TMI Blog2014 (11) TMI 315X X X X Extracts X X X X X X X X Extracts X X X X ..... the same, the tax authorities have acted in an objective manner to corroborate the admissions made in the sworn statement with other materials and have come to the conclusion to assess the said amount in the hands of right person – the order of the CIT(A) is set aside and the AO is directed to delete the addition made – Decided in favour of assessee. M/s GHP Corporation received ₹ 3.00 crores as advance in the financial year 2005-06 relevant to the AY 2006-07 - the amount of ₹ 2.00 crores received by way of cheque was credited to the capital account of the assessees herein available in the books of M/s GHP corporation – there is no reason to reject the claim of the assessees that they had taken away the remaining amount of ₹ 1.00 crores received by way of cash - Once it is seen that the assessees are possessed of ₹ 50.00 lakhs each, then there would merit in their contention that amount would be available as source for making investments - both the assessees have sought set off of ₹ 50.00 lakhs against the unexplained cash and unexplained jewellery found during the course of search - both the assessees are justified in the claim that the sources to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the delay and admit the appeal for hearing. The Ld Counsel appearing for the assessee did not press Ground No.1 relating to the validity of initiation of proceedings u/s 153A of the Act. Accordingly the same is dismissed as Not Pressed. The ground no.3 is general in nature. The remaining ground relates to the validity of addition of ₹ 1,02,50,000/- made u/s 69B of the Act. The facts relating thereto are set out in brief. The assessee s main sources of income are income Partnership firms, Salary income and Income from other sources. During the course of survey operations conducted at the business premises of the various concerns, certain documents were impounded. A paper found at page 12 of Annexure 17 of the bunch impounded during the course of survey operation revealed details of payment made for purchase of land at Jaipur. The said land was purchased by a sister concern named M/s Builders Alliance P Ltd. The said payment was reflected as under:- 7.4.2005 ₹ 12,00,000 Cash 9.4.2005 ₹ 10,00,000 Cash 14.4.2005 ₹ 10,00,000 Cash 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash receipt of ₹ 1.00 crore was not accounted for in the books of account. In the sworn statement taken during the course of search, both Shri Dixant Sharma and Shri Prashant Sharma agreed to offer ₹ 50.00 lakhs each as income in their respective hands. Since the assessee did not offer the amount of ₹ 50.00 lakhs also in the return filed u/s 153A, the AO assessed the same as unaccounted cash receipt on protective basis, since the same amount was also assessed in the hands of M/s GHP Corporation on substantive basis. 5. In the appellate proceedings, the Ld CIT(A) deleted the addition of ₹ 50.00 lakhs made on protective basis, since he had confirmed the addition made in the hands of the partnership firm on substantive basis. With regard to the addition of ₹ 1,02,50,000/- pertaining to the land purchased by M/s Builders Alliance P Ltd, the assessee submitted before Ld CIT(A) that he had made admission in the sworn statement in a confused state of mind under pressure and hence it was not a voluntary admission. He placed reliance on the circular issued by CBDT, in which the CBDT had advised its officers not to obtain confession as undisclosed income and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew that a Company is indeed a juristic person but it is separate and distinct only for the share holders and not necessarily from the Directors, particularly in a company which is controlled by family or few members. Accordingly, the Ld CIT(A) held that the assessee could not take support from the decision rendered in the case of M/s Haldiram Foods Ltd (supra). The Ld CIT(A) further placed reliance on the decisions rendered by Hon ble Supreme Court in the cases of CIT Vs. Durga Prasad More (82 ITR 540) and Sumati Dayal Vs. CIT (214 ITR 801) and held that the assessing officer is entitled to look into the surrounding circumstances and accordingly held that the assessee Shri Dixant Sharma only has made the impugned investment. Accordingly he confirmed the order of Ld CIT(A). 7. Before us, the Ld A.R submitted the impugned lands were purchased by the Company named M/s Builders Alliance P Ltd and hence the transactions noted down in the impounded document pertain to the above said company only. He further submitted that the sale agreements were executed in the name of the company cited above and the purchase of land has also been accounted for in the books of above said company. