TMI Blog2015 (3) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... he entries, the burden shifted upon the AO to prove that the explanation given by the assessee was wrong or that the entries made in the excel sheets were pertaining to sale transactions as alleged by the AO or the entries relating to gold bar was unaccounted purchase, as has been alleged by the Ld. CIT(A). Since both the authorities i.e. AO as well as the Ld. CIT(A) could not prove their case, hence, additions made by them on the basis of mere assumptions/presumptions and suspicions are not sustainable in the eyes of law and the same are accordingly ordered to be deleted. - Decided in favour of assessee. Deductions U/s 10A/10AA denied - CIT(A) allowed the claim - Held that:- Ld. CIT(A) directed the assessee to submit the complete details of imports and Exports made through these units and the approval of the Custom and Central Excise department and also to submit the documents relating to shipment, Import and Export Clearance, Invoices of import & Export and foreign remittances in the bank accounts. The assessee submitted that all the above stated documents had already been submitted before the AO, during the assessment proceedings. The Ld. CIT(A) after thorough examination of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eir room and all the transactions were paper transactions made in their names on behalf of the assessee company. The above evidences on the file are sufficient to hold that the said entities were only paper entities created by the assessee to inflate turnover. The assessee has miserably failed to prove that the transactions done by the assessee with these entities were genuine transactions. So far as the addition of ₹ 28 lakh in each year on adhoc basis on account of expenditure incurred to create these paper entities is concerned, we find that there is no evidence that the assessee has incurred such an expenditure to create these entities warranting adhoc additions of ₹ 28 lakh each. It is also the case of the assessee that the net profits of these entities have also been taxed. Further, we have upheld the addition of gross profits of the said entities, hence further adhoc addition of ₹ 28 lakh for each year merely on assumptions is not warranted and the same is accordingly ordered to be deleted. - Decided partly in favour of assessee. Addition towards discrepancy in stock - Held that:- The most vital fact on this issue is that the assessee has not been provid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is that the agreement value of property is ₹ 6 crore, which is then reduced by token payment of ₹ 21 Lacs and the balance is shown at ₹ 5.79 crores. Further, it is mentioned that token amount of ₹ 21 Lacs is paid on 22.7.2008; ₹ 2 crore before 7.8.2008 as cheque, if in cash, then on 01.08.2008. The assessee has explained that the deal did not materialize and was cancelled hence there was no question of payment of ₹ 2 crore in cash. It is not disputed that the property latter on was purchased by the Group company of the assessee M/s Gia Exports. When the assessee neither has purchased the property in question, nor there is any mention in the seized documents, that the assessee in fact has made the payment of ₹ 2 Crores, then the addition, merely on the basis of assumption that the assessee might have made the payments, in our view, is not sustainable in the eyes of law. - Decided in favour of assessee. - ITA Nos.7256, 7257, 7258, 7259 & 7260/M/2011 & ITA Nos.8083, 8084, 8085, 8086 & 8087/M/2011 - - - Dated:- 13-2-2015 - Shri D. Karunakara Rao And Shri Sanjay Garg JJ. For the Appellant : Shri Reepal G. Tralshawala, A.R. For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action on 25/9/2008 and hence, the same rate could not be adopted for making addition in AY 2005-06 and hence, the addition made of ₹ 1,64,21,516/- is without any justification and the addition is liable to be deleted. B. Addition of ₹ 17,91,780/- as alleged unexplained cash 4. The Learned Commissioner of Income-tax (A) erred in making addition of ₹ 17,91,780/- towards estimated alleged unexplained cash without appreciating the fact that there is no unexplained cash outside the books of account no such addition was made by the Ld. AO the observations made in the CIT(A) order is contrary to the factual position and hence, the addition made of ₹ 17,91,780/- as alleged unexplained cash merely on assumption and presumptions is without any justification and liable to be deleted. 5. The Learned Commissioner of Income-tax (A) failed to appreciate that no incriminating evidence was found in the course of search action proving any unexplained cash no such huge unexplained cash was found in the course of search action and the excel sheet found in the computer related to AY 2008-09 2009-10 not for AY 2005-06 and even the said excel sheet clearly prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment made by the CIT(A) is bad in law and liable to be struck down and delete the additions made in respect of unexplained purchase of gold bars and unexplained cash. 2. The appellant craves leave to add, amend, alter or delete all or any of the aforesaid grounds of appeal. 