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TMI Blog2019 (7) TMI 1310X X X X Extracts X X X X X X X X Extracts X X X X ..... 310 to 316/Ind/2012 of ITAT. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the finding of the assessing officer that the appellant was not having any lease hold land with him and that he did not earn agricultural income of Rs. 4,42,900/- from such land. 3. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the addition of Rs. 4,42,900/- towards income from other sources as made by the assessing officer. 4. The appellant craves leave to add, to alter and/or to modify the grounds of appeal on or before the date of hearing." 3. During the course of hearing, the assessee has also filed an additional ground that reads as under: "On the facts and in the circumstances of the case and in law, Learned Assessing Officer erred in making the addition and passing the impugned assessment order under section 153A rws 143(3) without reference to any incriminating material found and seized during the course of conduct of search." 4. This is second round of litigation. In the earlier round of litigation, matter travelled up to the stage of this Tribunal and the Tribunal in IT(SS) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 143(3) rws153A and 254 dated 26.03.2014 A.Y. 2001-02 Rs. 6,14,400 (addition of Rs. 4,46,308 as disallowance of agriculture income and rental income) A.Y. 2002-03 Rs. 6,87,706 (addition of Rs. 5,15,701 as disallowance of agriculture income and rental income) A.Y. 2003-04 Rs. 8,36,980 (addition of Rs. 5,85,071 as disallowance of agriculture income and rental income) A.Y. 2004-05 Rs. 9,16,120 (addition of Rs. 7,10,096 as disallowance of agriculture income and rental income) A.Y. 2005-06 Rs. 57,22,050 (addition of Rs. 7,54,536 as disallowance of agriculture income and rental income) A.Y. 2006-07 Rs. 14,94,220 (addition of Rs. 10,46,878 as disallowance of agriculture income and rental income) A.Y. 2007-08 Rs. 28,72,280 (addition of Rs. 27,25,930 as disallowance of agriculture income, rental income and addition of entries in BS-1) CIT(A) Order :dated 29.01.2016 addition sustained for all the years on account of agriculture income from lease hold land - A.Y. 2001-02 Rs. 4,04,200 A.Y. 2002-03 Rs. 4,42,900 A.Y. 2003-04 Rs. 4,85,900 A.Y. 2004-05 Rs. 5,50,400 A.Y. 2005-06 Rs. 5,93,400 A.Y. 2006-07 Rs. 7,31,382 A.Y. 2007-08 Rs. 7,86,930 and Rs. 16,02, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Mohd. Atique are in appeal before your Honors. 4. Additional grounds of appeal go to the root of the matterand hence are vital to the disposal of said appeals. Reference to incriminating material is of utmost importance to make addition u/s 153A.Admittance of additional grounds shall help the assessee in getting justice. 5. Reliance is placed on the following decisions for admittance of legal grounds in the instant appeals - a. Hon'ble Apex Court in the case of National Thermal Power Co. Ltd - [1998] 229 ITR 383 - [CLPB 01-02] b. Hon'ble ITAT Chennai (TM)bench in the case of Hemal Knitting Industries - [2010] 127 ITD 160 - [CLPB 39-45] c. Hon'ble ITAT Mumbai bench in the case ofAnjliPandit[2017] 88 taxmann.com 657 (Mumbai - Trib.) - Para 3 and 4 - [CLPB 25-38] 6. Assessee prays that the additional grounds of appeal being legal grounds on fundamental issue of reference to incriminating material found during the course of search and goes the root of matter and hence please be admitted for adjudication of matter. B. Facts of the case: (AY 2001-02 to 2007-08) 1. The main source of income for assessee is agriculture. In addition to this he is also earning in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of self-owned land was deleted by applying the finding given by Hon'ble ITAT of Rs. 6,000 per bigha. Addition of agriculture income on land taken on lease was sustained. 10. In A.Y. 2007-08, in addition to the above mentioned income sustained for agriculture income on land taken on lease, addition of Rs. 16,02,200 was sustained relating to one seized document vide BS-1. 11. Aggrieved assessee is in appeal before Your Honors. C. Submission: (A.Y. 2001-02 to 2007-08) 1. Hon'ble ITAT Bench of Indore vide order dated 31.01.2013 in appeal nos. IT(SS)A 310 to 316/IND/2012 stated - Para 6 - "........However, the fact remains that the assessee is owning agricultural land and also some land was taken on lease......." [emphasis supplied] [PB 378 back side internal page 8] Para 10-"......In respect of the land taken on lease, the matter is restored to the file of the Assessing Officer for determining the total land taken on lease after considering the additional evidence filed before Ld. CIT(A) as discussed hereinabove, and after allowing deduction on account of lease rent paid by the assessee thereon, the Assessing Officer is to compute the agricultural income ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rse of search operations on the basis of which addition has been sustained for the agriculture income on leasehold land. 4. In the statement of assesseerecorded u/s 132 on 21.09.2006, a specific question was raised vide Question No. 8which further emphasizes the fact that no documents relating to the agriculture land taken on lease were found. Relevant extract -[PB 34] The above question by the officer recording statement during the course of search further corroborates the fact that no documents relating to agriculture land taken on lease were found during the course of search. No addition ought to have been made in absence of any incriminating material found during the course of search relating to agriculture income. 