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers/directors in many concerns, it is quite common to refer all of them as his own concerns and the assets belonging to those concerns as his. However, under the eyes of law, each concern is a separate entity having independent rights and liabilities. Accordingly he submitted that the undisclosed investment, if any, involved in the land deal should not be assessed in the hands of the assessee herein. He further submitted that the assessing officer did not conduct further enquiries to ascertain the veracity of the impounded document also. Since the assessee did not actually pay the cash of ₹ 1,02,50,000/-, he did not disclose the same in his return of income. Accordingly he contended that the Ld CIT(A) was not correct in confirming the assessment of the amount of ₹ 1,02,50,000/- in the hands of the assessee. 8. On the contrary, the ld D.R placed strong reliance on the order of Ld CIT(A) and further submitted that the assessee himself has admitted the impugned amount as his income in the sworn statement taken at the time of search. 9. We have heard the rival contentions on this issue and perused the record. The fact that the land was purchased by M/s Builders Allian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order. Further, the impounded document says that ₹ 17.50 lakhs (each person). Further the sale consideration mentioned in the conveyance deed itself was ₹ 67.48 lakhs. However, it is seen that the assessing officer did not pose any question to the assessee seeking explanations in this regard, which are apparently visible. Thus it is seen that the only basis on which the impugned amount of ₹ 1,02,50,000/- was decided to be assessed in the hands of the assessee was the sworn statement given by Shri Dixant G Sharma. 11. The discussion made in the previous paragraph would show that there is no clarity, both in the mind of the assessing officer as well as the assessee. Even though the conveyance deeds were available with the assessing officer, yet he has chosen to presume that the accounted consideration was ₹ 47.50 lakhs only, whereas it can be reasonably presumed that the sale consideration was ₹ 70.00 lakhs. Further we notice that the assessing officer has not taken any steps to corroborate his view with any other document/books. We have also noticed that the assessee has been posed questions relating to group of cases, which consisted of M/s Builder ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surrounding circumstances do not warrant assessment of ₹ 1,02,50,000/- in the hands of the assessee herein. Accordingly, we set aside the order of Ld CIT(A) on this issue and direct the AO to delete the addition of the above said amount made in the hands of Shri Dixant G Sharma. 14. We shall now take up the appeals filed by both Shri Dixant G Sharma and Shri Prashant G Sharma for AY 2007-08. Both the assessees are aggrieved by the decision of Ld CIT(A) in not giving set off of ₹ 50.00 lakhs claimed by both of them in their respective hands. The facts relating to the same are discussed in brief. In the statement taken u/s 132(4) of the Act, Shri Dixant G Sharma disclosed a sum of ₹ 67.50 lakhs, which included unexplained cash of ₹ 35.00 lakhs and unexplained jewellery of ₹ 30.00 lakhs. Similarly Shri Prashant G Sharma declared a sum of ₹ 123.40 lakhs, which included unexplained cash of ₹ 60.00 lakhs and unexplained jewellery of ₹ 50.00 lakhs. 15. We have already seen that M/s GHP Corporation, in which both the assessees are partners, had received a sum of ₹ 3.00 crores as advance from M/s Alokik Township Corporation. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vailable with the assessees, the same would explain the sources for cash and jewellery found during the course of search. On the contrary, the ld D.R placed reliance on the orders of tax authorities. 18. It is an undisputed fact that the concern M/s GHP Corporation received ₹ 3.00 crores as advance in the financial year 2005-06 relevant to the assessment year 2006-07. It is also an undisputed fact that the amount of ₹ 2.00 crores received by way of cheque was credited to the capital account of the assessees herein available in the books of M/s GHP corporation. When this fact is accepted, we do not find any reason to reject the claim of the assessees that they had taken away the remaining amount of ₹ 1.00 crores received by way of cash. Further, we notice the revenue did not bring any other material on record to disprove the said claim. Once it is seen that these assessees are possessed of ₹ 50.00 lakhs each, then there would merit in their contention that said amount would be available as source for making investments. In the instant case, both the assessees have sought set off of ₹ 50.00 lakhs against the unexplained cash and unexplained jewellery ..... X X X X Extracts X X X X X X X X Extracts X X X X
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