TMI Blog2019 (6) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... ontrary material to support its finding. Only remedy is estimation of income per acre. In certain cases as referred in the finding of the Ld. CIT(A), the tribunal has estimated income per acre at ₹ 15000/- during A.Y. 1998-99 and ₹ 25000/- during A.Y. 2005-06. We are of the view that Ld. CIT(A) has rightly estimated the agricultural income of ₹ 30000/- per acre for A.Y. 2009-10. No interference is therefore called for in the well reasoned finding of the Ld. CIT(A). We uphold the same and dismiss the revenue s ground. Unexplained investment in gold - HELD THAT:- CIT(A) has rightly given the benefit of 350 gms of gold jewellery (250 gms for daughter and 100 gms for son) thereby giving relief of ₹ 5,80,555/- and confirming the remaining amount as unexplained investment at ₹ 86,535/-. No reason to interfere in the finding of Ld. CIT(A) deleting the addition of ₹ 5,80,555/- and same is upheld. Addition for unaccounted investment - on money paid for purchase of land - adition based on seized loose papers - HELD THAT:- The impugned addition for unaccounted investment in the land has rightly been deleted by CIT(A) as they were merely based on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Addition on protective basis in the hands of the assessee s for the unaccounted investment in purchase of 1.9 hectare land jointly with Mr. Mukesh Sharma purchased from Mr. Vinod Vaish - addition based on loose papers - HELD THAT:- Following the holding in Assessment Year 2009-10, we are of the view that both the lower authorities were not justified in making the addition on protective basis in the hands of all the 14 assessee s. We accordingly allow this common issue in the case of the 14 assessee s and delete the addition made on protective basis on un accounted investments in purchase of land Disallowance for expenses - difference between the amount deposited in the bank/amount of land taken and the amount admitted as undisclosed income - HELD THAT:- In the instant case though the actual source of earning the undisclosed income has not been stated but claiming certain expenses against the earning of said undisclosed income cannot be brushed aside. However, Ld. CIT(A) failed to adjudicate this issue and in the interest of justice we are of the view that this common issue needs to be set aside to the file of Ld. CIT(A) for adjudication after giving reasonable opportunity of bei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h 31.01.2013 Revenue 4 ITANo.699/Ind/2016 Suresh Kumar Upadhya 22.03.2016 Assessee 5 ITANo.700/Ind/2016 Chandra Kumar Sharma 22.03.2016 Assessee 6 ITANo.701/Ind/2016 Sanjay Kumar Sahu 22.03.2016 Assessee 7 ITANo.702/Ind/2016 Sukhdev Singh Dhariwal 22.03.2016 Assessee 8 ITANo.703/Ind/2016 Khemraj Singh Chauhan 22.03.2016 Assessee 9 ITANo.704/Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was conducted at residential premises of the assessee on 21.07.2008. During the course of search various incriminating material were found and seized. During the course of search proceeding assessee surrendered income on various counts. Consequently, notice u/s 153A of the Act dated 10.07.2009 served upon the assessee for making necessary compliances. The assessee filed return of income on 11.02.2010 in response to notice u/s 153A of the Act for A.Y.2009-10 declaring total income of ₹ 4,55,29,800/- and agricultural income of ₹ 12,13,089/-. Questionnaire was issued calling various informations. Details filed by the assessee were examined along with seized documents. Income assessed at total income of ₹ 7,79,03,480/- after making following additions to the income shown by the assessee:- A.Y. 2009-10 Amount Total income as shown in the return of income filed in response to notice u/s 153A of the IT. Act 4,55,29,800 Add: N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... share 6.deleting the addition of ₹ 580555/- made by the AO on account of unexplained investment in gold 7.deleting the addition of ₹ 8746000/- made by the AO on account of payment of on money for purchase of land. 8. deleting the addition of ₹ 6500000/- made by the AO on account of non genuine unsecured loans. The appellant reserves his right to add, amend or alter the grounds of appeal on or before the date, the appeal is finally heard for disposal. C.O.No.76/Ind/2014 (Assessee) That on facts and circumstances of the case and in law and in any view of the matter, the Ld. Assessing officer and Ld. CIT (A), Bhopal have erred in assessing and upholding the agricultural income at ₹ 25,000/- and ₹ 30,000/- per acre respectively as against total agricultural income declared ₹ 12,13,089/- for 10.1 acres of agriculture land which come to ₹ 1,20,100/- per acre. The summary of which is as under: Area of Land Agri. Income declared Agr income assessed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ressing ground No.1 2 raised in this appeal. Learned Authorised Representative (in short AR) did not oppose. 9. We have heard the rival contentions and perused the record placed before us. From going through the letter issued by the Office of Commissioner of Income Tax (DR) bearing No.FCIT( DR)I.T.A.T./Ind/2018-19 dated 13.05.2019 we observe that the department has requested for not pressing ground No.1 2 raised by the Revenue in IT(SS) No.88/Ind/2013. We, therefore, dismiss ground No.1 2 as not pressed. 