ACIT, New Delhi V. RSA Estate P. Ltd., New Delhi

ITSSA 91/DEL/2008

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 7406 (ITAT-DELHI)
• Duration Of Justice: 10 year(s) 8 month(s) 6 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 29-04-2019
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: F
• Next Hearing Date: 20-07-2017
• Assessment Year: misc
• Appeal Filed On: 22-08-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SULEKHA VERMA
• Assessee Lawyers: V K TULSIYAN
• Keywords: Search and seizure; Document seized; Retrospective amendment; Cost of acquisition; Documents seized

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : F , NEW DELHI BEFORE SHRI BHAVNESH SAINI , JUDICIAL M EMBER AND SH RI O.P. KANT , ACCOUNTANT MEMBER IT (SS) A NO .91 /DE L/ 2008 BLOCK PERIOD : 01.04.1995 TO 05.02.2002 ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 16, NEW DELHI VS. M/S. RSA ESTATE PVT. LTD., B - 48, FIRST FLOOR, SHIVALIK, MALVIYA NAGAR, NEW DELHI PAN : AAACR4006N (APPELLANT) (RESPONDENT) APPELLANT BY SMT. SULEKHA VERMA, CIT(DR) RESPONDENT BY SHRI V.K. TULSIYAN, CA ORDER PER O.P. KANT, A .M. : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST ORDER DATED 19/05/2008 PASSED BY THE LD. COMMISSIONER OF INCOME - TAX (APPEALS) - X, NEW DELHI [IN SHORT THE LD. CIT(A) ] FOR BLOCK PERIOD FROM 01/04/1995 TO 0 5/02/2002 RAISING FOLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.6 LAKHS MADE BY THE A.O. ON ACCOUNT OF UNDISCLOSED INVESTMENT MADE IRI THE PROPERTY NO. A - 166, DEFENSE COLONY ON THE BASIS OF SEIZED MATERIAL FOUND D URING THE SEARCH. HENCE THE CIT (A) HAS ALSO ERRED IN OVERLOOKING THE PROVISIONS OF SECTION 132(4) OF THE INCOME - TAX ACT, 1961. DATE OF HEARING 14.03.2019 DATE OF PRONOUNCEMENT 29.04.2019 2 IT (SS) A NO .91/DEL/2008 2. ONE THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.20 LAKHS MADE BY THE A.O. ON ACCOUNT OF UNDISCLOSED INVESTMENTS MADE IN THE PROPERTY AT 30A, NAV JEEVAN VIHAR ON THE BASIS OF SEIZED MATERIAL FOUND DURING THE SEARCH. HENCE THE CIT(A) HAS ALSO ERRED IN OVERLOOKING THE PROVISIONS OF SECTION 132(4) OF THE INCOME - TAX ACT, 19 61. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS. 16.80 LAKHS MADE BY THE A.O. ON ACCOUNT OF UNDISCLOSED INVESTMENTS MADE IN THE PROPERTY AT VASANT VIHAR ON THE BASIS OF SEIZED MATERIAL FOU ND DURING THE SEARCH. HENCE THE CIT (A) HAS ALSO ERRED IN OVERLOOKING THE PROVISIONS OF SECTION 132( 4) OF THE INCOME - TAX ACT, 1691. 2. B RIEFLY STATED FACTS OF THE CASE ARE THAT IN THE CASE OF THE ASSESSEE , A SEARCH AND SEIZURE ACTI ON UNDER SECTION 132(1) OF THE INCOME - TAX A CT, 1961 (IN SHORT THE A CT ) WAS CARRIED OUT ON 5/02/2002. CONSEQUENT TO THE SEARCH ACTION, AS PER THE PROVISIONS RELEVANT DURING PERIO D, ASSESSMENT UNDER SECTION 158 BC OF THE A CT WAS COMPLETED ON 27/02/2004 MAKING CERTAIN ADDITIONS BA SED ON THE MATERIAL FOUND DURING THE COURSE OF THE SEARCH. AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A), WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEVED WITH THE RELIEF ALLOWED TO THE ASSESSEE, THE REVENUE IS IN APPEAL BEFORE THE TRI BUNAL RAISING THE GROUNDS AS REPRODUCED ABOVE. 3. THE GROUND NO. 1 OF THE APPEAL RELATES TO ADDITION OF RS. 6 LA KHS MADE FOR UNDISCLOSED INCOME IN RELATION TO PROPERTY AT A - 166, DEFENCE COLONY. 