9911796707
TMI Blog2011 (11) TMI 692X X X X Extracts X X X X X X X X Extracts X X X X ..... r "the figures and notings in various slips were indicative of the cost of gold, the labour charges and sales tax leviable etc." 3. The CIT(A) has erred on facts and law in deleting the addition of Rs. 91,770/- on account of an unexplained investment without appreciating the fact that the paper containing the expenses was found from the premises of the assessee during the course of search and seizure operation and the onus cast upon the assessee in terms of section 132(4A) was not discharged. 4. On the facts and in law the CIT(A) has erred in deleting the addition of Rs. 91,770/- without considering the fact that entry of Rs. 2100/- pertains to school fees and also in correlating that the expenditure have been made by Urja Gas Company. 5. CIT(A) has erred on facts and in law in deleting the addition of Rs. 4 lakhs on account of unexplained investment without considering the statement of affairs filed by the assessee where no loan from Satvanti Monga is reflected. 6. CIT(A) has erred on facts and in law in deleting the addition of Rs. 34,631/- without appreciating the fact that the assessee has failed to explain the investment in FDR. 7. CIT(A) has erred on facts and in la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Tarun Monga, at M-103, Greater Kailash II, New Delhi. No valuable articles/cash/jewellery/documents/bullion were seized, since they were apparently found to be within the prescribed limits. However, some loose slips of torn papers containing scribblings were found and seized. Block return was filed declaring nil undisclosed income. The AO assessed the income at ₹ 34,79,087/-, vide block assessment order dated 30.4.04. 7. As per the block assessment order, a search and seizure operation was carried out on 26.4.02, on Kishorilal Joginderlal group of cases, Kanpur; that as a part of that search, a search was also conducted at the business and residential premises and the lockers of the in-laws of Shri Manish Bhatia and Shri Kunal Bhatia. The assessee, Smt.Avinash Monga is a member of the family in-laws of Shri Kunal Bhatia, son of Kishori Lal Bhatia. Suresh Monga is the husband of the assessee. 8. The AO observed that the assessee was a school teacher, regularly filing her Income Tax return and declaring income from salary, house property and other sources; that in the seized documents annexure A-I, the following pages reflected expenditure made in purchasing jewellery:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ining the entries were found from the premises of the assessee during the search and seizure operation; that the ld. CIT(A) has failed to consider that the assessee had miserably failed to discharge the onus cast upon her u/s 132(4A) of the Act with regard to the seized documents; that though the ld. CIT(A) has himself acknowledged in the impugned order that the figures and the notings in various slips were indicative of the cost of gold, labour charges and sales tax leviable, etc. the ld. CIT(A) has still gone on to delete the additions correctly made; and that apropos the addition of ₹ 91,770/-, the ld. CIT(A) failed to consider the fact that the entry of ₹ 2100/- pertained to school fee and also in co-relating that the expenditure was made by Urja Gas Company. 15. The learned counsel for the assessee, on the other hand, has strongly supported the impugned order. It has been submitted that the assessee lady is a retired school teacher having pension income besides income from salary, house property and other sources; that it was merely because the assessee is a member of the family of in-laws of Kunal Bhatia, son of Kishori Lal Bhatia, of the Kishorilal Joginderlal g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tives, as also stated by the assessee's husband, Shri Suresh Monga, in response to question No. 37, in his statement; that the jewellery was stridhan of the assessee, received at the time of her marriage and on other occasions, as also stated by Suresh Monga; and that the ld. CIT(A) has correctly deleted both the additions wrongly made. 16. We have heard the rival contentions on this issue and have perused the material on record with regard thereto. 