TMI Blog2016 (11) TMI 1366X X X X Extracts X X X X X X X X Extracts X X X X ..... in that document and then confronted the assessee with the same. All these exercise have not at all been carried out by the AO. Furthermore, the presumption stated u/s. 292C of the I.T. Act is a rebuttal presumption. Therefore, when the assessee herself denied any such transaction, it cannot be stated that the actual transaction has taken place between the assessee and the person concerned whose name mentioned therein. Further the Circular No. 24 of 2015 dated 31.12.2015 also supports the case of the assessee that satisfaction should have been recorded in the case of the appellant u/s. 153A of the I.T. Act. Therefore, the Appellant succeeds on the issue of satisfaction in view of the CBDT’s Circular stated above and also on the merit as the sole addition has been based on the document in which one transaction is allegedly sold without mentioning the date and further no corroborative evidence of any investment made by the assessee was found. Further the document is also unsigned and undated, the addition made in the hands of the assessee of ₹ 96 lacs cannot be sustained. Thus we reverse the finding of the Ld. CIT(A) by confirming the addition in the hands of the assessee un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d advisable at the time of hearing of appeal. It is prayed that the appellant appeal be allowed. 3. The grounds raised in Assessee s ITA No. 5515/Del/2013 (AY 2009-10) 1) That the Ld. CIT(A) grossly erred in law and facts of the case in confirming the penalty of ₹ 10,16,700/- (Rupees Ten Lacs Sixteen Thousand Seven Hundred) under section 271AAA of the Income Tax Act, 1961 without appreciating facts of the case. There was no undisclosed income of the assessee during the previous year and the addition had been made arbitrarily on the basis of a computer printout. 2) The appellant craves leave to add, alter, demand, supplement or raise fresh ground of appeal, if considered expedient and advisable at the time of hearing of appeal. It is prayed that the appellant appeal be allowed. ITA NO. 336/DEL/2012 (2009-10) SAMTA KHINDA VS. ACIT 4. The brief facts of the case are that the original return of income was filed u/s 139 of the Income Tax Act, 1961 on 27.3.2010 at a total income of ₹ 4,27,00,340/-. Search and seizure u/s. 132 of the I.T. Act was carried out at the business and residential premises of Nimitaya and Khinda group during which the resident ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oteshwara Rao order dated 12.8.2016 of the ITAT, Visakhapatnam (ITA No. 251 252Vizag/2012 (Ayrs. 2007-08 2008-09) - K.V Lakshmi Savitri Devi vs. ACIT (2012) 148 TTJ 157, ITAT Hyderabad Benches. - Hon ble A.P. High Court in the case of K Lakshmi Savitri Devi (Supra) in ITA No. 563 of 2011 has upheld the order of the Tribunal. - CBI vs. VC Shukla (1998) 3 SCC 410) - CIT vs. PV Kalyansundaram (294 ITR 49) - CIT vs. Girish Chaudhary (2008) 296 ITR 619 (Delhi) Delhi High Court. - ACIT vs. Sharad Chaudhary (2014) 165 TTJ 0145) (Delhi) - Sunita Dhadda vs. DCIT (2012) 71 DTR 0033 Jaipur 7.1 On the other hand, Ld. CIT(DR) relied upon the order of the Ld. CIT(A) and stated that Ld. CIT(A) has passed a well reasoned order which does not need any interference and the same may be upheld. 8. We have heard both the parties and perused the records, especially the Orders of the revenue authorities and the case laws cited by the Ld. Counsel of the assessee. In this case search u/s. 132 of the Act was conducted at the premises of the assessee at 2, Golden Gate, Westend Greens, Rajokari, New Delhi- 110 038 on 6.11.1008. During the course of search a computer printout p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AD on account of undisclosed income not declared by the Assessee in its books of account? 3. Whether on the (acts and circumstances of the case, the Income Tax Appellate Tribunal was correct in law in deleting the addition of ₹ 1,04,39,000 made by the AO on account of accommodation entries taken by the Assessee? 4. Whether on the facts and circumstances of the case, the order of the ITAT is not perverse as it has failed to consider that in this case, the AO made the addition on the basis of the relevant searched material gathered from the Assessee during the course of the search proceedings? 29. However, by an order dated 20th May 2015 the only question that was framed for consideration by the ITAT was as under: Did the ITAT fall into error in holding that the addition of ₹ 5,60,73,380 was unsustainable in law in the circumstances 0 the case? 30. Consequently, as the present appeal by the Revenue was concerned, its scope is confined to the question framed viz., the sustain ability of the deletion by the ITAT of the additions made by the AO as sustained by the CIT(A) of ₹ 5,60,73,380/- pertaining to the sale of flats on the second and third floor o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt termed a loose sheet containing some notings of figures as a 'dumb document' since there was no material to show as to on what basis the AO had reached a conclusion that the figure '48' occurring in one of them was to be read as ₹ 48 lakhs. 