3.1 THE LD. DR SUBMITTED THAT ADDITION WAS MADE BY THE ASSESSI NG OFFICER ON THE BASIS OF THE COMPUTER PRINTOUT OF A RECEIPT , WHICH WAS TAKEN FROM THE HARD DISK SEIZED DURING THE COURSE OF THE SEARCH OPERATION AT THE PREMISES OF THE ASSESSEE . ACCORDING TO THE RECEIPT , RS. 6 LAKH WAS RECEIVED BY THE ASSES SEE 3 IT (SS) A NO .91/DEL/2008 IN CASH ON 29/12/2000 AGAINST SALE OF THE PROPERTY LOCATED AT A - 166 DEFENCE COLONY. W HEREAS THE ASSES SEE CLAIMED THAT PAYMENT OF RS. 6 LAKH WAS RECEIVED ONLY THROUGH VARIOUS CHEQUES DATED 11/01/2001. ACCORDING TO THE LD. DR , RECEIPT IS REQUIRED TO MAKE ONLY IN CASE O F CASH PAYMENT AND NOT FOR CHEQUE PAYMENTS AND THUS THE CASH RECEIVED WAS IN ADDITION TO THE CHEQUE AMOUNT OF RS. 6 LAKH. ACCORDING TO HER , THE SAID RECEIPT HAS BEEN MADE BY THE ASSESSEE IN THE REGULAR COURSE AND NOT FOR THE PURPOSE FOR SHOWING TO THE INCO ME - T AX DEPARTMENT. SHE SUBMITTED THAT THERE IS A PRESUMPTION RAISE D UNDER SECTION 132(4A) OF THE A CT REGARDING DOCUMENTS SEIZED AND IN THE LIGHT OF SUCH PRESUMPTION, THE ONUS WAS ON THE ASSESSEE TO DISPROVE RECEIPT OF CASH AMOUNT OF RS. 6 LAKH S . ACCORDING TO THE LD. DR, THE ASSESSEE HAS FAILED TO DISCHARGE ITS ONUS AND THE LD. CIT(A) HAS IGNORED THE PROVI SION OF SECTION 132(4A) OF THE A CT WHILE DELETING THE ADDITION. IN SUPPORT OF HER CONTENTION , THAT IN ABSENCE OF REBUTTAL EVIDENCE BY THE ASSESSEE, THE ADD ITION BASED ON ENTRIES IN THE COMPUTER PRINTOUT SHOULD BE UPHELD, SHE RELIED ON THE DECISION OF THE HON BLE DELHI HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME T AX VERSUS SONAL C ONSTRUCTIONS REPORTED IN (2018) 28 TAXMANN.COM 127 (DELHI). 3.2 ON THE CONTRARY, THE LD. COUNSEL RELIED ON THE ORDER OF THE LD. CIT(A) AND SUBMITTED THAT THE PRINTOUT TAKEN IS UNSIGNED AND UNDATED AND THE AGREEMENT TO SELL DATED 15/12/2000 WAS ALSO FOR RS. 6 LAKHS ONLY. THE LD. COUNSEL SUBMITTED THAT THE ASSESSEE EXPLAI NED BEFORE THE LOWER AUTHORITIES THAT SAID COMPUTER PRINTOUT WAS ONLY DRAFT SINCE AT THE TIME THE SALE AGREEMENT DETAILS OF CHEQUES WERE NOT AVAILABLE, THE AMOUNT WAS PUT IN CASH IN THE DRAFT PREPARED IN COMPUTER. 4 IT (SS) A NO .91/DEL/2008 3.3 WE HAVE HEARD THE RIVAL SUBMISSIONS AN D PERUSED THE RELEVANT MATERIAL ON RECORD. IN THE CASE OF THE ASSESSEE, A COMPUTER PRINTOUT WAS TAKEN FROM THE HARD DISK SEIZED DURING THE COURSE OF SUCH OPERATION FROM THE PREMISES OF THE ASSESSEE. THIS PRINTOUT WAS UNSIGNED AND UNDATED RECEIPT ISSUED BY SH . SUBASH ARORA, THE D IRECTOR OF THE ASSESSEE COMPANY, WHEREIN AN AMOUNT OF RS. 6 LAKH S IN CASH HAS BEEN SHOWN AS RECEIVED ON 29/12/2000 FROM SH . M . L . CHHABRA TOWARDS PART PAYMENT ON ACCOUNT OF SALE OF BASEMENT FLOOR OF PROPERTY NUMBER A - 166 DEFENCE C OLON Y, NEW DELHI , UNDER THE TERMS AND CONDITION OF AGREEMENT TO SALE DATED 15/12/2000. THE ASSESSEE EXPLAINED THAT SAID PROPERTY WAS SOLD TO SRI M . L . CHHABRA FOR RS. 6 LAKHS AND FOR THAT PURPOSE AND AMOUNT OF RS. 6 LAKH S WAS RECEIVED FROM SRI M . L . CHHABRA THROU GH VARIOUS CHEQUES DATED 11/01/2001. THE ASSESSING OFFICER REJECTED THE CONTENTION OF THE ASSESSEE. ACCORDING TO THE ASSESSING OFFICER , THE AMOUNT OF RS. 6 LAKHS IN CASH MENTIONED IN THE RECEIPT DATED 29/12/2000 WAS IN ADDITION TO THE AMOUNT OF RS. 6 LAKHS R ECEIVED THROUGH CHEQUES AND ACCOUNTED IN THE BOOKS OF ACCOUNTS. THE LD. CIT(A) , HOWEVER , OBSERVED THAT RECEIPT IS UNSIGNED AND HAS ALSO NOT BEEN WITNESSED BY ANYBODY. THE LD. CIT(A) OBSERVED THAT THE ASSESSING OFFICER HAS NOT FOUND ANY DISCREPANCY IN REGAR D TO THE ENTRY OF RS. 6 LAKH S RECEIVED BY CHEQUE IN THE BOOKS OF ACCOUNTS. HE FURTHER OBSERVED THAT THERE IS NO OTHER MATERIAL EVIDENCE AVAILABLE ON THE RECORD TO SUGGEST THAT THE ASSESSEE HAD RECEIVED RS. 6 LAKH S IN