10. Now we take up ground no.3 through which revenue has challenged that the ld. CIT(A) admitted additional evidences without following provisions of Rule 46A of I.T. Rules. 11. At the outset, Ld. senior counsel for the assessee submitted that the additional evidences challenged in ground no.3 relats to addition for unexplained cash credit of ₹ 70,00,000/- which were placed before the ld. CIT(A) and are going to the root cause of the issue but no remand report was called from Assessing Officer. Therefore, the issues raised in this ground no.8 for which assessee has filed additional evidences may be remanded bac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s by directing the assessing officer to estimate agricultural income of ₹ 25,000/- per acre for A.Y. 2003-04 and ₹ 30,000/- for A.Y. 2006-07 to 2009-10 respectively. 6) Ground No.3 This ground of appeal is directed against treating of part of the agricultural income as non-genuine and income from undisclosed sources. The AO has observed that the appellant was required to substantiate the claim of earning agricultural income shown at the declared amount by furnishing documentary evidences regarding holding of agricultural lands, details of agricultural lands put to cultivation, crops grown, quantities produced, sale consideration, expenses incurred, etc. and also to file agricultural profit and loss account. It was held that as per details filed, the agricultural income comes as high as ₹ 57,500/- per acre in A.Yr.2003-04 and ₹ 1,20,100/- in A.Y..2009-10. The crops cultivated were traditional crops, like wheat, chana, hence, it was possible to earn such huge income. It was also observed that out of nearly 10 acres of agricultural land owned in 2005-06 to 2009-10, around 6 acres is located at village Kalapani, where only one cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lying these standards, the following amounts were held as non-genuine agricultural income and treated the same as income from other sources. Ayr. Agril. Income treated as income from other sources Rs. 2003-04 75,000/- 2004-05 78,000/- 2006-07 8,048/- 2007-08 1,24,412/- 2008-09 3,90,000/- 2009-10 960589/- 6.1) In the course of appeal proceedings, the ld. Counsel for the appellant has contended that the appellant owned agricultural lands with all agricultural facilities. All the necessary details were submitted during the course of assessment proceedings and since the agricultural income was exempt, no regular and proper books of accounts were maintained. According to the ld. A.R, the AO has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009-10 1,20,100/- The onus to prove the claim of agricultural income, being an exempted income, heavily lies on the appellant In view of the detailed findings given in the assessment order and summarized above, the appellant has not satisfactorily explained the reasonableness of the quantum of agricultural income claimed to have been earned by him. There are huge variations in the figures shown in different years, for which no explanation was forthcoming. At the same time, the estimation made by the AO cannot be held to be reasonable. The AO did not conduct any independent enquiry from revenue authorities or cite comparable cases of the close localities to support his findings. The orders of the Han'ble ITAT Benches relate to different periods and the income held reasonable in the subsequent period is lesser than the preceding period. Thus, it is clear that the facts of those cases are different. However, in the absence of sufficient material to support the claim, the income prescribed in the Tribunal orders can be taken as indicative and after considering the consistent figure of agricultural income show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound no.4 19. Now we take ground No.5 relating to addition of ₹ 1,50,00,000/- made by the AO and deleted by the Ld. CIT(A). 20. Brief facts relating to this ground are that during the course of search certain documents relating to company Prem Prakash Tube Pvt. Ltd. (in short PPTPL) was found in which major shareholding is with the assessee and his family members. Subscription to the equity share capital and share premium was received at ₹ 1,50,00,000/- by PPTPL during the A.Y. 2009-10. Documents also reveal that some Kolkata based company invested in the share capital of PPTPL for equity shares having face value of ₹ 10 and share premium of ₹ 90 per share. During the course of search when the assessee was confronted with these documents, he admitted that the sum of ₹ 1.50 crore was his undisclosed income and was introduced in the company PPTPL through various companies based in Kolkata. Later on in the income tax return filed in reply to notice u/s 153A of the Act the assessee failed to offer the alleged sum of ₹ 1.50 corers for tax. Ld. AO conducted necessary inquiry to come to a conclusion that the invested compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue come in appeal before the Tribunal and PPTPL also filed cross objection. 25. The Tribunal vide ITANo.188/Ind/2013 CO No.60/Ind/2013 dated 09.07.2015 held that the assessing officer was not heard during the course of appellate proceedings conducted by the Ld. CIT(A) and therefore, all the issues raised in the revenue s appeal and the cross objection are set aside to the file of the Ld. CIT(A) for deciding the issue afresh. 