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2016 (6) TMI 943 - GUJARAT HIGH COURT

2016 (6) TMI 943 - GUJARAT HIGH COURT - TMI - Unexplained investments on account of demand drafts allegedly purchased by the appellant in cash - Held that:- Perusing the statement of Hasmukhbhai Shah dated 19.08.2003 before CIT(A) and as per questions no. 19 and 21 the revenue has not been able to prove that the demand drafts purchased in cash belong to the assessee. Even if the onus in respect of the two DDs amounting to ₹ 1,61,527/- is discharged in assessment year 1993-94 in absence of .....

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estions raised in the present appeals are required to be answered in favour of the assessee - TAX APPEAL NO. 520 of 2004 TO TAX APPEAL NO. 522 of 2004 - Dated:- 9-6-2016 - MR. KS JHAVERI AND MR. G.R.UDHWANI, JJ. FOR THE APPELLANT : MR JP SHAH, ADVOCATE WITH MR MANISH J SHAH, ADVOCATE FOR THE OPPONENT : MR KM PARIKH, ADVOCATE ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. Being aggrieved and dissatisfied with the impugned judgment and orders passed by the Income Tax Appellate Tribunal, .....

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the addition made as unexplained investments on account of demand drafts allegedly purchased by the appellant in cash? 2. During the course of assessment proceedings the Assessing Officer reopened the assessment u/s 147. The Assessing Officer also made an addition of ₹ 6,50,593/- u/s 69 of the Income Tax Act on the ground that the assessee had purchased demand drafts of the value stated from The Baroda Traders Co-operative Bank Ltd and Shree Bharat Co-operative Banl Ltd., Fatehpura, Baroda .....

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assessee has stated that the Tribunal has erred in not following the ratio laid down by the Supreme Court in Kishinchand Chellaram vs. Commissioner of Income Tax reported in 125 ITR 713 wherein it is held as under: ... It is to our mind impossible to hold, in the face of the application for the remittance signed in the name of Tilokchand that this amount was sent by the assessee and the finding to that effect reached by the Tribunal must be held to be unreasonable and perverse....... Even if we .....

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e burden of showing that the amount was remitted by the assessee was on the revenue. 3.1 Mr. Shah submitted that considering the aforesaid decision, even if things are assumed against the assessee, the factum of money being that of assessee is not proved by the revenue. He submitted that even assuming that as per the decision in the case of Kishinchand (supra) the two letters were to be taken into account, those letters would at the highest establish that Trilokchand, an employee, remitted the a .....

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t of Hasumukhbhai Shah dated 19.08.2003 before CIT(A) and submitted that questions no. 18, 19 and 21 clearly show that it was nothing but malicious proceedings when the Assessing Officer vide his letter dated 03.07.2003 addressed to CIT(A) made the following concession ... Shri Bharat Cooperative Bank Ltd was not following practice to obtain DD forms and hence the same are not available. As regards the purchase of DDs from Baroda Traders Cooperative Bank Ltd., the DD forms have been obtained and .....

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r. Shah has further stated that one Mr. Atul Shah has stated in his statement that the list of the DDs purchased was prepared by Shri Hasmukh Shah after asking him the details and that Mr. Atul Shah has prepared the list on the basis of the DD application forms. He submitted that Mr. Atul Shah admits that the name of the assessee is not mentioned on any of the application forms and that he has filled the column for the purchaser on the basis of his memory. Mr. Atul Shah stated that the DDs were .....

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s of the some so called evidence which he claims to be in his possession but he is not prepared to confront the assessee with and therefore the evidence is not a clinching evidence and the allegation against the assessee therefore remains unproved. 3.6 In support of his submissions, Mr. Shah has relied upon the decision of this Court in the case of Krishna Textiles vs. Commissioner of Income Tax reported in (2009) 310 ITR 227 (Guj). 4. Mr. K.M. Parikh, learned advocate appearing for the responde .....

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of the bank were provided to the assessee for verification. 4.1 Mr. Parikh further submitted that the copies and records of the bank were provided to the assessee for verification and that the assessee failed to provide books of accounts and names and signatures of employees but the assessing officer has clearly mentioned in the assessment order that the names written in the demand drafts are of employees of the assessee as per old records. He submitted that the assessee has not even furnished t .....

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the bank manager cannot know the employees of the assessee since the procedure of making demand drafts is such that bank manager in no way comes into direct dealing with the person who takes the draft is also not found to be convincing since a manager who is responsible for banking transactions normally knows the persons who deals on day to day basis with the bankers. The assessee inspite of having allowed cross examination of witnesses i.e. bank officials failed to furnish any document in the .....

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cord, for the burden of showing that the amount was remitted by the assessee was on the Revenue. Unfortunately, for the Revenue, neither Tilokchand nor Nathirmal was in the service of the assessee at the time when the assessment was reopened and the assessee could not therefore be expected to call them in evidence for the purpose of helping the Revenue to discharge the burden which lay upon it. We must therefore hold that there was no material evidence at all before the Tribunal on the basis of .....

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