CASH IN ADDITION TO RS. 6 LAKH RECEIVED THROUGH CHEQUES. THE LD. CIT(A) NOTED THAT THE SALE DEED HAD BEEN EXECUTED FOR THE SALE OF THIS PROPERTY FOR RS. 6 LAKHS ONLY. THE LD. CIT(A) HELD THAT 5 IT (SS) A NO .91/DEL/2008 CONSIDERING THE TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE, THERE WAS NO BASIS FOR MAKING A DDITION OF RS. 6 LAKH. 3.4 IN THE CIRCUMSTANCES, THE QUESTION WHICH ARISES BEFORE US IS WHETHER THE ASSESSEE RECEIVED BOTH THE AMOUNT OF RS. 6 LAKH S SHOWN IN THE CASH RECEIPT DATED 29/12/2000 AND CHEQUE AMOUNT OF RS. 6 LA KH S ACCOUNTED FOR IN THE BOOKS OF AC COUNTS OF THE ASSESSEE , OR ONLY CHEQUE AMOUNT WAS RECEIVED BY THE ASSESSEE. IT IS EVIDENT FROM THE FACTS OF THE CASE THAT IN THE AGREEMENT TO SALE DATED 15/12/2000 THE SALE VALUE OF THE PROPERTY HAS BEEN SHOWN TO BE AT RS. 6 LAKHS ONLY AND THE SAID UNDATE D AND UNSIGNED RECEIPT HAS BEEN ISSUED IN RELATION TO AGREEMENT TO SELL DATED 15/12/2000. IN THE CASE OF S ONAL C ONSTRUCTION (SUPRA), THE HON BLE HIGH COURT RULED THAT ANY PROCEEDINGS UNDER THIS ACT OCCURRING IN SECTION 29 2C PERMIT THE ASSESSING OFFICER TO INVOKE THE PRESUMPTION THAT THE SEIZED DOCUMENT BELONG TO THE PERSON SEARCH ED AND THE CONTENTS OF THE SEIZED DOCUMENTS/BOOKS OF ACCOUNTS ARE TRUE AND THAT THE SIGNATURE OF EVERY OTHER PART OF THE BOOKS OF ACCOUNTS OR DOCUMENT, WHICH PURPORTS TO BE IN THE HANDWRITING OF ANY PARTICULAR PERSON ARE IN THAT PERSON S HANDWRITING ETC., EVEN IN THE ASSESSMENT PROCEEDINGS. THE HON BLE HIGH COURT HELD THAT IN SOME CIRCUMSTANCES CORROBORATION OF THE SEIZED MATERIAL MAY NOT BE REQUIRED FOR MAKING ADDITION. 3.5 BUT IN THE INSTANT CASE BEFORE US , IN AGR EEMENT TO SALE DATED 15/12/2000 , THE AMOUNT OF SALE TRANSACTION HAS BEEN MENTIONED AT RS. 6 LAKHS ONLY. W HEN WE EXAMINE THE SUBMISSION OF THE ASSESSEE IN THE LIGHT OF THE AGREEMENT TO SALE DATED 15/12/2000 , IN ABSENCE OF THE DETAIL OF THE CHEQUES NUM BER AND AMOUNT , THE RECEIPT WAS PREPARED AS CASH , WE CAN LOGICALLY CONCLUDE THAT THE 6 IT (SS) A NO .91/DEL/2008 AMOUNT RECEIVED AGAINST THE SALE OF THE PROPERTY WAS NOT MORE THAN RS. 6 LAKH S . THUS, THE ASSESSEE HAS REBUTTED THE PRESUMPTION THAT AMOUNT O F RS. 6 LAKH S MENTIONED IN RECEIPT WAS RECEIVED IN CASH BY THE ASSESSEE . ONCE THE ASSESSEE IS SUCCESSFUL IN REBUTTING THE PRESUMPTION, THE ONUS IS ON THE REVENUE TO ESTABLISH THAT RS. 6 LAKH S WAS RECEIVED BY THE ASSESSEE IN ADDITION TO THE AMOUNT OF RS. 6 LAKH S RECEIVED BY CHEQUE AND ACCOUNTED FOR IN THE BOOKS OF ACCOUNTS. MOREOVER, THE UNDATED AND UNSIGNED RECEIPT CANNOT BE TAKEN AS EVIDENCE AGAINST THE ASSESSEE, THOUGH IT IS FOUND FROM THE PREMISES OF THE ASSESSEE. IN TH E CASE OF COMMISSIONER OF I NCOME T AX VS . SHRI KULWANT R AI (2007) 291 ITR 36 (DELHI), THE A D DITION WAS MADE BY THE ASSESSING OFFICER ON THE BASIS OF A UNSIGNED AGREEMENT FOUND DURING THE COURSE OF THE SEARCH AT HIS PREMISES. THE HON BLE HIGH COURT UPHELD THE DELETION OF THE ADDITION BY THE TRIBUNAL OBSERVING AS UNDER: 13. IT IS AN ADMITTED FACT THAT THE PRESENT ASSESSED HAD NOT SIGNED THE AGREEMENT IN QUESTION AND SINCE THE ASSESSED HAD NOT SIGNED THE AGREEMENT, NO LIABILITY CAN BE ATTRIBUTED QUA THAT AGREEMENT TOWARDS THE ASSESSED SINCE HE IS NOT PARTY TO THE AGREEMENT TILL HE HAD SIGNED THE SAME. THE MERE FACT THAT THIS AGREEMENT WAS FOUND IN THE POSSESSION OF THE ASSESSED DOES NOT LEAD US ANYWHERE. WE FIND NO HESITATION IN HOLDING THAT THIS ADDITION OF RS. 17,00,892/ - MADE BY ASSESSING OFFICER IS BASED ON SURMISES AND GUESS WORK AND ON THIS POINT CASE