26. As the issue before us in the instant appeal in ground No.5 relats to unexplained investment in shares of ₹ 1.50 croes is very same issue which was before the Tribunal in the case of ACIT vs. PPTPL (supra), therefore, in these given facts and circumstances of the case, we are of the considered view that the instant issue raised in ground no.5 for unexplained investment of ₹ 1.50 crore also needs to be set aside to the file of the Ld. CIT(A) for deciding the matter afresh after providing reasonable opportunity of being heard to the assessee. In the result ground No.5 of the revenue s appeal is allowed for statistical purpose. 27. Now we take up ground No.6 through which the Revenue has challeng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2002-03 and 2007-08 and as per several purchase bills found during search, nearly 900 gms of jewellery was purchased in the names of the appellant, Smt. Neena Sharma and Smt. Vimla Rani Sharma. Therefore, the total jewellery of 2802.16 gms was required to be explained-by the appellant. The A.G. has held that gold jewellery totalling to 1500 gms might have been received by Smt. Vimla Rani Shrama, Smt. Neena Sharma and the appellant on various occasions including their marriage, receipts by inheritance, etc. but possession of the balance jewellery of 402.160gms (2802.160 less 1500 less 900 gms) remained unexplained. Therefore, he had worked out and made the addition at ₹ 6,67,0901- applying the average rate taken in the valuation report prepared at the time of search. 13.1 In the course of appeal proceedings, the appellant has contended that the addition made by the AO is not justified. The appellant belongs to a well to do family and the entire jewellery was either inherited from the parents or received by the family members including their children on various occasions or purchased subsequently. In the course of intensive search, the details of jewellery so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wellery (250 gms for daughter and 100 gms for son) thereby giving relief of ₹ 5,80,555/- and confirming the remaining amount as unexplained investment at ₹ 86,535/-. We therefore, find no reason to interfere in the finding of Ld. CIT(A) deleting the addition of ₹ 5,80,555/- and same is upheld. Ground No.6 of Revenue s appeal stands dismissed. 33. Now we take up Ground No.7 wherein the revenue has challenged the deletion of addition for unaccounted investment of ₹ 87,46,000/- made by the Ld. A.O on account of on money paid for purchase of land. Brief facts relating to this issue are that search and seizure actions were carried out u/s 132 of the Act at the residence of the assessee i.e. Shri Mukesh Sharma at Bhopal on 21.7.2008. Various documents along with the memorandum of agreement to purchase 1.9 hactare of land (approximate 4.70 acre land) at Ratanpur, Misord near Bhopal dated 24.5.2008 were found. During the post search enquiry it was found that the said land was purchased on 23.6.2008 by the assessee along with 14 other copurchasers which belong to a place called Dabra. 21 registration deeds were made show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aj singh Chouhan 12680 2647000 235000 3000 21355 556/(1.180 Hec.) 0.100 hec. 8 -do- 1563000 138720 680 12680 556/(1.160 hec) 0.060 Hec 9 -do- 1084000 96205 1000 8850 559/(0.1 60 hec. 0.040 hec. 10 Santosh Kumar Sharma 2647000 235000 2500 21355 558/(1.1 60 hec. 0.100 hec. 11 Su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19 Vijay Kumar Shrivastava 2647000 235000 3000 21355 556/(1.180 Hec.) 0.100 hec. Total 45000000 3994880 45560 363385 20 Mukesh Sharma 2647000 235000 900 21355 556/(1.180 Hec.) 0.100 hec. 21 Mukesh Sharma 2647000 235000 900 21355 556/(1.180 Hec.) 0.100 hec. Grand Total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al to 43,560 sq.ft sold @₹ 660/- per sq.ft for total consideration of ₹ 13,65,60,600/- and ₹ 9,00,000/- was paid to a person named Kaushal Bhaiya for arranging entries in the name of various parties i.e. the copurchasers. This unaccounted payment in the entire deal was worked out by Ld. A.O at ₹ 8,74,60,600/- (₹ 13,65,60,600/-+ ₹ 9,00,000/- (-) ₹ 5,00,00,000/-). Since the assessee s share in the stated consideration is 1/10th only, the unaccounted payment alleged to have been made by the assessee was added at ₹ 87,46,000/- as undisclosed income. On the basis of the finding by the Ld. A.O in the case of Mr. Mukesh Sharma addition for unaccounted receipt of ₹ 8,74,60,600/- was also made in the hands of the seller namely Mr. Vinod Vaish. Subsequently Ld. CIT(A) vide his order dated 28.32013 passed u/s 263 of the Act held that the order of the Ld. A.O passed in the case of Mr. Mukesh Sharma dated 31.12.2010 was erroneous and prejudicial to the interest of revenue and directed the Ld. A.O to examine the issue of undisclosed income invested in the purchase of said agriculture land and to make total addition of ₹ 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39. Per contra Ld. Counsel for the assessee submitted that the purchase of the land were made by the assessee along with other persons but there was no direct relation with them. Notings found in the papers reproduced at page 51 to 55 of the assessment order depicted in the seized document are rough notings. They do not contain any date, name or narration against the calculations. The assessee along with other buyers has made a planning regarding future prospects of the land after completion of the transaction and the alleged seized documents are dumb documents