4. Our findings in respect of the matter are as under: Issue A B (Grounds No. 1 to 5 Additional Ground): Addition towards alleged unaccounted purchase of gold bar Addition towards alleged unexplained cash ( Issue involved in AY 2005-06 to AY 2009-10): 5. The brief facts relating to this issue, as brought out from the impugned order, are that the assessee is engaged in the business of manufacturing and trading of gold jewellery mainly on wholesale basis. A search and seizure action was conducted by the Income Tax Authorities u/s. 132 of the Incometax Act, 1961 on 25.9.2008 at the business and residential premises of the assessee company whereby various documents as well as hard discs of the computers were seized. Statements of various personnel were also recorded in the course of search action. In the seized documents, the Assessing Officer (hereinafter referred to as the AO) noticed that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the course of search who stated that they had taken the jewellery for approval from the assessee company and had also sold the same and received cash in lieu thereof, which was deposited with the company on different dates. 5.2 On the basis of these statements recorded during the course of search, survey u/s. 133A were also carried out in the case of M/s. Royal Chains and Master Chains Pvt. Ltd. and also upon some other assessees to confirm as to whether the goods sent on approval were actually the sales of the assessee company which was not reflected in the books of accounts. The AO also relied upon the statements recorded during survey action in which Shri Madan Kothari, Managing Director of M/s Master Chain Pvt. Ltd. and Shri Suresh Jain Managing partner of M/s. Royal Chains, who had stated that they had provided marketing support to the assessee. They also made a disclosure on account of discrepancies found during the course of survey. On the basis of the statements recorded during the search survey operation, the A.O. held that the goods sent on approval were actually sales of the assessee company which were not reflected in the books of the accounts. He held that the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er: It is submitted that Shri Suresh F. jain has categorically stated in response to Q16 that he stands by the statement given by him at the time of survey at his premises. He has stated that his firm has provided marketing support for the gold ornaments which were given by AGJPL through approval memo. In response to Q19, he has stated that he has arranged for marketing support and therefore,. presumed that AGIPL might have issued sale invoices for the jewel/cry, On the other hands ShriMadan S. Kothari in his statement ha6 also stated that the jewel/cry was received as per issue voucher of AGIPL and it was taken back by AGIPL through receipt voucher prepared by them. He has categorically stated that AGIPL only prepares the receipt and issue vouchers and transactions are based on trust. It is further stated that during the course of search and seizure action, the modus operandi of sending out gold jewellery through trusted employees and showing the same as returned back without any sale was detected. From the deleted files in the computers, certain excel sheets were recovered which showed issue of jewellery and its corresponding return entry. The return entry in most of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... items sent by the assessee company were purchased by their firms and shown in the books of account. The Ld. CIT(A) therefore held that the third party evidences of M/s. Master Chains P. Ltd, and M/s. Royal Chains Pvt. Ltd, which were relied by the A.O. were in fact had gone in favour of the assessee proving that the transactions in question were not sales. The Ld. CIT(A) also observed that Shri Laxman Agre and Shri Ravindra Kaste, who were small employees of the assessee company, had retracted the statements by submitting Affidavit after the search and also it was not corroborated by an documentary evidence to prove that they had sold the goods and sent for approval and received cash which was deposited with the assessee company. He observed that though the statement recorded u/s. 132(4) has an evidentiary value but it cannot be accepted as conclusive evidence until unless it is corroborated with the documentary evidences. After considering the facts and circumstances of the case, the Ld. CIT(A) observed that the whole addition made by the A.O. on the issue of goods sent on approval by treating it as sales by not reflecting in the books of accounts was based on the statements recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sh on the excel sheets was shown at ₹ 24,94,000/- for A.Y. 2008-09 and ₹ 57,88,814/- for A.Y. 2009-10. Since, as in the case of the gold bars, the cash entries were also not found on a single day, therefore, he adopted the peak figure of ₹ 9,94,000/- for A.Y. 2008-09 and ₹ 25,89,560/- for A.Y. 2009-10 which was treated as unexplained cash of the assessee. For A.Ys, 2005-06, 2006-07 and 2007-08, the average amount of these two entries came out to be ₹ 17,91,780/- which was treated as unexplained investment of the assessee for each year. He therefore confirmed the addition of ₹ 8,94,72,480/- (1,64,21,516/- + 1,64,21,516/- + 1,64,21,516/- + 1,48,98,376/- +1,79,44,656/- + 17,91780/- + 