERSON SHOULD BE CONDEMN ED UNHEARD. THE ASSESSEE IS DIRECTED TO PRODUCE THE CREDITORS B EFORE THE LEARNED AO SO THAT HE CAN SATISFY HIMSELF ABOUT THE GENUINENESS OF THE TRANSACTIONS, THEREFORE, THIS GROUND IS SENT TO THE FILE OF THE AO FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW. T HIS GROUND FOR THE RESPECTIVE ASSESSMENT YEARS IS ALLOWED FOR STAT ISTICAL PURPOSES ONLY. THEREFORE, THE APPEALS ARE PARTLY AL LOWED FOR STATISTICAL PURPOSES. 5. NOW WE SHALL TAKE UP THE APPEALS OF SHRI RAJ KUM AR KUKREJA (IT(SS) NOS. 60 TO 65/IND/2012) FOR A.YS. 2 001-02 TO 7 2006-07) WHEREIN THE FIRST GROUND WAS NOT CONTESTED , BEING GENERAL IN NATURE, THEREFORE, THE SAME IS DISMISSED AS NOT PRESSED. 6. THE NEXT GROUND PERTAINS TO HOLDING THE INCOME O F THE WIFE IN THE NAME OF THE HUSBAND. ON THE REASONING STATE D IN THE CASE OF DILIP KUMAR KUKREJA (SUPRA), THIS GROUND OF THE ASSESSEE IS ALLOWED. 7. THE LAST GROUND PERTAINS TO HOLDING THE INCOME F ROM AGRICULTURE AS INCOME FROM OTHER SOURCES. THE CONTE NTION RAISED BY THE LEARNED COUNSEL FOR THE ASSESSEE IS THAT THE ASSESSEE IS HAVING 2.5 ACRES OF LAND, THEREFORE, THERE IS NO RE ASON TO TREAT THE SAME AS INCOME FROM OTHER SOURCES. THE LEARNED CIT DR STRONGLY DEFENDED THE ADDITION BY SUBMITTING THAT THE EXTENT OF INCOME SHOWN TO HAVE BEEN RECEIVED FROM AGRICULTURE IS NOT POSSIBLE. 7.1 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON FILE. THE STAND OF THE RE VENUE IS THAT EVIDENCE FOR EARNING AGRICULTURAL INCOME LIKE CULTI VATION, PROOF OF SEEDS, FERTILIZERS, LABOUR AND WATER CHARGES, ETC. WAS NOT PRODUCED BY THE ASSESSEE. ON THE OTHER HAND, THE AS SESSEE DURING ASSESSMENT PROCEEDINGS PRODUCED KHASRA KHATA UNI, 8 MANDI RECEIPTS FOR SALE OF AGRICULTURAL PRODUCE. TH E AO MADE THE ADDITION OF RS.22,500/- (A.Y. 2001-02), RS. 23,000/ - (A.Y. 2002- 03), RS. 34,000/-(A.Y. 2003-04), RS. 37,000/- (A.Y. 2004-05) AND RS.70,115/- (A.Y. 2006-07). ON APPEAL, THE LEARNED CIT(A) AFFIRMED THE ADDITIONS. WE FIND THAT THE IMPUGNED A DDITIONS ON ACCOUNT OF AGRICULTURAL INCOME WERE MADE BY THE AO ON THE GROUND THAT NO BOOKS OF ACCOUNTS HAVE BEEN MAINTAIN ED FOR SUCH AN AGRICULTURAL INCOME AND ALL THE RECEIPTS OF AGRI CULTURAL INCOME ARE IN CASH ONLY. TO PUT AN END TO LITIGATION AND THE FACT THAT 2.5 ACRES OF LAND IS OWNED BY THE ASSESSEE, ONLY OPTION REMAINS THAT INCOME MAY BE ESTIMATED, THEREFORE, THE INCOME SO C LAIMED IS TREATED AS INCOME FROM AGRICULTURE BUT IN THE ABSEN CE OF REQUIRED DETAILS, THE ADDITIONS ARE REDUCED TO 50% IN THE RE SPECTIVE ASSESSMENT YEARS. WE ARE MAKING IT CLEAR THAT OUR CONCLUSION PERTAINS TO THE IMPUGNED APPEALS ONLY AND MAY NOT B E QUOTED AS PRECEDENCE BECAUSE OUR CONCLUSION IS PURELY BASED U PON THE FACTS OF THE IMPUGNED APPEALS ONLY, THEREFORE, THIS GROUND FOR THE RESPECTIVE ASSESSMENT YEARS IS PARTLY ALLOWED. FINALLY, THE APPEALS IN THE CASES OF SHRI DILIP KU MAR KUKREJA ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES WHERE THE APPEALS IN THE CASE OF SHRI RAJKUMAR KUKREJA ARE PA RTLY ALLOWED. 9 THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 2.5.2012. SD SD (R.C.SHARMA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL ME MBER DATED: 2.5.2012 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-