and they cannot be relied as the assessment order making additions by it is mischievous. The calculation made by the Ld. A.O are based only on suspicion and assumption and are not supported with any coherent material as assumed by the Ld. A.O, over and above the amount of investment shown by the appellant. Ld. Counsel for the assessee further asserted that the alleged papers relates to future planning with respect to the land and loose paper No.74 75 was shown for the prospective buyers in furtherance of their business. No such transaction ever happened. The situation of land i.e. Ratanpur, Misrod is slightly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on under the provision of section 132(4A) would in any case not applicable to a third party from whose possession such papers and documents have not been obtained Para 12 23-29 4 (1991) 39 ITD 183(Del) Ashwin Kumar vs. ITO The loose sheet forming part of seized material is a dumb document and no addition can be made in the hand of assessee on the basis of dumb documents Para 24 30-38 5 (2005) 1 SOT 515 (Del) Nem Chand Daga v. ACIT Whether entries found in loose paper can have any authenticity or evidentiary value value-in selfheld no Para 16 21 39-50 6 (2002) 82 ITD 85 (Mum) (TM) S.P. Goyal vs. DCIT Addition cannot be made on basis of entry on loose paper is has to be supported by circumstantial evidence and corroborative evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 111-118 14 (1997) 224 ITR 180 CIT vs. Ram Narain Goel That suspicion however strong cannot take the place of evidence or proof Para 5 6 119-121 15 (2003) 262 ITR 295 (P H) CIT vs. Faqir Chaman Lal It is settled proposition that the presumption however strong cannot substitute evidence Para 3 122-124 16 (2001) 250 ITR 539 CIT vs. Emerald Commercial Ltd. Anr. The finding of the Income Tax Officer and CIT(A) were based on presumption and not warranted by the facts of the case Para 5 6 125-126 17 332 ITR 468 (P H) CIT vs. Atam Valves P. Ltd. As such the Ld. CIT(A) to that extent is justifies in holding that estimation of sales on the basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income Tax Vs. Kulwant Rai (2007) 291 ITR 36 (Delhi) (ix) Assistant Commissioner of Income Tax Vs. Kences Foundation Pvt. Ltd (2007) 289 ITR 509 High Court of Madras (x) Commissioner of Income tax Vs D.K. Gupta (2009) 308 ITR 230 (Del) High Court of Delhi (xi) Prakash Chand Nahta Vs Commissioner of Income Tax (2008) 301 ITR 134 (MP) High Court of Madhya Pradesh (xii) ACIT V/s Sri Satyapal Wassan (2007) 295 ITR 352 ITAT, Jabalpur Bench (xiii) Nirmal Fashions (P) ltd Vs. DCIT (2008) 25 SOT 387 (Kol) ITAT, Kolkata Bench (xiv) Commissioner of Income Tax Vs Tam Narain Goel (1997) 224 ITR 180, Punjab Haryana High Court. (xv) Commissioner of Income Tax Vs. Faqir Chand Chaman Lal (2003) 262 ITR 295 (P H) (xvi) Commissioner of Income Tax Vs. Emerald Commercial Ltd Ors (2001) 250 ITR 539, High Court of Calcutta (xvii) Commissioner of Income Tax Vs. Atam Valves (P) Ltd 332 ITR 468 (P H) (xviii) Starptex (India) (P) Ltd Vs. Deputy Commissioner of Income Tax (2003) 84 ITD 320 (Mum) (xix) Bansal Strips Pvt. Ltd Vs. Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5000 230310 280 20935 556/(1.180 hec 0.080 Hec. 3 Lalta Prasad Choudhary 2647000 235000 3000 21355 556/(1.180 Hec.) 0.100 hec. 4 Kamlesh Choudhary 479000 42520 2500 4010 559/(0.160 Hec.) 0.020 hec. 5 -do- 2168000 192500 3000 17520 557/(0.400 hec.) 0.080 hec. 6 -do- 2647000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2647000 235000 3000 21355 557/(0.400 hec. 0.100 hec. 15 Virendra Kumar Sharma 2647000 235000 3000 21355 557/(0.400 hec. 0.100 hec. 16 Sanjay Sahu 2647000 235000 3000 21355 559/(0.160 hec. 0.100 hec. 17 Pradeep Kumar Sharma 2647000 235000 3000 21355 559/(0.160 hec. 0.100 hec. 18 Chandra Kumar Sharma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eized document as well as typed version of the seized documents which are placed at page 53 and 55 of the paper book. 43. In the seized document LPS 1/1 page No.74 there were also details of bifurcation of the total land along with the amount paid for which portion and the total consideration for 1.9 hectare land is stated at ₹ 5 crores only. 44. Now coming to the English typed version of the seized documents scanned above these contains various figures and certain calculation for 206910 s1q.ft land @660/- per sq.ft. These are loose papers having no specific mention of names of the related parties. Mr. Mukesh Sharma has denied to have made the alleged unaccounted investment. As far as these loose sheets are concerned it has been stated that the co-purchasers including the assessee were planning to sell the land in future @660/- per sq.ft. It is contended by Ld. Counsel for the assessee that the land purchased is agricultural land and as per the stamp valuation authorities the circle rate of the alleged land was below the stated purchase consideration of ₹ 5 crores and by no stretch of imagination the value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stry charges) was paid and the balance amount was paid in cash over and above the stated purchase consideration. The AO has held that page no.74 ofLPS-1I1 and back side of the said page, give detailed calculations of the land deal with Shri Vinod Vaish. As per calculation given in page no.75, the area in sq.ft comes to 206910 sqfts and the total cost @₹ 660/- per sq.ft works out to ₹ 