17,91,780/- + 17,91,780/- + 9,94,000/- + 25,89,560/-) and deleted the balance additions made by the AO. 9. Now the assessee is aggrieved by the confirmation/enhancement of additions on account of unexplained investments made by the Ld. CIT(A) in respect of Gold Bars and entries relating to the cash found mentioned in the excel sheets, whereas, the Revenue has agitated the deletion of the additions by the Ld. CIT(A) which were made by the AO on account of labour charg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the paper book for A.Y.2009-2010 reflects details of trading in gold bars for the financial years ending on 31-3-2008 and 31-3-2009. After going through the various documents and evidences to which the Ld. AR has invited our attention, we find that the entire additions made on this issue either by the AO or by the Ld. CIT(A) are on the basis of some assumptions and presumptions. No evidence was found during the search action which may prove that the assessee was making unaccounted sales or unaccounted purchases of gold bars. Once the assessee had explained about the entries in the excel sheets, the burden was on the Revenue to prove that the explanation given by the assessee was wrong. On the basis of entries of excel sheets, the AO presumed that the assessee was making unaccounted sales whereas the Ld. CIT(A) presumed that the entries relating to gold bars reflected the unaccounted purchases. The Ld. CIT(A) at his own end had made necessary enquiries and found that the contention of the assessee that jewellery was issued as sample on approval basis, was correct. He found that the concerned authorities had also shown the receipt of the jewellery on approval basis and which were al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oyee and handing over of such a huge quantity of gold and cash to him by his employer, the alleged distance of about 24 hours travelled by him through Volvo Bus along with cash/jewellery, the carrying of Gold weighing 30 Kg in a plastic bag along with cash which even if it is taken that all was in the denomination of ₹ 1000/- notes would result into 200 bundles. Even the said statements have been retracted by the said two employees. On the other hand, the statements of the employees, who were responsible persons, in view of the fact that no other incriminating material or evidence has been found against the assessee, seem to be plausible. There seems no justification in the action of the lower authorities in making the impugned additions solely on the basis of statements of two small time employees which too have been retracted and which otherwise also do not inspire confidence, and especially in the absence of any iota of corroborating/convincing evidence. Further, the Ld. AR of the assessee has produced, before us, a copy of the order of the coordinate bench of the Tribunal passed in ITA No.165/Mum/2012, dated 5-6-2013 to show that in the case of one of the related parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that such type of mere assumptions cannot be said to be having any value of evidence in the eyes of law and even the assessee cannot be called to disapprove such type of assumptions and presumptions based on mere suspicions. The Revenue has to stand on its own legs to bring incriminating evidence against the assessee. No doubt, in this case, the initial burden was upon the assessee to explain about the entries made in the excel sheets, however, once the assessee had explained the entries, the burden shifted upon the AO to prove that the explanation given by the assessee was wrong or that the entries made in the excel sheets were pertaining to sale transactions as alleged by the AO or the entries relating to gold bar was unaccounted purchase, as has been alleged by the Ld. CIT(A). Since both the authorities i.e. AO as well as the Ld. CIT(A) could not prove their case, hence, additions made by them on the basis of mere assumptions/presumptions and suspicions are not sustainable in the eyes of law and the same are accordingly ordered to be deleted. So far as the additional ground of appeal taken by the assessee is concerned, since we have deleted the additions made on account of unaut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere closed at the time of search. It was admitted that the units generally remained closed when there was no export order. It was submitted that the machinery was in working condition and that the AO could personally verify the same. Regarding the allegation of the power consumption, assessee submitted that the company had power connection and it was used only when it got the export orders. It was further submitted that the SEZ units used to be operated only for export purposes. All the raw material had been imported under the supervision and control of Custom and Central Excise department. No item could have been entered or removed without the approval of the Custom and Central Excise department. No material produced from these units could have been sold in India because it was only for export purposes which was again under the supervision and control of Custom and Central Excise department. It was further stated that all the Import and Export raw material and finished goods were made through shipment and proper invoices