Smt. R.Prabha, CHENNAI V. ACIT, CHENNAI

ITSSA 9/CHNY/2008

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 2874 (ITAT-CHENNAI)
• Duration Of Justice: 8 year(s) 11 month(s) 19 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 13-01-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 24-11-2016
• Assessment Year: misc
• Appeal Filed On: 24-01-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: K G RAGHUNATH
• Keywords: Gift; Source of fund; Block assessment
• Section: 131; 15

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , ! .#$#%, ' !( BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER I.T.(SS) A. NO.9/MDS/2008 BLOCK PERIOD : 01.04.1986 TO 31.03.1996 & 01.04.1996 TO 24.09.1996 SMT. S. PRABHA, NO.11-A, PARAMESWARI NAGAR III STREET, ADYAR, CHENNAI - 600020. PAN : AGAPP 0445 L V. THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II(2), CHENNAI. (*+/ APPELLANT) (-.*+/ RESPONDENT) *+ / 0 / APPELLANT BY : SHRI K.G. RAGHUNATH, ADVOCATE -.*+ / 0 / RESPONDENT BY : SH. T.R. SENTHIL KUMAR, SR. STA NDING COUNSEL 1 / 2' / DATE OF HEARING : 24.11.2016 345 / 2' / DATE OF PRONOUNCEMENT : 13.01.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE ASSESSING OFFICER DATED 14.12.2007 FOR THE BLOC K PERIOD 01.04.1986 TO 31.03.1996 AND 01.04.1996 TO 24.09.19 96. 2. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASSE SSEE, SUBMITTED THAT THERE WAS A SEARCH IN THE PREMISES O F SHRI T.V. 2 I.T.(SS) A. NO.9/MDS/08 SUNDARAVADANAM, FATHER OF THE ASSESSEE, ON 24.09.19 96. CONSEQUENTLY, NOTICE UNDER SECTION 158BC READ WITH SECTION 158BD OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE AC T') WAS ISSUED TO THE ASSESSEE. THE ASSESSING OFFICER DETERMINED THE UNDISCLOSED INCOME FOR THE BLOCK PERIOD IN THE HANDS OF THE ASS ESSEE UNDER SECTION 158BC OF THE ACT AT ` 12,02,370/-. AN APPEAL WAS FILED BEFORE THIS TRIBUNAL IN I.T.(SS) A. NO.174/MDS/1998 . THIS TRIBUNAL BY AN ORDER DATED 30.6.2006, SET ASIDE THE ORDER OF THE ASSESSING OFFICER AND DIRECTED THE ASSESSING OFFICER TO REDO THE ASSESSMENT AFTER AFFORDING OPPORTUNITY TO THE ASSESSEE. ACCOR DINGLY, THE ASSESSMENT WAS COMPLETED UNDER SECTION 158BC OF THE ACT. BEING AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, TH E ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE THIS TRIBUNAL. 3. THE FIRST GROUND OF APPEAL IS WITH REGARD TO JUR ISDICTION OF THE ASSESSING OFFICER IN ASSESSING THE INCOME UNDER SEC TION 158BD OF THE ACT. ACCORDING TO THE LD. COUNSEL FOR THE ASSE SSEE, NO SEARCH WAS CARRIED OUT IN THE NAME OF THE ASSESSEE, THEREF ORE, THE ASSESSEE IS A PERSON OTHER THAN THE SEARCHED PERSON . HENCE, THE ASSESSMENT HAS TO BE MADE UNDER SECTION 158BD OF TH E ACT. IN FACT, THE ASSESSMENT WAS MADE UNDER SECTION 158BD O F THE ACT. 3 I.T.(SS) A. NO.9/MDS/08 THEREFORE, THE ASSESSING OFFICER HAS TO RECORD HIS SATISFACTION BEFORE ISSUING NOTICE UNDER SECTION 158BD OF THE AC T TO THE ASSESSEE. NO SATISFACTION WAS RECORDED BY THE ASSE SSING OFFICER, THEREFORE, ACCORDING TO THE LD. COUNSEL, IN VIEW OF JUDGMENT OF APEX COURT IN MANISH MAHESHWARI V. ACIT (2007) 289 ITR 3 41, THE ASSESSING OFFICER CANNOT MAKE ANY ASSESSMENT IN THE HANDS OF THE ASSESSEE. HENCE THE ENTIRE ASSESSMENT PROCEEDINGS CANNOT STAND IN THE EYE OF LAW. 4. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE LD . SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ISSUE OF RECORDING OF SATISFACTION WAS EXAMINED BY THIS TRIB UNAL IN THE EARLIER ROUND OF LITIGATION AND THIS TRIBUNAL BY AN ORDER D ATED 30.06.2006 IN I.T.(SS) A. NO.174/MDS/1998 FOUND THAT THE ASSESSIN G OFFICER HAS RIGHTLY INVOKED THE JURISDICTION AFTER RECORDING SA TISFACTION. AN APPEAL HAS ALREADY BEEN FILED BY THE ASSESSEE BEFOR E THE HIGH COURT AND THE SAME IS PENDING. THEREFORE, AT THIS STAGE, THE TRIBUNAL CANNOT GO INTO THE ISSUE OF JURISDICTION. IN OTHER WORDS, ACCORDING TO THE LD. SR. STANDING COUNSEL, THE ISSU E OF JURISDICTION WAS DECIDED BY THE CO-ORDINATE BENCH OF THIS TRIBUN AL AGAINST THE ASSESSEE, HENCE, THE SAME CANNOT BE RE-EXAMINED. 4 I.T.(SS) A. NO.9/MDS/08 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT IN THE EARLIER ROUND OF LITIGATION IN I.T.(SS) A. NO.174/MDS/1998, BY AN ORDER DATED 30.06.2006, THIS TRIBUNAL EXAMINED THE ISSUE OF JURISDICTION AND FOUND THAT T HE ASSESSING OFFICER HAS VALIDLY INITIATED PROCEEDING UNDER SECT ION 158BD OF THE ACT. THEREFORE, AS RIGHTLY SUBMITTED BY THE LD. SR . STANDING COUNSEL FOR THE REVENUE, THE VERY SAME ISSUE CANNOT BE RE-A GITATED ONCE AGAIN BEFORE THIS BENCH OF THE TRIBUNAL. IN OTHER WORDS, THE ORDER PASSED BY THIS TRIBUNAL IN I.T.(SS) A. NO.174/MDS/1 998 DATED 30.06.2006 IS BINDING ON BOTH THE PARTIES. THEREFO RE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSING OFF ICER HAS RIGHTLY INVOKED THE JURISDICTION AND INITIATED PROCEEDING U NDER SECTION 158BD OF THE ACT. 6. NOW COMING TO THE MERIT OF THE ISSUE RAISED BY T HE ASSESSEE, THE FIRST GROUND OF APPEAL IS WITH REGARD TO ADDITI ON OF ` 83,490/- TOWARDS UNEXPLAINED CASH GIFT FOR THE ASSESSMENT YE AR 1992-93. 5 I.T.