SHRI JIGNESHBHAI FULCHAND SHAH,JAMNAGAR V. THE ITO, WARD-2 (6), JAMNAGAR

ITA 80/RJT/2020

AI Insights

The case involves a series of appeals by Shri Jignesh Fulchand Shah and Dhaval Jinesh Shah against the orders of the Commissioner of Income Tax (Appeals), which arose from separate assessment orders passed by the Assessing Officer under sections 153A and 143 of the Income Tax Act, 1961. The appeals pertained to the assessment years 2009-10 to 2014-15 and involved common issues related to unexplained investments and interest income from alleged finance activities, as well as disallowances under section 14A of the Act. The Tribunal consolidated the appeals due to the similarity of issues and found that the additions made by the Assessing Officer were not substantiated by concrete evidence, leading to the decision to allow the appeals and delete the additions.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 40456 (ITAT-RAJKOT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Other Referred Cases: Common Cause (A Registered Society) v. Union of India, PCIT-II, Ahmedabad vs Vivek Prahladbhai Patel, CIT v. Anil Bhalla, CIT v. Girish Chaudhary, ACIT v Satyapal Wassan
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY PUNGLIA; LD.
• Assessee Lawyers: MANISH J. SHAH; LD; APPLYING RATE OF INTEREST
• Keywords: Set aside; Revenue expenditure; Corroborative evidences; Unexplained expenditure; Unexplained investment; Rejection of books of accounts; Salary income; Income from undisclosed sources; Document seized; Documents seized; Onus to prove; Source of fund; Earning of tax free income; Loose papers; Notional interest; Rule 8D
• Section: 142(1); 143(2); 250; 48; 132; 153A; 131; 43; 22; 69; 133(6); 13; 153C; 14A; 133A; 20

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER AND SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकरअपीलसं./IT(SS)A Nos.04,05,06,07,08/Rjt/2017 (Ǔनधा[रणवष[ / Assessment Year: (2009-10 to 2013-14) (Physical Hearing) Shri Jignesh Fulchand Shah Amidhara, 1 Oswal Colony, Jamnagar - 361005 Vs. The ACIT, Central Circle – 1, Rajkot èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AGNPS8768G (Assessee) (Respondent) आयकरअपीलसं./ITA No.80/RJT/2020 (Ǔनधा[रणवष[ / Assessment Year: (2014-15) (Physical Hearing) Shri Jignesh Fulchand Shah Amidhara, 1 Oswal Colony, Jamnagar - 361005 Vs. The ITO, Ward – 2(6), Manek centre, 4th floor, P. N. Marg, Jamnagar – 361008 èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AGNPS8768G (Assessee) (Respondent) आयकरअपीलसं./ITA No.121/RJT/2016 (Ǔनधा[रणवष[ / Assessment Year: (2013-14) (Physical Hearing) Dhaval Jinesh Shah Amidhara, 1- Oswal Colony, Behind Ayamblil Bhawan, Jamnagar - 361005 Vs. The Assistant Commissioner of Income Tax, Central Circle – 1, Amruta Estate, Rajkot èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AMIPS9143A (Assessee) (Respondent) Assessee by : Shri Manish J. Shah, Ld. AR Respondent by : Shri Sanjay Punglia, Ld. CIT-DR Date of Hearing : 28/11/2024 Date of Pronouncement : 24/12/2024 IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 2 आदेश / O R D E R PER DR. A. L. SAINI, AM: This is bunch of seven appeals, filed by two different assessees, pertaining to assessment years 2009-10 to 2013-14, are directed against the separate orders passed by the Commissioner of Income Tax (Appeals), which in turn arise, out of separate assessment orders, passed by the Assessing Officer, under section 153(A) r.w.s. 143 of the Income Tax Act, 1961( hereinafter referred to as “the Act”). 2. Out of these seven appeals, six appeals pertain to Shri Jignesh Fulchand Shah, vide IT(SS)A Nos.04,05,06,07,08/Rjt/2017, and ITA No.80/RJT/2020, and one appeal pertains to Dhaval Jinesh Shah, vide ITA No.121/RJT/2016. Since, the issues involved in all the appeals are common and identical; therefore, these appeals have been heard together and are being disposed of by this consolidated order. 3. Although, these appeals filed by the Assessee, vide IT(SS)A Nos.04,05,06,07,08/Rjt/2017, and ITA No.80/RJT/2020, contain multiple ground of appeals. However, at the time of hearing we have carefully perused all the grounds raised by the Assessee. We find that most of the grounds raised by the Assessee, are either academic in nature or contentious in nature, that is, only arguments are stated. However, to meet the end of justice, we confine ourselves to the core of the controversy and main grievances of the Assessee. With this background, we have summarized and concise the grounds raised by the Assessee, which are reproduced below: IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 3 1. The learned CIT(A) has erred in confirming addition made by the learned assessing officer on account of alleged unexplained investment in alleged finance business plus interest earned thereon on basis of rough jotting in Annexure A-l of the seized material, which are not incrementing documents. (i).On basis of rough jottings at page No. 9 of Annexure A-l of Rs. 2,02,32,000/-.( ground No.3 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii).On basis of rough jotting at page No. 11of Annexure A-l of Rs. 2,69,04,000/-.( ground No.4 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (iii On basis of rough jotting at page No. 11 of Annexure A-l of Rs. 3,02,40,000/-.( ground No.4 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) 2. The learned CIT(A) has erred on facts and in law in confirming addition made by the leaned assessing officer on account of interest income from alleged finance activities. (i)..Addition of Rs. 26,67,863/-, on account of interest income. ( ground No.7 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii).Addition of Rs. 25,50,581/-, on account of interest income. ( ground No.3 in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14) (iii) Addition of Rs. 29,23,739/-, on account of interest income. ( ground No.5 in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13) (iv)Addition of Rs. 24,23,901/-, on account of interest income. ( ground No.5 in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11) (v)Addition of Rs. 12,41,244/-, on account of interest income. ( ground No.5 in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10) (vi)Addition of Rs. 14,71,337/-, on account of interest income by applying gross profit ratio( ground No.2.2 in ITA No.80/Rjt/2020, for A.Y. 2014-15) 3.The learned CIT(A) has erred on facts and in law in confirming disallowance made by the assessing officer u/s. 14A of the Act. (i).Addition of Rs. 66,948/-( ground No.8 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii). Addition of Rs. 73,595/-( ground No.4 in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14) (iii). Addition of Rs. 79,636/-( ground No.6 in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13) (iv)Addition of Rs. 67,398/-( ground No.6 in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11) IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 4 (v)Addition of Rs. 88,644/-( ground No.6 in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10) 4.The learned CIT(A) has erred on facts and in law in confirming the addition of Rs. 7,96,500/- made by the learned assessing officer on account of alleged unexplained cost of education of the assessee's son.( Ground No.9 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) 5.The learned CIT(A) has erred in law as well as on facts in confirming the action of theassessing officer in making assessment u/s 153A, as there is no search u/s. 132 or requisition in the name of the assessee. [ This ground is raised by the assessee in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10, in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11, in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12, and in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13] 6.The Learned CIT(A) has erred in confirming the action of the learned assessing officer in rejecting the books of account and thereby invoking section 145A without finding out any specific defect in the books of account. [ This ground is raised by the assessee in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14,in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13, in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11,in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10,in ITA No.80/RJT/2020 for A.Y.2014-15.] 7.The order passed by the learned CIT(A) is bad in Law as well on facts, therefore,requires to be quashed. [ This ground is raised by the assessee in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10, in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11, in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12, in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13,in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14, and in ITA No.80/RJT/2020 for A.Y.2014-15.] IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 5 4.Additional Grounds of Appeal raised by the assessee are as follows: “The assessing officer erred in law and on facts in making addition of Rs. 7,73,06,000/- to the returned income of the assessee on the basis of loose paper marked as Annexure – A1 seized from the premise of RajhansImpeex Pvt Ltd,in the assessment order passed u/s 153A of the Income Tax Act, 1961, without appreciating the fact that addition on the basis of seized documents recovered from the premise of third party is necessarily to be made by issuing notice u/s. 153C of the Income Tax Act, 1961. The assessee reserves its right to add, amend, alter or modify any of the grounds stated hereinabove either before or at the time of hearing.” [This ground is raised by the assessee in IT(SS)A Nos.04,05,06,07,08/Rjt/2017] 5.First, we shall adjudicate, six appeals pertaining to Shri Jignesh Fulchand Shah, vide IT(SS)A Nos.04,05,06,07,08/Rjt/2017, and ITA No.80/RJT/2020. In order to adjudicate these six appeals and for the sake of convenience, the facts narrated in IT(SS)A No. 6/Rjt/2017, for assessment year 2011–12, have been taken into consideration for deciding the above appeals en masse. 6. Now we shall take the summarized and concise ground of appeal in case of Shri Jignesh Fulchand Shah, one by one, as follows: 7. Summarised and concise ground No.1 is reproduced below for ready reference: “1. The learned CIT(A) has erred in confirming addition made by the learned assessing officer on account of alleged unexplained investment in alleged finance business plus interest earned thereon on basis of rough jotting in Annexure A-l of the seized material, which are not incrementing documents. (i).On basis of rough jotting at page No. 9 of Annexure A-l of Rs. 2,02,32,000/-. ( ground No.3 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii).On basis of rough jotting at page No. 11of Annexure A-l of Rs. 2,69,04,000/-.( ground No.4 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 6 (iii On basis of rough jotting at page No. 11 of Annexure A-l of Rs. 3,02,40,000/-.( ground No.4 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12)” 8. The relevant material facts, as culled out from the material on record, (as per lead case in IT(SS)A No. 6/Rjt/2017) are as follows. The assessee, before us, is an individual.A search action u/s132 of the Act was carried out at the premises of the assessee on 23.08.2012. Consequent to search u/s132 of the Income Tax Act, proceedings u/s 153A of the Act were initiated by issuing notice dated 09.05.2013, which was duly served upon the assessee. The assessee was required to file return of income within 30 days of the receipt of the notice. In response to notice, the return of income showing total income of Rs.3,15,970/- was filed by the assessee on 10.06.2013. A notice u/s 143(2) of the Act was issued on 21.04.2014, which was served upon the assessee. Further detailed questionnaire was issued by the assessing officer on 24.06.2014, along with a notice u/s 142(1) of the Act. In response to these notices, the authorized representative of the assessee, attended to the assessment proceedings from time to time and filed details called for and written submissions were also filed before the assessing officer. 9.On verification of return of income, it was noticed by the assessing officer that the assessee is having income from other sources. During the course of search, a paper file, inventorized as annexure A-l, was found and seized from the premises of M/sRajhans Impex Pvt Ltd. This loose paper file contained 11 pages. The Page No 9 of this annexure which is in the handwriting of the assessee contained some details which were reproduced by the assessing officer in para number 3 of the assessment order. During the course of search proceedings, the assessee was asked to explain the same. In reply, the assessee, vide reply to question No.14 to statement dated 24.8.2012 stated that, “I accept IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 7 that this has been found frommy premises and the notings have been made by myself” Thereafter, when asked to explain the above notings, the assessee, in reply to question No 15 stated that, “I have perused the notings made on page No 9 of annexure A-l. I am not able to recollect the figures but looking to the figures it seems to be some projections, I have made or it can be calculation of some scheme.” 10.From the above questions and answers, the assessing officer noticed three points viz: (a) the papers have been found from the premises of the assessee, (b) that it is in the handwriting of the assessee and (c) these notings may be some projections. 11. However, the assessing officer, observed that since no explanation was submitted by the assessee, at the time of search and during the course of assessment proceedings, therefore, the assessee was again given an opportunity to explain the same and for that assessing officer again issued notice to the assessee. 12. In response, (vide submission of assessee dated 12.1.2015), the assessee submitted before the assessing officer, as follows: “The upper portion of this page shows projections of interest payable and interestreceivable for a particular amount of loan for a particular period of time. As youare kindly aware, the assessee accepts and advances loans in his individualcapacity and in the name of Amit Agencies and such loans have runningaccounts in the respective books of account and in the absence of name andperiod mentioned against figures appearing on this page, it may please beappreciated that the same cannot be directly linked with one specific figure withbooks of account. It is also a fact evident from the records that the assessee hasaccepted and advanced loans through proper banking channel throughout theyears under consideration. 