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Commissioner Of Income Tax (Central) , Gurgaon Versus Principal Officer, M/s Hill View Infrastructure (P) Ltd.

2015 (10) TMI 2379 - PUNJAB & HARYANA HIGH COURT

Addition u/s 69 - Whether ITAT has erred in not appreciating that once the entries appearing on any seized document in the course of search are credible and shows that outstanding liability of the assessee amounting to ₹ 1,28,89,362/- was in respect of an investment and by virtue of section 69 of the Act should have been treated as income and could not have been restricted to part payment? - Held that:- CIT(A) restricted the addition of ₹ 59,43,115/- as against the addition of ₹ .....

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; 13,00,000/- and the addition had been restricted to ₹ 59,43,115/-. The Assessing Officer had erred in making addition of ₹ 1,28,69,362/- to the income of the assessee. The balance amount payable by the assessee to Shri Monga and his family members which was shown in the books of account of the assessee as outstanding could not be termed as undisclosed income and included in the total income of the assessee. The CIT(A) and the Tribunal were right in sustaining the addition of ₹ .....

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(in short "the Act") against the order dated 6.6.2014 (Annexure A-3) passed by the Income Tax Appellate Tribunal, Chandigarh Bench 'B', Chandigarh (hereinafter referred to as "the Tribunal") in ITA No. 549/Chd/2013 for the assessment year 2009- 10, claiming the following substantial question of law:- Whether ITAT has erred in not appreciating that once the entries appearing on any seized document in the course of search are credible and shows that outstanding liabili .....

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on 22.11.2011 declaring nil income. The Assessing Officer passed the assessment order dated 21.12.2011 (Annexure A-1) by assessing the income at ₹ 1,71,18,360/-. The Assessing Officer made addition of ₹ 1,28,68,362/- to the taxable income of the assessee under Section 69 of the Act besides other additions. Feeling aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals) [for brevity "the CIT(A)"] who vide order dated 6.3.2013 (Annexure A-2) f .....

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09- 10 on this issue. Hence, the present appeal by the revenue. 4. Learned counsel for the revenue submitted that on the basis of pages 59 to 67 of Annexure A-2 [before the CIT(A)] found and seized from the premises of the assessee, it was established that the total amount which was shown as outstanding in the books of account was ₹ 1,28,89,362/- and the assessee had failed to satisfactorily explain the source of the said amount. It was further submitted that the outstanding liability of t .....

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e payment of ₹ 46,43,115/- in addition to ₹ 13,00,000/- to Mr. Monga whereas the remaining amount was still outstanding in the books of account of the assessee. The relevant findings read thus:- "From the narrations above, it is crystal clear that the documents in dispute corroborate and are selfspeaking, containing financial transactions of various projects. At page 14 of the impugned order, a table has been drawn which enumerates the total amount of transactions from the seize .....

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by Sh. Monga. So in the absence of any reflection in the books being shown by the assessee, I hold that ₹ 59,43,115/- is the amount to be added. The addition made by the AO is restricted accordingly. Consequently the assessee partly succeeds on this ground." 6. The Tribunal while dismissing the appeal has recorded as under:- "37. We have heard the rival contentions and perused the record. The issues raised vide ground No.1 in the appeal of the assessee and ground No.3 in the app .....

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respect of the Ashreya Studio Apartments, Hill View & M-1 Plaza. The letter further talks about advance lying with Mr. Lalit Jindal of ₹ 4,50,000/-. The person writing the letter has concluded by stating "Total receivable from you- ₹ 1,28,89,362/-, less already received from you - ₹ 13,00,000/- and balance due from you ₹ 1,15,89,362/-." To the said letter, Mr. Monga has further attached annexures i.e. transaction letter marked as (a) to (e) which incorporate .....

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onga in the projects floated by the assessee. The Assessing Officer requisitioned the assessee to produce Shri Monga but he was never produced despite the assessee stating that he was prepared to produce him. However, during the course of assessment proceedings, letter from Mr. Monga dated 21.11.2011 was produced in which it is claimed that the figures in the said letters were notional figures. Further, though the assessee claimed that the entries were reflected in the books of account but the s .....

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racom. However, the assessee failed to co-relate the total entries. The perusal of the various documents reflect the financial transactions in relation to various projects and in view of the covering letter which is very categorical in stating that the total amount receivable from the assessee was ₹ 1,28,89,362/- against which sum of ₹ 13 lacs was already received and the balance due from the assessee was ₹ 1,15,89,362/-. The presumption is to be drawn against the assessee wher .....

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the balance outstanding amount. The notings at page 66 reflect the total value of investment at ₹ 79,60,250/- as against which there was a credit of ₹ 33,01,375/- and the outstanding was ₹ 46,48/875/-. At page 65, the transaction was of ₹ 36,00,000/- against which there was a credit of ₹ 1,43,000/- and balance was ₹ 34,57,000/-. Similarly at page 64, the transaction was of ₹ 57,50,000/- against which there was a credit of ₹ 16,00,000/- and balance .....

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page was No.60, on which as against total amount of transaction, ₹ 2,34,542/-, ₹ 1,98,740/- was paid and the balance was ₹ 35,805/-. As per tabulated details at page 14, the amount credited/paid totalled to ₹ 46,43,115/- and the balance on each page was shown as receivable by Mr. Monga and his family members from the assessee vide letter dated 10.08.2008. Further sum of ₹ 13,00,000/- is mentioned in the said letter placed at page 67 as having been received by him. I .....

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