OF DHAKESWARI COTTON MILLS LTD V. COMMISSIONER OF INCOME TAX (1954) 26 ITR 775, MAY BE REFERRED TO, IN WHICH HELD: IN MAKING AN ASSESSM ENT UNDER SECTION 23(3) OF THE INDIAN INCOME TAX ACT, THE INCOME - TAX OFFICER IS NOT FETTERED BY TECHNICAL RULES OF EVIDENCE AND PLEADINGS, AND HE IS ENTITLED TO ACT ON MATERIAL WHICH MAY NOT BE ACCEPTED A S EVIDENCE IN A COURT OF LAW, BUT THE INCOME - TAX OFFICER IS NOT ENTITLED TO MAKE A PURE GUESS AND MAKE AN ASSESSMENT WITHOUT REFERENCE TO ANY EVIDENCE OR ANY MATERIAL AT ALL. THERE MUST BE SOMETHING MORE THAN BARE SUSPICION TO SUPPORT THE ASSESSMENT UNDER SECTION 23(3) . THE RULE OF LAW ON THIS SUBJECT HAS BEEN FAIRLY AND RIGHTLY STATED BY THE LAHORE HIGH COURT IN THE CASE OF 7 IT (SS) A NO .91/DEL/2008 SETH GURMUKH SINGH V. COMMISSIONER OF INCOME - TAX, PUNJAB (1944) 12 I.T.R. 393. 3 .6 IN VIEW OF THE AFORESAID DISCUSSION, WE DO NOT FIND ANY ERROR IN THE ORDER OF THE LD. CIT(A) ON THE ISSUE IN DISPUTE AND ACCORDINGLY WE UPHOLD THE SAME. THE GROUND OF THE APPEAL OF THE REVENUE IS ACCORDINGLY DISMISSED. 4. THE GROUND NO . 2 OF THE APPEAL RELATES TO ADDITION OF RS. 20 LAKH S MADE BY THE AO ON ACCOUNT OF UNDISCLOSED INVESTMENT MADE IN THE PROPERTY AT 30A, NAV JEEVAN VIHAR. 4.1 THE LD. DR SUBMITTED THAT DURING THE COURSE OF THE SEARCH, PHOTO COPY OF A SIGNED AGREEMENT TO SELL BETWEEN SH. VED PARKASH BHARDWAJ AND THE ASSESSEE COMPANY SHOWING A PURCHASE OF ENTIRE TERRACE/ROOF ABOVE THE GROUND PORTION OF THE PROPERTY NO. 38, NAV JEEVAN VIHAR, NEW DELHI FOR RS. 50 LAKHS, WAS FOUND AND SEIZED. IN THIS DOCUMENT ADVANCE PAYMENT OF RS. 35 LAKHS, INCLUDING RS.25 LAKHS IN CASH IS MENTIONED. ACCORDING TO THE LD. DR , THIS DOCUMENT IS DULY SIGNED BY THE DIRECTOR OF THE ASSESSEE COMPANY AND THUS , IN TERMS OF SECTIO N 132(4A) READ WITH SECTION 292C OF THE A CT, CONTENTS OF THE DOCUMENTS ARE PRESU MED TO BE TRUE UNLESS REBUTTED BY THE ASSESSEE. SHE SUBMITTED THAT THE LD. CIT(A) SIMPLY REJECTED THE DOCUMENT AS IT WAS NOT SIGNED BY THE WITNESSES AND ON THE GROUND THAT CHEQUES MENTIONED IN THE AGREEMENT DOES NOT BELONG TO THE ASSESSEE. THE LD . DR SUBMI TTED THAT THE ONUS WAS ON THE ASSESSEE TO EXPLAIN AS THE CHEQUES MENTIONED IN THE AGREEMENT WERE BELONGING TO THE ASSESSEE OR SOMEONE ELSE. ACCORDING TO HER, THE ASSESSEE HAS NOT REBUTTED THE PRESUMPTIONS PROVIDED UNDER SECTION 29 2C OF THE A CT. MOREOVER , S HE SUBMITTED THAT IN THE BOOKS OF ACCOUNT , PROPERTY HAS BEEN 8 IT (SS) A NO .91/DEL/2008 SHOWN TO HAVE PURCHASED FOR RS. 15 LAKHS AS AGAINST RS. 35 LAKHS IN THE IMPUGNED AGREEMENT AND THE ADDITION IN DISPUTE RELATES TO AMOUNT OF CASH OF RS. 20 LAKHS , WHICH IS NOT RECORDED IN THE BOOK S OF ACCOUNTS OF THE ASSESSEE. SH E SUBMITTED THAT IN VIEW OF THE FAILURE OF THE ASSESSEE IN REBUTTING ALONGWITH EVIDENCES THE PRES UMPTION PROVIDED IN SECTION 292C OF THE A CT , THE ADDITION IN DISPUTE SHOULD BE UPHELD. 4.2 ON THE CONTRARY, THE LEARNED COUNS EL OF THE ASSESSEE RELIED ON THE ORDER OF THE LD. CIT(A) AND SUBMITTED THAT THE DOCUMENT WAS A DRAFT AGREEMENT WHICH WAS NEVER EXECUTED . HE SUBMITTED THAT NEITHER THE EACH PAGE OF THE AGREEMENT WAS SIGNED BY THE PARTIES , NOR THERE IS ANY WITNESS AND THIS A GREEMENT WAS NOT REGISTERED AND HENCE , THIS DOCUMENT CANNOT BE RELIED UPON. THE LD. COUNSEL SUBMITTED THAT DETAI LS OF CHEQUE PAYMENT OF RS. 10 L ACS MENTIONED IN THE AGREEMENT ARE NOT MATCHING WITH THE CHEQUE PAYMENT OF RS.10 LAKH ACTUALLY PAID BY THE ASSES SEE. THE LD. COUNSEL SUBMITTED THAT TRIBUNAL IN THE CASE OF SH . ANKUR ARORA IN IT A NO. 332/D EL/2004 HAS UPHELD THE DECISION OF THE LD. CIT(A), DELETIN G THE ADDITION OBSERVING THAT THERE IS NO MATERIAL BROUGHT ON RECORD BY THE AO THAT THE ASSESSEE HAD RECEIVED THE PAYMENT OF RS. 10 LACS . 