13. The assessing officer, having gone through the above reply of the assessee noticed that the assessee admits that the above noting may be pertaining to his finance business, although he asserts that, in the absence of any name and IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 8 period mentioned against the figures appearing on this page, it cannot be directly linked. The assessing officer observed that the assessee is largely into finance business, wherein, he accepts loans for which he pays interest and makes the advances, on which, interest is charged. Therefore, assessing officer was of the view that it is clearly established that the transactions are indeed pertaining to assessee's finance business. However, the assessee's submissions stating that the noting in the loose paper appears to be some projection etc. was not accepted by the assessing officer, for the following reasons: (i).Firstly, the assessee is engaged in finance business wherein he borrows money, makes advances, charges interest and pays interest. The notings found corroborates with the business of the assessee. Hence, it can be reasonably inferred that these entries are part and parcel of the assessee's core business. (ii).Secondly, on the same page, another entry is appearing underneath the above entries, which reads as under: Vaibhav Paper Rs.65,35,000 Rs. 3,26,750 Rs.68,61,750 The assessing officer observed that above entry relates to an advance made by the assessee to one M/s Vaibhav Paper Boards Pvt Ltd. This advance is appearing, as such in the balance sheet of the assessee and the amount of Rs. 65,35,0000/- is opening balance of such loan for the year under consideration. Both the upper portion and the lower portion are in the same handwriting, written by same ink and written by same person. During the course of search, the assessee admitted to the fact that the entry at the lower part was loan given IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 9 to Vaibhav Paper Boards Pvt Ltd.Again, the same page contains noting as follows: “Rajhans Impex Share transfer on 17.8.07 Cheque issue on date 9th Feb 07“ The assessing officer, therefore noticed that these are as per the books and these corroborates and upholds the fact that the seized paper is not a dumb document.Therefore, here is a case where the assessee is feigning ignorance of the first part of the transactions whereas, the second part of the transactions were admitted and found reflected in his books. It is an established fact that the seized materials cannot be read contextually in a manner beneficial to the assessee. Rather, it has to be read as a whole.Therefore, there is no doubt that the paper found contains transactions that are real and has actually occurred. (iii)Thirdly, the assessee is engaged in the finance business under the proprietary concern Amit Agencies. One interesting feature of the assessee's finance business is that, he is regularly incurring loss from such finance business. This can be seen from the following chart. Particulars of Amit Agencies which is the prop. concern of the assessee engaged in finance business. AY 09-10 AY 10-11 AY 11-12 AY 12-13 AY 13-14 Interest earned 4678208 3063800 3487437 5324325 4928929 Interest paid 5011183 4483643 5791883 6991358 6430149 Net loss from finance business (-) 332975 (-)1419843 (-)2304446 (-)1667033 (-) 1501220 IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 10 14.The assessing officer observed from the above chart, that the assessee had incurred net loss of interest to the tune of Rs 72,25,517/-( 3,32,975 +14,19,843 +23,04,446+16,67,033+15,01,220). Thus, assessing officer noticed that this is a huge loss. Which prudent businessman, who is engaged in finance business and whose source of fund is borrowed capital / fund, would incur such huge loss and that too repeatedly, year and year again. Had it been a one-time loss, it would have been presumed that the assessee might have failed in his finance business. But this is a recurringphenomenon. Each time the loss is increasing. When one incurs loss in finance business, it means that the “interest charged” is less than the “interest paid”. Also, there are no bad loans. Which prudent businessman would take pain, borrow capital, take the risk of advancing it and end up in charging less interest. This is absurdity. Therefore, assessing officer was of the view that it clearly establishes that the assessee is also engaged in finance business which is otherwise not recorded in his regular books of accounts, as can be seen from the seized page No 9 of Annexure A-l. In fact, the seized page reveals the magnitude of such unaccounted financing business of the assessee. 15. The assessing officer observed that by feigning ignorance about the transactions recorded on this page and by giving a vague explanation that these transactions may be estimates etc., the assessee has failed to fulfill the onus cast upon him by virtue of section 132(4A) of the Income Tax Act, which reads as follows: “(4A) Where any books of account, other documents, money, bullion, jewellery, or other valuable article or thing are or is found in the possession or control of any person in the course of a search, it may be presumed – (i) That such books of account, other documents, money, bullion, jewelleryor other valuable article or thing belong or belongs to such person; (ii) That the contents of such books of account and other documents aretrue; and IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 11 (iii) That the signature and every other part of such books of account andother documents which purport to be in the handwriting of any particularperson or which may reasonably be assumed to have been signed by, or tobe in the handwriting of, any particular person, are in that person'shandwriting and in the case of a document stamped, executed or attested,that it was duly stamped and executed or attested by the person by whomit purports to have been so executed or attested. The assessing officer also stated that the same concept is stated in section 292C of the Income Tax Actand from these two sections, it is very clear that the onus to prove and explain the material found and belonging to the assessee which is in the handwriting of the assessee, is cast upon the assessee, by virtue of section 132(4A), which the assessee has failed to do so. 16. Therefore, assessing officer noticed that the jottings recorded on page No. 9 pertains to assessee's finance business which is not part of the regular books of accounts and where the principal amount and the interest portion are unaccounted. As per the above jotting, the assessee was to pay interest on a sum of cash borrowed of Rs. 50 lacs, whereas, he was supposed to received interest on an advance, made in cash, of Rs. 186 lacs. Therefore, this sum of Rs. 186 lacs was treated as unexplained investment, by the assessing officer. 17. The assessing officer again noticed that as per the jotting on page No 9, the rate of interest charged is 1% per month, which again corroborates with the submission of the assessee made during the course of assessment. Hence, the interest @1% pm on an advance of Rs. 186 lacs works out to Rs 22,32,000/-. Since the assessee has not come forward to explain these entries and also not given any details of his unaccounted finance business, it was presumed by the assessing officer that the advance remained advanced for one whole year. Against this, benefit of interest paid on borrowed capital is being given, computed @ 12% per annum i.e. Rs. 6,00,000/- and the interest calculation is IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 12 made on the net of advances. The net interest income earned is thus taken at Rs. 16,32,000/- (Rs 22,32,000-Rs. 6,00,000). Hence an addition of Rs 2,02,32,000/-( Rs.1,86,00,000 + Rs. 16,32,000)was made by the assessing officer, on account of unaccounted investment and interest earned thereon from finance business. 18. During the assessment proceedings, the assessing officer, asked the assessee to explain the jottings mentioned on the upper partof seized material. In response, Vide reply dated 13.01.2015, the assessee has furnished the written submission before the assessing officer, which are reproduced below: Description Amount Remarks Hussain 60.00 Projected advance receivable from the said party but the transaction could not actually take place. Maha 75.00 It was projected to give advance to one party viz., Mahalaxmi Extrusions but the said transaction could take place only during the FY 2013-14 which is evident from the copy of ledger account of Mahalaxmi Extrusions from the books of account of RajhansImpex P. Ltd. Deepak 50.00 Loans repayable to Deepak Ground as per group summary from the books of account of Amit Agencies. Uday 30.00 Loans repayable to uday group as per group summary from the books of account. 19. Having gone through the above reply of the assessee, the assessing officer noticed that these transactions are not projected ones. Whereas, most of the transactions appear in the assessee's books in one way or the other. For example, \"Maha 75.00\" appearing on the seized page is actually loan advanced as per books. Again, there are entries of \"P. Shah\" (which is Parag Shah) to whom loans are given. Therefore, it is clear that, these entries are the unaccounted finance business of the assessee. Similarly, in justification of the left hand side entries, the assessee states that these are projected advance IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 13 receivable. Thus, assessing officer observed that this is absurd because, how can the advance receivable be projected. this proves that the contention of the assessee is false, misleading and devoid of truth.Although there is no indication that the entries at the left side of Page No. 11 represent funds borrowed for financing, however, since it is established that the entries on the right hand, sides are funds advanced, so it was presumed by the assessing officer that the left hand side entries are funds borrowed. Accordingly, the funds borrowed for financing is to the tune of Rs 110 lacs, and the advances made is to the tune of Rs 252 lacs. Therefore, this sum of Rs. 252 lacs was treated as unexplained investment. 20. As per the above facts, the rate of interest charged is 1% per month.Hence, the interest @1% p.m. on an advance of Rs. 252 lacs worked out by the assessing officer to the tune of Rs. 30,24,000/-. Since the assessee has not come forward to explain these entries and also not given any details of his unaccounted finance business, it was presumed by the assessing officer that the advance remained advanced for one whole year. Against this, benefit of interest paid on borrowed capital is being given computed @ 12% per annum i.e. Rs. 13,20,000 and the interest calculation is made on the net of advances. The net interest income earned was thus, taken at Rs. 17,04,000/-. Hence, addition of Rs 2,69,04,000/- ( Rs.2,52,00,000 + Rs. 17,04,000)was made on account of unaccounted investment and interest earned thereon from finance business. 21. During the assessment proceedings, the assessing officer noticed that on top of Page No 11 of annexure A-1 there is an entry of \"430-250 = 180x150=2,70,00,000\". The assessee has not offered any clarification in respect of this entry/noting. Therefore, assessing officer deduced, reasonable inference keeping in mind the entire matrix of the case and was of the view that the equation is a bit cryptic i.e. coded only to mislead any other person. The IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 14 figure 180 appearing after first \"=\" sign is as a result of operation of \"-\" sign between '430' and '250'. Further, the end figure of 2,70,00,000/- is as a result of operation of \"X\" sign between '180' and '150', appearing before second \"=\" sign, with three additional 'zeroes' place thereafter. As the assessee is into business of financing, the same was taken by the assessing officer, as loan advance in cash and accordingly an amount of Rs. 2,70,00,000/-was added to assessee's income as unexplained investment. The interest earned thereon, @ 12%, was computed at Rs. 32,40,000/- by the assessing officer. Therefore, the total addition on this count was made by the assessing officer, to the tune of Rs. 3,02,40,000/- ( Rs. 2,70,00,000 + Rs. 32,40,000). 22.Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the Ld. CIT(A), who has confirmed the action of the Assessing Officer.Before the CIT(A), the assessee demonstrated the relevant facts and provided detailed submissions to assail the action of the assessing officer stating that the documents found during the search were merely rough jottings and estimates. However, rejecting the assessee`s plea and taking the base of Annexure A-1 and page No. 9 and 11 of the said Annexure, the ld CIT(A) confirmed the addition made by the assessing officer, to the tune of Rs.2,02,32,000/-, Rs.2,69,04,000/- and Rs.3,02,40,000/- respectively. The ld. CIT(A) observed thatassessee did not have any evidence to rebut the finding of the assessing officer and to prove that the notings were mere estimates or some projections. The CIT(A) noticed that assessee was trying to deny nature of the transactions only for the simple reason that they were not recorded in books of accounts. The Ld CIT(A) further observed that the explanation of the assessee regarding the noting were not supported, by any evidence, though as per law the onus was upon the assessee to prove veracity of the explanation, therefore, the IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 15 assessing officer was left with no other option but to deduce reasonable inference keeping in mind the entire matrix of the case. The notings were of cryptic nature i.e. coded only to mislead any other person. The Ld.CIT(A) noted that the notings were related to loans given by the assessee. This way, these three additions,Viz:Rs.2,02,32,000/-, Rs.2,69,04,000/- and Rs.3,02,40,000/- respectively, made by the assessing officer, were confirmed by the ld. CIT(A). 23. Aggrieved by the order of the Ld. CIT(A), the assessee, is in further appeal before us. 24. On merits of the case,Shri Manish J. Shah, Learned Counsel for the assessee, vehemently contends that there notings on page No. 9 and 11 of Annexure-A1 are only estimated figures and the assessing officer had wrongly assumed that the notings were related to the finance business activity of the assessee. The Department did not find any assets, during the course of search, representing such large undisclosed income allegedly treated to have been earned by the assessee. The addition was made purely on guess work and presumptions. The assessing officer did not have any corroborative evidence on record to establish his findings. The ld Counsel stated that in absence of any date mentioned in the alleged loose paper relied upon by the Department no addition can be made in any assessment year. In other words, the loose paper relied upon by the Department is nothing but a dump document neither containing any date of transaction nor containing the nature of transaction. In the Assessment Year 2011-12, no assumption with regard to year of transaction can be made. The ld Counsel submitted, before us, a compilation of legal case laws, which we have gone through. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 16 25. Without prejudice, the ld Counsel also stated that the assessing officer considered only such figures from page 9 which were having remarks 'to collect’ for the purpose of making its addition while assessing officer does not allow credit in respect of figure having remarks 'to pay'. Similarly, the A.O. did not consider the figure appearing on left hand side of page 11 for credit while making addition of figures appearing on right hand side of page 11. In other words and in any case, the A.O. ought to have considered the net of the figures, from the seized material for the purpose of making addition. 26.On merits of the case,Shri Sanjay Punglia, Ld. CIT-DR for the Revenue, argued that the jottings recorded on page No. 9 and 11 of seized documents pertain to assessee's finance business which is not part of the regular books of accounts and where the principal amount and the interest portion are unaccounted. Since the assessee has not come forward to explain these entries and also not given any details of his unaccounted finance business, it was rightly presumed by the assessing officer that the advance remained advanced for one whole year. Therefore, the assessing officer was right in making the addition on account of principal amount and interest to the tune of Rs.2,02,32,000/-, Rs.2,69,04,000/- and Rs.3,02,40,000/- respectively in the hands of the assessee, as the entries mentioned in seized documents were pertained to assessee`s business. 