13,65,60,600/- and after including ₹ 50,00,000/- towards registry expenses and ₹ 9,00,000/- paid to one Shri Kaushal Bhaiya, the total amount works out to ₹ 14,24,60,600/-. The payment details are given on the reverse side on page no. 74. He further held that page no. 26 of loose paper of LPS-l/l give names of 14 persons in whose names the land was purchased. Therefore, the AO has concluded that the persons are known to the appellant and are under his control. The AO had further held that cheque payment of ₹ 50,00,000/- mentioned in page no.74 backside gets corroborated with the actual cheque payment of₹ 50,00,000/- made on 23.05.2008. The area of the land and the registration expenses tally with the actual area of the land and the amount of expenditure incurre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e course of assessment proceedings, the appellant has contended that land under consideration was agricultural and un-diverted land and it was not commanding any such price as assumed by the AO. The estimated rough jottings at page no.75 relate to the calculation of estimated return after diversion of land for residential and commercial purposes after obtaining necessary approvals from various authorities. Therefore, the action of the AO, treating the documents as correct evidences is not justified and hence, the addition is also not correct. The appellant has also referred to the statement of Shri Vinod Vaish to press his point that no such payment was made. It was contended that Shri Vinod Vaish has denied receipt of any such payments. It was also contended that as per the appellant's information all other persons, who have purchased the land, have also filed their individual returns of income and the same were accepted without any reservations. Under these circumstances, the appellant has stated that the addition made by the AO is not correct. Finally, the appellant has relied on several case laws to support this contention that no addition is possible on ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idering the location and the status of the land, it did not command such price as opined by the A.O. Under these circumstances, I am of the considered opinion that though the jottings contained in the loose papers may generate a suspicion, they are not sufficient enough, without corroborating evidences, to conclude that actual money has changed hands. In this view of the matter, the addition covered in this ground of appeal is not sustainable, hence, deleted. This ground of appeal is, accordingly, allowed . 47. After perusal of the finding of Ld. CIT(A) and also examining the facts of the case. We observe that except the loose papers, other evidences placed on record clearly proves that the transaction of purchase of land took place and the assessee and other copurchasers purchased 1.9 hectare land from Mr. Vinod Vaish and total consideration paid by the purchasers as per the registered sale deeds is ₹ 5 crores. What remains to be adjudicated in the light of judicial pronouncements is that whether the Ld. A.O was justified in making the addition merely on the basis of loose papers found during the course of search without establishing any nexus with the actual ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50. Hon ble High Court of Gujarat in the case of CITV/s Maulikumar K Shah 2008 307 ITR 137 wherein it has held that the additions made by the A.O on the basis of seized paper alone without any corroborative evidence could not be sustained . 51. Similar view was taken by the Co-ordinate Bench in the case of M.M. Financiers V/s DCIT 2007 107 TTJ 200 (Chennai). 52. There are also certain legal precedent which clarifies that the loose documents cannot alone make basis where loose sheets are found, there was inference drawn by the AO that they represent concealed transactions but such inference can be positively made only on identification of papers and after due verifications. Figures therein cannot be rightly inferred to represent un accounted income unless there is something more to it. 53. In the case of CIT V/s Girish Choudhary 2008 296 ITR 691 (Delhi) the Hon ble High Court had dismissed the revenue s appeals holding that when there was no materials on record to show on what basis the AO had reached to the conclusion that the figure 48 was to be read as ₹ 48 lakhs when the document recovered during the course of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that he had received ₹ 34.35 lakhs. Again in the statement recorded on 11.12.1998, Shri Rajarathinam, the seller admitted that a total consideration of ₹ 34.85 lakhs was received from the assessee out of which ₹ 4.10 lakhs was received in demand draft and the balance in cash. In the affidavit given on 08.01 .1999 by Shri Rajarathinam, it was mentioned that the sale consideration received by him from Sri P.V.Kalyanasundaram i.e. the assessee, was only ₹ 4.10 lakhs and the earlier statements given before the Income Tax authorities were not true. On 10.08.2000, the seller Sri Rajarathinam submitted a letter before the Assessing Officer withdrawing the affidavit given on 08.01.1999. In the subsequent sworn statement recorded before the Assessing Officer on 20.11.2000, Sri Rajarathinam had mentioned that the sale consideration of ₹ 34.85 lakhs which was received by him from the purchase consideration was actually ₹ 34.85 lakhs, as against ₹ 4.10 lakhs stated in the registered deed for