4.3 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. ACCORDING TO THE PHOTOCOPY OF THE AGREEMENT TO SALE OF THE IMPUGNED PROPERTY, WHICH WAS DULY SIGNED ON TH E LAST PAGE BY BOTH SELLER ( SH . VED PRAKA SH BARDWAJ) AND THE PURCHASER ( THE ASSESSEE) , THE FOLLOWING ADVANCE PAYMENTS WERE MADE: (I) RS.5 LAKHS VIDE CHEQUE NO.046276, DT. 07.11.1998. (II) RS. 5 LAKHS VIDE CHEQUE NO. 046398, DT. 16.01.1999. 9 IT (SS) A NO .91/DEL/2008 (III) RS.25 LAKHS IN CASH. 4.4 T HE ASSESSEE , HOWEVER, DURING ASSESSMENT PROCEEDINGS SUBMITTED THAT IT HAS MADE PAYMENT OF RS.15 LAKHS FOR ACQUIRING THE IMPUGNED PROPERTY AS UNDER: DATE CHEQUE NO. AMOUNT (IN RS.) 28 - 02 - 199 9 188821 3,00,000 23 - 03 - 1999 678567 4,50,000 30 - 03 - 1999 678330 1,50,000 15 - 09 - 1999 678368 1,00,000 CASH 5,00,000 TOTAL 15,00,000 4.5 THE LD. CIT(A) DELETED THE ADDITION MAINLY ON THE GROUND THAT AGREEM ENT WAS NOT SIGNED ON EACH PAGE ; NOT CONTAINING THE SIGNATURE OF THE WITNESSES; THE CHEQUES MENTIONED IN THE AGREEMENT DOES NOT BELONG TO THE ASSESSEE; THE AO HAS NOT BROUGHT ON RECORD ANY OTHER MATERIAL TO ESTABLISH THAT CHEQUE BELONG TO THE ASSESSEE OR ANY OTHER MATERIAL TO SUGGEST THAT ADDITIONAL CASH HAS CHANGED HANDS IN THE TRANSACTION. THE LD. CIT(A) HAS RELIED ON THE DECISION OF THE TRIBUNAL IN THE CASE OF SH . ANKUR ARORA (SUPRA). THE LD. CIT(A) HAS REPRODUCED THE RELEVANT PART OF THE ORDER IN THE CASE OF ANKUR ARORA (SUPRA). ON PERUSAL OF THE SAID PART OF THE ORDER OF THE TRIBUNAL , WE FIN D THAT IN THAT CASE AN UNSIGNED AGREEMENT TO SELL WAS FOUND AT TIME OF THE SEARCH AND THUS , PLACING RELIANCE ON THE SAID DECISION , IS NOT CORRECT IN ACCORDANCE WITH LAW, BECAUSE IN THE INSTANT CASE , THE AGREEMENT HAS BEEN SIGNED BY BOTH THE PARTIES ON THE LAST PAGE OF THE AGREEMENT. 10 IT (SS) A NO .91/DEL/2008 4.6 IN OUR OPINION, ONCE THE AGREEMENT IS FOUND TO BE DULY SIGNED BY THE PARTIES ON THE LAST PAGE OF THE AGREEMENT, IT WAS SUFFICIENT ENOUGH TO FASTEN THE LIABILITY ON THE PARTIES AND IT WAS THE ONUS ON THE ASSESSEE TO REBUT THE PRESUMPT ION PROVIDED UNDER SECTION 29 2C OF THE ACT THAT CONTENTS OF THE DOCUMENTS ARE TRUE. THE ASSESSEE CANNOT TAKE SHELTER OF THE PLEA THAT CHEQUES NUMBER MENTIONED IN THE AGREEMENT ARE NOT BELONGING TO HIM. IT WAS ONUS OF THE ASSESSEE TO EXPLAIN AS TO WHOM THOSE CHEQUES MENTIONED IN THE AGREEMENT TO SALE BELONGS AS THE AGREEMENT WAS SIGNED BY THE ASSESSEE AND FOUND FROM THE PREMISE OF THE ASSESSEE . THE FINDING OF THE LD. CIT(A) THAT ASSESSING OFFICER HAS NOT BRO UGHT OUT ANY MATERIAL TO ESTABLISH THAT THE CHEQUES BELONGS TO THE ASSESSEE IS CONTRARY TO THE PRESUMPT ION UNDER SECTION 29 2C OF THE ACT. FURTHER, THE LD. CIT(A) HAS HELD THAT NO ANY OTHER MAT ERIAL TO SUGGEST THAT ADDITION OF CASH OF RS. 20 LAKHS HAS CHANGE D HANDS IN THIS TRANSACTION. IN THIS REGARD, WE MAY LIKE TO REFER THE DECISION OF THE HON BLE DELHI HI GH COURT IN THE CASE OF SONAL C ONSTRUCTIONS (SUPRA), WHEREIN THE HON BLE HIGH COURT ON THE ISSUE OF CORROBORATION SOUGHT IN SUPPORT OF THE SEIZED DOCUMENT S HAS OBSERVED AS UNDER: 17. AS TO THE CORROBORATION SOUGHT BY THE TRIBUNAL IN SUPPORT OF THE SEIZED DOCUMENTS, IT IS NOT AN INVIOLABLE RULE APPLICABLE TO ALL SITUATIONS AND TO ALL CASES THAT EVERY SEIZED DOCUMENT SHOULD BE CORROBORATED BEFORE ANY ADDITI ON CAN BE MADE BASED