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TMI Blog2017 (3) TMI 435X X X X Extracts X X X X X X X X Extracts X X X X ..... ead of Shri S.J. Baid based on the statement given by Shri S.J. Baid before the IT department during the search and seizure operation conducted in the premises of the appellant. The Ld. CIT(A) has erred in not considering the Dossier Report of the Department wherein the remarks prove that Tribunal order arose out of protective assessment of Mr. S.J.Baid was passed, however recovery could not be made. The CIT(A) has erred in passing the order with the assumption that there would not be a possibility of confirming the substantive addition in the case of Shri S.J. Baid unless further investigation would have been carried out on the appellant on whom the substantive addition has been made. The CIT(A) had erred in upholding the order of the A.O. who had passed the order on assumption and surmise based on the statement recorded u/s 131 of the Income Tax Act, 1961 of Mr. S.J. Baid without relying on the submission/evidence provided by the assessee based on which order was passed by the then Commissioner of Income Tax (Appeals) XVII dated 26th March, 1993." 3. During the course of hearing, none appeared on behalf of the assessee. It is noted from perusal of the order-sheet entries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would amount to a double addition and therefore, the additions made in the present case shall stand deleted as already held by the learned CIT(A). However, if in the case of Shri S.J. Baid this issue has been decided by the Tribunal in a different way, the A.O. shall reconsider the entire matter in the present case for all the three years after allowing adequate opportunity to the assessee and keeping in mind any direction contained in the order of the Tribunal in the case of Shri S.J.Baid. Accordingly, the issue is restored back to the file of the A.O. for all the three assessment years to be reconsidered in the light of the observations made by us as above". 6. In the second round proceedings, the AO gave adequate opportunity of hearing to the assessee to provide all the documents and after considering the same,the A.O. confirmed the addition by making detailed discussion in the assessment order. The submissions of the assessee were not found acceptable by the A.O. since the assessee did not submit copy of ITAT order in the case of Shri S.J. Baid. The reasoning given by the A.O. for making addition in the hands of the assessee has been summarized by him in concluding part of hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r was Shri S.J. Baid. The addition made by the A.O. is incorrect since the assessee was not a proprietor of M/s Industrial agency (1975), Nagpur. Also the order u/s 143(3) r.w.s 254 was passed by the A.O based on the recorded statement of Shri S.J. Baid without bringing any evidence to prove that no order of the Tribunal in the case of S.J. Baid was passed. Assessing Officer had also asked for the order of S.J. Baid from the assessee for which the assessee has clearly stated that he was not in a possession of the same. The A.O. was asked to make efforts to obtain a copy of the ITAT's order in the case of Shri S.J. Baid, if any, from the records of the officer who submitted the dossier report. In response the A.O. submitted his report stating that the officer who submitted the dossier report could not be contacted. However extracts of the correspondence and dossier comments mentioned were furnished to indicate that there is no such case pending before the ITAT. No records in respect of Shri S.J. could be traced, and that the comments recorded by the then A.O. were vague and meaningless. Thereupon letters were issued by this office to the Registrar of ITAT at Mumbai as also at Na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITAT Nagpur. The appellant was given a final opportunity to furnish his comments on the A.O. report etc. fixing the date of hearing on 20/03/2012. The appellant was also informed that if no-compliance is made, the matter shall be finalized on the basis of materials on record. None attended on that matter till the date of passing of this order. Thus this order is passed on the basis of written submissions filed by the appellant on earlier date and materials on record. The A.O. order, submissions made for the appellant and materials on record have been considered. The basis of the additions is on account of income from business carried on in the name of M/s Industrial Agencies, Nagpur. Shri S.J. Baid was considered as the nominal owner of the business and the A.O. held that the actual business was controlled by Shri N.M.R Tara, the appellant Shri S.J. Baid was only signing the papers as directed by the appellant. Even the Income Tax returns were filed by the appellant. These facts were admitted by Shri S.J. Baid in his statement given before the I.T. Department during the search and seizure operation conducted in the premised of Shri N.M.R Tara and M/s Industrial Agencies. The IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Shri N.M.R. Tara. Thus, unless the ITAT order specifically held the addition in the hands of Shri S.J. Baid as a substantive addition, the decision of ITAT would have no material effect in the present appellant's case (in who's hands substantive addition has been made). In these circumstances, in view of the detailed discussions in the assessment order, wherein the statement of Shri S.J. Baid has been reproduced, the fact that no order of the Tribunal in the case of Shri S.J. Baid has been brought on record, for the reasons recorded in the assessment order, the addition made in the hands of the Shri N.M.R. Tara is confirmed." 8. Perusal of the order passed by the Ld. CIT(A) shows that it has been noted by him after considering all the facts of this case that assessee was real owner of the business carried on in the name of M/s Industrial Agencies, Nagpur and Shri S.J. Baid was only nominal owner of the business. It was held that actual business was controlled by the assessee and Shri S.J. Baid was only signing the papers as per directions of the assessee. Under these circumstances the substantive addition has been rightly made in the hands of the assessee. Nothing has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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