27.We have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record.Though facts have been discussed in detail in the foregoing paragraphs, however in the succinct manner, the relevant facts and background are reiterated in order to appreciate the controversy and the issue for adjudication.During the assessment proceedings, it IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 17 was noticed by the assessing officer, from loose paper file marked as Annexure- A1 seized from the premises of Rajhans Impex Pvt. Ltd that in said Annexure- A1, there were hand written details which were reproduced by the assessing officer, on page No 2 of the order. The assessing officer called for explanation of the assessee with supporting evidence regarding nature of the notings etc. During the assessment proceedings, the assessee submitted written submissions stating that seized documents are only rough jottings and estimates, and some documents pertain to projection, hence addition should not be made. However, the assessing officer, rejected the arguments of the assessee and observed that notings in the seized documents were pertaining to assessee`s finance business but in absence of names and the period to be mentioned against the notings, mentioned on the pages, the assessee was not able to directly link the same. Based on the above facts, additions on account of principal amount and interest to the tune of Rs.2,02,32,000/-, Rs.2,69,04,000/- and Rs.3,02,40,000/- respectively, were made by the assessing officer. 28. The assessee submitted, before us, all the seized documents, in a paper book. We have gone through the seized documents, that is, Annexure- A1 and page Nos. 9 and 11. We have gone through the seized document, which is placed in assessee`s paper book page No.9, which pertains to addition made by the assessing officer, of Rs.1,86,00,000 + Rs. 16,32,000 interest, thus total addition comes to Rs 2,02,32,000/-. In this seized document we noticed that:(1)Name of the assessee does not appear,(2)There is no name of the opposite party who received the advance, as suspected by the assessing officer,(2)There is no signature of the assessee, (3)There is no signature of the opposite party, as suspected by the assessing officer, (4)There is no any date mentioned in front of each entry, (5) There is no any information in the said seized document, that the opposite party( who received advance, as per IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 18 assessing officer), is paying interest to the assessee and even rate of interest is not mentioned, (6) For which business purpose, and for which transaction purpose, the said document is prepared by the assessee is not mentioned, (7) Terms and conditions, if any, for the purpose of which business, if any, are not mentioned in the said seized document. It is well known fact that in order to do business transactions, such as purchase, sale, to give advance, to receive advance, etc, there should be a contract, at least, between two persons, and a person cannot make a contract with himself. For example, sale is a contract, which should fulfil all the essential conditions of the valid contract, as per Contract Act. For example, to give an advance, there should be a contract. After going through the seized document, which is placed at paper book, page number 9 of assessee`s paper book, we are of the view that it does not satisfy any of the essential conditions of a valid contract. Therefore, based on such dump document, the liability to pay the income tax, should not be fasten on the assessee. 29. We reproduce here the picture of the seized document, which is placed at paper book page No.9, as follows: IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 19 IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 20 After going through the above seized document, we note that it is a dump document, which does not give any information that who is liable to pay the income tax in relation to the rough jottings mentioned in the said document. We also noticed in the above dump document that there is a date, mentioned as 9th Feb, 07, therefore, if the revenue wants to collect the tax, based on the entries mentioned in the above dump document, then the tax should be collected in the relevant assessment year.As per date 9th Feb, 07, the previous year is 2006-07 and assessment year is 2007– 08, however, in the assessee`s case under consideration, the assessment year involved, is the assessment year 2011– 12, therefore by no any scratch of imagination, such jottings in the dump document, should be taxable in the assessment year 2011-12. That is, such above dump document does not pertain to assessment year 2011–12.We note that assessee before us is an individual( person).Further, the term 'Person' has been defined in clause 31 of section 2, to include seven categories of persons, all of which are independent and distinct from each other. A literal interpretation of the above provisions leads to the conclusion that only a right person as per the Act, is liable to pay tax on his income and no option is available to tax income in the hands of the person other than the one in whose hands it is taxable.The Hon’ble Supreme Court in ITO Vs. CH. Atchaiah (1996) 218 ITR 239 (SC) has held that the income should be assessed on the right person, right assessment year and it should be on the right income. From the aforesaid decision of the Hon’ble Supreme Court only the right person and the right person alone is liable to be taxed and not the wrong person.Thus, the above dump document mentioned the date as 9th Feb, 07, therefore, rough jotting mentioned in the said dump document can not be assessed in the assessment year 2011–12, therefore addition of Rs 2,02,32,000/-, made by the assessing officer needs to be deleted. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 21 30.About addition of Rs 2,69,04,000/- ( Rs.2,52,00,000 + Rs. 17,04,000), we note that during the assessment proceedings, the assessee has furnished the written submission and explanation before the assessing officer, which are reproduced below: Description Amount Remarks Hussain 60.00 Projected advance receivable from the said party but the transaction could not actually take place. Maha 75.00 It was projected to give advance to one party viz., Mahalaxmi Extrusions but the said transaction could take place only during the FY 2013-14 which is evident from the copy of ledger account of Mahalaxmi Extrusions from the books of account of RajhansImpex P. Ltd. Deepak 50.00 Loans repayable to Deepak Ground as per group summary from the books of account of Amit Agencies. Uday 30.00 Loans repayable to uday group as per group summary from the books of account. 31.In justification of the left hand side entries, the assessee stated that these are projected figure sand transactions in most of the cases could not actually take place. However, the assessing officer rejected the contention of the assessee and stated that although there is no indication that the entries at the left side of Page No. 11 represent funds borrowed for financing, however, since it is established that the entries on the right hand, sides are funds advanced, so it was presumed by the assessing officer that the left hand side entries are funds borrowed. Accordingly, the funds borrowed for financing is to the tune of Rs 110 lacs, and the advances made is to the tune of Rs 252 lacs. Therefore, this sum of Rs. 252 lacs was treated as unexplained investment.Therefore, we note that addition of Rs 2,69,04,000/- ( Rs.2,52,00,000 + Rs. 17,04,000), was made by the assessing officer based on the presumptions and assumptions, which is not permitted in the taxation jurisprudence. Hence, addition needs to be deleted. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 22 32. About the addition of Rs. 3,02,40,000/-( Rs. 2,70,00,000 + Rs. 32,40,000), we note that during the assessment proceedings, the assessing officer noticed that on top of Page No 11 of annexure A-1 there is an entry of \"430-250 = 180x150=2,70,00,000\". The learned council for the assessee submitted before us that it is a rough jotting and does not give any meaning. Therefore, we find there is no mention of any name and address of the person with whom the assessee has done the transaction to the tune of Rs. 3,02,40,000/-( Rs. 2,70,00,000 + Rs. 32,40,000). This document does not contain the essential information, such as: (1)Name of the assessee does not appear,(2)There is no name of the opposite party who received the advance, as suspected by the assessing officer, (2)There is no signature of the assessee, (3)There is no signature of the opposite party,as suspected by the assessing officer, (4) There is no any date mentioned in front of each entry, (5) There is no any information in the said seized document, that the opposite party( who received advance, as per assessing officer), is paying interest to the assessee and even rate of interest is not mentioned, (6) For which business purpose, and for which transaction purpose, the said document is prepared by the assessee is not mentioned, (7) Terms and conditions, if any, for the purpose of which business, if any, are not mentioned in the said seized document. Therefore, our decision rendered in para 28 and 29 of this order, will applicable here. Besides, the above addition was made by the assessing officer based on the surmise and conjuncture as the assessing officer, himself stated in the assessment order that he deduced, reasonable inference keeping in mind the entire matrix of the case and assessing officer was of the view that the equation is a bit cryptic i.e. coded only to mislead any other person. The figure 180 appearing after first \"=\" sign is as a result of operation of \"-\" sign between '430' and '250'. Further, the end figure of 2,70,00,000/- is as a result of operation of IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 23 \"X\" sign between '180' and '150', appearing before second \"=\" sign, with three additional 'zeroes' place thereafter. As the assessee is into business of financing, the same was taken by the assessing officer, as loan advance in cash and accordingly an amount of Rs. 2,70,00,000/-was added to assessee's income as unexplained investment. The interest earned thereon, @ 12%, was computed at Rs. 32,40,000/- by the assessing officer. Therefore, the total addition on this count was made by the assessing officer, to the tune of Rs. 3,02,40,000/-( Rs. 2,70,00,000 + Rs. 32,40,000). The above facts clearly state that assessing officer made addition based on surmise and conjuncture and guess work, which is not permitted in taxation jurisprudence. Hence, we are of the view that the said addition was made by the assessing officer without any incrimenting material, hence needs to be deleted. 33. We find that while making these three additions viz: Rs.2,02,32000/-, Rs. 2,69,04,000/- and Rs. 3,02,40000/- , the assessing officer also added notional interest. That is, assessing officer further computed notional interest on such alleged unexplained investment/advances and also made addition thereof. The details of addition made by the A.O. is summarized hereunder: Seized Page No. Alleged Unaccounted Investment/ Advances Alleged Interest Total 9 1,86,00,000 16,32,000 2,02,32,000 11 2,52,00,000 17,04,000 2,69,04,000 11 2,70,00,000 32,40,000 3,02,40,000 Total… 7,08,00,000 65,76,000 7,73,76,000 IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 24 We note that when during the course of search no incriminating or documents or unaccounted transactions have been found, the assessing officer ought not to have made above additions. As we have stated above that the seized documents did not contain details about the dates of receivables / payables and its contents were not corroborated by the assessing officer by any material so as to link the alleged transactions to be actual transactions. As regards addition of Rs. 2,70,00,000/- made by the A.O. in respect of figures appearing on top of page No. 11 stating that the appellant has not offered any clarification in respect of this entry / noting and considering it as alleged cash loan advance. However, the appellant has vide submission dated 13.01.2015 explained that the same appears to be an estimated figures, showing tentative stock position of Rajhans Impex Pvt.Ltd.It is pertinent to note that no assets representing such large undisclosed Income allegedly earned by the appellant have been found during the course of search neither from the business premises nor from the residence of the appellant. The A.O. has made the addition purely on guess work and presumption basis to there is no contrary, contradictory or corroborative evidence on record establish that these figures are alleged unaccounted cash loan transactions. Therefore, these three additions made by the assessing officer do not sustain in the eye of law. 34. We also note that assessing officer considered only such figures from page 9 which were having remarks 'to collect’ for the purpose of making its addition while assessing officer does not allow credit in respect of figure having remarks 'to pay'. Similarly, the assessing officer did not consider the figure appearing on left hand side of page 11 for credit while making addition of figures appearing on right hand side of page 11 of seized document. It is settled principle of law that any document has to be taken as a whole and the Assessing Officer should not pick and choose those parts of the seized material IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 25 which suits him and totally rejected those parts of the same document which are in support of the assessee. Therefore, either the Assessing Officer should not rely on such seized material at all or if he uses these documents, as evidence, against the assessee then he should read it as a whole and also accept those parts of the documents which support the assessee. One Cannot be permitted to blow hot and cold in the same steam. ‘Head I win’ and ‘tail you lose’, approach is alien to the principles of justice. The doctrine of ‘approbate and reprobate’ as borrowed in our jurisprudence from the Scotch law gives strength, to this basic rule. There cannot be approval and rejection in the same steam. To attempt to take advantage of one part and to reject the rest is against the fine norms of jurisprudence. Therefore, these three additions made by the assessing officer needs to be deleted. 