TMI Blog2011 (3) TMI 680X X X X Extracts X X X X X X X X Extracts X X X X ..... for the Appellant. Sai Prasad for the Respondent. ORDER Chandra Poojari, Accountant Member. These are cross appeals preferred by the revenue as well as by the assessee are directed against different orders passed by the CIT(A)-I and pertains to the assessment year 2002-03. 2. The revenue is in appeal before us in ITA No. 955/H/2007 with regard to deletion of addition made by the Assessing Officer in respect of Himayat Nagar property and Erra Manzil Property though he has confirmed the additions in respect of Shivam Land and Bharkatpura Land even these additions are on the same footing. Further the revenue is appeal before us in ITA No. 954/H/2007 with regard to deletion of penalty by the CIT(A) made under section 271(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities described by the Assessing Officer as 'some scribbling slips' and the Assessing Officer's on analysing the seized material revealed that 'the assessee made investments in various immovable properties' the total investment being Rs. 69,27,500. 7. According to the Assessing Officer, as stated in the assessment order, a notice under section 148 of the Income-tax Act dated 26-3-2004 was served on 28-3-2004 and as there was no compliance for this notice, a notice under section 142(1) dated 28-12-2004 was issued requiring the assessee to file the return of income for the assessment under consideration on or before 17-1-2005. Since there was no compliance, Inspector of IT attached to his office was deputed for service of the notice under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty proceedings under section 271(1)(c) of the Income-tax Act, was initiated by the Assessing Officer and penalty was levied vide order dated 27-9-2005 at Rs. 22,46,295. The assessee carried the appeals on both quantum issue and penalty separately to the CIT(A). The CIT(A) directed the Assessing Officer to re-compute the income from salary at Rs. 25,000 p.m. from April 2001 to December, 2001 and Rs. 40,000 p.m. from January 2002 to March, 2002 totalling of Rs. 3,45,000 for the Financial Year 2001-02. Further, the addition regarding Shivam Land at Rs. 15,27,500 was reduced to Rs. 7,63,750 , Himayat Nagar land at Rs. 30 lakhs was deleted, Bharkatpura land at Rs. 10 lakhs confirmed and Erramanzil land at Rs. 14 lakhs deleted by the CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the loose documents are nothing but dumb documents cannot be used for the purpose of assessment without any corroborative evidence. 12. But the issue before us now remains is that whether the loose documents can be the basis for impugned addition. As seen from the loose documents as scanned by the CIT(A) in his order, these are just hand written loose documents. There is no presumption in law that the Assessing Officer is supposed to discharge tax liability by direct evidence only and thereupon determined the income beyond doubt. The income of the assessee is to be computed by the Assessing Officer on the basis of available record. In many a time, it is very important to have direct evidence or conclusive evidence to prove to determine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they are not able to unearth any background with regard to these loose documents. Without any of this, the department has taken a view that the assessee is carrying on unexplained investment in land. The department not traced and examined any of the parties. The department cannot draw inference on the basis of suspicion, conjuncture and surmise. Suspicion, however strong cannot take place of material in support of the findings of the Assessing Officer. The Assessing Officer should act in a judicious manner, proceed with judicial spirit and should come to a judicial conclusion. The Assessing Officer is required to act fairly as a reasonable person and not arbitrarily and capriciously. Assessment made should have adequate material and it shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s there on the note book/loose slips and their statements to be recorded and then such statement undoubtedly should be confronted to the assessee and he has to be allowed to cross examine the parties. In the present case, undoubtedly no statement from parties were recorded. Entire addition in the hands of the assessee on the basis of uncorroborated writings in the loose papers found by the Special Investigation Team. The evidence on record is not sufficient to support the revenue's case that assessee made investment in land. The circumstances surrounding the case are not strong enough to justify the additions. In view of this, we are of the opinion that no addition can be made on account of investment in properties at Rs. 69,27,500. Since w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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