purchase of land. In the cash flow statement for the assessment year 19 99-2000 i.e. block period 01.04.1998 to 08.12.1998, the Assessing Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn on 28.01.2000 wherein he did not admit the cash on money consideration for the sale transaction. Subsequently he revised the I.T. Return wherein he admitted the sale consideration and showing ₹ 4.80 lakhs out of the above as utilised for construction of residential house property and consequently claiming exemption under Section 54, the seller filed the computation of income paying ₹ 1,83,576/- as tax, which was quite evident from the conflicting statements given by the seller and the conflicting I.T. Returns filed by him that his action of admitting sale consideration and paying tax was nothing but an obvious effort to save from further harassment from the Revenue and escape from the exigibility of tax on undisclosed income of the cash consideration under Section 158 BD of the Act, which in magnitude would far exceed the tax paid by him. The burden of proving actual consideration in such transaction was that of Revenue. The Tribunal had given factual finding and held as follows: We find that it is the uniform view of the Courts and also held by the Apex Court as reported in 131 ITR 397 the burden of proving actual consideration in such transaction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 34 was also available to the prosecution from the statements made by Shri Jacob Mathai, Danial P. Rambal and P. Ghoshal and Ejaj Ilmi during investigation, in that, they have admitted receipts of the payments as shown against them in MR.71/91. While on this point, he made a particular reference to those entries in MR 71/91 Which, according to him m if corresponded with the entries in the other books and the enclose sheets would prove the payments to Shri Advani and Shri Shukla. As regard s the proof of authorship of the entries he drew our attention to the statements of Pawan Jain, A. V. Pathak and O.K. Guha who have stated that the entries were made by J. K. Jain and that the Jain Brothers had put their signatures against some of these entries in token of verification thereof. He also drew our attention to the written opinion given by the hand writing expert in this regard. 39. In Beni v. Bisan Oayal [AIR 1925 Nag. 445J it was observed that entries in book s of aCCount are not by themselves sUfficient to charge any person with liability, the reason being that a man cannot be allowed to make evidence for himself by what he chooses to write in his Own books behind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs and electronic documents within the legal parameters. The Commission has also observed that Department has not been able to make out a clear case of taxing such income in the hands of the applicant firm on the basis of these documents. 24. Since it is not disputed that for entries relied on in these loose papers and electronic data were not regularly kept during course of business, such entries were discussed in the order dated 11.11.2016 passed in Sahara's case by the Settlement Commission and the documents have not been relied upon by the Commission against assessee, and thus such documents have no evidentiary value against third parties. On the basis of the materials which have been placed on record, we are of the considered opinion that no case is made out to direct investigation against any of the persons named in the Birla's documents or in the documents A-8, A-9 and A- 10 etc. of Sahara. 27. Considering the aforesaid principles which have been laid down, we are of the opinion that the materials in question are not good enough to constitute offences to direct the registration of F.I.R. and investigation therein. The materials shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NEY of ₹ 8,74,60,600/- has been paid. We therefore find no reason to interfere in the finding of Ld. CIT(A) deleting the addition of ₹ 87,46,600/- and dismiss the revenue s Ground No.7. 59. Though Ground No.8 revenue has challenged the deletion of addition of ₹ 65,00,000/- which was made by the Ld. Assessing Officer on account of non-genuine unsecured loans. 60. At the outset, Ld. Senior Counsel for the assessee giving reference to his submissions for ground no.3 submitted that certain additional evidences were filed before the Ld. CIT(A) relating to the addition of ₹ 70,00,000/- for unexplained cash credit. Ld. CIT(A) gave part relief to the assessee by deleting the addition of ₹ 65,00,000/- without calling for remand report from the assessing officer. Prayer was made to set aside to the issue to the file of Ld. CIT(A) for deciding afresh. Ld. DR raised no objection if the issue raised in ground no.8 are set aside to the file of Ld. CIT(A) for afresh adjudication after calling for remand report from the assessing officer relating to the additional evidences filed by the assessee before the Ld. CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent Year 2009-10. 66. Ground No.1 relates to addition for agriculture income. We have already dealt with this issue in the revenue s appeal and have confirmed the finding of Ld. CIT(A) thereby dismissing the revenue s Ground No.4 relating to addition of ₹ 50,500/- made on account of non genuine agriculture income. Since we have confirmed the finding of Ld. CIT(A) this Ground No.1 of the assessee s Cross Objection deserves to be dismissed. 