35. We note that Hon'ble Supreme Court of India in the case of Common Cause (A Registered Society) v. Union of India 77 taxmann.com 245 (SC) has held that \"There has to be some relevant and admissible evidence and some cogent reason, which is prima facie reliable and supported by other circumstances pointing out that the particular third person against whom the allegations have been levelled was in fact involved in the matter or he has done some act during that period, which may have co-relations with the random entries. In plethora of cases Courts have held that even if the entries in loose papers etc, are admissible as evidence, then to support that inference about correctness of the entries therein, supportive independent evidence is required and such entries would not suffice without independent material. Such materials have no probative value in the absence of some corroborative primary evidence of the reality of such transaction shown in the noting in such loose sheets of paper. Therefore, any presumption of transaction on some vague, tenuous and dubious entries in a sheet of paper is not rational and legal unless there is IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 26 corroboration by corresponding entry in accounts of both the parties to the transaction. Reliance is also placed on the following judicial pronouncements: (i)Hon'ble High Court of Gujarat in the case of PCIT-II, Ahmedabad vs Vivek Prahladbhai Patel (2016) 66 taxmann.com 41 (Gujarat) held as follows: “Unexplained investments u/s. 69-ITAT deleted the addition - Upon appreciation of the evidence on record and finds no reason to take a different view. In the opinion of this court, having regard to the evidence which has come on record, which reveals that there is an agreement to sell executed between the assessee and the sellers, which shows the price of the plots of land in question to be a much higher fiqure than the documented price and the fact that the sellers have stated that they have received higher amounts by way of on-money and have also shown receipt of such amount in their income tax returns, the circumstances do raise a suspicion, However, as held by the Supreme Court in Commissioner of Incometax v. DaulatramRawatmull, (1964 (3) TMI 14-SC), even if circumstances raise a suspicion, suspicion cannot take the place of evidence” (ii) Sharad Chaudhary [2015] 55 taxmann.com 324 (Delhi - Trib.) “18. Coming to the decisions/legal propositions as relied on by the CIT(A), we observe that the Hon'ble Jurisdictional High Court of Delhi in the case of CIT v. Anil Bhalla (supra), has held that when no independent material or evidence had been brought on record by the assessing officer to establish that the noting/jottings recorded on loose sheet or on the paper represented an unaccounted transaction, then the CIT(A) was right in accepting the explanation of the assessee and their lordships further held that the Tribunal was right in holding that the loose sheet does not represent any expenditure incurred by the assessee, then the findings of the Tribunal do not warrant any interference. 19. In the case of CIT v. Girish Chaudhary (supra), the Hon'ble Jurisdictional High Court of Delhi dismissing the appeal of the revenue held that when there was no material on record to show on what basis the assessing officer had reached to the conclusion that the figure '48' was to be read as Rs. 48 lakh, then the document recovered during the course of search was a dumb document and led nowhere. The relevant observations and conclusion of their Lordship read as under: \"Hence, in the present case there is no material on record to show as to on what basis the Assessing Officer has reached at the conclusion that the figure \"48\" is to be read as Rs. 48 lakhs. The apex court in Central Bureau of Investigation v. V.C. Shukla (1998) 3 SCC 410 has laid down that:- \"File containing loose sheets of papers is not book and hence entries therein are not admissible under section 34 of the Evidence Act, 1872.\" Similarly, the document annexure A-37 recovered during the course of search in the present case is a dumb document and lead us nowhere. Thus , the Tribunal rightly IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 27 deleted the addition of Rs. 48 lakhs made by the Assessing Officer on account of undisclosed income on the basis of seized material. 20. In the present case, we are unable to see any valid reason or basis on which the assessing officer made an addition of Rs. 4,47,00,000 on the basis of entry in Annexure A-1 which clearly stipulates noting of Rs.4,47,000.00 and we are inclined to hold that the assessing officer has not brought out any other incriminating material or evidence to support the impugned addition as the assessing officer has deleted the decimal mentioned in Rs. 4,47,000.00 and treated the same entry of Rs. 4,47,000 as Rs. 4,47,00,000 for creating basis of the addition. We are unable to accept and uphold the basis on which the assessing officer held that the assessee has made investment in land out of its undisclosed income as entry No. 1 & 2 on the top of Annexure A-1 itself are ambiguous and there is no relation of entry No. 1 & 2 with the noting below the line which reflects total of Rs. 4,47,000 with a mention of specification of IC Battery. We are also unable to see any acceptable and cogent basis on which the assessing officer held that the assessee has made investment in land (as per entry No. 1 & 2 on the top) out of books of account from income of undisclosed sources and picked up the amount of Rs. 4,47,00,000 for making addition u/s 69 of the Act by accepting total of Rs. 4,47,000.00 as sacrosanct and also deleting the decimal for converting Rs. 4,47,000 into Rs. 4,47,00,000 for making impugned addition. 21. On the basis of our aforementioned discussion, we reach to a fortified conclusion that the document Annexure A-1 is a dumb document which is not acceptable and reliable to support conclusion of the assessing officer for making addition u/s 69 of the Act. Per contra, the CIT(A) was right in accepting contentions and explanation of the assessee that the document in issue i.e. Annexure A-1 is a dumb document which does not support findings of the assessing officer that an inference is drawn from annexures that the assessee made investments in land out of books of accounts out of income from undisclosed sources. Accordingly, in view of our above findings and observations, we are of the considered opinion that the benefit of the ratio of the decision of Hon'ble High Court of Delhi is available for the assessee which clearly supports finding of the CIT(A) in the impugned order that the addition cannot be made and sustained on the basis of Annexure A-1 as the same is dumb document which cannot be used against the assessee for making impugned addition. 22. The CIT(A) has also relied on the decision of ITAT Jabalpur in the case of ACIT v Satyapal Wassan (supra) wherein elucidating with respect to the same issue, the coordinate bench of the Tribunal has held as under: \"The crux of these decisions is that a document found during the course of search must be a speaking one and without any second interpretation, must reflect all the details about the transactions of the assessee in the relevant assessment year. Any gap in the various components as mentioned in section 4 of the Income Tax Act must be filled up by the Assessing Officer through investigations and correlations with the other material found either during the course of the search or on investigation. As a result, we hold that document No. 7 is a non-speaking document. Next issue raised by the learned Departmental Representative is that addition could be considered under section 68. In our considered view, this submission is misplaced. In fact it does not arise from the order of the Assessing Officer. He has only made addition under section 69 for the undisclosed advances given by the assessee. The question of treating them as cash credits is only an afterthought. The Department is not sure as to whether the alleged entries are payments or receipts. If the Department itself is IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 28 vacillating and two interpretations are possible, then this fact itself justifies the stand of the assessee that no addition can be made. 23. From above decision of ITAT Jabalpur Coordinate Bench we note that a charge can be levied on the basis of document only when the document is a speaking one. The document should speak either out of itself or in the company of other material found on investigation and /or in the search. The document should be clear and unambiguous in respect of all four components of charge of tax. If it is not so, the document is only a dumb document and no charge of tax can be levied on the assessee on the basis of a dumb document. 24. While granting relief for the assessee, the CIT(A) has also relied on the decision of Hon'ble Punjab and Haryana High Court in the case of CIT Jalandhar v. Atam Valves (P.) Ltd. (supra) wherein it has been held that: \"During the pendency of assessment proceedings, a survey was conducted by the Department under section 133A of the Act on 27.9.2005 in the premises of the assessee and certain incriminating documents were found including a 'Slip Pad' containing payment of Wages to various persons. The slips were written by Manoj Jain, an employee of the assessee who was confronted with the slips, apart from questioning of the Director Manoj Jain as well as Director of the assessee explained the position as to how the slips had been written and the stand of the assessee was that the same did not represent payment of wages during the year in question but were for the earlier year. However, the Assessing Officer did not accept the explanation and made an addition. The CIT(A) as well as the Tribunal partly set aside the addition. It was held that even though explanation of the assessee that the loose papers did not relate to payment of wages during the year in question may not be accepted in absence of any other material, the loose sheets by itself were not enough to make addition as per estimate of the Assessing Officer.\" 25. In this case the guiding ratio laid down by their lordship is that when the loose papers did not relate to certain payment during the relevant period in question, then in absence of any other supportive material or evidence these loose sheets by itself were not found to be enough and justified basis to make addition. 26. The CIT(A) has also relied on the decision of ITAT Delhi 'E' Bench in the case of Atul Kumar Jain v. DCIT (supra) wherein the coordinate bench of this Tribunal went on to hold that when the assessing officer decided \"550\" as 5,50,000 by adding \"000\" to the figure given i.e. \"550\" without any basis and supportive and corroborative evidence then the assessing officer was not justified in deciphering the figures on a seized paper at his own whims and caprice based on unfounded presumptions and conjectures without bringing any corroborative material evidence in support thereof and the same cannot form the basis for assessing undisclosed income by way of sale proceed or investment of a property. In this case, it was also held that the seized papers being not corroborated by any independent evidence can not be considered as a reliable document as a proof of investment in house property and accordingly this kind of paper is liable to be ignored and addition made on the basis of this land of document is not sustainable. 27. In view of foregoing discussions, we are of the view that in the present case, the assessing officer made addition on the basis of nothings on Annexure A-1( which is enclosed to this order). As we have already stated and concluded earlier that on logical analysis of the nothings contents of Annexure A-1, we reach to a conclusion that only Annexure A-1 stand IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 29 alone is not sufficient to draw an inference that the assessee made investment of Rs. 4,47,00,000 in purchase of land out of books of accounts and statement of investments and assets furnished before Revenue Authorities by using income earned from undisclosed sources. We are also of the opinion that the assessing officer deleted the decimal to convert Rs. 4,47,000 into Rs. 4,47,00,000 for making addition without any basis and corroborative evidence at his own whims which is not permissible. We are also in agreement with the findings of the CIT(A) that the impugned document i.e. Annexure A-1 is a dumb document as on logical analysis, neither the independent nor the collective meaning of the nothings or entries written therein support the conclusion of the assessing officer that the assessee made investment against Rs. 4,47,00,000 in purchase of land out of income earned out of books of accounts from undisclosed sources in absence of any other supportive or corroborative evidence or materials. We, therefore, are of the opinion that the nothings and contents of Annexure A-1 show noting of household expenses made by the assessee out of drawings and cash withdrawn from banks and details about quantity and rates of Battery. In absence of any supportive and corroborative material and evidence about location and measurement of the land and its seller (as per assessing officer to whom sale consideration of Rs. 4,47,00,000 was paid by the assessee) from critical and logical analysis of remaining part of nothings on Annexure A-1, maximum an inference may be drawn that the assessee noted details of proposal of a land deal nothing else. We also observe that the Annexure A-1 in absence of any other incriminating material or evidence, stand alone is not sufficient proof of investment in land of Rs. 4,47,00,000 by the assessee as the contents of main three parts of the nothings are not interlinked and inference drawn by the assessing officer is also not supported by the mathematical calculation of the contents as details of land in first and second part of nothings are not itself sufficient to support the impugned addition and in the third part in which there is a noting of total Rs. 4,47,000.00 is written below the details of model / make and quantity of IC Battery from which the assessing officer deleted the decimal for reading and accepting the same as Rs. 4,47,00,000 which is not permissible in absence of other supportive evidence. 28. On the basis of foregoing discussion and respectfully following the ratio of the decisions relied on by the CIT(A) and the assessee, we reach to a conclusion that the assessing officer made addition on the basis of Annexure A-1 on his own whims, surmises and conjectures and also by converting and moulding the contents of the impounded document to gather support for his baseless findings. We further hold that the Annexure A-1 stand alone can not be used as a basis of making impugned addition without the company of any other supportive material and evidence. We, therefore, also hold that the assessing officer made addition of Rs. 4,47,00,000 without any basis and justified reason which was rightly deleted by the CIT(A) by holding that the Annexure A-1 is a dumb document which cannot be a basis for making addition in regard to investment in purchase of land out of income from undisclosed sources u/s 69 of the Act. We are unable to see any ambiguity, perversity or any other valid reason to interfere with the conclusion and findings of the CIT(A) in the impugned order and we upheld the same. 29. Accordingly, the sole ground of the Revenue being devoid of merits is dismissed. 30. In the result, appeal of the Revenue is dismissed.” IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 30 36. From the above judgements, it is vivid that in the assessee`s case under consideration, the assessing officer was not sure as to whether the alleged entries are payments or receipts in Annexure-A1, page 9 and 11. If the assessing officer itself is vacillating and two interpretations are possible, then this fact itself justifies the stand of the assessee that no addition can be made.The document should be clear and unambiguous, and if it is not so, the document is only a dump document and no charge of tax can be levied on the assessee on the basis of a dumb document. Thus, in the assessee`s case under consideration, the assessing officer, was not justified in deciphering the figures on a seized paper at his own whims and caprice based on unfounded presumptions and conjectures without bringing any corroborative material evidence in support thereof. Besides, the documents used by the assessing officer, were not the incrimanting documents. Based on these facts and circumstances, the concise and summarise ground No.1 raised by the assessee is allowed. 