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Santosh Ahluwalia and MJS Ahluwalia Versus A.C.I.T., Circle-2, Jaipur

2016 (7) TMI 1184 - ITAT JAIPUR

Addition in the hands of assessee’s husband on protective basis - cash available on the date of search - Held that:- The authorities below have failed to apply their mind and appreciate the evidence available with it. Paragraph No. 2 of 4.3 of CIT(A)’s order clearly points out that there is a hard disk and hard disk was found during the course of search and on the basis of hard disk, the brought forward cash of ₹ 50,88,408/- was available on 11/11/2009. If the cash of ₹ 50,88,408/- w .....

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. We have no doubt that the addition made by the authorities below were without any jurisdiction and were not in accordance with law and the facts and circumstances of the case. Accordingly, the addition in the hands of the assessee is deleted. - Also the addition made in the hands of assessee Smt. Santosh Ahluwalia being cash found in the locker, in our opinion is also required to be deleted - Decided in favour of assessee. - ITA No. 06/JP/2013, ITA No. 08/JP/2013 - Dated:- 13-6-2016 - SHRI .....

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red in upholding the addition of ₹ 5,74,100/- made u/s 69 on account of cash by treating the as unexplained, arbitrarily. 1.1. That the Ld. CIT(A) has further erred in ignoring the fact that the cash found was belonging to M/s Rajasthan Mining & Engineering Pvt. Ltd. which is duly supported by necessary evidences, thus the addition so confirmed deserves to be deleted. 1.2 That the Ld. CIT(A) has further erred in misinterpreting the statements of the assessee recorded during the course .....

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eating the same as unexplained, arbitrarily. 1.1 That the Ld. C1T(A) has further erred in ignoring the fact that the cash found was belonging to M/s Rajasthan Mining & Engineering Pvt. Ltd. which is duly supported by necessary evidences, thus the addition so confirmed deserves to be deleted. 1.2 That the Ld. CIT(A) has further erred in misinterpreting the statements of the assessee recorded during the course of search. 1.3 That the Ld. CIT(A) has further erred in ignoring the fact that asses .....

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action u/s 132 of the Income Tax Act,1961 was carried out on 12-11-2009 at the business and residential premises of Kamal Jeet Singh Ahluwalia and Group. Notice u/s 153A / 153C r.w.s. 143(2) was issued to the assessee. During the course of search cash totalling to ₹ 19,87,200/- was found which comprised of an amount of ₹ 14,13,100/- found from the residence of assessee and the amount of ₹ 5,74,100/- found from a locker bearing no 10 maintained with SBBJ, Gopalbari, Jaipur main .....

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husband and also treated the cash found in the abovementioned locker as unexplained money of assessee and made addition in the hands of assessee on substantive basis which was added in the hands of assessee s husband on protective basis. Ld. AO made further addition on substantive basis on account of difference in the weight of jewellery as found during the course of search and as declared by assessee in VDIS and same amount was added in the hands of assessee s husband on protective basis. 3. Re .....

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that cash belongs to the company of the assessee namely M/s Rajasthan Mining and Engineering Pvt. Ltd.. However, the ld Assessing Officer was not convinced with the explanation given by the assessee and has made addition of ₹ 14,75,980/- in the hands of the assessee and balance in the hands of Smt. Santosh Ahluwalia. Finding of the ld Assessing Officer is mentioned at paragraph No. 4.3 of the assessment order, which is as under:- 4.3 Assessee s reply was considered but not found to be acc .....

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ngs. In view of this, the difference in weight of gold (purity 89.28%), which, after conversion at the rate of ₹ 1500/- per gram, as valued by the Department Valuer on the date of search operation, comes to an amount of ₹ 7,06,950/- and is added back to the income of the assessee U/s 69A of the IT Act, 1961 on substantive basis as the VDIS surrender was done in assessee s name only also the jewellery items as per inventory prepared during the search consisted to women s jewellery ite .....

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he balance sheet. It was submitted that the company being juristic person is assessed separately and once the cash amount shown in the return of income was accepted by the department then the addition made by the Assessing Officer was bad in law in the hands of the assessee. 3. The assessee feeling aggrieved by the order passed by the ld Assessing Officer has taken up the matter in the appeal to the ld CIT(A). The ld CIT (A) vide order dated 26/11/2012 has confirmed the addition. We would like t .....

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tinguish between the ledger and cash book in his statements. I have carefully perused the statement of Shri MJS Ahluwalia and find that he was very much in command of his faculties and was able to furnish all the details and explanation as and when asked for by the Department during the search operations. Nowhere on perusal of his statement does it appear that his mental capacity was afflicted during the course of recording of these statements. However, he is allowed a margin of doubt that he di .....

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as failed to furnish any explanation either during the course of assessment or appellate proceedings as to where the balance amount of cash was kept. No reconciliation of the bank statements with the cash found, and as reflected in the cash book submitted has been furnished. If his explanation is accepted, that ₹ 19,00,000/- found at the premises of the assessee including the locker of his wife belonged to the company, then, he is required to furnish a cogent explanation regarding the bala .....

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his amount is given to the assessee. 4. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that the authorities below have failed to apply correct law and have wrongly made addition of the amount of ₹ 14,13,100/- in the hands of the assessee and had wrongly added the amount of ₹ 5,74,600/- in the hands of Smt. Santosh Ahluwalia, wife of the assessee and M/s Rajasthan Mining and Engineering Pvt. Ltd. The ld AR further submitted that after search assessee .....

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hat in his statements recorded u/s 132(4) the assessee denied having maintained the books of account M/s Rajasthan Mining and Engineering Pvt. Ltd. and thus the Ld. AO alleged that the books of account including the cash book of the said company submitted before him was after thought. It is submitted that it is a settled law where the books of accounts were incomplete at the time of search, the assessee should give an opportunity to complete the same. Accordingly the assessee after the search ha .....

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orted in 107 Taxman 85. A perusal of the cash book of M/s Rajasthan Mining & Engineering P. Ltd. would show that there was a closing balance of ₹ 50,69,938/- as on the date of search, which was well above the cash found at the business premises as well as locker of the directors of the said company i.e. the assessee and his wife Smt. Santosh Ahluwalia. The allegation of Ld. AO that the assessee has not been able to establish the source of cash found during the course of search is compl .....

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ower authorities during the course of assessment / appellate proceedings and wherein, there was sufficient cash availability as on the date of search indicating that the cash so found ₹ 19,00.000/- as tabulated above and the cash of ₹ 19,00,000/- seized by the department has been owned by M/s RMEPL and has shown the same as other advances'. All these set of circumstances leave no doubt as to the fact that the cash so found during the course of search belonged to M/s RMEPL only an .....

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ly question No. 31 wherein the assessee had admitted that no cash book is being maintained by the company. It was further submitted that since no cash book was maintained by the assessee, as admitted by the assessee in respect of the company, therefore, the explanation given by the assessee that the cash found in the premises of the assessee belongs to the company, is not plausible explanation and therefore, the Assessing Officer has rightly treated the amount of ₹ 14.13 lacs as unexplaine .....

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