of the sales had been maintained and foreign remittances was also received through proper banking channels with the approval of the Reserve Bank of India. It was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... foreign remittances in the bank accounts. The assessee submitted that all the above stated documents had already been submitted before the AO, during the assessment proceedings. The Ld. CIT(A) after thorough examination of the said documents did not note any discrepancy in the same. He further noted that even the A.O. had also not mentioned any discrepancy in the Import and Export Clearance papers submitted during the course of assessment. He further observed that it was a fact that in the SEZ units, no Import or Export could be made without the approval of the Custom and Central Excise department. All the payments and receipts were made through banking channels and no discrepancy was pointed out by the A.O. It was established that raw material was imported and the final product was exported with due approval of the Custom and Central Excise department. All the papers relating to the shipment and foreign remittances were in order and moreover the assessee had submitted that there was no Import and Export activity taken place in the search year. He therefore rightly held that the assessee was eligible for claiming deduction u/s. 10A of the I.T. Act. We therefore do not find any inf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upheld. ITA No.7257/M/2011 for A.Y. 2006-07 (Assessee s Appeal): Grounds No.1 to 8 and Additional Ground : 19. Grounds No.1 to 8 additional ground of the assessee s appeal are identical to that of grounds taken in ITA No.7256/M/2011 for A.Y.2005-06 as discussed above. In view of our findings given above, while deciding the said ITA No.7256/M/2011, grounds No.1 to 8 additional ground of this appeal are decided accordingly. Grounds No.9 to 11: 20. Grounds No.9 to 11 are reproduced as under: D. Addition towards unexplained expenditure ₹ 9,31,000/- plus ad hoc estimated addition of ₹ 28,00,000/- 9. The Learned Commissioner of Income-tax (A) erred in confirming addition of ₹ 9,31,000/- as unexplained expenditure on the ground that the gross profit declared by alleged closely linked entities is cost of the appellant without appreciating the fact that the transactions with those concerns were genuine transactions and the said concerns had duly offered and declared the profit earned by them and paid tax on the same, which has also been accepted by the department even after the search action and assessments made u/s.153C of the Act on those entities and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port of sales and purchases to establish the actual delivery of the goods. The Auditor of M/s. Manav Jewelers had confessed in his statement that there was no actual delivery of jewellery to support sale/purchase and audit was finalized in that chawl on computer only. In order to verify the genuineness of these parties, survey operation u/s. 133A was carried out in all concerns. The survey report had established that all the persons were ex-employees/present employees of the assessee company. All these persons shown as proprietors of these concerns actually were men of no means. No books of accounts or any valuable stock was found in their premises. All these persons were having bank accounts in SBI which were introduced by Shri Hitesh Jain, Managing Director of M/s. Auro Gold Jewellery P. Ltd. In the statements recorded during the course of survey, all these persons had admitted that books of accounts or any gold stock had not been maintained in their room (Kotrie) and all the transactions were paper transactions made in their names on behalf of the company M/s. Auro Gold Jewellery P. Ltd. On the basis of the seized material and statements recorded, the AO asked the assessee compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that these proprietary concerns were running in the name of ex-employee of the company having no source of income and no sale/purchase was physically made by delivering the gold bars or jewellery at there so called business premises because they were men of no means. It was also admitted by the A.R. that these were only paper entities and there were no actual sale/purchase made in the proprietary concerns. All the bank transactions in these proprietary concerns also belonged to the assessee company only. For the purpose of completing the paper formalities, PAN No. from the Income-tax Department, registration for Sales Tax and VAT Act etc. was taken. Sales-tax and Incometax returns were also filed of these paper entities. From the statements recorded of the proprietors and the Auditor of these proprietary concerns, it was established that these were only paper entities and had done no sale/purchase transactions in gold jewellery. The assessee had created these paper entities to increase the sale/purchase on paper and to avoid the payment of taxes by showing bogus expenses in the P L A/c. He therefore held that the A.O. had rightly added the gross profit earned by these concerns as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entities created by the assessee to inflate turnover. The assessee has miserably failed to prove that the transactions