67. Ground No.2 of the Cross Objection relates to unexplained investment of ₹ 1.50 crores. We find that the same issue has been raised by the revenue in Ground No.5 of its appeal for Assessment Year 2009-10and after adjudicating the same we allowed revenue s ground for statistical purposes to the file of Ld. CIT(A) for afresh adjudication. Therefore this ground No.2 of the Cross Objection also deserves to be allowed for statistical purposes. 68. Ground No.3 of Cross Objection relates to addition of un disclosed investment in jewellery. We have dealt with this issue in the revenue s appeal for Assessment Year 2009-10 and have confirmed the finding of Ld. CIT(A) deleting the addition of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sold agriculture land measuring 1.9 hectare to Mr. Mukesh Sharma and others. The stated consideration received by Mr. Vinod Vaish was ₹ 5 crores but the Ld. A.O on the basis of the finding in the case of Mr. Mukesh Sharma came to a conclusion that on money of ₹ 8,74,60,600/-has been paid by all the purchasers to Mr. Vinod Vaish. Ld. A.O made the addition of ₹ 8,74,60,600/- in the hands of Mr. Vinod Vaish and assessed the income at ₹ 12,07,58,972/- vide his order dated 29.12.2011 u/s 143(3) of the Act. Against this impugned addition of ₹ 8,74,60,600/- assessee preferred appeal before Ld. CIT(A) and succeeded as the Ld. CIT(A) deleted the addition. 75. Now the revenue is in appeal before the Tribunal. 76. We have heard rival contentions and perused the records placed before us. The issue raised by the revenue in Ground No.3 deleting the addition of ₹ 8,74,60,600/- made by the Ld. A.O on account of undisclosed income. We find that the issue relates to the sale of 1.9 hectare land owned by the assessee for which consideration of ₹ 5 crores was stated in the registered sale deed but the Ld. A.O in the case of one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... py of appellant's statement recorded by the A.O., copy of appellant's affidavit denying receipt of any on money and other details filed before the A.O. were filed. It was contended on the basis of the replies and other details filed that the notings if the loose papers seized from Shri Mukesh Sharma are not corroborated by any other evidences to establish that the appellant has received any on money. It was contended that the land was sold at the ruling market price which was higher than guideline price and capital gain on the same was offered to tax in the return filed. There is no basis for making the addition except the A.O's findings contained in the assessment order. The rough jottings relate to the calculation of estimated return on sale of such land, provided the land is diverted for residential and commercial purposes after obtaining approvals from various authorities. The land can be sold in terms of square feet only, when usage of land is changed and converted into residential/ commercial use. The hand writing contained in the loose paper is not in the handwriting of the appellant or any of his family members. There is no corrob01.-ative material to suggest th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide and page no. 75. The A D has summarized the basis of his conclusions at page no. 58 of the assessment order by stating that the cheque payment of ₹ 50,00,0001- on the backside of page no. 74 tallies with the actual amount of ₹ 50 lakhs paid on 23.5.200B. The area of land and registry expenses tally with the actual land area and the expenses incurred on registration. The figure of '225' mentioned at page no. 75 denotes the amount of ₹ 225 lakhs deposited by DDI cheque in the bank documents of 14 persons of Dabra. The figure of '323' mentioned in these documents tallies with the amount of cash deposited in the bank accounts of the 14 persons plus registration charges and page no. 74 back side and page no. 75 corroborated each other. Though the first observation is found to be correct, the subsequent observations are only inferences and are not based on facts. There is nothing unusual in tallying the land area. The amount of registration expenses were incurred at ₹ 49, 18,335/- and not ₹ 50,00,000/-, i.e. the figure mentioned against the narration. The total of the amount deposited through DDI cheques in the bank accounts of the 14 per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ees in which protective addition for unaccounted investments in purchase of land as well as disallowance of expenses have been made. Details of the assessee s with appeal Nos along with total income disclosed, additions made and income assessee is detailed below; Name of Assessee ITANo. Total income Addition on disallowance of expenses Addition on protective basis Assessed income 1 Suresh Kumar Upadhyay ITANo.699/Ind/2016 26,33,230 19,520 46,01,538 72,54,288 2 Chandra Kumar Sharma ITANo.700/Ind/2016 42,96,651 3,68,349 29,38,117 76,03,117 3 Sanjay Kumar Sahu ITANo.701/Ind/2016 4,62,060 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 76,90,329 13 Ram Kumar Swami ITANo.711/Ind/2016 22,88,974 3,61,595 49,45,794 75,96,363 14 Virendra Kumar Sharma ITANo.542/Ind/2017 23,58,560 2,92,010 48,76,208 76,26,778 82. Following grounds of appeal have been raised by the above stated 14 assessee s; ITA No.699/Ind/2016 1. That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was alr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s' initiated by the AO were illegal, void and without jurisdiction. 