46. In the present case, there was again no material on the basis of which the AO could have applied a standard rate of ₹ 4,800 per sq ft for all the floors of VT. It was also not open to the AO to draw an inference on the basis of the projection in the document, particularly when the Assessee offered a plausible explanation for the document. The burden shifted to the Revenue to show, on the basis of some reliable and tangible material, how rate at which the flats on the second and third floors of VT was higher than that dictated in the sales register or the sale deeds themselves. 47. In the circumstances, the Court is of the view that the ITAT was justified in coming to the conclusion that the addition of ₹ 5,60,73,380 made by the CIT (A) was not sustainable in law. 48. For the aforementioned reasons, the question framed by the Court is answered in the negative, i.e., in favour of the Assessee and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ards purchase of site. The assessee right from the beginning stated that he had not received any on money from M/s. M.V.V. Builders towards sale of site. Besides, loose sheets found in the premises of M/s. M.V.V. Builders, the A.O. does not have any other document to show that the assessee has received on money from the purchaser. The A.O. has not made out any attempt to find out some reliable cogent material evidence on record to support his findings or to corroborate the statement of the purchaser. The assessee denied having received any on money over and above what was stated in the sale deed. The assessee rightly claimed that the sale transaction has been completed on 7.6.2006. The sale transaction has been completed by way of registered sale agreement-cum-GPA. The assessee has received full consideration as on the date of registration of document and handed over the possession of the property to the buyers. The allegation of the A.O. is that the purchaser has paid on money to the assessee in the financial years relevant to assessment year 2007-08 and 2008-09 which is almost one year after sale is completed. We further noticed that total consideration has been paid through prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey has been exchanged between purchaser and seller. Therefore, we are of the view that the A. 0. is not correct in making additions towards on money without there being any evidence to show that the assessee has received anv money over and above what was stated in the sale deed. 17. Considering the facts and circumstances of this case and also applying the ratios of the judgements cited above, we are of the view that the A.O. is not correct in coming to the conclusion that on money exchanged between the parties based on a loose sheet found in the premises of a third party and also statement given by a third person. To sustain the addition, the A.O. should have taken an independent enquiry about the value of the property and ascertain whether any under valuation is done, if so what is the correct value of the property. Further, the A.O. failed to bring any evidence to support his findings that there is on-money payment over and above what is stated in the sale deed. In the absence of proper enquiry and sufficient evidences, we find no reasons to confirm the additions made by the A.O. The CIT(A) without appreciating facts, simply upheld additions made by the A.O. Hence, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material on record. It should not be based on conjectures and surmises. As of now, the material considered by the AO for making the addition of ₹ 1 crore is seized material marked a 'A/CRK104' and the statement of 5. This loose sheet found at the premises of CRK is not enough material to sustain this addition. The seized material found during the course of search and the statement recorded are some piece of evidence to make the addition. The AD has to establish the link between the seized material and other books of account to the assessee. The seized material and statement of CRK cannot be conclusive evidence to make this addition. The entire case herein is depending upon the rule of evidence. There is no conclusive presumption to say that actual consideration passed on between the parties is actually ₹ 165lakhs. The assessee as well as her brother stated in their respective statements that the consideration passed between the parties is only ₹ 65lakhs. In spite of this the AO proceeded to conclude that the seized material is conclusively reflecting the payment of consideration at ₹ 165lakhs. The Department herein is required to establish the nexus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vs. P. V. Kalyanasundaram (2006) 203 CTR (Mad) 449: (2006) 282ITR 259 (Mad) relied on . 