done by the assessee with these entities were genuine transactions. However, the Ld. A.R. has alternatively submitted that even if the gross profit of these four entities is added to the income of the assessee, then there is no basis for further adhoc/estimated addition of ₹ 28 lakh for each year. In view of the above submissions of the Ld. A.R. and our discussions made above, the order of the Ld. CIT(A) confirming the addition of gross profits earned by these four bogus concerns into the income of the assessee is upheld. So far as the addition of ₹ 28 lakh in each year on adhoc basis on account of expenditure incurred to create these paper entities is concerned, we find that there is no evidence that the assessee has incurred such an expenditure to create these entities warranting adhoc additions of ₹ 28 lakh each. It is also the case of the assessee that the net profits of these entities have also been taxed. Further, we have upheld the addition of gross profits of the said entities, hence further adhoc addition of ₹ 28 lakh for each year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Y. 2005-06, these issues are decided accordingly. The additional ground relating to enhancement of income is also dismissed being rendered infructuous. 33. Grounds No.5 to 7 in this appeal deal with addition towards unexplained expenditure and ad hoc estimated addition. This issue has been discussed and decided by us in assessee s appeal for A.Y. 2006-07. In view of our findings given above, these issues are decided accordingly. Grounds No.8 to 11: Addition towards discrepancy in stock 34. Grounds No.8 to 11 of this appeal, for the sake of convenience, are reproduced as under: D. Addition of ₹ 16,44,14,449/- towards discrepancy in stock 8. The Learned Commissioner of Income-tax (A) erred in confirming addition of ₹ 16,44,14,449/- towards alleged excess stock of gold jewellery and gold bars found in the course of search action vis- -vis recorded in the books of account without appreciating the fact that there was no such discrepancy in stock as on the date of search action more particularly when no inventory was taken by the department in course of search action and hence, the addition confirmed of ₹ 16,44,14,449/- towards alleged excess stock is unjus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r jewellery sent for approval, combined entries for 18 carat and 22 carat jewellery were made in the column meant for 22 carat and because of this reason discrepancy had occurred between the quantity of jewellery as per books and physically found during the course of search. Assessee emphasized that 18 carats, 22 carats and 99.5 standard gold bar trading and 99.9 gold bar trading, if combined together, then the discrepancy would be very minimum and result in minor shortage of stock. It had been further submitted that while making the above addition, the Ld. AO applied the rate of standard gold for 22 carat Jewellery. The AO also did not give the credit towards shortage of standard gold bars of 892,224 grms allegedly found during the course of search as well as credit of 5000 grms gold bars received from P. V. Gold which was not recorded in the books of accounts and confirmation was filed. Further the AO had also not allowed credit towards alleged shortage of 18 carat jewellery of 207232.102 grms found despite the fact that the assessee had entered 18 carats gold ornaments in the column meant for 22 carats in the excel sheet maintained for the purpose of jewellery sent on approval. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the said excel sheet reflected separate columns of 18kt 22 kt gold ornaments - sent on approval received back with cross references, [Assessee Paper Book III - page 446). To maintain data in two separate columns was time consuming, cumbersome and did not serve any purpose, since the same marketing personnel takes both 18kt and 22kt gold which is entered as issued and on return of the same ornaments entered as receipt in separate columns. The appellant thought fit to maintain all issue of gold items both of 18kt and 22kt in one column. Therefore, one column of 18kt was hidden and by default 22kt was retained. The same became simple and was easy to maintain issue and receipt in one column as the weight would remain the same whether it is 18kt or 22kt. Hence, for easy reference, management took a policy decision to maintain only one column and the column of 18kt gold was hidden in the excel sheet. c) The appellant submits that though all entries were under the head 22kt gold, appellant did sent 18kt gold ornaments also to various customers. This is proved by the survey action of department on third parties i.e. issue voucher of appellant showing 18kt gold ornaments was found i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering the meagre difference, combined stock of gold bars is maintained and the overall picture of gold bars emerges as under- 99.5 standard gold bar as per books 12337.760 grams 99.5 standard gold bar trading as per books 892.224 grams 99.9 gold bar trading as per books 50.000 grams Total as per books 13279.984grams Less: Gone on Approval 13041.980 grams Balance 238.004grams Less: Physically found by search party 4651.017grams Total excess found 4413.013grams Less: Received from P.V. Gold 5000.000 grams Total shortage (due to weight diff.) 586.987 grams ii) The excess found was due to the reason that standard gold bar of 5000grams received from P.V. Gold remained to be entered in the stock sheet as on the date of search action, since this gold bar was received for job work i.e. manufac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lower authorities and has further contended that separate columns have been made in the books of accounts regarding different kinds of gold jewellery and gold bars and that the explanation of the assessee that a combined entry was made in the excel sheet in respect of different qualities of jewellery and gold bars sans evidence, hence is liable to be rejected. 