(SS) A. NO.9/MDS/08 7. SHRI K.G. RAGHUNATH, LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT THE ASSESSEE RECEIVED GIFTS ON THE O CCASION OF HER MARRIAGE. ACCORDING TO THE LD. COUNSEL, THE MARRIA GE OF THE ASSESSEE TOOK PLACE ON 18.10.1991. THE ASSESSEE HA S FURNISHED DETAILS OF 206 PERSONS, WHO HAD GIFTED CASH TO THE EXTENT OF ` 1,47,275/-. THE DETAILS OF THE GIFT WERE FURNISHED TO THE ASSESSING OFFICER. THE DETAILS FILED BEFORE THE ASSESSING OF FICER ARE AVAILABLE AT PAGES 2 TO 5 OF THE SUBMISSION FILED BY THE ASSE SSEE FOR THE ASSESSMENT YEAR 1992-93, WHICH FALLS IN THE BLOCK P ERIOD. THE ASSESSING OFFICER FOR THE REASONS BEST KNOWN TO HIM , ACCEPTED 50% OF THE GIFT RECEIVED BY THE ASSESSEE AND BALANCE 50 % WAS TAKEN AS UNDISCLOSED INCOME FOR THE ASSESSMENT YEAR 1992-93, WHICH FALLS IN THE BLOCK PERIOD. ACCORDING TO THE LD. COUNSEL, MA NY DIGNITARIES ATTENDED THE MARRIAGE OF THE ASSESSEE. THE ASSESSE E, IN FACT, SUBMITTED THE COPIES OF MOI BOOKS AND OTHER DETAILS WHICH CONTAINED THE NAMES AND DETAILS OF THE PERSONS WHO MADE THE GIFTS. THEREFORE, THE ASSESSING OFFICER IS NOT JUSTIFIED I N ACCEPTING 50% OF GIFT AND DISALLOWING REMAINING 50%. 8. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE LD . SR. STANDING COUNSEL, SUBMITTED THAT THE MOI BOOKS WERE IN FACT 6 I.T.(SS) A. NO.9/MDS/08 FURNISHED BEFORE THE ASSESSING OFFICER. SINCE THE ASSESSING OFFICER HAS A DOUBT ABOUT THE SO-CALLED GIFT RECEIVED DURIN G THE MARRIAGE, HE DISALLOWED 50% OF THE SAME AND ALLOWED THE REMAI NING 50%. THEREFORE, ACCORDING TO THE LD. SR. STANDING COUNSE L, NO INTERFERENCE IS CALLED FOR. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSMENT IS ADMITTEDLY MADE UNDER SECTION 158BD OF THE ACT. THE NAMES AND OTHER DETAILS ARE AVAILABLE IN THE MOI BOOKS. IT IS ALSO NOT IN DISPUTE THAT NO MATERIAL WAS FOUND DURING THE COURS E OF SEARCH OPERATION IN RESPECT OF THE SO-CALLED GIFTS SAID TO BE RECEIVED BY THE ASSESSEE DURING HER MARRIAGE. THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT OUT OF THE GIFTS RECEIVED DU RING HER MARRIAGE, INVESTMENT WAS MADE. THIS TRIBUNAL IS OF THE CONSI DERED OPINION THAT WHEN THE ASSESSEE HAS FILED THE DETAILS OF GIF T SAID TO BE RECEIVED FROM VARIOUS PERSONS DURING HER MARRIAGE A ND THE ASSESSING OFFICER HAS ACCEPTED 50% OF THE SAME WITH OUT ANY REASON, IT IS NOT KNOWN WHY THE ASSESSING OFFICER D ISBELIEVED THE REMAINING 50% OF GIFTS. THIS TRIBUNAL IS OF THE CO NSIDERED OPINION THAT IF THE ASSESSING OFFICER HAS ANY DOUBT ABOUT T HE RECEIPT OF GIFTS 7 I.T.(SS) A. NO.9/MDS/08 DURING THE ASSESSEES MARRIAGE, HE OUGHT TO HAVE DI SALLOWED THE ENTIRE CLAIM INSTEAD OF RESTRICTING IT TO 50%. THE VERY FACT THAT THE ASSESSING OFFICER ACCEPTED 50% OF THE GIFTS SHOWS T HAT THE ASSESSEE IN FACT RECEIVED THE GIFTS. THEREFORE, T HERE IS NO JUSTIFICATION IN RESTRICTING TO 50%. IN VIEW OF THI S, THIS TRIBUNAL IS UNABLE TO UPHOLD THE ORDER OF THE ASSESSING OFFICER . ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 83,490/- TOWARDS UNEXPLAINED CASH GIFT FOR THE ASSE SSMENT YEAR 1992-93 IS DELETED. 10. THE NEXT ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO ADDITION OF ` 2,50,000/- FOR THE ASSESSMENT YEAR 1995-96, TOWARDS FIXED DEPOSIT IN MCC BANK. 11. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THERE WAS A FIXED DEPOSIT IN MCC BAN K, TIRUVANMIYUR BRANCH IN THE JOINT NAME OF THE ASSESSEE AND HER HU SBAND DR. SIVAKUMAR. NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION REGARDING THIS DEPOSIT. THE FIXED DEPOSI T WAS, IN FACT, MADE ON 28.07.1994. ACCORDING TO THE LD. COUNSEL, THE CASH GIFT RECEIVED DURING THE ASSESSEES WEDDING WAS VERY MUC H AVAILABLE FOR MAKING INVESTMENT TO THE EXTENT OF ` 1,47,275/-. THE LD.COUNSEL 8 I.T.(SS) A. NO.9/MDS/08 FURTHER SUBMITTED THAT THE ASSESSEE HAS ALSO RECEIV ED CASH GIFT FROM VARIOUS PERSONS ON VARIOUS OCCASIONS LIKE BIRTHDAY AND OTHER SOCIAL OCCASIONS, APART FROM WEDDING. THE HOUSEHOLD EXPEN SES RECEIVED FROM THE ASSESSEES HUSBAND DR. SIVAKUMAR WAS ALSO USED FOR MAKING DEPOSIT IN THE FIXED DEPOSIT. AFTER TAKING INTO CONSIDERATION OF THE CASH GIFT RECEIVED DURING WEDDING TO THE EXT ENT OF ` 1,47,275/-, RECEIPT OF GIFT ON HER SONS NAMING CEREMONY TO THE EXTENT OF ` 24,705/-, PROCEEDS OF SALE OF PART OF HER JEWELLERY , WHICH WAS CONFIRMED BY THE ASSESSING OFFICER BY AN ORDER DATE D 29.09.1998 TO THE EXTENT OF ` 41,458/- AND ACCUMULATED CASH SAVINGS FROM HOUSEHOLD EXPENSES TO THE EXTENT OF ` 1,28,000/-, THE AVAILABLE CASH BALANCE WITH THE ASSESSEE WAS ` 3,42,165/-, OUT OF WHICH, THE ASSESSEE HAS MADE FIXED DEPOSIT OF ` 2,50,000/-. EVEN THOUGH THE FIXED DEPOSIT STANDS IN THE JOINT NAME OF THE ASSES SEE AND HER HUSBAND, THE ASSESSEE HAS FURNISHED ALL THE SOURCES OF INCOME FOR MAKING SUCH DEPOSIT. THE ASSESSING OFFICER WITHOUT CONSIDERING THE CLAIM OF THE ASSESSEE, MADE ADDITION OF ` 2,50,000/-. THIS BEING A BLOCK ASSESSMENT UNDER SECTION 158BD OF THE ACT, ACCORDING TO THE LD. COUNSEL, IN THE ABSENCE OF ANY MATERIAL FOU ND DURING THE COURSE OF SEARCH OPERATION, THERE CANNOT BE ANY ADD ITION. 9 I.T.(SS) A. NO.9/MDS/08 12. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH ERE WAS A FIXED DEPOSIT JOINTLY IN THE NAME OF THE ASSESSEE AND HER HUSBAND DR. SIVAKUMAR. IN FACT, THE FD WAS OPENED IN JULY, 199 4. THE ASSESSING OFFICER COLLECTED DETAILS BY SUMMONING TH E BRANCH MANAGER OF MCC BANK, TIRUVANMIYUR BRANCH, UNDER SEC TION 131 OF THE ACT. IN FACT, THE FIXED DEPOSIT ACCOUNT WAS OP ENED ON 28.07.1994. ON 12.09.1994, A SUM OF ` 1 LAKH WAS WITHDRAWN AND THE BALANCE OF ` 1.5 LAKHS WAS RENEWED FOR FURTHER PERIOD. THE ACCUMULATED INTEREST ALONG WITH FIXED DEPOSIT WAS C REDITED TO THE SAVINGS BANK ACCOUNT TO THE EXTENT OF ` 1,77,822/- ON 27.05.1995. THE ABOVE AMOUNT WAS AGAIN INVESTED ON 31.05.1995 A ND 05.06.1995 IN THE FORM OF FOUR DEPOSITS FOR ` 1.4 LAKHS. THE ASSESSEE HAS ALSO TAKEN A LOAN AGAINST THE FIXED DE POSIT TO THE EXTENT OF ` 1,61,000/-. THEREFORE, ACCORDING TO THE LD. SR. ST ANDING COUNSEL, THE ASSESSING OFFICER HAS RIGHTLY FOUND TH AT THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF INCOME. 13. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, THE BLOCK ASSESSMENT WAS MADE UNDER SECTION 158BD OF TH E ACT SINCE 10 I.T.(SS) A. NO.9/MDS/08 THE ASSESSEE IS THE PERSON OTHER THAN THE SEARCHED PERSON. WE HAVE CAREFULLY GONE THROUGH THE PROVISIONS OF SECTI ON 158BB(1) OF THE ACT. SECTION 158BB(1) OF THE ACT CLEARLY SAYS THAT THE UNDISCLOSED INCOME FOR THE BLOCK PERIOD HAS TO BE C OMPUTED ON THE BASIS OF THE EVIDENCE FOUND DURING THE COURSE OF SE ARCH OPERATION AND SUCH OTHER MATERIALS OR INFORMATION AVAILABLE W ITH THE ASSESSING OFFICER AND RELATABLE TO SUCH EVIDENCE FOUND DURING THE COURSE OF SEARCH OPERATION. IN THE CASE BEFORE US, IT IS NOB ODYS CASE THAT THERE WAS ANY EVIDENCE FOUND DURING THE COURSE OF S EARCH OPERATION. THE ASSESSING OFFICER GOT THE INFORMATI ON ABOUT THE FIXED DEPOSIT FROM THE BRANCH MANAGER OF THE BANK WHILE E XAMINING HIM UNDER SECTION 131 OF THE ACT. THEREFORE, THIS TRIB UNAL IS OF THE CONSIDERED OPINION THAT IN THE ABSENCE OF ANY MATER IAL FOUND DURING THE COURSE OF SEARCH OPERATION, THERE CANNOT BE ANY ADDITION FOR THE BLOCK PERIOD UNDER SECTION 158BD OF THE ACT. 14. EVEN ON MERIT, AS DEMONSTRATED BY THE LD.COUNSE L FOR THE ASSESSEE, THE GIFT RECEIVED BY THE ASSESSEE IN CASH DURING HER WEDDING WAS AVAILABLE TO THE EXTENT OF ` 1,47,275/-. THE ASSESSEE HAS ALSO DEMONSTRATED BEFORE THE ASSESSING OFFICER THAT SHE RECEIVED ` 24,705/- TOWARDS CASH GIFT DURING HER SONS NAMING 11 I.T.(SS) A. NO.9/MDS/08 CEREMONY. THE PROCEEDS OF SALE OF JEWELLERY WAS AD MITTED BY THE ASSESSING OFFICER BY AN ORDER DATED 29.09.1998 TO T HE EXTENT OF ` 41,458/-. THE ASSESSEE CLAIMS THAT THE ACCUMULATED SAVINGS FROM THE HOUSEHOLD EXPENSES WAS TO THE EXTENT OF ` 1,28,000/-. THE TOTAL AVAILABLE CASH WITH THE ASSESSEE FOR MAKING THE INV ESTMENT WAS ` 3,42,165/-. THE ASSESSEE NOW CLAIMS THAT OUT OF TH IS ` 3,42,165/-, THE FIXED DEPOSIT OF ` 2,50,000/- WAS MADE. IT IS CUSTOMARY IN THIS PART OF COUNTRY TO RECEIVE GIFTS DURING THE COURSE OF MARRIAGE AND ALSO NAMING CEREMONY AND OTHER SOCIAL OCCASIONS. T AKING INTO CONSIDERATION OF THE SOCIAL STATUS OF THE ASSESSEE IN THE SOCIETY AND THE CUSTOMARY PRACTICE PREVAILING IN THIS PART OF C OUNTRY, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CLAIM OF THE ASSESSEE TOWARDS AVAILABILITY OF CASH TO THE EXTENT OF ` 3,42,165/- CANNOT BE RULED OUT. THEREFORE, THE CLAIM OF THE ASSESSEE THAT THE FIXED DEPOSIT WAS MADE TO THE EXTENT OF ` 2,50,000/- OUT OF AVAILABLE CASH OF ` 3,42,165/- CANNOT BE REJECTED IN TOTO. THIS TRIBUN AL IS OF THE CONSIDERED OPINION THAT THE ASSESSEE MIGHT HAVE DEP OSITED IN THE FD OUT OF THE CASH AVAILABLE WITH HER FROM THE GIFT S RECEIVED DURING HER MARRIAGE AND OTHER SOCIAL OCCASIONS, AS STATED BY THE ASSESSEE. THEREFORE, THE ADDITION OF ` 2,50,000/- TOWARDS FIXED DEPOSIT IN MCC 12 I.T.(SS) A. NO.9/MDS/08 BANK IS NOT JUSTIFIED. ACCORDINGLY, THE ORDER OF T HE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 2,50,000/- IS DELETED. 15. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADD ITION OF ` 1,78,371/- TOWARDS INVESTMENT IN MARUTI 1000 CAR FO R THE ASSESSMENT YEAR 1996-97. 16. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT NO MATERIAL WAS FOUND DURING THE COU RSE OF SEARCH OPERATION IN RESPECT OF PURCHASE OF MARUTI 1000 CAR . THE ASSESSING OFFICER ISSUED A QUESTIONNAIRE ON 03.08.1998 CALLIN G FOR CERTAIN DETAILS ABOUT THE BANK ACCOUNT STANDING IN THE NAME OF THE ASSESSEE AND HER HUSBAND DR. SIVAKUMAR ALONG WITH P ASSBOOK / STATEMENT OF ACCOUNTS. IN PURSUANCE TO THIS QUESTI ONNAIRE, THE ASSESSEE HAS FURNISHED COPIES OF THE PASSBOOK AND B ANK STATEMENT. FROM THESE COPIES FURNISHED BY THE ASSE SSEE, THE ASSESSING OFFICER FOUND THAT TWO PAY ORDERS FOR ` 1,61,000/- AND ` 1,55,000/- WERE ISSUED IN FAVOUR OF ONE DR. AZEEZUR REHMAN TOWARDS PURCHASE OF MARUTI 1000 CAR. THE ASSESSING OFFICER ALSO APPEARS TO HAVE EXAMINED DR. AZEEZUR REHMAN ON 17.0 9.1998. THE ASSESSING OFFICER HAS ALSO FOUND THAT THE ASSES SEE HAS TAKEN A LOAN OF ` 1.61 LAKHS AGAINST THE FIXED DEPOSIT, ON 04.09.1995 . THE 13 I.T.(SS) A. NO.9/MDS/08 ASSESSING OFFICER ULTIMATELY TREATED THE VALUE OF T HE PAY ORDER TO THE EXTENT OF ` 1,54,371/- ALONG WITH CASH PAYMENT OF ` 24,000/- AS UNDISCLOSED INCOME. ACCORDING TO THE LD. COUNSEL, THE ASSESSEE WAS NOT INVOLVED IN THE TRANSACTION OF PURCHASE OF CAR. THE CAR IS NOT AN ASSET OF THE ASSESSEE. NO MONEY WAS PAID BY THE ASSESSEE TO DR. AZEEZUR REHMAN. IN FACT, THE TRANSACTION WA S BETWEEN THE ASSESSEES HUSBAND AND DR. AZEEZUR REHMAN. MERELY BECAUSE THE BANK ACCOUNT STANDS IN THE JOINT NAME OF THE ASSESS EE AND HER HUSBAND, THE ASSESSING OFFICER MADE ADDITION IN THE HANDS OF THE ASSESSEE. ACCORDING TO THE LD. COUNSEL, THE ENTIRE TRANSACTION WAS MADE BY THE ASSESSEES HUSBAND DR. SIVAKUMAR, THERE FORE, THERE CANNOT BE ANY ADDITION IN THE HANDS OF THE ASSESSEE . 17. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSING OFFICER FOUND THAT TWO PAY ORDERS FOR ` 1.61 LAKHS AND ` 1.55 LAKHS RESPECTIVELY WERE ISSUED FROM THE BANK ACCOUNT IN F AVOUR OF DR. AZEEZUR REHMAN FOR PURCHASE OF MARUTI 1000 CAR. IN RESPONSE TO THE QUESTIONNAIRE ISSUED BY THE ASSESSING OFFICER C ALLING UPON THE ASSESSEE TO FURNISH THE COPIES OF THE BANK PASSBOOK AND STATEMENT OF ACCOUNT OF THE ASSESSEE AND HER HUSBAND, THE ASS ESSEE HAS 14 I.T.(SS) A. NO.9/MDS/08 FURNISHED COPIES OF HER PASSBOOK AND STATEMENT OF B ANK ACCOUNT IN MCC BANK, TIRUVANMIYUR BRANCH ALONE. NO DETAILS AB OUT THE BANK ACCOUNT OF THE ASSESSEES HUSBAND DR. SIVAKUMAR WAS FURNISHED BEFORE THE ASSESSING OFFICER. IN THE ABSENCE OF AN Y DETAILS, THE CREDIT OF ` 1,54,371/- TOWARDS PURCHASE OF MARUTI 1000 CAR TREA TED AS UNEXPLAINED IN THE HANDS OF THE ASSESSEE. APART FR OM THAT, THE ASSESSEE HAS ALSO MADE CASH PAYMENT OF ` 24,000/-. THEREFORE, THE ENTIRE CONSIDERATION ON PURCHASE OF CAR WAS TREATED AS UNDISCLOSED INVESTMENT BY THE ASSESSEE. 18. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT NO MATERIAL WAS FOUND DURING THE COURS E OF SEARCH OPERATION IN RESPECT OF THE INVESTMENT MADE IN THE CAR. THE ASSESSING OFFICER APPARENTLY MADE THE ADDITION SINC E THE ASSESSEE COULD NOT PRODUCE THE DETAILS OF THE BANK ACCOUNT A ND STATEMENT OF BANK ACCOUNTS OF HER HUSBAND DR. SIVAKUMAR. THE FA CT REMAINS THAT THE ASSESSEE HAS FILED COPIES OF BANK STATEMEN T OF THE ASSESSEE IN MCC BANK, TIRUVANMIYUR BRANCH. WE HAVE CAREFULLY GONE THROUGH THE PROVISIONS OF SECTION 158BB(1) OF THE ACT. FOR THE PURPOSE OF MAKING BLOCK ASSESSMENT UNDER SECTION 15 8BC OR 15 I.T.(SS) A. NO.9/MDS/08 158BD OF THE ACT, THE ASSESSING OFFICER HAS TO CON FINE HIMSELF TO THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPER ATION OR TO THE INFORMATION WHICH IS RELATABLE TO THE MATERIAL FOUN D DURING THE COURSE OF SEARCH OPERATION. IN THE CASE BEFORE US, IT IS NOBODYS CASE THAT THE ASSESSING OFFICER HAS FOUND ANY MATER IAL WITH REGARD TO INVESTMENT MADE IN THE MARUTI CAR, DURING THE CO URSE OF SEARCH OPERATION. THE ISSUE OF PAY ORDERS APPARENTLY CAME TO THE KNOWLEDGE OF THE ASSESSING OFFICER AS PER THE DETAI LS FURNISHED BY THE BANK MANAGER WHEN HE WAS SUMMONED BY THE ASSESS ING OFFICER. THEREFORE, THIS TRIBUNAL IS OF THE CONSID ERED OPINION THAT IN THE ABSENCE OF ANY MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION WITH REGARD TO INVESTMENT SAID TO BE MADE IN MARUTI 1000 CAR, THERE CANNOT BE ANY ADDITION IN THE BLOCK PERI OD. MOREOVER, THE ASSESSEE CLAIMS THAT SHE IS NOT CONCERNED WITH THE TRANSACTION OF PURCHASE OF CAR. THEREFORE, AT THE BEST, THE ADDIT ION MAY BE MADE IN THE HANDS OF DR. SIVAKUMAR, THE ASSESSEES HUSBA ND IN THE REGULAR ASSESSMENT. ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 1,78,371/- FOR THE ASSESSMENT YEAR 1996-97 IS DELETED. 16 I.T.(SS) A. NO.9/MDS/08 19. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADD ITION OF ` 1,81,000/- TOWARDS SETTLEMENT OF LOAN FOR THE ASSES SMENT YEAR 1996-97. 20. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE AVAILED A LOAN OF ` 1,61,000/- AS AGAINST THE FIXED DEPOSIT ON 04.09.1995. NO MATERIAL WAS F OUND DURING THE COURSE OF SEARCH OPERATION WITH REGARD TO REPAYMENT OF LOAN BY THE ASSESSEE. ACCORDING TO THE LD. COUNSEL, THE ASSESS EE HAS RECEIVED A SUM OF ` 1,00,000/- FROM HER HUSBAND DR. SIVAKUMAR. ALONG W ITH THIS SUM OF ` 1,00,000/-, THE ASSESSEE HAS ALSO UTILISED ACCUMULA TED SAVINGS OF ` 61,000/- FOR REPAYMENT OF LOAN AVAILED FROM MCC BAN K, TIRUVANMIYUR BRANCH. THE EXPLANATION OF THE ASSESS EE WAS TOTALLY IGNORED BY THE ASSESSING OFFICER. ACCORDING TO THE LD. COUNSEL, THERE CANNOT BE ANY ADDITION IN THE BLOCK ASSESSMEN T IN THE ABSENCE OF ANY MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION. MOREOVER, ACCORDING TO THE LD. COUNSEL, THE ASSESSEE HAD SUFFICIENT SOURCE FOR REPAYMENT OF ` 1,61,000/- TOWARDS LOAN. 21. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR REVENUE, SUBMITTED THAT THE AS SESSEE HAS TAKEN LOAN AGAINST THE FIXED DEPOSIT TO THE EXTENT OF ` 1.7 LAKHS ON 17 I.T.(SS) A. NO.9/MDS/08 08.09.1995. IN FACT, A SUM OF ` 1,75,820/- WAS CREDITED AGAINST FOUR FDS WHICH MEANS THAT THE ASSESSEE HAD SQUARED UP TH E LOAN TAKEN BY PAYING ` 1.61 LAKHS INTO THE LOAN ACCOUNT. THEREFORE, THE REPAYMENT OF LOAN TO THE EXTENT OF ` 1.61 LAKHS WAS TREATED AS UNDISCLOSED INCOME BY THE ASSESSING OFFICER. THUS, THE ASSESSING OFFICER HAS RIGHTLY MADE THE ADDITION. 22. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSING OFFICER ON THE BASIS OF THE STATEMENT FURNISHED BY THE ASSESSEE WITH REGARD TO BANK ACCOUNT, FOUND THAT THERE WAS A CRED IT OF ` 1,75,820/- THE ASSESSING OFFICER ALSO FOUND THAT THE ASSESSEE HAS AVAILED A LOAN OF ` 1.7 LAKHS ON 08.09.1995. THEREFORE, THE ASSESSING OFFICER PRESUMED THAT THE ASSESSEE HAD SQUARED UP THE LOAN BY PAYING ` 1.61 LAKHS INTO THE LOAN ACCOUNT. IT IS PERTINENT TO NOTE THAT THIS IS A BLOCK ASSESSMENT UNDER SECTION 158BD OF THE ACT. T HEREFORE, THE ASSESSING OFFICER CANNOT TRAVEL BEYOND THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION. IN THE CASE BEFORE US, NO SEARCH MATERIAL WAS REFERRED BY THE ASSESSING OFFICER IN T HE ASSESSMENT ORDER. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT THERE CANNOT BE ANY ADDITION IN THE BLOCK PERIOD TO THE EXTENT OF 18 I.T.