ON IT. IF CALCULATIONS AND COMPUTATIONS HAVE BEEN MADE IN THE SEIZED DOCUMENTS IN SUCH A MANNER THAT ITS PROBATIVE VALUE AND GENUINENESS CANNOT BE DOUBTED, NOTHING PREVENTS THE ASSESSING OFFICER FROM MAKING ADDITIONS ON THE BASIS OF SU CH DOCUMENTS DESPITE THE ABSENCE OF ANY CORROBORATION. IT MUST BE REMEMBERED THAT IN SUCH CASES IT IS DIFFICULT TO OBTAIN CORROBORATION, PARTICULARLY OF THE TYPE CONTEMPLATED BY THE TRIBUNAL. THE TRIBUNAL OBSERVED THAT CORROBORATION COULD HAVE COME IN THE FORM OF A VALUATION OF THE PROPERTY BY THE DEPARTMENTAL VALUATION OFFICER OR FROM THE 11 IT (SS) A NO .91/DEL/2008 PURCHASERS OF THE PROPERTY WHO COULD HAVE SAID THAT THEY DID PAY CONSIDERATION OVER AND ABOVE WHAT HAS BEEN RECORDED BY THE ASSESSEE IN THE BOOKS OF ACCOUNTS. THE VALUATI ON OF PROPERTIES CAN AT BEST BE ONLY AN ESTIMATE. IT MAY NOT BE PRACTICAL TO EXPECT THE PURCHASERS OF THE PROPERTY TO DEPOSE AGAINST THE SELLER SINCE BOTH OF THEM ARE PARTY TO THE SAME TRANSACTION IN WHICH ON - MONEY IS ALLEGEDLY INVOLVED. WHEN DOCUMENTS WH ICH ARE NOT MEANT FOR THE EYES OF THE REVENUE ARE UNEARTHED AFTER UNDERTAKING AN EXERCISE WHICH INVOLVES AN INTRUSION INTO THE PRIVACY OF THE ASSESSEE, IT IS NOT PERMISSIBLE TO DISCOUNT THE VERACITY, GENUINENESS AND TRUTHFULNESS OF THE CONTENTS THEREIN FOR THE FLIMSIEST OF REASONS. IT WOULD BE PROPER TO INSIST UPON STRONG EVIDENCE IN REBUTTAL OF THE CONTENTS OF THE DOCUMENTS, PARTICULARLY AFTER THE INTRODUCTION OF SECTION 292C WITH RETROSPECTIVE EFFECT FROM 1.10.1975. 4.7 WE FIND THAT THE ASSESSEE HAS FAILED TO REBUT THE PRESUMP TION PROVIDED UNDER SECTION 292C OF THE A CT WITH REFER ENCE TO THE CASH PAYMENT OF RS. 25 LAKHS MENTIONED IN THE AGREEMENT TO SALE AS AGAINST RS. 5 LAKH S ONLY SHOWN IN THE BOOKS OF ACCOUNT FOR PURCHASE OF THE PROPERTY. IN THE ALTERNATIVE, THE LEARNED COUNSEL BEFORE US SUBMITTED THAT WHETHER THE AGREEMENT FOUND DURING THE COURSE OF SEARCH WAS NOT ACTED UPON BY THE PARTIES, MIGHT BE VERIFIED BY THE ASSESSING OFFICER AND THE ASSESSEE IS READY TO DISCHARGE ITS ONUS FOR REBUTTING THE PRESUMPTION PROVIDED U/S 132(4A) OF THE ACT, IF OPPORTUNITY IS GIVEN. 4.8 IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE, WE FEEL IT APPROPRIATE TO RESTORE THIS ISSUE TO THE FILE OF THE LD. ASSESSING OFFICER FOR PROVIDING OPPORTUNITY TO THE ASSESSEE TO REBUT THE PRESUMPTION PROVIDED UNDER SECTION 132(4A) OF THE ACT. IT WILL BE RESPONSIBILITIES OF THE ASSESSEE TO PRODUCE NECESSARY EVIDENCE TO SUPPOR T THE CONTENTION THAT THE AGREEMENT FOR SALE FOUND DURING THE COURSE OF SEARCH WAS 12 IT (SS) A NO .91/DEL/2008 CANCELLED AND NOT ACTED UPON. ACCORDINGLY, THE GRO U ND IS ALLOWED FOR STATISTICAL PUPRPOSES. 5. THE GROUND NO. 3 OF THE APPEAL RELATES TO ADDITION OF RS. 16.80 LAKHS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDISCLOSED INVESTMENT MADE IN THE PROPERTY AT VASANT VIHAR, DELHI. 5.1 THE BRIEF FACTS QUA THE ISSUE IN DISPUTE, MENTIONED BY THE LD. CIT(A) IN PARA 6.2 OF THE IMPUGNED ORDER ARE REPRODUCED AS UNDER: 6.2. THE AO NOTED THAT AS PER THE SEIZED DOCUMENT ANNEXURE VR/AA - 12/PAGES 4,5,13,29,31 AND 28 RELATE TO THE PART PAYMENTS FOR THE PROPERTY NO. E - 13/11, VASANT VIHAR, NEW DELHI.. PAGE NUMBERS 14 TO 75 OF THE ANNEXURE ARE FOR AGREEMENTS TO SELL DT. 03 - 11 - 1999. AS PER THESE AGREEMENTS, THE APPELLANT COMPANY PURCHASED THE PROPERTY FROM FOUR PERSONS I.E. (I) SMT AMARJIT KAUR; (II) SMT KIRAN JEET KAUR; (III) SHRI SATINDER SINGH AND (IV) SH. MANDEEP SINGH AS 1/4TH SHARE EACH FOR RS.40 LAKHS I.E. TOTALING TO