5. In search assessment, any undisclosed income, which can ultimately be added, is only to the extent of any unrecorded assets / material found or any incriminating documents found as representing undisclosed income earned. Reliance is placed on following judicial precedents of the Hon'ble Jurisdictional Indore Bench of ITATwhich in turn has followed / referred decisions of various Hon'ble High Courts- no addition warranted in absence of incriminating mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dingly be given to the Ld. AO and relief may please be granted. Considering the above facts, circumstances of the case, submissions made, documents on record and judicial precedence, appeal of the assessee may please be allowed by deleting the additions made by the Ld. AO and sustained by the Ld. CIT(A). Submitted Authorised Representative 6. Ld. D.R. opposed these submissions and supported the orders of the authorities below. Ld. Counsel for the assessee has taken us through various documents filed in support of claim of land taken on lease. However, no evidence with regard to the carrying out activities has been filed. 7. We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. The effective ground in this appeal on merit is with regard to the disallowance of claim of agricultural income earned from the lands taken on lease. We find that the assessee has filed confirmation and copy of lease agreement with one Mr. Aman Ulla Khan enclosed at paper book page Nos.51 to 57 and Shri Narayan Singh Meena. It is stated in the agreement that land was given to the assessee. Ld. Counsel for the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e holder is usually written, the name of the assessee is not appearing meaning thereby the land has not been given on lease as per Government records. * In some cases, the assessee has furnished lease agreements with the farmers from whom the said land has been claimed to be taken on Batai. These agreements are made on plain paper with no stamp on them and it appears that they have been signed in one hand writing. Therefore the genuineness of such agreements has not been established. * During the assessment proceedings and the set aside proceedings also the assessee was required to furnish any proof of agriculture activities being done on the said land or any proof of sale of yield. The assessee has failed to furnish any documentary evidence such as bills/vouchers of seeds and fertilizers, transport expenses, agriculture equipments, irrigation facilities etc. The assessee did not furnish any proof of sale of agriculture produce also. * Merely existence of agriculture land does not establish that actually any income has been generated on it by the assessee." 9. The Ld. CIT(A) affirmed the aforesaid finding by observing as under: "7.4(b) So far as the claim of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts and in the circumstances of the case and in law, Learned Assessing Officer erred in making the addition and passing the impugned assessment order under section 153A rws 143(3) without reference to any incriminating material found and seized during the course of conduct of search." 12. Ld. Counsel for the assessee reiterated the submissions as made in the written submissions. The written submissions of the assessee are as under: Fixed for hearing on 14.02.2019 Before the Hon'ble Income Tax Appellate Tribunal, Indore Bench, Indore IT(SS)A No.: 30/Ind/2016to 36/Ind/2016 by the Assessee In the matter of :Mohd. Atique, Bhopal PAN : AGWPA6383N Assessment Year :2001-02 to 2007-08 Status : Individual May it please Your Honors, In the course of hearing held on 06.02.2019, Hon'ble Bench was kind in giving an opportunity to the Ld. CIT(DR) to make her submission on the case laws relating to the additional grounds filed by the assessee. 