(SS) A. NO.9/MDS/08 ` 1,61000/-. MOREOVER, THE ASSESSEE EXPLAINED BEFORE THE ASSESSING OFFICER THAT SHE RECEIVED A SUM OF ` 1,00,000/- FROM HER HUSBAND DR. SIVAKUMAR AND ANOTHER SUM OF ` 61,000/-, WHICH WAS ACCUMULATED SAVINGS OF THE ASSESSEE, WAS ALSO UTILI SED FOR REPAYMENT OF ` 1,61,000/-. IN VIEW OF THE EXPLANATION OF THE ASSESSEE, WHICH WAS NOT FOUND TO BE FAULT BY THE AS SESSING OFFICER, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE RE CANNOT BE ANY ADDITION TOWARDS UNDISCLOSED INCOME OF THE ASSESSEE . ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTENT OF ` 1,61,000/- TOWARDS REPAYMENT OF LOAN FOR THE ASSESSMENT YEAR 1996-97 I S DELETED. 23. NOW COMING TO THE ADDITION OF ` 20,000/- TOWARDS FIXED DEPOSIT FOR THE ASSESSMENT YEAR 1996-97. 24. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE BANK ACCOUNT IN MCC BANK IS A JO INT ACCOUNT HELD BY THE ASSESSEE ALONG WITH HER HUSBAND DR. SIV AKUMAR. THE FIXED DEPOSIT WAS OPENED BY HER HUSBAND OUT OF HIS OWN FUNDS. IN FACT, THE ASSESSEE HAD NO KNOWLEDGE OF TRANSACTION OR THE SOURCE OF INCOME FOR MAKING THE DEPOSIT. THEREFORE, ACCORDIN G TO THE LD. COUNSEL, THIS DEPOSIT BELONGS TO DR. SIVAKUMAR AND NOT TO THE 19 I.T.(SS) A. NO.9/MDS/08 ASSESSEE. MOREOVER, NO MATERIAL WAS FOUND DURING T HE COURSE OF SEARCH OPERATION, THEREFORE, THERE CANNOT BE ANY AD DITION IN THE BLOCK PERIOD. 25. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT ON PERUSAL OF BANK ACCOUNT, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS AVAILED LOAN OF ` 17,000/- AGAINST THE FIXED DEPOSIT OF ` 20,000/- WHICH WAS, IN FACT, DEPOSITED BY CASH. THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY TREATED THE FIXED DEPOSIT OF ` 20,000/- AS UNDISCLOSED INVESTMENT. 26. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THERE WAS NO MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION. FOR THE PURPOSE OF MAKING BLOCK ASSESSM ENT UNDER SECTION 158BD OF THE ACT, THE ASSESSING OFFICER HAS TO CONFINE HIMSELF TO THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION IN VIEW OF THE LANGUAGE EMPLOYED BY THE PARLIAMENT IN SECTION 158BB(1) OF THE ACT. MOREOVER, THE FIXED DEPOSIT S TANDS IN THE NAME OF THE ASSESSEES HUSBAND AND NOT IN THE NAME OF THE ASSESSEE. THEREFORE, IT IS FOR THE ASSESSEES HUSB AND TO EXPLAIN THE 20 I.T.(SS) A. NO.9/MDS/08 SOURCE FOR MAKING THE DEPOSIT. MERELY BECAUSE THE ASSESSEE AVAILED THE LOAN FROM THE BANK, THERE CANNOT BE ANY ADDITION IN THE HANDS OF THE ASSESSEE FOR THE DEPOSIT WHICH STANDS IN THE NAME OF DR. SIVAKUMAR, HUSBAND OF THE ASSESSEE. THEREFORE, THIS TRIBUNAL IS UNABLE TO UPHOLD THE ORDER OF THE ASSESSING OFFICER AND THE SAME IS SET ASIDE. THE ADDITION OF ` 20,000/- IS DELETED. 27. THE NEXT ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO ADDITION OF ` 1,00,000/- TOWARDS FIXED DEPOSIT IN INDIAN BANK FOR THE ASSESSMENT YEAR 1996-97. 28. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE HAS WITHDRAWN A SUM OF ` 1,00,000/- FROM MCC BANK, TIRUVANMIYUR BRANCH, ON 12.09.1994. THIS AMOUNT WAS USED FOR MAKING FIXED DEPOSIT ON 05.10.1995. H OWEVER, THE ASSESSING OFFICER FOUND THAT THE FIXED DEPOSIT COUL D NOT BE MADE ON 05.10.1995 WITH THE MONEY WITHDRAWN ON 22.08.1995. ACCORDING TO THE LD. COUNSEL, THE MONEY WITHDRAWN ON 22.08.1995 CANNOT BE USED FOR MAKING DEPOSIT ON 05.10.1995. IN FACT, TH E MONEY WITHDRAWN ON 22.08.1995 WAS UTILISED TO REPAY THE L OAN AVAILED AGAINST THE FIXED DEPOSIT FROM MCC BANK, TIRUVANMIY UR BRANCH. 21 I.T.(SS) A. NO.9/MDS/08 ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER HAS SIMPLY IGNORED THIS EXPLANATION OF THE ASSESSEE AND MADE A DDITION. 29. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSEE MADE FIXED DEPOSIT OF ` 1,00,000/- IN INDIAN BANK, NEELANKARAI BRANCH. ADMITTEDLY, THE ASSESSEE HAS WITHDRAWN ` 1,00,000/- ON 22.08.1995. THE BRANCH MANAGER WAS EXAMINED BY THE ASSESSING OFFICER UNDER SECTION 131 OF THE ACT ON 03.08.1998. HE EXPLAINED THAT THE FIXED DEPOSIT OF ` 1,00,000/- WAS ORIGINALLY OPENED ON 05.10.1995. THEREFORE, THE ASSESSING OFFICER FOUND THAT THERE CANNOT BE ANY SOURCE FOR MAKING INVESTMENT OF ` 1,00,000/- IN THE FIXED DEPOSIT ON 05.10.1995, THEREFORE, HE MADE THE ADDITION. 30. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE ASSESSEE HAS WITHDRAWN A SUM OF ` 1,00,000/- FROM MCC BANK, TIRUVANMIYUR BRANCH ON 12.09.1994. THE D EPOSIT WAS ADMITTEDLY MADE ON 05.10.1995. THEREFORE, THIS TRI BUNAL IS OF THE CONSIDERED OPINION THAT THE ASSESSEE WOULD HAVE MAD E INVESTMENT OUT OF THE AMOUNT WITHDRAWN ON 12.09.1994. MOREOVE R, NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION. T HE ENTIRE 22 I.T.(SS) A. NO.9/MDS/08 ADDITION WAS MADE ON THE BASIS OF THE STATEMENT SAI D TO BE MADE BY THE BRANCH MANAGER, MCC BANK, TIRUVANMIYUR BRANCH. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT IN THE A BSENCE OF ANY MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATIO N, THERE CANNOT BE ANY ADDITION IN THE BLOCK PERIOD. THEREFORE, TH IS TRIBUNAL IS UNABLE TO UPHOLD THE ORDER OF THE ASSESSING OFFICER . ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION OF ` 1,00,000/- TOWARDS INVESTMENT IN FIXED DEPOSIT IN I NDIAN BANK IS DELETED. 31. THE NEXT GROUND OF APPEAL IS WITH REGARD TO ADD ITION OF ` 50,000/- TOWARDS INVESTMENT IN IFCI FOR THE ASSESSM ENT YEAR 1996- 97. 32. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEES HUSBAND DR. SIVAKUMAR MADE AN INVESTMENT IN IFCI FROM HIS OWN SOURCE OF FUNDS IN THE NAME OF THE ASSESSEE AS WELL AS HER MINOR SON MASTER KARTHIK. THEREFORE, THE TRANSACTION OF INVESTMENT WITH IFCI DOES NOT BELONG TO THE ASSESSEE AT ALL. THE INVESTMENT WAS MADE IN THE NAME OF MIN OR SON AND THE ASSESSEE BY HER HUSBAND DR. SIVAKUMAR. THEREFORE, ACCORDING TO 23 I.T.