8.4.1 The Hon ble A.P. High Court in the case of K Lakshmi Savitri Devi (Supra) in ITA No. 563 of 2011 has upheld the order of the Tribunal. We are of the view that the Tribunal has rightly held that the registered document dt. 21.8.2006 under which the respondent purchased the above property showed that only ₹ 65. 00 lakhs was paid to the vendor by the respondent: that there was no evidence to show that the respondent had paid Rs.l. 00 crore in cash also to the vendor; that no presumption of such payment of ₹ 1.00 crore in cash can be drawn on the basis of an entry found in a diary loose sheet in the premises of C. Radha Krishna Kumar which is not in the respondents handwriting and which did not contain the name of the respondent or any date of payment or the name of the person who made the payment. It rightly held that the Revenue failed to establish the nexus of the seized material to the respondent and had drawn inferences based on suspicion, conjectures and surmises which cannot take the place of proof. We also agree with the Tribunal that the assessing officer did not co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r transaction. Even otherwise when the assessee had denied the transactions, AO should have examined the recipient of search stated in that document and then confronted the assessee with the same. All these exercise have not at all been carried out by the AO. Furthermore, the presumption stated u/s. 292C of the I.T. Act is a rebuttal presumption. Therefore, when the assessee herself denied any such transaction, it cannot be stated that the actual transaction has taken place between the assessee and the person concerned whose name mentioned therein. Further the Circular No. 24 of 2015 dated 31.12.2015 also supports the case of the assessee that satisfaction should have been recorded in the case of the appellant u/s. 153A of the I.T. Act. As the Ld. Counsel for the assessee has also argued that no satisfaction has been recorded. The CBDT Circular which is based on the decision of the Hon ble Supreme Court of India in the case of CIT vs. Calcutta Knitwears (2014) 43 taxmann.com 446 (SC) provides as under:- SECTION 153C, READ WITH SECTION 158BD, OF THE INCOMETAX ACT, 1961 - SEARCH AND SEIZURE - ASSESSMENT OF INCOME IN CASE OF OTHER PERSON - RECORDING OF SATISFACTION NOTE UNDER SECT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is one and the same then he should also record the satisfaction. Leaving aside the matter on satisfaction in this case the assessment has also been made disregarding the provisions of the search as provided under Chapter XIV-B of the Act. Once again at the cost of repetition the date of search is 6.11.2008 and the assessment year involves before us is assessment year 2009-10 and further addition has been made on the basis of the document impounded during the course of search at the residence of the assessee. The AO has proceeded to make an assessment u/s. 143(3) of the I.T. Act. Therefore, the Appellant succeeds on the issue of satisfaction in view of the CBDT s Circular stated above and also on the merit as the sole addition has been based on the document in which one transaction is allegedly sold without mentioning the date and further no corroborative evidence of any investment made by the assessee was found. Further the document is also unsigned and undated, the addition made in the hands of the assessee of ₹ 96 lacs cannot be sustained. In view of this, we reverse the finding of the Ld. CIT(A) by confirming the addition of ₹ 96 crores in the hands of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat assessee had received all the aforesaid jewellery as gift on the occasion of her marriage on 13.11.1998 from her parents and relatives. The value of jewellery has appreciated over a period of ten years from approx. ₹ 9.93 lacs to ₹ 29.18 lacs. He stated that there is no evidence whatsoever nature with the department to prove that out of total jewellery of ₹ 29,18,395/- with the assessee, jewellery wroth ₹ 17,62,445/- seized by the Department is unexplained which is purely on arbitrary assumption. Therefore, the Ld. CIT(A) has gave part relief to the assessee and confirmed the addition of ₹ 5.67 lacs. From the above, we also find that both the authorities below have made the additions and confirmed part addition without any basis and the same is totally based on assumption only which is not sustainable in the eyes of law. It is a settled law that addition on assumption is not permissible under the law. Even otherwise, the Appellant succeeds on the legal issue of satisfaction in view of the CBDT s Circular as stated above vide para no. 9.1 of the order and therefore, the addition is not sustainable in the eyes of law. Hence, we delete the addition co ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
