TMI Blog2012 (7) TMI 532X X X X Extracts X X X X X X X X Extracts X X X X ..... tion should be made in the hands of Shri Suresh Malge on mere conjectures, surmises and presumptions - AO should pay the cost of Rs. 20,000/- to Shri Suresh Babu Malge for making him come again in appellate proceedings - in favour of assessee. - IT(SS)A No.05/Mum/2012, IT(SS)A No.06/Mum/2012 - - - Dated:- 20-7-2012 - Shri D.K.Agarwal, Shri B. Ramakotaiah, JJ. Assessee by: DR. K. Shivaram Department by: Shri B. Jaya Kumar, DR O R D E R Per B. Ramakotaiah, A.M. These two appeals are arising out of the block assessments framed in consequence of the search operations u/s 132 of the Act took against these two assessees on 13.7.1996. Though, the appeals are in respect of two difference assessees but as the facts are identical; the assessment passed by the A.O are also interlinked with each other and hence, both these appeals are disposed off by this common order. 2. The appeal in IT(SS)A 05/Mum/2012 in which the assessee has taken the following grounds: 1. The learned Asstt.CIT erred in passing the order without providing sufficient and adequate opportunity of hearing to assessee as the copy of statement recorded was furnished only on 22/12/2011, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rore on behalf of his wife Smt Sushila Suresh Malge as their undisclosed income. The A.O has reproduced the question no.20 and its answer given by Shri Suresh Babu G Malge which is as under: Question no.20 reads as under: In view of the facts and circumstances of the basis of documents do you want to admit a concealment of income and evasion of tax for the period relevant to the current assessment year and last few years by you and your wife. Do you want to offer any additional income in respect of yourself and your wife voluntarily and prepared to pay the taxes accordingly in due course. The reply of the assessee was as under: I do not know exact position. I admit that there is concealment of income by myself and my wife of evasion of taxes. I do not know exact amount; however, considering all the facts and circumstances of the case, I am offering Rs. 50 lakhs for myself and Rs. 1 crore in my wife s case without coercion, without torture, we will pay the taxes in due course and we shall not retract the offer under any condition. I keep my option open if anything on higher side, I shall offer my addition income in respect of myself and wife and pay taxes accordingly. 3.3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accounted income includes the undisclosed income of Rs. 9,32,240/- shown by Shri Suresh Malge in his block return as well as the undisclosed income of ₹ 5,54,380 shown by Smt Sushila Malge in her block return, which has already discussed above is stated to be a benami of Shri Suresh Malge. The total undisclosed income as discussed above is ₹ 1,50,00,000/- . 4. In sum and substance, final determination of the undisclosed income by the A.O was based on the income allegedly offered by the assessee on 14.7.96 in the statement recorded u/s 132(4) of the Act. However, these orders had chequered history. 4.1 Both these assessees had challenged the said assessment orders before the Tribunal by way of appeals being IT(SS)A No.170 and 171/Mum/1997. The main grievance of the assessees before the Tribunal was that the statement recorded by the search party was not supplied to the assessee despite their repeated requests and the A.O made the addition relying on the said statement. The Tribunal set aside the orders of the A.O in both these cases and restored the matter to his file with the direction to reframe assessment de-novo after supplying the copy of the statement and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turnover, in the construction activity, land development, film production, film distribution etc., the amount surrendered by the assessee of Rs. 1.50 crore appears to be a very fair estimate of his own unaccounted income, which he has arrived after considering all the facts and circumstances of his business. 37. Hence, the undisclosed income of the assessee as per the above discussion is taken at Rs. 1.50 crore. This unaccounted income includes the undisclosed income of Rs. 9,32,740/- shown by Shri Suresh Malge in his block return as well as the undisclosed income of Rs. 5,54,880/- shown by Smt Sushila Malge in her block return which has already discussed above is stated to be a benami of Shri Suresh Malge. 6. Since, the directions of ITAT was not followed in re-assessment proceedings and the statement crucial for deciding the addition was not provided in spite of directions given, the Hon'ble ITAT vide the orders in IT(SS)A Nos. 8 9/Mum/2009 has restored the matter with certain observations particularly about the gross violation principles of natural justice and levying a cost of ₹ 5000/- upon AO, for completing it de novo. 6. Consequent to these orders of the ITAT, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Smt. Sushila. Even on merits, it was submitted that assessee, Smt sushila was assessed already and referred to Para 5.17 of the assessment order to submit that even as early as AY 1991-92 Smt. Sushila was assessed under section 143(3), the fact of which was accepted by AO. Therefore, holding her as benamidar is not correct. He relied on the orders of the Hon'ble Delhi High Court in the case of S.K. Bahadur vs. Union of India, 345 ITR 95 to submit that the addition of income from assets belonging to the wife of assessee was not justified in the hands of assessee. The findings given by AO are not based on evidence and but only on presumptions, surmises and conjectures, which cannot be upheld. The burden is on the Revenue to prove that Smt. Sushila Malge is a benamidar of husband and the burden was not discharged. He referred the copy of the statement placed in paper book in page No.35 to submit that she owned up her business and income. Therefore treating as benamidar of husband is not correct on the facts of the case. It was his submission that since AO did not pass the assessment on the basis of record available, inspite of setting aside twice with specific directions, the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts. This issue was already considered twice by the ITAT when the orders were set aside earlier. As copy of the statement was given to the assessees, AO is directed to complete the assessment only on the basis of incriminating material if any, after considering assessee s explanation with reference to the papers seized and transactions/investments found by the Department. In no case AO should make assessment only on the basis of 132(4) statements which stands modified/ withdrawn, unless there is corroborative evidence linking the statement with the undisclosed /unearthed incomes. We make it clear that in case AO repeats the same orders without examining the material on record, the orders will be quashed without any further consideration. 9.3 AO should examine the books of account placed on record vis- -vis the seized material, bank statements and other material placed by assessee, so as to quantify any undisclosed income. 9.4 There is already evidence on record that Smt. Sushila Malge has been filing the returns much before the search and they were scrutiny assessments in her case as well. Just because her affairs are being looked after by her husband, it does not mean that she ..... X X X X Extracts X X X X X X X X Extracts X X X X
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