37.In the result, following additions are deleted. (i).On basis of rough jotting at page No. 9 of Annexure A-l of Rs. 2,02,32,000/-. ( ground No.3 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii).On basis of rough jotting at page No. 11of Annexure A-l of Rs. 2,69,04,000/-.( ground No.4 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (iii On basis of rough jotting at page No. 11 of Annexure A-l of Rs. 3,02,40,000/-.( ground No.4 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12)” 38.Now we shall adjudicate, Concise and Summarized ground No. 2, which is reproduced below for ready reference: IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 31 “2. The learned CIT(A) has erred on facts and in law in confirming addition made by the leaned assessing officer on account of interest income from alleged finance activities. (i)..Addition of Rs. 26,67,863/-, on account of interest income. ( ground No.7 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii).Addition of Rs. 25,50,581/-, on account of interest income. ( ground No.3 in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14) (iii) Addition of Rs. 29,23,739/-, on account of interest income. ( ground No.5 in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13) (iv)Addition of Rs. 24,23,901/-, on account of interest income. ( ground No.5 in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11) (v)Addition of Rs. 12,41,244/-, on account of interest income. ( ground No.5 in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10) (vi) Addition of Rs. 14,71,337/-, on account of interest income by applying gross profit ratio ( ground No.2.2 in ITA No.80/Rjt/2020, for A.Y. 2014-15) 39. Succinct facts qua ground No.2 and as per lead case in IT(SS)A No. 6/Rjt/2017, are as follows.During the assessment proceedings, the assessing officer, on perusal of assessee's income from financing business, earned from proprietorship concern, namely, M/s Amit Agencies and personal financing activity, it was noticed that the assessee has shown a loss of Rs. 16,36,733 (Rs. 42,96,377- Rs. 59,33,110). On comparing it, with similar results shown by assessee, in financial year 2006-07, it was seen by the assessing officer that the assessee had shown total profit of Rs. 7,31,650/-, as against gross interest income, so earned i.e. Rs. 28,76,383/-. Here the Gross profit (GP) ratio stands at 25.43%. Similarly, for F.Y. 2007-08, the assessee had shown total profit of Rs. 10,28,835/-, as against gross interest income so earned i.e. Rs. 45,59,942/-. Here the GP ratio stands at 24.15%. Therefore, assessing officer noted that the assessee is into financing business and as such the money so borrowed and advanced can be treated at par with a trading commodity. Thus, the theory of IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 32 GP ratio was invoked by the assessing officer. The assessing officer further observed that in this year, the assessee has shown loss in his financing activity, which is definitely beyond comprehension. Thus, assessing officer, was of the view that when one incurs loss in finance business, it means that the interest charged is less than the interest paid. Also, there are no bad loans. Which prudent businessman would take pain, to borrow capital, and to take the risk of advancing it and end up in charging less interest? This is absurdity. Thus, the assessee's book results were rejected and provisions of Section 145A are invoked to estimate the interest income of the assessee. In order to estimate, the GP rate is adopted at 24%, based on the GP ratios of FY 2006-0,7 & 2007-08. Thus, the total interest income earned was taken at Rs. 10,31,130/-. The loss of Rs. 16,36,733/- was also disallowed and added back. Hence, total addition on this count was to the tune of Rs. 26,67,863/- ( Rs. 10,31,130+ Rs. 16,36,733). 40. On appeal, the ld CIT (A) confirmed the action of the assessing officer, therefore, assessee is in further appeal before us. 41. Learned Counsel for the assessee, argued that entire addition made by the assessing officer does not have any sound basis. The assessing officer has not pointed out any discrepancies in the books of accounts and despite that assessing officer has rejected the books of accounts and thus, such an action of assessing officer of rejecting the books of accounts is not sustainable in the eyes of law. The ld. Counsel also relied on the following judgements. 1. CIT v. Symphony Comfort System Ltd. – (2013) 35 taxmann.com 533 (Guj.) 2. CIT v. Jananamandal Ltd. – (2013) 214 Taxmann.com 49 ( All – HC) IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 33 42.On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 43. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. We note that the assessing officer has invoked the provision of section 145A of the Income Tax Act, on the premise that assessee, particularly, in absence of any bad loans, could not have incurred losses, from the finance business, and thus, estimated the interest income of the assessee by applying rate of interest @ 24% on the advances made by the assessee.Therefore, during the course of assessment proceedings, the assessing officer, by rejecting the books of accounts of the assessee u/s 145A of the Income Tax Act, has estimated gross profit rate @ 24% of advance made, and thus, estimated the income of the assessee at Rs. 10,31,130-. Such an estimation results into disallowance of loss of Rs. 16,36,733/-, as declared by the assessee in his return of income and this way, the total disallowance comes toRs. 26,67,863/- ( Rs. 10,31,130+ Rs. 16,36,733).We find that assessing officer, has rejected the books of accounts, solely on the reason that in absence of any bad loans, the assesseecould not have incurred losses. We do not agree with the opinion of the assessing officer because loss may be incurred on account of other factors, such as, the revenue expenditure maybe more, as compare to income. Moreover, the assessing officer can not ask the assessee to maximise his profit. While doing the business, there may be losses also, and the assessee is incurring continuous losses, because, may be, on account of his long-term strategy that in future, he will earn profit also. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 34 44. The ld Counsel also stated before us that the assessee is having a proprietary concern viz. M/s. Amit Agencies' wherein the assessee carries on investment activities of taking loans from relatives and friends and these borrowed funds are advanced to Rajhans Impex Pvt. Ltd. The assessee charges and pays interest at 12% on these investment transactions. During the year under appeal, the assessing officer observed that the assessee has incurred loss of Rs. 16,36,733/- in Amit Agencies and therefore asked the assessee to explain the reasons for such negative result from investment activity in the name of M/s. Amit Agencies. In response, the assessee vide letter dated 12.01.2015 explained as under: \"As regards loss appearing in the books of Amit Agencies in some of the assessment years, we wish to clarify that part of the borrowed funds of Amit Agencies have been withdrawn and invested by the assessee through his personal books of account as loans advanced as well as investment in commodities market from which he has earned income in his individual capacity. Hence, in order to determine the net earnings out of investment activity of the assessee, the overall position of income and expenses relating to such investment activities from both the books of account viz. Amit Agencies and personal books of Shri Jinesh F. Shah is required to be considered together. We enclose herewith assessment year wise chart showing such details of consolidated and overall income and expenses relating to investment activities carried out by the assessee in his individual capacity and Amit Agencies along with copies of profit & loss account from the respective books. The figures appearing in the said chart are fully verifiable with the respective books of account as well as return of income filed by the assessee for the years under assessment(s). It would be observed from the said chart that there is net loss from investment activities during the A.Y. 2011-12, 2012-13 & 2013-14. The apparent reason for such loss during these three years is that interest cost on the borrowed fund could not be fully compensated from the income earned out of investment in commodities.\" 45However, the assessing officer, did not consider the above submission of the assessee in proper perspective and considered the aforesaid investment activity of the assessee as his finance business activity and treated at par with activity of commodity trading and thereby invoked provisions of Section 145A to estimate the interest income applying theory of Gross Profit. It is submitted by ld Counsel that the investment activity under consideration has been IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 35 systematically carried on by the assessee, consistently year by year and the same has also been accepted by the Department in the original assessment(s) made in the past. Under the circumstances, there is no justification in considering the investment activity of the assessee, as alleged business activity and thereby to apply gross profit theory to the same. In any case, the concept of gross profit cannot be applied even in case of financing business. Considering the above facts and circumstances, we delete the addition. 46. In the result, following additions of the assessee, are deleted: (i)..Addition of Rs. 26,67,863/-, on account of interest income. ( ground No.7 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii).Addition of Rs. 25,50,581/-, on account of interest income. ( ground No.3 in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14) (iii) Addition of Rs. 29,23,739/-, on account of interest income. ( ground No.5 in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13) (iv) Addition of Rs. 24,23,901/-, on account of interest income. ( ground No.5 in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11) (v) Addition of Rs. 12,41,244/-, on account of interest income. ( ground No.5 in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10) (vi) Addition of Rs. 14,71,337/-, on account of interest income by applying gross profit ratio ( ground No.2.2 in ITA No.80/Rjt/2020, for A.Y. 2014-15) 47. Now, we shall adjudicate summarise and concise ground No.3 raised by the assessee, which is reproduced below: “The learned CIT(A) has erred on facts and in law in confirming disallowance made by the assessing officer u/s. 14A of the Act. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 36 (i).Addition of Rs. 66,948/-( ground No.8 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii). Addition of Rs. 73,595/-( ground No.4 in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14) (iii). Addition of Rs. 79,636/-( ground No.6 in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13) (iv)Addition of Rs. 67,398/-( ground No.6 in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11) (v)Addition of Rs. 88,644/-( ground No.6 in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10) 48.Succinct facts qua ground No.3 and as per lead case in IT(SS)A No. 6/Rjt/2017, are as follows. During the assessment proceedings,the assessing officer, on verification of the return of income, noticed that the assessee was having exempt income to the tune of Rs. 1,10,522/-. Against this, the assessee had not claimed any expenditure. However, assessee had claimed interest of Rs. 59,33,110/-. Hence, the provisions of section 14A are applicable in this case, as the assessee had not shown any expenditure against exempted income. The assessee was therefore asked to show- cause as to why the expenditure attributable to earning of exempted income should not be disallowed. 49. In reply, the assessee submitted before assessing officer that assessee had not incurred any expenditure for earning exempted income. In absence of incurring of expenditure for earning exempted income, the question of disallowance does not arise. In fact, the nature of exempt incomes earned by the assessee is such that it does not require incurring any expenditure. The source of investment fetching exempted income is also interest free funds in the form of own capital, which is not borrowed. Further, the borrowed funds on which interest expenditure is incurred by the assessee, have been advanced on which interest income is earned (taxable income, which is duly reflected in the return of income). Hence, there is direct nexus between interest expenditure incurred IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 37 and taxable interest income earned by the assessee and it cannot be linked even indirectly with investments from which exempted income is earned. 50. However, the assessing officer has rejected the above reply of the assessee and observed that assessee has incurred expenditure, therefore the contention of the assessee, that he had not incurred any expenditure, was not accepted by the assessing officer. The assessing officer, stated that as per section 14A of the Act, any expenditure incurred to earn exempt income is disallowable. As per Rule 8D of the Income Tax Rules, where the Assessing Officer, having regard to the accounts of the assessee of a previous year, is not satisfied with the claim made by the assessee that no expenditure has been incurred in relation to income which does not form part of the total income under the Act for such previous year, he shall determine the amount of expenditure in relation to such income in accordance with the provisions of sub-Rule (2) of Rule 8D of the Rules. The Sub-rule(2) lays down the formula for the same. Therefore, the assessing officer, worked out the disallowance as follows: A Amount of interest claimed 59,33,110 B The average value of investment, income from which does not or shall not form part of the total income, as appearing in the balance sheet of the assessee, on the first day and the last day of the previous year. 6,94,465 C The average of total assets as appearing in the balance sheet of the assessee, on the first day and the last day of the previous year. 6,49,15,088 A X B/C = Rs. 63,473/- Note-2: Proportionate disallowance out of other expenditure A 1/2% of B viz., average value of investments 3,472 Total of Note 1 + Note 2 = Rs 65,948/- IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 38 Hence, a sum of Rs. 66,948/-, was disallowed by the assessing officer, u/s 14A of the Act and added to the total income of the assessee. 51. On appeal, the Ld. CIT(A) confirmed the action of the assessing officer. The ld. CIT(A) has just reiterated the facts narrated by the assessing officer and stated that there is no any defects in the findings of the assessing officer. Aggrieved by the order of ld CIT(A), the assessee is in appeal before us. 52. The learned Counsel argued before the Bench that assessing officer failed to appreciate that the assessee has sufficient amount of interest free fund in form of capital to make investment yielding exempt income, therefore, addition under section 14A of the Act does not attract. 53. On the other hand, ld. DR for the revenue argued that assessee has exempt income to the tune of Rs.1,10,552/- and the assessee did not disallow any expenditure and other administrative expenditure, as per section 14A r.w.r. 80D of the Act, therefore, assessing officer was right in making the said addition. 