2.That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) has erred in law and on facts in confirming the addition of ₹ 3,68,349/-. 6. That the Ld. CIT(A) has erred in law and on facts in conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) has erred in law and on facts in confirming the addition of ₹ 67,72,708/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee s possession. 6. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 7. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 8. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 9. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.703/Ind/2016 1. That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) has erred in law and on facts in confirming the addition of ₹ 1,18,77,858/-. made on the basis of a dumb document unrelated to the assessee and not found from the assessee s possession. 6. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 7. That the Ld. CIT{A) erred in law and on fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is unwarranted and perverse and is devoid of any merit. 7. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition of substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 8. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.706/Ind/2016 1.That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) and the AO were not justifie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) and the AO were not justified in law and on facts in sustaining the addition of ₹ 4,33,000/-. 6. That the Ld. CIT(A) has erred in law and on facts in confirming the addition of ₹ 1,16,14,786/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee's possession. 7. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 8. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the prote ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 9. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.710/Ind/2016 1.That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) and the AO were not justified in law and on facts in sustaining the addition of ₹ 3,61,595/- claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) and the AO were not justified in law and on facts in confirming the addition of ₹ 48,76,208/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee s possession. 6. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 7. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 8. That the Ld. CIT(AJ has exceeded her j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioned in the chart given herein above relating to the 14 assessee s. Aggrieved assessee s preferred appeal before Ld. CIT(A) and failed to succeed and now all the assessee s are in appeal before the Tribunal. 85. Ld. Counsel for the assessee reiterated the submissions made before the lower authorities and Ld. Departmental Representative supported the orders of the lower authorities. 86. We have heard rival contentions and perused the records placed before us. As regards the first common issue challenging the validity of reassessment u/s 148 of the Act, we find that there was certain information relating to these 14 assessee s found by the search team during the search u/s 132 of the Act conducted on 21.7.2008 at the premises of Mr. Mukesh Sharma including a memorandum of agreement for purchase of land by Mr. Mukesh Sharma and 14 other parties. Certain loose papers were also seized which as per the Ld. A.O indicated some undisclosed investment. Return were filed on 31.03.2010 and notice u/s 148 of the Act issue within 4 years i.e. before 31.03.2014. Proper opportunity was given to assessee(s) to reply to the reasons recorded for reopening. In our consi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etween the amount deposited in the bank/amount of land taken and the amount admitted as undisclosed income by the following 10 assessee s; Name of Assessee ITANo. Amount Deposit in bank/loan Amount admitted as undisclosed income Difference 1 Suresh Kumar Upadhyay ITANo.699/Ind/2016 26,52,750 26,33,230 19,520 2 Chandra Kumar Sharma ITANo.700/Ind/2016 46,65,000 42,96,651 3,68,349 3 Sukhdev Singh Dhariwal ITANo.702/Ind/2016 40,00,000 22,21,765 17,78,235 4 Lalta Prasad Choudhary ITA No.706/Ind/2016 26,50,569 22,94,656 3,5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion after giving reasonable opportunity of being heard to the assessee s. In the result this common issue of disallowance totalling to ₹ 45,24,621/- relating to 10 assessee s is allowed for statistical purposes. 91. Now we come to the fourth common issue through which the respective assessee s are aggrieved with the findings of Ld. CIT(A) to have exceeded her jurisdiction in giving direction to the Ld. A.O to reopen the cases for assessment year 2010-11 giving direction for examining the correctness of opening capital, which is not within the scope of Ld. CIT(A). 92. We observe that Ld. CIT(A) in her common appellate order for the 14 assessee s have directed the Ld. A.O to consider the reopening of the cases for Assessment Year 2010-11. We find that the power of the Commissioner (Appeals) are provided in Section 251 of the Act reads as follows:- 251. (1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers (a) In an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment [(aa)in an appeal against the order of assessment in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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