2. A written submission on the additional grounds along with relevant judicial decisions is already on record. This further submission may please be considered in continuation to the earlier submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d round of litigation and an assessee can raise issue relating to validity of order in second round of litigation even if same was not raised in first round - Held, yes" [emphasis supplied] c) Hon'ble Bombay High Court (Full Bench) in the case of Ahmedabad Electricity Co. Ltd. - [1993] 6 Taxman 27 - HEAD NOTE - "Section 254 of the Income-tax Act, 1961 - Appellate Tribunal - Powers of - Assessment years 1962-63 to 1971-72 - During assessment assessee did not claim deduction of amounts transferred to 'reserve' as per Electric Supply Act, 1948, either before ITO or AAC - Later, on basis of a High Court decision holding such amounts as deductible on revenue account assessee claimed deduction of same before Tribunal by way of additional ground while appeal was pending before Tribunal - Tribunal refused to permit assessee to raise such additional ground - Whether phrase 'pass such order thereon' occurring in section 254(1) confers widest possible jurisdiction on Tribunal including jurisdiction to permit any additional ground of appeal if in its discretion and for good reasons it thinks it necessary and permissible to do so - Held, yes - Whether Tribunal had jurisdictio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITAT viz., 'Whether the additions made to the income of the Respondent Assessee for the said AYs under Section 2(22)e of the Income Tax Act, 1961 ('Act') were not sustainable because no incriminating material concerning such additions were found during the course of search and further no assessments for such years were pending on the date of search?' [emphasis supplied] 6. The above judicial precedents adequately fortify the case of the appellant. Addition made towards agriculture income on leasehold agriculture land in absence of incriminating material relating to such addition found and seized during the course of search and also without following the direction given by the Hon'ble Coordinate Bench to ascertain the leasehold agriculture land and compute agriculture income thereon after deducting lease rent, ought to be deleted. Submitted Authorised Representative" 13. Ld. D.R. opposed these submissions and pointed out that even in earlier ground of litigation, the assessee had taken a legal ground, which was rejected by this Tribunal. Further, Ld. D.R. submitted that in the present case, this Tribunal cannot travel beyond the directions given vide order dated 31.1.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aining to the assessment year 2003-04. The assessee has raised following grounds of appeal: 1. "On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the order of the assessing officer, wherein he had failed to follow the directions contained in the combined order dated 31.1.2013 in appeal No.310 to 316/Ind/2012 of ITAT. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the finding of the assessing officer that the appellant was not having any lease hold land with him and that he did not earn agricultural income of Rs. 4,85,900/- from such land. 3. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the addition of Rs. 4,85,900/- towards income from other sources as made by the assessing officer. 4. The appellant craves leave to add, to alter and/or to modify the grounds of appeal on or before the date of hearing." 18. Since similar grounds were raised by the assessee in the appeal IT(SS)A No.30/Ind/2016 except difference in figures, this appeal of the assessee is also dismissed based on the findings given in para 14 above in IT(SS) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 except difference in figures, this appeal of the assessee is also dismissed based on the findings given in para 14 above in IT(SS)A No.30/Ind/2016. 23. Now we take up IT(SS)A No.35/Ind/2016 pertaining to the assessment year 2006-07. The assessee has raised following grounds of appeal: 1. "On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the order of the assessing officer, wherein he had failed to follow the directions contained in the combined order dated 31.1.2013 in appeal No.310 to 316/Ind/2012 of ITAT. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the finding of the assessing officer that the appellant was not having any lease hold land with him and that he did not earn agricultural income of Rs. 5,93,400/- from such land. 3. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the addition of Rs. 5,93,400/- towards income from other sources as made by the assessing officer. 4. The appellant craves leave to add, to alter and/or to modify the grounds of appeal on or before the date of hearing." 24. Since similar groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or to modify the grounds of appeal on or before the date of hearing." 