54.We have heard the Learned Counsel appearing on behalf of the respective parties at length. We note that assessing officer has made an addition of Rs. 66,948 /- u/s 14A of the Income Tax Act, 1961, on the premise that despite of having exempt income of Rs. 1,10,552/-, the assessee did not disallow any expenditure and other administrative expenditure as per section 14A r.w.r. 80D of the Act, and thus, by applying the formula provided under rule 8D of the Rules, the assessing officer has made an addition of Rs. 66,948/-. We find merit in the submissions of ld. Counsel for the assessee to the effect that assessing officer failed to appreciate that the assessee has sufficient amount of interest IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 39 free fund in form of capital to make investment yielding exempt income, therefore, addition under section 14A of the Act does not attract. During the course of assessment proceedings, the assessee explained to the A.O. that he has not incurred any expenditure to earn the aforesaid income and therefore no disallowance should be made notionally by applying the provisions of Section 14A of the Act.We find that the assessee has plenty of his own funds in the form of capital which were utilized for making investments yielding exempted income and therefore there is no direct or indirect nexus of interest expenditure incurred for earning of exempted income in the form of dividend and long-term capital gain (LTCG).The borrowed funds on which interest expenditure was incurred were exclusively given as advances from which interest income was earned. Therefore, the working of disallowance u/s. 14A is erroneous to the extent interest expenditure of Rs. 59,33,110/- is considered in the formula prescribed under rule 8D for the purpose of computing disallowance u/s. 14A of the Act.Therefore, in absence of having incurred any expenditure and / or having any direct or indirect nexus thereof for earning exempt income, the notional disallowance made by the assessing officer by invoking provisions of section 14A read with rule 8D, is only on presumptions, hence, needs to be deleted. 55.Having regard to the language of section 14A(2), read with Rule 8D of the Rules, it is also made clear that before applying the theory of apportionment, the Assessing Officer needs to record satisfaction that having regard to the kind of the assessee, suo moto disallowance under section 14A was not correct. It will be in those cases where the assessee in his return has himself apportioned but the Assessing Officer was not accepting the said apportionment. In that eventuality, it will have to record satisfaction to this effect. Further while IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 40 recording such a satisfaction, nature of loan taken by the assessee for purchasing the shares/making investment in shares is to be examined by the Assessing Officer. We note that in assessee`s case under consideration, the assessing officer has not recorded any satisfaction. Therefore, we delete the addition. 56. In the result, following additions are deleted: (i).Addition of Rs. 66,948/-( ground No.8 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12) (ii). Addition of Rs. 73,595/-( ground No.4 in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14) (iii). Addition of Rs. 79,636/-( ground No.6 in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13) (iv) Addition of Rs. 67,398/-( ground No.6 in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11) (v) Addition of Rs. 88,644/-( ground No.6 in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10) 57. Now, we shall adjudicate concise and summarised ground No.4, which is reproduced below for ready reference. “4.The learned CIT(A) has erred on facts and in law in confirming the addition of Rs. 7,96,500/- made by the learned assessing officer on account of alleged unexplained cost of education of the assessee's son.( Ground No.9 in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12)” 58.Succinct facts qua ground No.4 and as per lead case in IT(SS)A No. 6/Rjt/2017, are as follows. During the assessment proceedings, it was noticed by the assessing officer that the assessee had incurred cost towards the IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 41 education of his son, Mr.Amit J. Shah, who was pursuing his studies in MBA. During the course of search, the son of the assessee had admitted that total cost of Rs. 14,80,000/- was incurred towards cost of education. Therefore, during the course of assessment proceedings, the assessee was asked to explain the same. 59. In response, the assessee, during the course of assessment proceedings submitted before the assessing officer that assessee had in fact incurred only expenditure to the tune of Rs. 6,83,500/-, for which he submitted necessary, evidences. So far as the statement made, during the course of assessment is concerned, the son of the assessee submitted that the statement was made out of communication gap, lack of awareness, fumbling, tense environment and circumstances, during the course of search. It was thus reiterated that, the assessee had only incurred expenditure to the tune of Rs. 6,83,500/-. 60. However, the assessing officer, rejected the above contention of the assessee, on two counts, Viz: (1)Firstly, the cost of education for MBA in a premier institute, like S. P. Jain Institute of management & Research, is much more than what the assessee has shown to have recorded in his books. (2) Secondly, it is a matter of fact that the cost of boarding, lodging, transaction, etc, which is over and above, the fees has also got to be factored in, therefore, the cost of education admitted by Amit Shah during the search to the extent of Rs. 7,96,500/-, was treated as unexplained expenditure. 61.Since, the assessee has not given any break up of such expenditure, therefore, the same was added to the income of the last year of the course, IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 42 which is, AY 2011-12. Hence, an addition of Rs. 7,96,500/- (Rs 14,80,000 - Rs. 6,83,500),was made to the total income of the assessee. 62. On appeal, the ld CIT (A) confirmed the action of the assessing officer. The ld CIT(A) observed that the assessing officer on the basis of statement of assessee’s son taken during the course of search proceedings, has rightly made an addition of Rs. 7,96,500/-, as unexplained education cost of assessee’s son. Aggrieved, by the order of the ld CIT(A), the assessee is in appeal before us. 63. Learned Counsel for the assessee, pleaded that assessing officer has made an addition without considering evidence given by the assessee, with regard to hostel and course fees paid to S. P. Jain institute of management and research. During the assessment proceedings, the assessee has provided full address of S.P. Jain Institute of Management and Research, and if the assessing officer had any doubt, he could have made enquiry directly from the S.P. Jain Institute of Management and Research. Therefore, ld. Counsel contended that addition made by the assessing officer may be deleted. 64.On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 65. We have heard both the parties. We find that the assessing officer without considering the complete details submitted by the assessee, vide its letter dated 13.01.2015 ( refer page 74 & 75 of paper book) has made an addition only on the presumption that cost of education for perusing MBA from premier institute like S.P. Jain institute of management and research cannot be mere Rs. 6,83,500/-, and thus, came to the conclusion that statement of assessee’s son, IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 43 taken during the course of search proceedings, stating that total cost of pursuing MBA was Rs. 14,80,000/-, is actual expenditure, and hence, balance expenditure of Rs. 7,96,500/- was added as unexplained expenditure.The assessing officer has made an addition without considering evidence given by the assessee with regard to hostel and course fees paid to S. P. Jain institute of management and research. Further, the assessing officer conveniently ignored clarification made by the assessee’s son that statement given with regard to education cost at that time of search proceedings was due to communication gap and lack of awareness. The assessing officer has also not acceded the request of assessee that his statement with regard to cost of education for pursuing MBA can independently verifiable from S. P. Jain institute of Management and research. However, assessing officer failed to examine the correctness of the amount by issuing notice under section 133(6) of the Act, to theS. P. Jain institute of Management and research. The assessee has submitted the detail of cost of education for perusing MBA from institute S.P. Jain institute of management and research at Rs. 6,83,500/-, paid as per the fee structure of the Institute. 66. We find thatduring the course of assessment proceedings, the assessee was asked to furnish the details and source of education expenses incurred for pursuing MBA course of his son Shri Amit J. Shah.Theassessee's son furnished the details regarding education expenses incurred for pursuing MBA course along with supporting documentary evidences vide letter dated 13.01.2015 which is reproduced here under: \"In this connection, I wish to submit that I have done MBA course from S. P. Jain Institute of Management and Research, Mumbai. The details of course and hostel fees paid to the said institute are tabulated hereunder: IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 44 Sr.N o. Date Amount Source Mode Cheque No. Bank Name & Account No. 1 07.09.2009 1,000 R1PL Loan Cheque 807795 HDFCBank 2 16.11.2009 2,00,000 AJS Cheque 139211 SBI-10870011653 3 16.11.2009 50,000 AJS Cheque 139212 SBI-1087001 1653 4 16.11.2009 35,000 AJS Cheque 139213 SBI-1087001 1653 5 22.07.2010 2,00,000 RIPL Cheque 282749 SBI-30986842250 6 27.01.2011 67,500 RIPL Cheque 282863 SBI-30986842250 7 22.06.2011 25,000 RIPL Loan Cheque 434646 SBI-30986842250 8 17.08.2011 1,05,000 RIPL Loan Cheque 434676 SBI-30986842250 Total... 6,83,500 Copies of supporting proofs in respect of aforesaid expenditure incurred on MBA course are enclosed herewith. I further wish to clarify that in question and answer no. 19 of my statement recorded on 24.08.2012 during the course of search, the total cost of MBA course was inadvertently stated by me at Rs. 14,80,000/- which is not backed by any evidence for certain reasons viz. communication gap, lack of awareness, fumbling, tense environment and circumstances during the search etc. However, the fact that I have incurred actual expenditure of Rs. 6,83,500/- only on my MBA course including hostel expenses is independently verifiable from S. P. Jain Institute of Management and Research.\" 67. The A.O. did not consider the above submission in proper perspective and made the addition only on the basis of statement during the course of search proceedings without bringing any documentary evidence on record whereas the assessee had furnished all the details along with supporting documentary evidences which have not found false or non-genuine. The A.O. has failed to appreciate that the expenditure on education was incurred in the name of an institute of repute with which there cannot be any unaccounted transactions.Theassessee also submitted copy of e-mail communication dated 11.11.2009 of S. P. Jain Institute of Management and Research showing fees structure for the course pursued by the assessee's son. Therefore, further addition should not be made, based on surmise and conjuncture, hence, we delete the addition. 68. In the result, concise and summarised ground No.4, of assessee is allowed. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 45 69. The concise and summarised ground No.5 is reproduced below for ready reference: 5.The learned CIT(A) has erred in law as well as on facts in confirming the action of theassessing officer in making assessment u/s 153A, as there is no search u/s. 132 or requisition in the name of the assessee. [ This ground is raised by the assessee in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10, in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11, in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12, and in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13] 70. We note that search was carried out in the business premises of the assessee. At this juncture, it is appropriate to reproduce the findings of the ld. CIT(A), which is as follows. “4.1 After going through the submissions of the appellant and contents of the assessment order, remand report of the assessing officer was called for to ascertain correct factual state of affairs. The ACIT in his remand report mentioned that search was carried out on 23.8.2012 in the business premises of the assessee. Warrant of Authorization dated 9.10.2012 was issued in the name of the assessee for locker No. 97 in the Bank of Baroda, Digvijay Plot, Jamnagar and second warrant of Authorization dated 9.10,2012 was issued in the joint names of the assessee, Jayaben J Shah and Bhavini B. Shah for locker No.1206, Nava Nagar Co.op.Bank Jamnagar. Copy of the panchnammas was also enclosed with the report which has been placed on record. 4.2 In view of the given facts and circumstances of the case it was self evident that the ground of appeal was contrary to the facts of the case and the submission of the AR of the appellant was a misrepresentation of facts. Accordingly, the ground of appeal is dismissed.” 71. The assessee has himself submitted in his paper book, the documents relating to search, in the name of assessee and other connected persons, under section 132 of the Act, vide assessee`s paper book page Nos.93 to 105. We have examined these documents and reached on the conclusion IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 46 that there was a search in the case of assessee under section 132 of the Act. Hence, we dismiss this ground raised by the assessee. 72. In the result,concise and summarised ground No.5, raised by the assessee, is dismissed. 73.The concise and summarised ground No.6 is reproduced below for ready reference: 6.The Learned CIT(A) has erred in confirming the action of the learned assessing officer in rejecting the books of account and thereby invoking section 145A without finding out any specific defect in the books of account. [ This ground is raised by the assessee in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14,in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13, in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11,in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10,in ITA No.80/RJT/2020 for A.Y.2014-15.] 74. This ground has already been adjudicated by us, vide, summarized and concise ground No.2above, of this order, hence it does not require further adjudication. 75.The concise and summarised ground No.6 is reproduced below for ready reference: 7.The order passed by the learned CIT(A) is bad in Law as well on facts, therefore,requires to be quashed. [ This ground is raised by the assessee in IT(SS)A No.04/Rjt/2017, for A.Y. 2009-10, in IT(SS)A No.05/Rjt/2017, for A.Y. 2010-11, in IT(SS)A No.06/Rjt/2017, for A.Y. 2011-12, in IT(SS)A No.07/Rjt/2017, for A.Y. 2012-13,in IT(SS)A No.08/Rjt/2017, for A.Y. 2013-14, and in ITA No.80/RJT/2020 for A.Y.2014-15.] IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 47 76. This is general ground raised by the assessee, hence does not require adjudication. 77. Additional ground raised by the assessee, on legal issue, is reproduced below for ready reference: “The assessing officer erred in law and on facts in making addition of Rs. 7,73,06,000/- to the returned income of the assessee on the basis of loose paper marked as Annexure – A1 seized from the premise of RajhansImpeex Pvt Ltd,in the assessment order passed u/s 153A of the Income Tax Act, 1961, without appreciating the fact that addition on the basis of seized documents recovered from the premise of third party is necessarily to be made by issuing notice u/s. 153C of the Income Tax Act, 1961. The assessee reserves its right to add, amend, alter or modify any of the grounds stated hereinabove either before or at the time of hearing.” [ This ground is raised by the assessee in IT(SS)A Nos.04,05,06,07,08/Rjt/2017] 78. Since we have deleted the entire additions made by the assessing officer, in all the appeals of the assessee, therefore, this ground does not require adjudication, as, all the additions on merit are deleted itself, hence all other issues on legal ground, in the impugned assessment proceedings, are rendered academic and infructuous. 79.Now coming to the appeal in ITA No. 121/Rjt/2016, pertaining Dhaval Jinesh Shah, for assessment year 2013–14,wherein the grounds of appeal raised by the assessee are as follows: 1.The Learned Assessing Officer has erred on facts and in law in making disallowance of Rs. 8479/- u/s. 14A. The CIT(A) has erred in confirming it. 2.The Learned Assessing Officer has erred on facts and in law in making addition of Rs. 80,64,975/-, on account of alleged unexplained marriage expenses merely on the basis of seized papers and without any contrary documentary evidence. The CIT(A) has erred in confirming it. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 48 The assessee craves leave to add, alter, amend, delete or withdraw one or more grounds of appeal. 80. First, we shall take ground No.1 raised by the assessee, which relates tomaking disallowance of Rs. 8,479/- u/s 14A of the Act. 81.The facts of the case which can be stated quite shortly are as follows:A search action u/s132 of the Act was carried out at the premises of the assessee, on 23.08.2012. Consequent to search u/s132 of the Act, the proceedings u/s 153A of the Act, were initiated for AYs 2007-08 to 2012-13. The case, was selected for scrutiny.As this is the search relevant assessment year, hencea notice u/s 142(1) of the Act was issued on 09.05.2013, which was served upon the assessee requiring him to file return of income for A.Y. 2013-14. In response to notice, thereturn of income showing total income of Rs. 7,99,810/- was filed by the assessee, on 31.07.2013. A notice u/s 143(2) of the Act was issued on 21.04.2014, which was served upon the assessee. Further detailed questionnaire was issued on 24.6.2014, along with a notice u/s 142(1) of the Act. In response to the notices of hearing,assesseefrom time to time, filed details called for and written submissions, before the assessing officer. 82. On verification of return of income, it was noticed by the assessing officer that the assessee is having income from salary, interest and dividend. The assessing officer noticed that the assessee was having exempt income to the tune of Rs. 14,419/-. Against this, the assessee had not claimed any expenditure. However, assessee had claimed interest of Rs 3,54,000. Hence, the provisions of section 14A are applicable in this case as the assessee had not shown any expenditure against exempted income. The assessee was therefore asked to show cause as to why the expenditure attributable to earning of exempt income should not be disallowed. In reply, the assessee submitted that, he had not IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 49 incurred any expenditure for earning exempted income. In absence of incurring of expenditure for earning exempted income, the question of disallowance does not arise. In fact, the nature of exempt incomes earned by the assessee is such that it does not require incurring any expenditure. The source of investment fetching exempted income is also interest free funds in the form of own capital which is not borrowed. Further, the borrowed funds on which interest expenditure is incurred by the assessee have been advanced on which interest income is earned (taxable income, which is duly reflected in the return of income). Hence, there is direct nexus between interest expenditure incurred and taxable interest income earned by the assessee and it cannot be linked even indirectly with investments from which exempted income is earned. However, the assessing officer rejected the contention of the assessee and made the addition of Rs. 8,479/-, u/s 14A of the Act and added to the total income of the assessee. 83.Aggrieved by the order of the Assessing Officer,the assessee, carried the matter in appeal, before the theLd. CIT(A), who has confirmed the action of the Assessing Officer. The ld. CIT (A) just reiterated the facts of the assessment order and stated that conclusion reached by the assessing officer is correct. Aggrieved by the order of the learned CIT (A), the assessee is in appeal before us. 84. Learned Counsel for the assessee, argued that assessee had not incurred any expenditure for earning exempted income. In absence of incurring of expenditure for earning exempted income, the question of disallowance does not arise. In fact, the nature of exempt incomes earned by the assessee is such that it does not require incurring any expenditure. The source of investment fetching exempted income is also interest free funds in the form of own capital IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 50 which is not borrowed, this way, the ld. Counsel repeated the same submission which were made before the assessing officer. 85. On the other hand, ld. DR for the revenue argued thatthe provisions of section 14A are applicable in the case of the assessee, as the assessee had not shown any expenditure against exempted income. Therefore, addition made by the assessing officer may be confirmed. 86.We have heard the rival parties and have gone through the material placed on record.We find that the assessee has plenty of his own funds in the form of capital which were utilized for making investments yielding exempted income and therefore there is no direct or indirect nexus of interest expenditure incurred for earning of exempted income. Therefore, in absence of having incurred any expenditure and / or having any direct or indirect nexus thereof for earning exempt income, the notional disallowance made by the assessing officer by invoking provisions of section 14A read with rule 8D, is only on presumptions, hence, needs to be deleted. Besides, having regard to the language of section 14A(2), read with Rule 8D of the Rules, it is also made clear that before applying the theory of apportionment, the Assessing Officer needs to record satisfaction that having regard to the kind of the assessee, suo moto disallowance under section 14A was not correct. It will be in those cases where the assessee in his return has himself apportioned but the Assessing Officer was not accepting the said apportionment. In that eventuality, it will have to record satisfaction to this effect. Further while recording such a satisfaction, nature of loan taken by the assessee for purchasing the shares/making investment in shares is to be examined by the Assessing Officer. We note that in assessee`s case under consideration, the assessing officer has not recorded any satisfaction. Therefore, we delete the addition. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 51 87. In the result, ground No.1 raised by the assessee is allowed. 88. Coming to ground No.2, which relates to addition of Rs. 80,64,975/-, on account of alleged unexplained marriage expenses. The relevant material facts, as stated by the lower authorities are as follows. During search action, some loose papers were found and seized wherein expenses, incurred for marriage of the brother of the assessee, were mentioned. The assessing officer reproduced the contents of the seized material in the assessment order on page No. 4 to 6.The assessing officer worked out segregation of the expenses incurred in the marriage into two parts i.e. explained and unexplained expenses. On the basis of the seized material, as per assessing officer, the total expenses were to the tune of Rs. 1,01,39,480/-. It was ascertained by the assessing officer that expenditure of Rs. 20,74,505/- was incurred form sources explained by the assessee. However, source of remaining expenses amounting to Rs. 80,64,975/- could not be explained with supporting evidence by the assessee. Therefore, assessing officer, made the addition to the tune of Rs. 80,64,975/-(Rs. 1,01,39,480-Rs. 20,74,505) 89. On appeal, the ld CIT(A), confirmed the action of the assessing officer stating thatall these facts established and examined by the assessing officer, are beyond any doubt that these transactions were actually made in connection with marriage and they were not estimates. Aggrieved by the order of the ld.CIT(A), the assessee is in further appeal before us. 90. Learner Counsel for the assessee argued thatassesseehas not incurred marriage expenses other than those for which details have been furnished before the assessing officer. This fact can also be independently verified by the assessing officer from the respective payees whose contact details are available on the copies of bills forming part of impounded materials and also furnished by the assessee during the assessment proceedings. The chart showing name and IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 52 address of payees of marriage expenses was also furnished before the assessing officer, and assessing officer, ought tohave verified by issuing notices to the various payees under section 133(6) of the Act, however, assessing officer failed to do so, therefore addition should not be sustained in the hands of the assessee. 91. On the other hand, the learned DR for the revenue submitted that considering the status of the assessee, the marriage expenses should be higher side, as compared to the amount voluntarily disclosed by the assessee. The documents seized during search were also speaking that actual expenditure incurred by the assessee, on marriage is more than what the assessee has stated.Therefore,addition made by the assessing officer should be sustained. 92. We have carefully considered the facts of the case, the submission of the Learned Counsel for the assessee and ld DR for the Revenue and evidences on record.We note that during the year under appeal, there was a marriage function of the assessee's brother Shri Amit J. Shah.During the course of assessment proceedings, the assessee was asked to furnish details of marriage expenses incurred along with documentary evidences and also to explain the contents of page number 25 to 28 of Annexure A-l (reproduced by the A.O. on pages 4 to 6 of his assessment order) impounded from the residence which related to marriage of Shri Amit J. Shah.In response, the assessee, vide its submission dated 09.01.2015, submitted complete details along with documentary evidences in respect of marriage expenses which is reproduced below: \"1. There was a marriage function of my brother Shri Amit J. Shah. 2. I enclose herewith chart showing details viz. name of payee, nature of expenditure and amount in respect of expenditure of Rs. 20,74,505/- actually incurred by us on the marriage occasion of my brother Shri Amit J. Shah solemnized on 15.04.2012 i.e. during the F.Y. 2012- 13 relevant to A.Y. 2013-14. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 53 3. In support of aforesaid marriage expenses incurred by me and / or our families, 1 enclose herewith copies of supporting documentary evidences in the form of bills, vouchers, payment advice etc., majority of them are also forming part of seized material viz. Annexure A-l & A-2. 4. I also enclose herewith chart showing details of source of aforesaid marriage expenses and its accounting in the books of account of respective family members along with supporting documentary evidences viz. ledger, relevant extract from cash book and bank statement, majority of them are also forming part of seized material viz. Annexure A-l. 5. It is categorically placed on record that as per my understanding and records, my family has not incurred marriage expenses other than those for which details have been furnished hereinabove. This fact can also be independently verified from the respective payees whose contact details are available on the copies of bills forming part of impounded materials and also furnished at Sr. No, 3 hereinabove. The chart showing name and address of payees of marriage expenses is also enclosed herewith for your ready reference. 6. As regards explanations for contents of seized pages 25 to 28 of Annexure A-l impounded from my residence, I re-iterate the fact as explained during the course of post search proceedings that these pages contains estimations, rough jottings relating to marriage occasion of Shri Amit J. Shah. The handwritten figures mentioned on these 4 pages are also in round figure which are nothing but rough estimates only. It can be observed from details furnished at point no. 2 that the actual expenditure on marriage supported by bills, vouchers etc. are in absolute figures. Hence, no adverse inference should be drawn in respect of these rough estimates in absence of any contrary positive evidence of actual expenses having been brought on record. 7. It is quite possible that the various expenses as anticipated by my family on the marriage occasion of Shri Amit J. Shah are not actually incurred for various reasons such as – • Initially, marriage occasion was planned on little larger scale and therefore estimates of expenses were on higher side. However, due to certain sociaC matters, the same was scaled down and therefore actual expenditure was lower than the estimates. • My family initially had decided to buy new jewellery for the occasion but later on we decided to convert our old jewellery into new ornaments and partly to purchase new ornaments and therefore as against projected cost of new jewellery only labour or conversion charges were actually incurred. In this connection, I invite your kind attention to page nos. 66 & 67 (copies enclosed) of impounded material in Annexure A-1 which contain vouchers relating to conversion of old ornaments into new ornaments issued by the jeweller. In any case, the actual transactions can also be cross checked with the Jeweller. • Our Jain relatives and guests being invitees on marriage occasion preferred to stay at Oswal Centre, Oswal Samaj etc. Therefore, actual hiring of hotel rooms was less. • My family had planned to hire and pay for hotel rooms for accommodation of guests for marriage occasion. However, as per the tradition /system in our Jain Community most of the guests who stayed at hotels while checking out insisted to pay and thereby the actual cost was not borne by my family. • It would also be observed from the details furnished hereinabove that part of the total marriage expenses is borne by in-laws family ofShri Amit J. Shah as part of custom. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 54 In view of the above, it is respectfully submitted that the actual marriage expenditure which is supported by documentary evidences should be considered as against the rough estimated figures relating to marriage which are not supported by any documentary or contrary evidence. There is also nothing contrary found on record so as to contend that I and / or my family has actually incurred higher expenditure as a-gainst actual expenditure shown. The rough jottings / estimates in the handwritten loose sheets forming part of the seized material do not conclusively or positively prove :hat we have actually incurred the expenditure as mentioned therein on the occasion of marriage. 