RS.1.60 CRORES. WHEN T HE ASSESSEE WAS ASKED TO EXPLAIN THE PAYMENT FOR THIS PROPERTY, IT WAS SUBMITTED BY THE ASSESSEE THAT A TOTAL PAYMENT OF RS. 1,43,20,000/ - WAS MADE TO THESE PERSONS. THE ASSESSEE HAS ALSO FURNISHED DATE - WISE DETAILS OF PAYMENTS MADE BY CHEQUES AND DEMAND D RAFTS TO THESE PARTIES. REGARDING THE BALANCE OF RS.16.80 LAKHS, IT WAS STATED THAT THE AMOUNT WAS NOT PAID ON ACCOUNT OF CERTAIN DISPUTES AND THAT THE DIFFERENT CHEQUES ISSUED TOTALING TO RS.16.80 LAKHS TO THESE FOUR PERSONS WERE STOPPED. IT WAS CONTENDED THAT THIS AMOUNT HAS NOT BEEN PAID, BECAUSE THOSE PARTIES HAVE NOT COMPLETED THE FORMALITIES OF OBTAINING REQUISITE CERTIFICATES. HOWEVER, THE AO HAD NOT ACCEPTED THE SUBMISSION OF THE APPELLANT. THE AO OBSERVED THAT AS PER THE SEIZED AGREEMENTS TO SELL, IT IS CLEAR THAT THE PURCHASE CONSIDERATION WAS FOR RS.1.60 CRORES AND, THUS, THE ASSESSEE HAD MADE THE TOTAL PAYMENT OFRS.1.60 CRORES FOR THE PURCHASE OF THIS PROPERTY. IT WAS ALSO OBSERVED THAT THE APPELLANT HAD NOT FILED / PRODUCED ANY DOCUMENTARY EVIDE NCE REGARDING THE DISPUTE WITH REFERENCE TO THE PROPERTY AND TO STOP THE PAYMENT OF DIFFERENT CHEQUES OF RS.16.80 LAKHS. ACCORDINGLY, THE AO HAS TREATED THE AMOUNT OF RS.16.80 LAKHS AS UNDISCLOSED INCOME OF THE BLOCK PERIOD AND ADDED THE SAME TO THE RETURN ED UNDISCLOSED INCOME . 13 IT (SS) A NO .91/DEL/2008 5.2 DURING THE APPELLATE PROCEEDING BEFORE THE LD. CIT(A), HE DIRECTED THE ASSESSING OFFICER TO MAKE ENQUIRY AND FIND OUT THE EXACT AMOUNT PAID TO THE CO - OWNERS, HOWEVER , THE ASSESSING OFFICER SIMPLY FORWARDED THE COPY OF SALE AG REEMENTS ENTERED WITH THOSE FOR CO - OWNERS. AFTER CONSIDERING THE SUBMISSION OF THE PARTIES, THE LD. CIT(A) DELETED THE ADDITION OBSERVING AS UNDER: 6.6. I HAVE CONSIDERED THE SUBMISSION OF THE AR AND PERUSED THE FACTS OF THE CASE. I HAVE ALSO GONE THROUG H THE COPY OF AGREEMENT TO SELL ENTERED INTO BY THE APPELLANT WITH EACH OF THE CO - OWNER WHICH CONTAINED THE IDENTICAL TERMS AND CONDITIONS. FOR EXAMPLE, AGREEMENT TO SELL ENTERED WITH SMT AMARJIT KAUR ON 3RD NOVEMBER, 1999 CLEARLY STATES THAT HER 1/4TH SHA RE WAS PURCHASED FOR RS.40 LAKHS. IT WAS SPECIFICALLY MENTIONED IN THE AGREEMENT AS UNDER: AND WHEREAS THE SECOND PARTY HAS AGREED TO PURCHASE / ACQUIRE THE VALID PROPERTY FROM THE FIRST PARTY AND THE CONSIDERATION AMOUNT OF RS.36,20,000/ - (RUPEES THIRTY SIX LAX TWENTY FIVE THOUSAND ONLY) OUT OF THE TOTAL RS.40,00,000/ - (RUPEES FOURTY LACS ONLY ), HAS BEEN PAID BY THE SECOND PARTY TO THE FIRST PARTY AND THE BALANCE SUM OF RS. 3,75,000/ - (RUPEES THREE LACS SEVENTY FIVE THOUSAND ONLY) SHALL BE PAID BY THE SECOND PARTY TO THE FIRST PARTY AT THE T[ME OF EXECUTION AND REGISTRATION OF SALE DEED AND REC EIVING OF INCOME TAX CLEARANCE CERTIFICATE IN FORM 34(A). THE ABOVE NARRATION IN THE AGREEMENT CLEARLY SHOWS THAT THE APPELLANT HAS PAID RS.36.25 LAKHS TO EACH CO - OWNER AND HAS RETAINED BALANCE PAYMENT OF RS.3J5 LAKHS EACH WHICH WAS TO BE PAID AT THE TI ME OF REGISTRATION OF THE SALE DEED AFTER RECEIVING THE NECESSARY CLEARANCES. NOW, AS PER THE APPELLANT, THIS BALANCE PAYMENT OF RS.3.75 LAKHS TO EACH CO - OWNER WAS NOT PAID AND ACCORDINGLY, THE APPELLANT HAD ACCOUNTED FOR THE COST OF ACQUISITION OF THE PRO PERTY ALSO AT RS.1,43,20,000/ - ONLY AND THE BALANCE PAYMENT OF RS.16.80 LAKHS WAS NOT PAID AND ACCORDINGLY NOT TAKEN AS COST OF THE PROPERTY. THE AO HAS NOT BROUGHT OUT ANY EVIDENCE OR MATERIAL ON RECORD TO CORROBORATE HIS ASSERTION THAT THE BALANCE PAYMEN T OF RS.3.75 LAKHS TO EACH