28. The assessee has also filed an additional grounds that reads as under: 29. The facts in brief are that the second round of litigation. In the earlier round of litigation, matter came up to this Tribunal and this Tribunal vide its order dated 31.1.2013 in IT(SS)A No.288 to 294/Ind/2012 was pleased to restore the assessment to the file of the A.O. for decision afresh. Ld. Counsel for the assessee reiterated the submissions as made in the written submissions. The submissions of the assessee for all the assessment years are as under: "Fixed for hearing on 06.02.2019 Before the Hon'ble Income Tax Appellate Tribunal, Indore Bench, Indore IT(SS) No.: 37/Ind/2016 to 42/Ind/2016 by the Assessee ________________________________________________________ __________ In the matter of :Mohd. Shakeel, Bhopal PAN :ARZPS3328P Assessment Year :2001-02 to 2004-05, 2006-07 to 2007-08 Status :Individual Return :A.Y. 2001-02at Rs. 1,56,000 and agriculture income Rs. 21,000 on 25.09.2008 A.Y. 2002-03 at Rs. 1,57,100 and agriculture income Rs. 21,000 on 25.09.2008 A.Y. 2003- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts from orders of Ld. AO and Ld. CIT(A) during second round of appeal before the Hon'ble ITAT Bench of Indore after the matter was set aside by the Hon'ble Bench to the file of AO vide order pronounced on 03.09.2012 in appeal nos. IT(SS)A 288 to 294/Ind/2012. The matter was set aside by the Hon'ble Bench owing to additional evidences filed by the assessee which were not considered by the authorities below. While setting aside the matter to the file of Ld. AO, Hon'ble ITAT noted the following facts in its order at internal Page 5[PB 126] - "On the issue as to why these documents could not be filed before the learned Assessing Officer, it was explained by the learned counsel that the search took place on 21.09.2006 and notice u/s 153C was issued on 16.09.2008 approximately after two years of the search. The return was claimed to be filed on 16.09.2008. It was also pointed that the questionnaire was issued on 11.10.2008, therefore, the assessment was to be completed by 31.12.2008."[emphasis supplied] 8. Search was conducted in the case of Mohd. Shafique, Mohd. Atique and survey in the case of M/s. Ekta Transport Co. Cases of Mohd. Shafique and Mohd. Atique are in appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stage, the AO of the person who has been searched must arrive at a satisfaction that the assets or documents seized does not belong to the searched person but to some 'other person'; in the second stage, that is, after such satisfaction is arrived by the AO of person searched, then he is required to transfer or hand over the assets or documents to the AO having jurisdiction over the 'other person'; and lastly, the AO of 'other person' shall commence the proceedings under section 153C and consequently pass assessment /reassessment order in the manner provide u/s 153A. If such a procedure is not followed then needless to say that jurisdiction to proceed u/s 153C cannot be acquired by the AO of 'other person', i.e., other than the person searched. 12. Reliance is placed on following judicial precedence of the Jurisdictional High Court of Madhya Pradesh in the case of Mechmen [2015] 60 taxmann.com 484 - Para 15 13. These additional grounds go to the root of matter and are vital to the disposal of said appeals. Their admittance shall help the assessee in getting justice. Reliance is placed on the following decisions for admittance of legal grounds i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the assessee. These documents are of Bombay Transport Company (Prop. NavedBhai). Thus, no referencehasbeen made by Ld. AO to any incriminating material found during the search of Mohd. Atique and Mohd. Shafique, which belongs to the assessee on the basis of which additionismade been made in all the impugned years. In the set aside proceedings, Ld. AO sustained the additions made by the then Ld. AO for all the years under consideration. 17. Further, for A.Y. 2004-05 and A.Y. 2006-07: Bombay Transport Company (Prop. NavedBhai) had entered into transport contract with M.P. State Civil Supplies Corporation Limited, receipts of which amount to Rs. 74,50,000 and Rs. 90,47,916 respectively. Ld. AO applying the provisions of section 292C made an addition of @ 8% on total contract receipts which amounts to Rs. 5,96,000 and Rs. 7,23,833 respectively. This transport contract is in the name of Bombay Transport Company (Prop. NavedBhai).M.P. State Civil Supplies Corporation Limited confirmed that it has made payments to Bombay Transport Company. [PB 99,107] 18. Ld. AO took the deposits in the bank accounts of Mohd. Shafique and Co. for the purpose of applying NP rate of 8% to arrive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd rigours follow up that certified copy of satisfaction note recorded by AO in the case of assessee i.e. Mohd. Shakeel was provided through letter dated 18.12.2018. Application under RTI was filed on 17.09.2018 which is also pending for disposal in this respect. [PB 55& annexure to this submission] 2. On perusal of the certified copy of satisfaction note following is evident - a. Heading - Mohd. Shakeel b. Start of the satisfaction note - "....documents seized or requisitioned belongs or belong to the assessee" i.e. Mohd. Shakeel c. Towards the end of satisfaction note - "Therefore the proceedings u/s 153C against the assessee is initiated and his income is assessed or re-assessed in according to the provisions of section 153A." 3. All the above noted points as evident from the certified copy of satisfaction note recorded by AO in the case of assessee i.e. MohdShakeel conclude that the satisfaction note provided is from the file of assessee and not from the file of searched persons i.e. Mohd. Atique and Mohd. Shafique. 