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Assistant Commissioner of Income-tax, Central Circle-VI, Kolkata Versus Smt. Usha Agarwal and Vica-Versa

2016 (7) TMI 134 - ITAT KOLKATA

Addition on account of undisclosed income - introduction of unaccounted money in the guise of loan or gift or capital gain - disclosure made by the assessee’s husband - Held that:- We find that the entire addition of ₹ 1 crore made by the Learned AO was merely based on the disclosure made by the assessee’s husband while making total disclosure of ₹ 7.5 crores for the total group as a whole and the assessee’s name has been included in the figure of ₹ 1 crore only in order to mak .....

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eleted the addition made in the sum of ₹ 1 crore. - Cash deposit in the bank account - Held that:- We find that the assessee had claimed that no such cash deposits to that extent was made in her bank accounts. We also find that this claim of the assessee was never verified by the Learned AO for want of time which is not disputed by the revenue before us. We find that the Learned AR had fairly agreed for setting aside of this issue to the file of the Learned AO to enable him to make a d .....

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No. 323/CC-VI/CIT(A)C-1/11-12 dated 01.11.2013. Assessment was framed by DCIT, C.C-VI, Kolkata u/s. 143(3) of the Income tax Act, 1961 (hereinafter referred to as the Act ) for AY 2010-11 vide his order dated 31.12.2011. 2. The only issue to be decided in this appeal of the revenue is as to whether the Learned CITA is justified in deleting the addition made in the sum of ₹ 1 crore and sustaining the addition in the sum of ₹ 51 lacs in the facts and circumstances of the case. 3. The .....

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) filed a disclosure petition dated 14-11-2009 before the DDIT(Inv) thereby admitting undisclosed income of ₹ 7 ½ crores in the name of the family members which included surrender of ₹ 1 crore in the hands of the assessee for the assessment year 2010-11 by way of "Misc & others". The AO also noted that the statement of undisclosed income placed at schedule-2 of the' disclosure petition was signed by the assessee. However, the assessee did not include the said .....

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nduct search u/s 132; that no incriminating material representing undisclosed income or undisclosed assets of the assessee was found in the search; and, that the disclosure made at the time of the search was unwarranted and irrelevant as it was not based on any material found in the search. The AO was not impressed with the argument that the disclosure was made under coercion. He was of the opinion that the argument was only an afterthought. The AO also rejected the contention that no incriminat .....

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was argued that the AO has erred in law in relying solely on the confessional statement made by third party for drawing adverse inference in the case of the assessee when there was no corroborative material on record to support such statement. The Ld AR has further submitted that Sri Sambhunath Agrawal was not legally competent to make statement on behalf of the assessee; and, that such unlawful statement made without any authority was not binding on the assessee, But, even otherwise, the declar .....

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ed that the AO has made irrelevant observations for making the addition. For, the AO has mentioned that undisclosed cash deposit in bank account was found in consequence to the search; but then, the same has been considered separately. Secondly, there is no finding of the AO in his assessment order that the cash deposit was unexplained in the hands of the assessee. It was explained at the assessment stage that the ITS data showing cash deposit of ₹ 51 lakhs was factually incorrect in as mu .....

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ely in the case(s) of the concerned assessees. The issue regarding cash deposit in the bank account or introduction of money in the guise of loan or gift or capital gain is in the way related to the disclosure of ₹ 1 crore in the assessment year 2010-11. 5. The Learned CITA observed in his order that the AO has brought no material on record to show that Sri Sambhunath Agrawal had got any legal sanction or authority to make a disclosure on behalf of the assessee. But, even otherwise, the di .....

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l crore in the case of the assessee is not supported or corroborated by independence evidence. He observed that the CBDT vide its Circular dated 10.3.2003 has clearly instructed that the Learned AO should rely on credible evidence and that the material gathered in search should form the basis for framing the assessment. He further held that specific issues relating to cash deposit in bank account or introduction of undisclosed money in the guise of loan or gift or capital gain, if any , has to .....

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ad denied the same at the assessment stage and had stated that only ₹ 6.50 lacs was deposited in the bank account which is already disclosed in the returns , no separate ground was raised by the assessee contesting such addition. He finally held that the Learned AO had held that cash deposit of ₹ 51 lacs in bank account of the assessee has to be treated as unexplained income, however, no separate addition was being made in view of the addition of ₹ 1 crore on the basis of the d .....

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on account of undisclosed income without appreciating the facts of the case. The assessee has also preferred cross objection by raising the following ground: - That the CITA has erred in sustaining addition of ₹ 51 lakh towards deposit of cash in bank account when no such transaction had actually taken place. 7. The Learned AR relied on the order of the Learned CITA with regard to the addition deleted in the sum of ₹ 1 crore. With regard to the addition sustained in the sum of ͅ .....

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ned AO. 8. We have heard the rival submissions and perused the materials available on record. We find that the entire addition of ₹ 1 crore made by the Learned AO was merely based on the disclosure made by the assessee s husband while making total disclosure of ₹ 7.5 crores for the total group as a whole and the assessee s name has been included in the figure of ₹ 1 crore only in order to make the total disclosure to ₹ 7.5 crores. We find that no incriminating materials w .....

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18 (SC) The Hon ble SC has observed that an admission is an extremely important piece of evidence but it cannot be said that it is conclusive. It is open to the person who made the admission to show that it is incorrect. (ii) CIT vs Ravindar Kumar Jain (2011) 201 taxman 95 (Jharkhand HC) 6. We have considered the submissions made by the learned counsel for the appellant and perused the reasons given in the orders passed by the CIT(A). 7. It is not in dispute that during the course of search, th .....

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er himself. Therefore, part of alleged admission of assessee was not found correct. Not only this, even from the order passed by the Assessing Officer itself it is apparent that the assessee, in addition to stating that he deposited ₹ 3 lakhs in different Saving Bank Accounts of Oriental Bank of Commerce, he also lent some money to private persons that fact was also found not correct by the Assessing Officer himself. Therefore, the admission made by the assessee before the Assessing Office .....

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at he lent some of the amounts to some persons. Therefore relying on only one such statement given by the assessee in these circumstances where out of three two facts were found to be not correct, then in these facts and circumstances, it was the duty of the Assessing Officer to collect more evidence in support of the fact that there was undisclosed income of ₹ 7 lakhs in the hands of the assessee. These reasons had been considered by the CIT(A) as well as by the ITAT and therefore, their .....

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dd hours. The assessee had given proper explanation for all the items under which disclosure was sought to be obtained from the assessee. With regard to the investment in house property he had stated that he took the plot in 1964 from the housing society which was constructing the bungalow for which the assessee made contribution from time to time and took possession in 1974 when only one ground floor was constructed. He had been living there and during 1986 to 1988 he had constructed the first .....

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ccount of gold ornaments could not be sustained since looking into the quantum of holding and the assessee s explanation this was a normal holding which could be found in any middle class Indian family. The furniture on the ground floor was 15 years old and the assessee had spent ₹ 25,000 for renovation after making withdrawal from the firm s account. With respect to furniture in the first floor a detailed source of investment of furniture purchased with due confirmation from the party con .....

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