(SS) A. NO.9/MDS/08 THE LD. COUNSEL, THIS CANNOT BE TREATED AS UNDISCLO SED INCOME IN THE BLOCK PERIOD. 33. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E DEPOSIT / INVESTMENT IN IFCI STANDS IN THE NAME OF THE ASSESS EE AND HER MINOR SON MASTER KARTHIK. THEREFORE, IT IS FOR THE ASSESSEE TO EXPLAIN THE SOURCE OF INVESTMENT. IN THE ABSENCE O F ANY EXPLANATION FROM THE ASSESSEE, ACCORDING TO THE SR. STANDING CO UNSEL, THE ASSESSING OFFICER HAS RIGHTLY MADE THE ADDITION OF ` 50,000/-. 34. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THE INVESTMENT IN IFCI STANDS IN THE N AME OF THE ASSESSEE AND HER MINOR SON MASTER KARTHIK. THE ASS ESSEE CLAIMS THAT THE INVESTMENT WAS MADE BY HER HUSBAND DR. SIV AKUMAR IN HER NAME AS WELL AS HER MINOR SONS NAME. NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION WITH REGARD T O INVESTMENT IN IFCI. THE ADDITION WAS MADE ON THE INFORMATION FIL ED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT. IN FACT, THE ASSISTANT MANAGER OF IFCI SHRI MURTHY WAS SUMMONED UNDER SECT ION 131 OF THE ACT. ON THE BASIS OF THE DETAILS FURNISHED BY THE SAID SHRI 24 I.T.(SS) A. NO.9/MDS/08 MURTHY, IT WAS FOUND THAT THERE ARE TWO BONDS FOR ` 25,000/- EACH, ONE IN THE NAME OF THE ASSESSEE AND ANOTHER IN THE NAME OF HER MINOR SON MASTER KARTHIK. THE INVESTMENT APPEARS T O BE MADE FROM THE MONEY WITHDRAWN FROM INDIAN BANK, NUNGAMBA KKAM BRANCH. FROM THE ABOVE FACTUAL ASPECT, IT APPEARS THAT NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION. T HIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT SINCE THE ASSESSEE COUL D EXPLAIN THE SOURCE FOR MAKING THE INVESTMENT, NO ADDITION CAN B E MADE IN THE BLOCK ASSESSMENT. 35. IN VIEW OF THE LIMITATIONS PROVIDED IN SECTION 158BB(1) OF THE ACT, FOR THE PURPOSE OF COMPUTING UNDISCLOSED INCOM E FOR THE BLOCK PERIOD, THE ASSESSING OFFICER CANNOT TRAVEL BEYOND THE MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATION. IN TH IS CASE, THE ADDITION WAS MADE ON THE BASIS OF THE STATEMENT REC ORDED UNDER SECTION 131 OF THE ACT FROM THE ASSISTANT MANAGER, IFCI AND THE BRANCH MANAGER, INDIAN BANK. NO OTHER SEARCH MATER IAL WAS FOUND DURING THE COURSE OF SEARCH OPERATION. THEREFORE, THE INFORMATION PROVIDED BY THE ASSISTANT MANAGER, IFCI AND THE BRA NCH MANAGER, INDIAN BANK, CANNOT BE THE BASIS FOR MAKING ADDITIO N IN THE BLOCK ASSESSMENT UNDER SECTION 158BD OF THE ACT. IN VIEW OF THE ABOVE 25 I.T.(SS) A. NO.9/MDS/08 STATUTORY MANDATE, FOR COMPUTING THE UNDISCLOSED IN COME FOR THE BLOCK PERIOD, THIS TRIBUNAL IS OF THE CONSIDERED OP INION THAT IN THE ABSENCE OF ANY SEARCH MATERIAL, THERE CANNOT BE ANY ADDITION FOR THE BLOCK PERIOD. THEREFORE, THIS TRIBUNAL IS UNABLE T O UPHOLD THE ORDER OF THE ASSESSING OFFICER AND ACCORDINGLY, THE SAME IS SET ASIDE AND THE ADDITION OF ` 50,000/- IS DELETED. 36. THE NEXT GROUND OF APPEAL ARISES FOR CONSIDERAT ION IS WITH REGARD TO ADDITION OF ` 29,374/- TOWARDS INCOME FROM OTHER SOURCES, FOR THE ASSESSMENT YEAR 1996-97. 37. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE HAS ADMITTED A SUM OF ` 22,000/- BEING BANK INTEREST UNDER THE HEAD INCOME FROM OTHER SOU RCES IN THE RETURN FILED BY HER. IN FACT, A SUM OF ` 12,134/- WAS RECEIVED TOWARDS INTEREST FROM INDIAN BANK, NEELANKARAI BRANCH AND A NOTHER SUM OF ` 9,866/- WAS RECEIVED FROM MCC BANK, TIRUVANMIYUR BR ANCH. THUS, THE TOTAL INTEREST RECEIVED WAS ` 22,000/-. SINCE THE ACCOUNTS ARE JOINTLY HELD BY THE ASSESSEE AND HER HUSBAND, A SUM OF ` 19,508/- WAS TAKEN AS TOTAL INCOME BY THE ASSESSEE S HUSBAND DR. SIVAKUMAR. ACCORDING TO THE LD. COUNSEL, A SUM OF ` 29,374/- CANNOT BE CONSIDERED TO BE UNDISCLOSED INCOME IN TH E HANDS OF THE 26 I.T.(SS) A. NO.9/MDS/08 ASSESSEE. ACCORDING TO THE LD. COUNSEL, A SUM OF ` 9,866/- WAS DISCLOSED BY THE ASSESSEE AND THE BALANCE OF ` 19,508/- WAS DISCLOSED IN THE CASE OF DR. SIVAKUMAR. THEREFORE, THERE CANNOT BE ANY ADDITION TOWARDS INTEREST IN THE HANDS OF THE A SSESSEE. 38. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT ON PERUSAL OF SHORT TERM DEPOSIT LEDGER, THE ASSESSING OFFICER FO UND THAT THE ASSESSEE RECEIVED A SUM OF ` 3,229/- ON 12.09.1994 AND ANOTHER SUM OF ` 1,938/-, ` 1,980/- AND ` 2,190/- RESPECTIVELY ON 29.10.1994, 14.12.1994 AND 21.02.1995. THE ASSESSEE HAS IN FAC T RECEIVED ` 9,337/- TOWARDS INTEREST. SIMILARLY, THE ASSESSING OFFICER FOUND THAT THE ACCRUED INTEREST IN FIXED DEPOSIT WAS ` 7,822/-. THE INTEREST RECEIVED FROM THE BANK WAS TO THE EXTENT OF ` 41,508/-. THE ASSESSEE HAS ADMITTED ONLY ` 22,000/-, THEREFORE, THE INTEREST OF ` 19,508/- WAS TREATED AS UNDISCLOSED INCOME IN THE H ANDS OF THE ASSESSEE. 39. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ENTIRE ADDITION WAS MADE ON THE BASIS OF THE DEPOSIT LEDGE R OF THE BANK. NO MATERIAL WAS FOUND DURING THE COURSE OF SEARCH O PERATION, IT IS 27 I.T.