39. We have considered the rival contentions. The most vital fact on this issue is that the assessee has not been provided the copies of the inventories made during search at different premises of the assessee except that of one at Laxmi Premises. Even during the course of hearing, the records in this respect were called upon, but the Revenue could not furnish the copy of any other inventory. When the Revenue itself has failed to provide the copies of inventories to the assessee, how can assessee be asked to reconcile the same. The Ld. AR of the assessee has pointed out various defects in the consolidated stock inventory prepared by the AO which are apparent on the record as has failed to correctly record the figures in relation to 18kt. jewellery. The assessee, otherwise has explained that in the excel sheet, combined fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned Commissioner of Income-tax (A) erred in confirming addition of ₹ 2 Cr. towards alleged cash payment for purchase of property at Cama Industrial Estate, Lower Parel without appreciating the fact that the said property was not purchased by the appellant the observation made in the order is contrary to the factual position and hence, the question of making payment in cash of ₹ 2 crores does not arise and the addition therefore made is without any justification and liable to be deleted. 14. Without prejudice to the above, the Ld. CIT(A) failed to appreciate that no where in the seized papers it has been stated that cash of ₹ 2 crore is paid for the purchase of the property by the appellant and hence, the addition made of ₹ 2 crores is without any justification and liable to be deleted. 15. Without prejudice to the above and without admitting, the payment in cash for purchase of property outside books of account, if any, is merely application of income and not source of income and hence, if any addition is sustained towards source of income on any of the issues in dispute, the appellant be allowed telescopic benefit and thus, the addition made of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is is supported by loose paper marked page no. 28 wherein it is mentioned that agreement value of property is 6 crore, which is bifurcated between premises and machinery, etc. and the total value of property of ₹ 6 crore is then reduced by token payment of Rs,21 Iacs and the balance is shown at ₹ 5. 79 crore. Further, on this page it is mentioned that token amount of R.s.21 lacs is paid on 22.7.2008; ₹ 2 crore before 7.82008 as cheque if in cash then 01.08.2008. Thus, amount of ₹ 2 crore is not over and above the total negotiated price of ₹ 6 crore, It is only noted that payment of ₹ 2 crore is to be paid in cheque if paid on or before 7.8.08 and if to be paid in cash than on or before 1.8.08 and not mentioned as cash paid of ₹ 2 crore. However, deal did not materialize and was cancelled hence payment of ₹ 2 crore in cash does not arise. Further, page no. 144 of the seized paper show date mentioned as 27 Oct against 79 Possession; which as per directors' working, the final payment of ₹ 79 lacs was to be paid on possession of the property to be received on 27 October 2008. Thus, this page is mere rough noting and even if c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty in question, nor there is any mention in the seized documents, that the assessee in fact has made the payment of ₹ 2 Crores, then the addition, merely on the basis of assumption that the assessee might have made the payments, in our view, is not sustainable in the eyes of law. When there is no evidence of such a payment made by the assessee, the assessee can not be called upon to prove the negative. The addition on this account is therefore, ordered to be deleted. 47. Now we take up Revenue s appeals. ITA No.8083/M/2011 for A.Y. 2005-06 (Revenue s Appeal) 48. The Revenue in its appeal has taken the following grounds of appeal: 1. Whether on the facts and the circumstances of the case and in law, the Ld. CIT (A) is justified holding that the assessee is entitled to deduction u/s. 10a of the IT Act, 1961, when enough evidences were collected at the time of survey at the business premises which show that assessee has not carried out any manufacturing activities at SEZ unit Surat. 2. Whether on the facts and the circumstances of the case and in law, the Ld. CIT (A) is justified in directing the A.O. to allow the deduction u/s. 1OA of the Income Tax Act, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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