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2006 (9) TMI 240 - AT - Income TaxBlock assessment - Search And Seizure - Onus to disprove the contents - additions made on account of notings in the seized documents PKC-60 found and seized during the search in the case of the assessee showing outstanding debts regarding amounts receivable from the various parties - HELD THAT:- In the present case in hand, the AO has not been able to demonstrate with adequate evidence that the assessee received the amounts in two years as alleged. These entries as recorded in 'PKC-60" do not clearly reveal that the assessee has earned income. The assessment of undisclosed income is under Chapter XIV-B of the Act and there is no scope of assumption or presumption while making assessment under this chapter. They are dumb documents on which reliance cannot be placed, unless they are corroborated with other evidences. In our considered opinion we see no infirmity in the order of learned CIT(A) in deleting the additions. Accordingly, we uphold the order of the learned CIT(A) and dismiss the ground of appeal of the Revenue. Addition on protective basis when the substantive addition has been made in the hands of Smt. Kanchan Khullar - HELD THAT:- We are of the considered view that the protective assessment does not survive as the basis of determination of undisclosed income i.e. seized documents were found from the business premises of Ms. Kanchan Khullar and, therefore, any undisclosed income computed therefrom can be assessed in her hands alone. The AO did not transfer the proceedings in respect of these seized documents in the hands of the assessee respondent u/s 158BD of the Act. Further, the assessee respondent did not include any undisclosed income computed from the seized documents under reference in his block return in Form 2B. Therefore, the protective assessment of this income cannot be sustained in the hands of the assessee respondent. Accordingly, the decision of the learned CIT(A) in this regard is upheld and the Revenue's ground of appeal is dismissed. Before parting with this ground, we would like to make it clear that our observation in respect of this ground would not prejudice the Revenue's stand in the case of Ms. Kanchan Khullar pending before Tribunal on merit. Undisclosed deposit made by the assessee in the names of Sunita, Renu & Soni in the HDFC Bank, Jamshedpur, holding the same to be the Stridhan of the depositors - HELD THAT:- We find that the assessee respondent has explained regarding these investments before the AO that these are 'Stridhan'. The learned CIT(A) took the view that the fixed deposits were not found in the search. The onus is on the AO to bring material evidence to prove that the assessee respondent has made these investments. In that view of the matter, we are of the view that the observation of learned CIT(A) does not need any clarification as because this being 'Block assessment' proceeding, the Revenue has failed to discharge the onus which lies on them. Accordingly, the order of the learned CIT(A) is upheld and the ground of appeal of the Revenue is dismissed. Addition in respect of the difference in the amount of investment noted in the seized documents pp. 37-45 of SK-I against disclosed investment made ignoring the provisions of sub-s. (4A) of s. 132 - HELD THAT:- We find that the AO while making the addition has failed to confirm the actual payment made by the assessee with the person to whom the payment was made. The assessee has also not denied regarding the documents so referred and has duly explained. We, therefore, do not find any reason to interfere with the order of the learned CIT(A). Accordingly, the same is upheld. Expenditure in respect of inflation of expenditure to suppress income - HELD THAT:- We find that the AO while completing the assessment has not considered the payments made by the assessee through cheques as pointed out during the course of hearing. The assessee has given the same explanations before the lower authorities also. It is apparently clear that the cheques were drawn on "on account", which was duly reflected in the audited accounts. The ld DR has not been able to controvert the submissions made by the learned counsel for the assessee in this regard. Therefore, we see no infirmity or illegality in the order of the learned CIT(A). Accordingly, the order of the learned CIT(A) is upheld and the ground of appeal taken by the Revenue is dismissed. In the result, the appeal of the Revenue stands dismissed.
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