(SS) A. NO.9/MDS/08 NOT IN DISPUTE THAT THE ASSESSEE HAS DISCLOSED ` 22,000/- TOWARDS INTEREST UNDER THE HEAD INCOME FROM OTHER SOURCES . THE ASSESSING OFFICER FOUND THAT THE TOTAL INTEREST REC EIVED BY THE ASSESSEE WAS ` 41,508/-. THE ASSESSEE CLAIMS A SUM OF ` 19,508/- WAS DISCLOSED IN THE HANDS OF THE ASSESSEES HUSBAN D DR. SIVAKUMAR. IN THE ABSENCE OF ANY MATERIAL FOUND DU RING THE COURSE OF SEARCH OPERATION, THIS TRIBUNAL IS OF THE CONSID ERED OPINION THAT THERE CANNOT BE ANY ADDITION IN THE BLOCK PERIOD. FURTHERMORE, IT IS NOT IN DISPUTE THAT A SUM OF ` 19,508/- WAS DISCLOSED IN THE HANDS OF DR. SIVAKUMAR. THE DEPOSIT BEING JOINTLY HELD BY T HE ASSESSEE AND HER HUSBAND, THIS TRIBUNAL IS OF THE CONSIDERED OPI NION THAT A PART OF INTEREST HAS TO BE TREATED AS INCOME OF THE ASSESSE ES HUSBAND. THEREFORE, THE ADDITION MADE BY THE ASSESSING OFFIC ER TO THE EXTENT OF ` 19,508/- IS NOT JUSTIFIED. ACCORDINGLY, THE ORDER OF THE ASSESSING OFFICER IS SET ASIDE AND THE ADDITION MADE TO THE E XTENT OF ` 19,508/- IS DELETED. 40. THE NEXT ISSUE ARISES FOR CONSIDERATION IS WITH REGARD TO ADDITION OF ` 45,000/- TOWARDS GADGETS FOR THE ASSESSMENT YEAR 1997-98. 28 I.T.(SS) A. NO.9/MDS/08 41. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE REVENUE AUTHORITIES FOUND TAPE-R ECORDER, PORTABLE TV AND NATIONAL VCR WITH REMOTE IN THE PRE MISES OF SHRI T.V. SUNDARAVADHANAM, THE FATHER OF THE ASSESSEE. THE ASSESSEE BEING A MARRIED DAUGHTER, HAS NO CONTROL OVER THE P REMISES OF THE ASSESSEES FATHER. THE PRESUMPTION UNDER SECTION 1 34 OF THE ACT MAY BE APPLICABLE TO THE PERSON WHO IS RESIDING IN THE PREMISES. AFTER THE MARRIAGE, THE ASSESSEE IS RESIDING IN HER HUSBANDS PLACE, THEREFORE, THE ELECTRONIC GADGETS, WHICH WERE FOUND IN THE PREMISES OF SHRI T.V. SUNDARAVADHANAM, THE FATHER OF THE ASS ESSEE, CANNOT BE TREATED AS UNDISCLOSED INCOME OF THE ASSESSEE. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER IS NOT JUSTIFIED IN MAKING ANY ADDITION. 42. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT DU RING THE COURSE OF SEARCH OPERATION, SHRI T.V. SUNDARAVADHANAM ADMI TTED THAT THE ELECTRONIC GADGETS BELONG TO THE ASSESSEE. SINCE T HE ASSESSEE COULD NOT PRODUCE ANY BILLS AND VOUCHERS FOR THE PU RCHASE OF THE ELECTRONIC GADGETS, THE ADDITION WAS MADE IN THE HA NDS OF THE ASSESSEE, THEREFORE, THE ASSESSING OFFICER HAS MADE THE ADDITION. 29 I.T.(SS) A. NO.9/MDS/08 43. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ELECTRONIC GADGETS WERE ADMITTEDLY FOUND IN THE PREMISES OF SH RI T.V. SUNDARAVADHANAM, THE FATHER OF THE ASSESSEE. THE A SSESSEE BEING A MARRIED DAUGHTER, CANNOT HAVE ANY CONTROL O VER THE PREMISES OF SHRI T.V. SUNDARAVADHANAM. THEREFORE, THE PRESUMPTION IS THAT THE ELECTRONIC GADGETS BELONG T O SHRI T.V. SUNDARAVADHANAM AND NOT THE ASSESSEE. IF THE BILLS AND VOUCHERS COULD NOT BE PRODUCED, IT IS FOR THE ASSESSING OFFI CER TO MAKE ADDITION IN THE HANDS OF SHRI T.V. SUNDARAVADHANAM AND DEFINITELY NOT IN THE HANDS OF THE ASSESSEE. SINCE THE ASSESS EE IS A MARRIED DAUGHTER OF SHRI T.V. SUNDARAVADHANAM, THIS TRIBUNA L IS OF THE CONSIDERED OPINION THAT MAKING ADDITION WITH REGARD TO THE COST OF THE ELECTRONIC GADGETS IS NOT JUSTIFIED. IN VIEW O F THE ABOVE, THIS TRIBUNAL IS UNABLE TO UPHOLD THE ORDER OF THE ASSES SING OFFICER AND ACCORDINGLY THE SAME IS SET ASIDE. THEREFORE, THE ADDITION OF ` 45,000/- MADE IN THE HANDS OF THE ASSESSEE IS DELET ED. 44. NOW COMING TO THE ADDITION OF ` 12,134/- FOR THE ASSESSMENT YEAR 1997-98, SHRI K.G. RAGHUNATH, THE LD.COUNSEL F OR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE HAS ADMITTED A SUM OF 30 I.T.(SS) A. NO.9/MDS/08 ` 22,000/- TOWARDS BANK INTEREST, WHICH COMPRISES ` 12,134/- FROM INDIAN BANK, NEELANKARAI BRANCH AND THE ASSESSEE HA S DISCLOSED INTEREST INCOME IN THE RETURN OF INCOME. THEREFORE , ACCORDING TO THE LD. COUNSEL, THERE CANNOT BE ANY ADDITION FOR THE A SSESSMENT YEAR 1997-98. 45. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT TH E ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS RECEIVED ` 12,134/- TOWARDS INTEREST FOR THE ASSESSMENT YEAR 1997-98. IN FACT, THE TOTAL INTEREST RECEIVED WAS ` 41,508/-. THE ASSESSEE HAS DISCLOSED ` 22,000/-. THEREFORE, THE DIFFERENCE OF ` 19,508/- WAS TREATED AS UNDISCLOSED INCOME IN THE BLOCK PERIOD. 46. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. FOR THE ASSESSMENT YEAR 1996-97, WHILE CONSIDERING THE INTE REST INCOME, THIS TRIBUNAL FOUND THAT A SUM OF ` 19,508/- WAS DISCLOSED IN THE HANDS OF DR. SIVAKUMAR, THE ASSESSEES HUSBAND. TH E ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS RECEIVED ` 12,134/- FOR THE ASSESSMENT YEAR 1997-98. THE TOTAL INTEREST RECEIV ED BY THE ASSESSEE, INCLUDING ` 12,134/- FOR THE BLOCK PERIOD, WAS ` 41,508/-. 31 I.T.(SS) A. NO.9/MDS/08 SINCE THE ASSESSEE ALREADY DISCLOSED A SUM OF ` 22,000/- AND DR. SIVAKUMAR, THE ASSESSEES HUSBAND, HAS DISCLOSED ` 19,508/-, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE CA NNOT BE ANY FURTHER ADDITION TOWARDS UNDISCLOSED INCOME IN RESP ECT OF INTEREST RECEIVED FROM BANK DEPOSIT. IN VIEW OF THE ABOVE, THIS TRIBUNAL IS UNABLE TO UPHOLD THE ORDER OF THE ASSESSING OFFICER AND ACCORDINGLY THE SAME SET ASIDE. THE ADDITION OF ` 12,134/- IS DELETED. 47. THE LAST GROUND OF APPEAL ARISES FOR CONSIDERAT ION IS WITH REGARD TO ADDITION OF ` 2,73,000/- TOWARDS JEWELLERY, FOR THE ASSESSMENT YEAR 1997-98. 48. SHRI K.G. RAGHUNATH, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ASSESSEE RECEIVED 650 GMS OF GOL D JEWELLERY AS GIFT DURING THE OCCASION OF HER MARRIAGE. THE ASSE SSEE, IN FACT, FILED DETAILS OF GOLD RECEIVED, BEFORE THE ASSESSING OFFI CER. THE ASSESSEES GRANDMOTHER HAD ALSO GIFTED 300 GMS OF G OLD ON 18.10.1991 ON THE OCCASION OF HER WEDDING. ACCORDI NG TO THE LD. COUNSEL, GIFTING GOLD JEWELLERY AS SRIDHAN IS VERY COMMON IN THIS PART OF COUNTRY, THEREFORE, THE CLAIM OF THE ASSESS EE CANNOT BE BRUSHED ASIDE BY THE ASSESSING OFFICER. ACCORDING TO THE LD. COUNSEL, WHEN THE GIFTS WERE RECEIVED DURING WEDDIN G FROM THE 32 I.T.