CO - OWNER WAS ACTUALLY PAID BY THE APPELLANT. IN THE ABSENCE OF MATERIAL OR EVIDENCE IT CANNOT BE ASSUMED THAT THE APPELLANT HAD MADE THE PAYMENT TO THESE CO - OWNERS FROM UNDISCLOSED SOURCES. THE AGREEMENT ITSELF SPECIFICALLY PROVI DES THAT THE BALANCE PAYMENT WILL BE MADE ONLY AFTER OBTAINING NECESSARY CLEARANCES AT THE TIME OF EXECUTION OF SALE DEED. THEREFORE, CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, I AM 14 IT (SS) A NO .91/DEL/2008 OF THE OPINION THAT AO WAS NOT JUSTIFIED IN MAKING ADDITION OF R S. 16.80 LAKHS. HENCE, THE ADDITION OF RS. 16.80 LAKHS IS DELETED. 5.3 THE LD. DR SUBMITTED BEFORE US THAT NO DOCUMENT AS TO CLEARANCE OF REGISTRATION WAS FILED. ACCORDING TO HER THE FINDING OF THE LD. CIT(A) THAT ASSESSING OFFICER HAS NOT BROUGHT OUT A NY EVIDENCE MATERIAL ON RECORD TO CORROBORATE HIS ASSERTION THAT BALANCE PAYMENT OF RS. 3.75 LAKHS TO EACH CO - OWNER WAS ACTUALLY PAID BY THE ASSESSEE, IS CONTRARY TO THE LAW AND THIS RESPONSIBILITY OF CORROBORATION CANNOT BE FASTENED ON THE ASSESSING OFFICE R. SHE SUBMITTED THAT IN REMAND PROCEEDING THE ASSESSING OFFICER HAS CONFIRMED FROM THE CO - OWNERS THAT THEY AGREED TO SELL THE PROPERTY FOR RS. 1.60 CRORES . 5.4 O N THE CONTRARY, THE LEARNED COUNSEL OF THE ASSESSEE RELIED ON THE ORDER OF THE LD. CIT(A) AND SUBMITTED THAT THERE IS NO EVIDENCE ON RECORD THAT THE ASSESSEE HAS MADE PAYMENT OF RS. 16.80 LAKHS TO THE FOUR CO - OWNERS OF THE IMPUGNED PROPERTY . 5.5 WE HAVE HEARD THE RIVAL SUBMISSION AND PERUSED THE RELEVANT MATERIAL ON RECORD. IN THE CASE ACCORDING TO THE AGREEMENT TO SELL DATED 3 - 11 - 1999 FOUND DURING THE COURSE OF THE SEARCH , THE ASSESSEE AGREED TO PURCHASE THE PROPERTY AT VASANT VIHAR, NEW DELHI, FROM FOUR CO - OWNERS FOR A SALE CONSIDERATION OF RS. 1.60 CRORE S I.E. RS. 40 LAKHS EACH FOR (1/4 TH ) ONE FOURTHS SHARE OF CO - OWNER. THE ASSESSEE PR OVIDED DETAIL OF PAYMENT OF RS. 1, 43,20, 000/, HOWEVER , REGARDING THE BALANCE PAYMENT OF RS. 16.80 LAKHS , THE ASSESSEE STATED THAT SAI D AMOUNT WAS NOT PAID ON ACCOUNT OF CERTAIN DISPUTES OF COMPLETING THE FORMALITIES OF OBTAINING REQUISITE CERTIFICATES. ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE MUST HAVE PAID THE ENTIRE AMOUNT OF RS. 15 IT (SS) A NO .91/DEL/2008 1.60 CRORE S AS PER THE AGREEMENT. DURING THE AP PELLATE PROCEEDINGS, THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER TO CARRY OUT ENQUIRIES FROM THE CO - OWNERS OF THE PROPERTY TO ASCERTAIN WHETHER THEY HAD RECEIVED THE BALANCE AMOUNT OF RS. 16.80 LACS, HOWEVER , IN THE REMAND REPORT HE COULD NOT ESTABLISH IN CLEAR TERMS THAT SAID AMOUNT WAS RECEIVED BY THOSE CO - OWNERS. NO OTHER MATERIAL IN THE FORM OF CASH RECEIPT ETC . OR STATEMENT OF THE ASSESSEE HAS BEEN FOUND DURING THE COURSE OF SEARCH TO SUGGEST THAT THIS PAYMENT HAS BEEN MADE IN CASH. THE ASSESSING OF FICER HAS NOT BEEN ABLE TO CONFIRM FROM THE SELLERS ALSO THAT THEY RECEIVED THIS AMOUNT OF RS. 16.80 LAKH S FROM THE ASSESSEE. IN ABSENCE OF ANY SUCH EVIDENCES, THE FINDING OF THE LD. CIT(A) ON THE ISSUE IN DISPUTE IS WELL REASON ED AND WE DO NOT FIND ANY ER ROR IN THE SAME. ACCORDINGLY , THE GROUND OF THE APPEAL OF THE REVENUE IS DISMISSED. 5.6 IN THE RESULT, THE APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES . ORDER IS PRONOUNCED IN THE OPEN COURT ON 2 9 T H APRIL , 201 9 . S D / - S D / - [ BHAVNESH SAINI ] [O.P. KANT] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 9 T H APRIL , 2019 . RK / - [D.T.D.S] COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI