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2016 (10) TMI 991 - AT - Income TaxAddition on account of unaccounted receipts on the basis of certain loose papers in the form of chits found and seized during the course of search - Held that:- In the instant case, nothing is brought on record that the assessee in fact received any amount from Sh. Sohanraj Mehta. It is well settled that as per the provisions of Section 292(1) of the Act, the documents found during the course of search may be presumed to be belonging to the person in whose possession those documents were found, however, in the present case no such document was found from the possession of the assessee and in those documents which were found and seized during the course of search in Dhariwal Group of cases, there was no indication that the figures referred therein reflected any quantity of goods or amount of money which related to the assessee. It is not in dispute that the presumption available u/s 132(4A) can be drawn against the person in whose case search was authorized and from whose possession or control documents/books of account or diary etc. were found but the presumption regarding correctness of contents of those documents/books of accounts etc. can be raised against the third party only when the documents are speaking one. In the present case, no document was found from the possession of the assessee and a bunch of loose papers which were seized from the premises of third party did not indicate the unrecorded sales made to the assessee. Moreover, no opportunity was granted by the AO to cross examined Sh. Sohanraj Mehta, on the basis of whose statement the AO presumed that unaccounted sale was made by the assessee. We, therefore, considering the totality of the facts of the present case, do not see any valid reason to interfere with the findings of the ld. CIT(A) who rightly deleted the addition made by the AO. Treatment to agricultural income declared by the assessee as income received from undisclosed sources - Held that:- In the present case, the assessee furnished the documents relating to the land holding which were not doubted by the AO. The assessee entered into an agreement for cultivation of the agricultural land with Sh. Dhirender Bhati and furnished the certificate dated 20.08.2010 from Tehsilpatwari which revealed that vegetables were grown on the assessee’s agricultural land for the past many years. The AO in the present case, did not examine Sh. Dhirender Bhati with whom the assessee entered into an agreement and also did not make any enquiry from Tehsilpatwari Sh. Jagdish Prasad Sharma who issued a certificate stating therein that the vegetables were grown on the agricultural land of the assessee. Therefore, the impugned addition was made by the AO on the basis of presumption only which is not tenable in the eyes of law. In that view of the matter, we are of the view that the ld. CIT(A) rightly deleted the addition made by the AO. Addition of disallowance of interest made u/s 36(1)(iii) - interest bearing funds were diverted for non-business purposes - Held that:- In the present case, the ld. CIT(A) had given a categorical finding that the assessee advanced the money to those concerns in which he was either a director or a partner and there was business expediency, the said categorical finding of the ld. CIT(A) was not rebutted. We, therefore, do not see any valid ground to interfere with the findings of the ld. CIT(A). Share transactions - short term capital gain OR income from other sources - Held that:- In the present case, it is an admitted fact that the assessee did not produce the broker for verification of genuineness of transaction. However, it is not clear as to whether the AO asked the assessee to produce the broker. It is also not clear as to whether the shares were transferred in D-mat account of the assessee and if those were not transferred to the D-mat account what was the reason for the same. This issue was although discussed by the AO but it had not been touched by the ld. CIT(A). We, therefore, in the absence of the clear facts available on the record, deem it appropriate to set aside this issue back to the file of the AO for fresh adjudication in accordance with law after providing due and reasonable opportunity of being heard to the assessee. Addition in respect of cash found during the course of search from the premises of the assessee - Held that:- In the present case, it appears that the family members of the assessee had owned the money which was reflected in their books of accounts as cash in hand, those books of accounts were not doubted. Therefore, the ld. CIT(A) rightly deleted the addition made by the AO.
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