(SS) A. NO.9/MDS/08 PARENTS, GRANDPARENTS AND IN-LAWS, IT MAY NOT BE PO SSIBLE TO HAVE ANY RECORD OF THE GIFTS SAID TO BE RECEIVED. MOREO VER, HIGH DIGNITARIES ATTENDED THE WEDDING CELEBRATION OF THE ASSESSEE. WHEN THEY GIFTED GOLD AND CASH, RECORDING SUCH GIFT IS IMPOSSIBLE. IN FACT, THE ASSESSEE HAS FURNISHED NAMES OF THE PE RSONS FROM WHOM GIFTS WERE RECEIVED, BEFORE THE ASSESSING OFFI CER. ACCORDING TO THE LD. COUNSEL, THE ASSESSING OFFICER SIMPLY IG NORED THE DETAILS FURNISHED BY THE ASSESSING OFFICER. THE ASSESSEES SON ALSO RECEIVED GIFTS OF 30 SOVEREIGNS OF GOLD JEWELLERY F ROM RELATIVES AND FRIENDS. THE LIST OF THE PERSONS, WHO GIFTED 30 SO VEREIGNS OF GOLD JEWELLERY AT THE TIME OF BIRTH OF THE ASSESSEES SO N, WAS ALSO FILED BEFORE THE ASSESSING OFFICER. IN FACT, DURING THE OCCASION OF WEDDING, GRANDMOTHER GIFTED 30 SOVEREIGNS OF GOLD J EWELLERY, 228 GMS OF JEWELLERY WERE RECEIVED AS GIFT FROM FAMILY MEMBERS, GUESTS, FRIENDS AND OTHER HIGH DIGNITARIES. MOREOVER, THE ASSESSEES SON RECEIVED 114 GMS OF GOLD JEWELLERY FROM CLOSE RELAT IVES. THEREFORE, ACCORDING TO THE LD. COUNSEL, THESE JEWELLERY CANNO T BE TAKEN AS INCOME OF THE ASSESSEE IN THE BLOCK PERIOD. 49. ON THE CONTRARY, SHRI T.R. SENTHIL KUMAR, THE L D. SR. STANDING COUNSEL FOR THE REVENUE, SUBMITTED THAT DU RING THE COURSE 33 I.T.(SS) A. NO.9/MDS/08 OF SEARCH OPERATION, 386 GMS OF GOLD JEWELLERY WERE FOUND AT THE RESIDENCE OF SHRI T.V. SUNDARAVADHANAM AND ALSO 962 GMS WERE FOUND IN THE LOCKER OF MCC BANK, TIRUVANMIYUR BRANC H, WHICH BELONG TO THE ASSESSEE AND HER HUSBAND. SOME OF TH E PERSONS ALSO FILED CONFIRMATION LETTERS. IN FACT, ONE SHRI KHUMBAMOORTHY RESIDING AT KOOTHAPAR, TRICHY, CONFIRMED THAT HE GI FTED 5 SOVEREIGNS OF CHAIN TO THE BRIDE AT THE TIME OF MARRIAGE ON 18 .10.1991. HOWEVER, THE COPIES OF THE MOI BOOK SHOW THAT THE S AID SHRI KHUMBAMOORTHY GIFTED ONLY 2 SOVEREIGNS OF CHAIN TO THE BRIDEGROOM. THEREFORE, THERE WAS CONTRADICTION BET WEEN THE CONFIRMATION LETTER FILED BY THE ABOVE SAID SHRI KH UMBAMOORTHY AND THE MOI BOOK MAINTAINED BY THE ASSESSEE. THEREFORE , ACCORDING TO THE LD. SR. STANDING COUNSEL, THE ASSESSING OFFICER HAS RIGHTLY MADE AN ADDITION OF ` 2,73,000/- FOR THE ASSESSMENT YEAR 1997-98. 50. THE LD. SR. STANDING COUNSEL FURTHER SUBMITTED THAT THE TOTAL GIFT SAID TO BE RECEIVED BY THE ASSESSEE ON THE OCC ASION OF HER MARRIAGE IS 360 GMS OF JEWELLERY. THE CLAIM OF THE ASSESSEE REGARDING THE RECEIPT OF 440 GMS OF JEWELLERY FROM GRANDMOTHER OF THE BRIDEGROOM, GRANDMOTHER OF SMT. PRABA AND IN-LA WS OF SMT. PRABA WAS ALSO DISALLOWED BY THE ASSESSING OFFICER IN THE ABSENCE 34 I.T.(SS) A. NO.9/MDS/08 OF SATISFACTORY EXPLANATION. THE ASSESSING OFFICER HIMSELF DISALLOWED 50% OF GIFTS SAID TO BE RECEIVED TO THE EXTENT OF 228 GMS OUT OF 448 GMS. THEREFORE, THE EXCESS GOLD JEWELLE RY TO THE EXTENT OF 650 GMS WAS TREATED AS UNEXPLAINED IN THE HANDS OF THE ASSESSEE, WHICH WAS VALUED AT ` 2,73,000/-. HENCE, ACCORDING TO THE LD. SR. STANDING COUNSEL, NO INTERFERENCE IS CA LLED FOR. 51. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN VIEW OF THE CONTRADICTION FOUND BETWEEN THE MOI BOOK AND CONFIR MATION SAID TO BE FILED BY ONE OF THE DONORS, NAMELY, SHRI KHUMBAM OORTHY, THE ASSESSING OFFICER HAS TAKEN ONLY 50% OF THE GIFTS S AID TO BE RECEIVED. IT IS NOT IN DISPUTE THAT THE ASSESSEE R ECEIVED GOLD JEWELLERY AS A GIFT. IT IS ALSO A CUSTOMARY PRACTI CE IN THIS PART OF COUNTRY TO GIFT GOLD JEWELLERY TO BRIDE AND BRIDEGR OOM ON THE OCCASION OF MARRIAGE BY THE RELATIVES AND FRIENDS. MERELY BECAUSE THERE WAS CONTRADICTION WITH REGARD TO JEWELLERY GI FTED BY SHRI KHUMBAMOORTHY, BEING ONE OF THE DONORS, THIS TRIBUN AL IS OF THE CONSIDERED OPINION THAT REJECTING THE CLAIM OF THE ASSESSEE TO THE EXTENT OF 50% IS NOT JUSTIFIED. THIS TRIBUNAL IS O F THE CONSIDERED OPINION THAT WHEN THE FACT OF RECEIPT OF GIFT IS NO T IN DISPUTE, THE 35 I.T.(SS) A. NO.9/MDS/08 CONTRADICTION BETWEEN CONFIRMATION LETTER FILED BY SHRI KHUMBAMOORTHY AND ENTRY IN THE MOI BOOK CANNOT BE A REASON TO REJECT 50% OF THE CLAIM OF THE ASSESSEE WITHOUT ANY OTHER MATERIAL. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHE N THERE IS A CONTRADICTION BETWEEN ENTRY IN THE MOI BOOK AND THE CONFIRMATION LETTER FILED BY SHRI KHUMBAMOORTHY, THE CONFIRMATIO N LETTER HAS TO BE PREFERRED RATHER THAN THE MOI BOOK MAINTAINED BY TH E ASSESSEE. THE CONFIRMATION LETTER WAS FILED BY THE DONOR HIMS ELF, THEREFORE, THAT HAS TO BE PREFERRED WHILE DECIDING THE QUANTUM OF G IFT SAID TO BE MADE BY THE DONORS. THEREFORE, THIS TRIBUNAL IS UN ABLE TO UPHOLD THE ORDER OF THE ASSESSING OFFICER ACCORDINGLY THE SAME IS SET ASIDE AND THE ADDITION OF ` 2,73,000/- MADE TOWARDS THE VALUE OF 650 GMS OF GOLD JEWELLERY IS DELETED. 52. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 13 TH JANUARY, 2017 AT CHENNAI. SD/- SD/- ( ! .#$#% ) ( . . . ) (ABRAHAM P. GEORGE) (N.R.S. GANESAN) ' / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 7 /DATED, THE 13 TH JANUARY, 2017. KRI. 36 I.T.(SS) A. NO.9/MDS/08 / -289 :952 /COPY TO: 1. *+ /APPELLANT 2. -.*+ /RESPONDENT 3. 1 ;2 /CIT, CENTRAL-II, CHENNAI-34 4. 9< -2 /DR 5. =% > /GF.