8. Without prejudice to above, it is further submitted that there was cash on hand as per the personal books of account of respective family members as on the date of search as under: Sr. No. Name of Family Member Cash Balance as on 23.08.2012 (Rs.) (i) Jinesh F. Shah 2,92,476 (ii) Jinesh F. Shah (HUF) 24,379 (Hi) Jayaben J. Shah 25,174 (iv) Dhaval J. Shah 25,136 (v) Bhavini D. Shah 25,041 (vi) Amit J. Shah 11,634 Total... 4,03,840 Copies of relevant pages from cash book of respective family members are enclose herewith which is part of the department's records. It is pertinent to note that no physical cash personally belonging to any of the members of my family was actually found from the residence during the course of search on 23.08.2012. Hence, in case any alleged expenditure relating to marriage occasion (April 2012) is found as having been incurred but remained unlinked with Accounting, the same may be considered as having been expended out of aforesaid personal cash balances as appearing in the personal books of account of the respective family member(s) which is not physically found during the course of search. \" 9. The assessee vide submission dated 12.01,2015 (copy enclosed) further submitted as under: \" The assessee has already furnished details of marriage expenses amounting to Rs. 20,74,505/- actually incurred alongwith supporting documentary evidences alongwith source of such expenditure vide submission dated 09.01.2015. • The assessee has further submitted that cash balance aggregating to Rs. 4,03,840/- as appearing in the personal books of family members but was not physically found at the time of search is required to be considered as having been expended towards alleged expenditure relating to marriage, found as having been incurred but remained unlinked with the accounting. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 55 • Hence, marriage expenses to the extent of Rs. 20,74,5051- and Rs. 4,03,840/-, as aforesaid, should be considered as explained. • As already explained by the assessee vide letter dated 09.01.2015, the assessee family has not incurred any marriage expenses other than above and to validate this fact, the assessee has requested your goodselft independently cross confirm the said fact from the respective payees whose contact details are made available on records. • With a view to extend co-operation and facilitate the assessment proceedings, the assessee has obtained confirmations from following three payees on his own: Sr. No. Name of Payee Nature of Payment Amount (Rs.) (i) K. D. Jewellers Purchase of Jewellery and Conversion of Old Jewellery 3,65,100 (ii) Atul Caterers (Vipul) Catering Services 4,11,726 (iii) Parmar Kishor Mandap Service Mandap Keeping and Decoration 4,50,283 We enclose herewith confirmations of the aforesaid three payees confirming the true facts relating to actual transactions with the assessee. In view of the above and at the cost of pain of repetition, we reiterate that the actual marriage expenditure which is supported by documentary evidences should be considered as against the rough estimated figures relating to marriage which are not supported by any documentary or contrary evidence. There is also nothing contrary found on record so as to contend that the assessee has actually incurred higher expenditure as against actual expenditure shown. The rough jottings /estimates in the handwritten loose sheets forming part of the seized material do not conclusively or positively prove that the assessee has actually incurred the expenditure as mentioned therein on the occasion of marriage. \" The A.O. however did not appreciate the above submissions of the assessee in proper perspective and considered sum of the figures appearing on page no. 25 to 28 of Annexure A-l which came to Rs. 1, 01,39, 480/- as actual marriage expenses incurred by the assessee and made addition of Rs. 80,64, 975/- after allowing deduction of Rs. 20,74,505/- being marriage expenditure actually shown by the assessee. 10.The A.O. has however failed to consider that the actual expenditure incurred on marriage is supported by documentary evidence which is duly reflected in the books of account and the assessee has furnished all the relevant documentary evidences showing source thereof. Further, the details of actual expenditure on marriage which are supported by bills, vouchers are in absolute figures which should have been considered by the A.O. as against the rough jottings / estimates in the handwritten loose 'sheets forming part of the seized material. 11. The A.O. has also not brought any contrary documentary evidence on record so as to conclusively prove or conclude that the assessee has actually incurred expenditure over and above shown by him on marriage. The assessee also made specific request to the A.O. to independently verify the correctness of actual expenditure incurred with the persons whose names are appearing on the seized pages for which contact details were made available on records. Even, the confirmations obtained and furnished by the assessee from the major payees whose names are appearing on the seized pages have not been contradicted by the A.O. IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 56 12. There is nothing contrary found on record to show any nexus of the amounts appearing on the seized loose papers with the actual marriage expenditure and the addition is made purely on the basis of seized materials which do not positively or conclusively prove that the assessee has incurred such expenditure. No other incriminating document or undisclosed income has been found in the assessee' case during the course of search so as to justify the source of addition made by the A.O. 13. It is settled position that no addition can be made merely on the basis of loose papers where the figures appearing thereon represent just rough jottings and where the same cannot be positively corroborated or proved by concrete supporting documentary evidence. Assessee relies on the following decisions: (i)Jurisdictional Gujarat High Court judgement in the case of CIT vs. Maulikkumar K. Shah [2008] 307 ITR 137 in which it is held that: \"nothings in the seized diary found from the premises were the only material on the basis of which the Assessing Officer had made the impugned additions. The Assessing Officer had not brought any corroborative material on record to prove that such sales were made and 'on- money' was received by the assessee outside the books of account. The Assessing Officer had not examined any purchaser to whom the sales of shops were effected. Onus heavily lay on the revenue to prove with corroborative evidence that the entries in the seized diary actually represented the sales made by the assessee. Such onus had not been discharged by the revenue. Mere entries in the seized material were not sufficient to prove that the assessee had indulged in such a transaction. The inference of the Assessing Officer that the assessee has received 'on-money', was merely based on suspicion and surmises and there was no material whatsoever to support the conclusion of the Assessing Officer that the assessee had in fact received any 'on-money'. The addition as made by the Assessing Officer being based on mere presumptions and assumptions and without any corroborative evidence, could not be sustained.\" (ii)Hon'ble Ahmedabad Tribunal judgement in the case of Shri Haresh R. Vasani (IT(SS)A No. 580 & 581/And/2010) “I have carefully considered the assessment order and the above submissions. The Assessing Officer has made the addition for the only reason that as per the loose paper found, the assessee has made advances or payment to one Kalubhai of the impugned amount. However, it is seen that except the seized material, the Assessing Officer has not independently established that any such transaction has in fact, taken place. From the perusal of the seized material, it is also not clear whether the same pertained to an asset, liability, loan, advance or any other detail There is no other document o evidence to suggest that the assessee has advances/ paid a sum of Rs. 31,68, 75(97- to one Kalubhai. Hence there is no justification for presuming that the assessee must have paid a sum ofRs.31,68,750/-. The Assessing Officer has also not carried out any inquiry with the other party of the transaction to find out the facts and has simply rejected the explanation of the assessee and addition has been made on estimate basis. Therefore, considering the facts of the case, I am of the view that there is no justification for making the addition on merely Presumptive basis. Accordingly, the addition of Rs.31,68, 756*7- is directed to be deleted. \" IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 57 (iii)Hon'ble Jabalpur Tribunal decision in case of ACIT vs Satyapal Wassan 39 TTJ/72 in which it is held that “The above discussion also leads us to infer that a charge on the basis of the document can be levied only when the document is a speaking one. The document should speak either out of itself or in the company of other material found on investigation and/or in the search. The speaking from the document should be loud, clear and unambiguous in respect of all the four components as described above. If it is not so, then the document is only a dumb document. No charge can be levied on the basis of a dumb document. The crux of these decisions is mat a document found during the course of search must be a speaking one and without any second interpretation, must reflect all the detail1* about the transactions of the assessee in the relevant assessment year. Any gap in the various components as mentioned in section 4 of the Income-tax Act must be filled up by the Assessing Officer through investigations and correlations with the other material found either during the course of the search or on investigation. (iv)The Hon'ble Third member bench of Mumbai ITAT in case of SP Goyal 82 ITD 85 in which it is held that Lastly, the hon'ble Vice-President (Judicial Member) also cited the decision of the hon'ble Supreme Court in the case of Chuharmal v. CIT [1988] 172 ITR 250 for the proposition that when a person is found in possession of anything, the onus of proving that he was not its owner was on that person. The above ratio will not have application to the facts of the present case. In the case of Chuharmal v. CIT [1988] 172 ITR 250 (SC), the possession was in regard to valuable articles in the form of wrist watches of foreign make. The ownership of such valuable articles have to be definitely proved and if the person in whose possession the said valuable article was found claimed that the same did not belong to him, the onus of proving that he was not its owner was on that person. In the present case here it is a mere loose sheet in which the assessee confirmed that the entry was in his own handwriting. The loose paper in itself has got no intrinsic value. It does not represent a negotiable instrument which can be exchanged for a sum of Rs. 60 lakhs. Therefore, the above decision does not have direct applicability to the facts of the present case. When it is a mere entry on a loose sheet of paper and if the assessee claims that it was only a planning, not supported by actual cash, then there has to be circumstantial evidences to support that this entry really represent cash of Rs. 60 lakhs. There is no such evidence found by the Revenue in the form of extra cash, jewellery or investment outside the books. In such a case, the explanation offered by the assessee cannot be rejected. In that view of the matter, I concur with the view taken by the learned Accountant Member.” 93.We note that assessee submitted before us the seized documents, which is mentioned in Annexure-A1, which were found during the course of search, which is placed at Paper Book Page No. 1 to 5. We have examined these documents. We note that during the course of search and the seizure action, the search team found certain expenses relating to marriage function, at the assessee`s place and in this respect, the assessee has submitted the name and IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 58 address of the person to whom the payment were made and then it was on the Assessing Officer to issue the summons and notices u/s 133(6) or u/s 131 of the Act and should have called the necessary details from those persons, to whom the assessee paid the amount, however, the Assessing Officer has failed to do so. The assessee submitted in the Paper Book, the various expenses, which incurred on marriage function, and these expenses includes, diesel expenses, mandap expenses, flower expenses, mehendi expenses, payment made to drivers, jewellery purchase from various jewellery shops and other expenses and the money paid by the assessee to various persons during the marriage function. However, we note that as per assessee, the actual expenditure was only Rs. 20,74,505/-. In the diary, the assessee made his projections and estimated expenditure, to be incurred by him in the marriage function, however, these were only estimates and actual expenses were never incurred by the assessee more than Rs. 20,74,505/-.It was revealed from the assessment order, from the submissions of the assessee before the assessing officer and also the submissions made in appeal proceedings that the assessing officer did not carry out any enquiry before rejecting the submission of the assessee. It was duty of the assessing officer to conduct further investigation to ascertain the veracity of the depth of truthfulness of the assessee's explanation for expenses and the real nature of the notings in the seized papers. Even after conducting such enquiry, the assessing officer was of the view to make the addition the onus should have been shifted on the assessee to rebut the findings of the assessing officer. There was nothing on the record which could indicate that the assessing officer discharged his duty. It seems that the assessing officer adopted a slipshod approach and jumped to a conclusion without gathering any material evidence on the record. The settled position of law is that no addition without any supporting evidence is sustainable in the law.The facts of the case, submission to the assessee before the assessing officer and in the appeal proceedings make IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 59 it evident that the addition was made in a casual and ad hoc manner without controverting the submission of the assessee. Therefore, we delete the addition. 94. In the result, ground No.2 raised by the assessee is allowed. 95. In the combined result, appeal of the assessee ( Shri Jinesh Fulchand Shah) and appeal of the assessee ( Shri Dhaval Jinesh Shah), are allowed on merit. Order pronounced in the open court on 24/12/2024. Sd/- Sd/- (DINESH MOHAN SINHA) (Dr .A. L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER Rajkot Dated:24/12/2024 आदेशकȧĤǓतͧलͪपअĒेͪषत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Rajkot 6. Guard file. By order/आदेशसे, Assistant Registrar/Sr. P.S./P.S. ITAT, Rajkot Strengthened preparation & delivery of orders in the ITAT 1) Date of dictation 03.12.2024 2) Date on which the typed draft is placed before the Dictating Member & Other Member 03.12.2024 3) Date on which the approved draft comes to the Sr. P.S./P.S. 4) Date on which the fair order is placed before the Dictating Member for pronouncement 5) Date on which the fair order comes back to the Sr. P.S./P.S. 6) Date on which the file goes to the Bench Clerk 7) Date on which the file goes the Head Clerk 8) Date on which the file goes to the Assistant Registrar for IT(SS)A Nos. 04 to 08/Rjt/2017 & ITA No. 80/Rjt/2020 & ITA No. 121/Rjt/2016 A.Ys. 2009-10 to 2014-15 60 signature on the order 9) Date of Dispatch of the order "