17. The amounts, as below, were added by the AO, total amounting to ₹ 12,72,707/-, and forming the basis of ground Nos. 1&2:- Annexure Amount Figure/s Remarks A-1 Page No. Assumed as undisclosed income in the asstt. order u/s 158 BC appearing/scribbling on the loose slips/torn pieces of paper 1. (Rs. 95,000) ₹ 95,000 Aggregate of following has been added to undisclosed income. Renu Khanna 5,000 Priyanka 5,000 Renu B 5,000 Shriya B 5,000 Mrs. Monga 10,000 Ms. Monga - Veena Bansal 10,000 Renu Likha - Indra 10,000 Manjula 5,000 Sandeep 10,000 Dr. Kakkar 10,000 Veena Sehgal 5,000 Juhi 5,000 Renu Leekha 10,000 The person who has scribbled various figures on the loose slip, purpose, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e figures, whether sale or purchase, not corroborated. 16. 48,000 480.00 i) Rough estimate only, no address, not known who has scribbled the figures, whether sale or purchase, not corroborated. 17. 32,224 32,224 The person who has scribbled above on loose slips, purpose, nature date/period not known, no address, no signature. 18. 15,850 158.50 i) The person who has scribbled above on loose slips, purpose, nature date/period not known, no address, no signature. ii) The figure of 158.50 has been read as ₹ 15,850 for adding to undisclosed income. 19. 17,950 179.50 i) The person who has scribbled above on loose slips, purpose, nature date/period not known, no address, no signature. ii) The figure of 179.50 has been read as ₹ 17,950 for adding to undisclosed income. 20. 42,950 42,950 The person who has scribbled above on loose slips, purpose, nature date/period not known, no address, no signature. 21. 135,866 1,35,866.00 The person who has scribbled above on loose slips, purpose, nature date/period not known, no address, no signature. 22. 6,600 Not legible The person who has scribbled above on loose slips, purpose, nature date/period not known, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndicative of the cost of gold, labour charges and sales tax leviable, etc., leading to the belief that they related to the purchase of jewellery; that since these slips were found at the residence of the assessee, the AO had held that the jewellery was purchased by the assessee and her husband and the additions of the amounts were made in the block assessments of both the assessee, as well as her husband; that however, none of the jewellery items matching the descriptions given in the loose papers was seized in the search; that where some narration was given in the slips, the AO remained unable to relate the same to the assessee or to corroborate it with jewellery or other assets found during the search; that the husband of the assessee in his statement had stated that the jewellery found in the house had been purchased from her own sources or was gifted from relatives and that the entire jewellery was the stridhan of his wife, received at the time of their marriage and on other occasions; that in the circumstance of no jewellery item matching the description given in the loose papers having been seized in the search and the AO had failed to relate the jewellery where some narratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment of not only the assessee, but also her husband, Suresh Monga. It is also undisputed that the AO has not been able to relate the amounts to the assessee or to corroborate the same with the jewellery or other assets discovered in the search. Further, Suresh Monga, the husband of the assessee in his statement, had stated that the jewellery which was found in the house was the stridhan of his wife, the assessee or purchased from their own sources. These facts remain uncontroverted. 25. The stand of the Department in this regard is that the ld. CIT(A) has ignored the factum of the slips contraining the entries having been found from the premises of the assessee and the assessee having failed to discharge her onus u/s 132(4A) of the Act with regard to such slips. In this regard, whereas it is undeniable that the onus u/s 132(4A) of the Act was on the assessee, the slips seized in the search operation were neither in the handwriting of the assessee, nor did they contain the nature of the figures mentioned therein, nor as to whether the figures represented goods or money, sales or purchase, the receipt or payment, etc. Therefore, the seized slips were nothing more than dumb docum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 320 dated 01.08.98 from BOI from account of Satwanti Monga. 2. ₹ 4,00,000/- cheque No. 088955 dated 2.11.98 from BOI account No. 11223. 3. ₹ 10,00,000/- Pay order No.008285 dated 4.2.99 - loan from Central Bank of India. 4. ₹ 1,44,000/- cost of stamp papers paid on cash out of cash withdrawals from bank in 1998-99. 30. The AO observed that the assessee had thus contradicted the statement filed, since the sale proceeds of HUDA plot at Gurgaon at ₹ 4,50,000/- had been credited in bank account No. 16488 in Central Bank of India, Kashmiri Gate, but an amount of ₹ 4,00,000/- had been paid from her account No. 11223; that it was also not clear as to why the loan from Satwanti Monga was taken and as to when it was repaid; that even in the statement of affairs filed by the assessee for F.Y. 1998-99, i.e., assessment year 1999-00, no loan from Satwanti Monga had been reflected; that in fact, in the statement of affairs for assessment year 1998-99, on the assets side of the balance sheet, ₹ 1,60,000/- had been shown in the name of Smt. Satwanti Monga; that this was a loan of ₹ 1,60,000/- taken by Smt. Satwanti Monga from Smt. Avinash Monga, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he parties on this issue and having perused the material on record with regard thereto, it is seen that it remains undisputed that the payment of ₹ 4,00,000/- had been made from the bank account of Smt. Satwanti Monga, mother-in-law of the assessee. It also remains undisputed that this loan had in fact been repaid by the assessee to her mother-in-law. Besides, the assessee had purchased the first floor of house No. M-103, G.K.II, New Delhi, for ₹ 18,00,000/-, vide registration deed dated 5.2.99. Stamp duty of ₹ 1,44,000/- had also been paid by the assessee. This was reflected in the return of income and the statement of affairs filed by the assessee with the Department, for assessment year 2000-01. Thus, the purchase of the property had been duly declared in the regular return filed. Details of loan of ₹ 10,00,000/- from Central Bank of India were filed vide Pay Order No. 008285, dated 4.2.99. The other amount of ₹ 4,00,000/- from Bank of India was through cheque No. 088955, dated 2.11.98 from account No. 11223. 35. The ld. CIT(A) has duly taken into consideration the above facts while deleting the addition of ₹ 4,00,000/-. Nothing has been brou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law of the assessee and the assessee, as the second holder thereof; that the return of income of Smt. K. Chawla was not filed, since she was a NRI and her income was below the taxable limit for the relevant years, due to which fact, her return of income was not required to be filed; and that the assessee being only the second holder of the FDR, which was held jointly only for the sake of convenience, it cannot be treated as belonging to the assessee. The ld. CIT(A) deleted the addition by observing that there was no corroborative evidence brought by the assessee that the FDR belonged to the assessee. 42. We do not find any justification in the deletion of this addition. Once the assessee has not been able to show as to which FDR had been declared in the return of income filed for assessment year 97-98, the FDR was rightly treated by the AO as undisclosed investment u/s 69A of the Act. Ground No.6 is, as such, accepted. 43. The last ground, i.e., ground No.7, pertains to the deletion of the addition of ₹ 7,05,988/- being credit entries in Bank Account No. 9984 with Central Bank of India, treated as undisclosed income by the AO. 44. As per the assessment order, during the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 98-99. 2000-01 01-02 NIL As max. credit balance is ₹ 5,08,921/- which is explainable from credit balance of F.Y. 98-99. 01-02 02-03 NIL As max.credit balance is ₹ 2,13,993/- which is explainable from credit balance of F.Y. 98-99. Peak credit balance for A/c No. 9994: F.Y. A.Y. Peak credit balance (Rs.) Remarks 98-99 99-00 26,920 ---- 99-00 00-01 6,79,066 The max.credit balance is ₹ 7,05,986/-.But ₹ 26,920 is of F.Y. 98-99. Therefore, difference between ₹ 7,05,986/-& `26,920 is peak credit of this year. 2000-01 01-02 NIL As max. credit balance is ₹ 6,04,409/- which is explainable from credit balance of F.Y. 99-00. 01-02 02-03 NIL As max. credit balance is ₹ 4,40,581/- which is explainable from credit balance of F.Y. 99-00. 02-03 03-04 NIL As max. credit balance is ₹ 3,21,114/- which is explainable from credit balance of F.Y. 99-00. 46. As such total peak credit balance for the block period in Account No. 16488 came to ₹ 9,30,750/- and the peak credit balance for the block period thus came to ₹ 7,05,986/-. This was treated as the assessee's unexplained income found for the block period. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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