4. For invoking provisions of Section 153C of the Act, recording of satisfaction is a must by - a. The AO of the searched person and b. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 008 - [PB 73, 79, 91, 97] "In the order sheet entry dated 05.12.2008 assessee was asked to furnish following detail: During the year under consideration following amount has been received in the bank a/c. ofMohd. Shafique and Co. Deposits Total Deposits in Bank of India Safia College State Bank of India TT Nagar A.Y. 2001-02 - 8 7,54,054 A.Y. 2002-03 6,000 18,33,879 A.Y. 2003-04 2,36,000 24,65,691 A.Y. 2004-05 3,16,010 17,00,714 A.Y. 2006-07 95,562 2,07,587 A.Y. 2007-08 1,00,000 - Kindly give the details of all above credits in your books of accounts...." c. For A.Y. 2004-05 and 2006-07, Ld. AO has stated as under for estimating income @ 8% - [PB 99 and 107] "Information were called from M.P. State Civil Supplies Corpn. Ltd. were in the F.Y. 2003-04 & 2005-06, contract payment of Rs. 74,50,000/- &Rs. 90,47,916/- were made to Bombay Transport Company. Therefore, in absence of Books of Accounts 8% of above receipts will be taxable in the hands of assessee........" d. Para 2 of Assessment Order for A.Y. 2007-08 dated 31.12.2008 - [PB 112] "In the relevant assessment year assessee has shown unsecured loans of Rs. 17,000/- from Saad A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the set aside proceedings further corroborate the fact that no reference has been made to any incriminating material found during search and seizure operations carried in the case of Mohd. Atique andMohd.Shafique.Details sought by the Ld. AO are from the books of account of the assessee. 10. Reliance is placed on following judicial precedents of the Hon'ble Indore Bench of ITAT - no addition warranted in absence of incriminating material - a. Kamal Kishore KotwaniIT(SS)A No. 186 to 190/IND/2016 dated 04.07.2018 b. Kamta Prasad Dwivedi IT(SS)A No. 183 to 185/IND/2016 dated 19.09.2018 c. Jay Dee Securities & Finance Ltd 88 taxmann.com 626 (Delhi- Trib.) dated 17.04.2017 11. Firstproviso to Section 153C reads - "Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to sub-section (1) of section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person :" In the instant case, search in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 012 - order pronounced on 31.01.2013 - Para 43 - "As discussed hereinabove, the assessee had agricultural land since 40 years and also having substantial income from operation of trucks. The assessee was also having income from house property since last many years. Even though the Assessing Officer has not accepted the income from house property but the same was assessed as income from other sources by declining deduction claimed u/s 24 but the fact remains that the assessee has declared income which was assessed by the Assessing Officer under different heads. All these facts indicate that the assessee could have cash in hand of Rs. 5 lacs as on 1. 4.2001. Accordingly, the Assessing Officer is directed to delete the addition of Rs. 5 lacs as opening cash balance."[emphasis supplied] [PB 39] Finding given by the Hon'ble Bench in the case of father of the assessee in his search assessment finds a direct application in the case of the assessee himself also. In the instant case, assessee is earning income from business of transportation since the year 1991. Apart from this assessee is also earning income from agricultural activity. To substantiate his claim statement of affairs a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed person only. 19. Ld. AO asked the assessee to furnish details of amount received in bank account of Mohd. Shafique and Co. Assessee submits that Mohd. Shafique and Co. is the proprietorship concern of Mohd. Shafique, father of the assessee. This fact is also stated by Mohd. Shafique in his statement recorded u/s 132 on 26.09.2006 in response to Q.8.[PB 64] 20. For the additions made in A.Y. 2007-08 : Para 3 of the Assessment Order dated 31.12.2008 - [PB 112] "In the relevant assessment year assessee has shown Advances from following persons: S.No. Name of Person Amount Received Squared Up During the year 01 Memboob Khan 1,00,000/- Yes 02 Rashid Vahid 1,00,000/- Yes 03 S.Mahmood Ali 1,20,000/- Yes In the order sheet entry dated 10.12.2008 assessee was asked to furnish bank statement............" Bank statement was submitted before Ld. AO during the first round of proceedings. Referring to this statement, it is evident that amount received from the above mentioned three persons was returned through banking channel. Details of which are as under - [PB 46, 50, 51, 52] Sr.No. Name of person Date of repayment Instrument No. Amount repai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the memorandum of appeal, but the Tribunal, in deciding the appeal, shall not be confined to the grounds set forth in the memorandum of appeal or taken by leave of the Tribunal under this rule : Provided that the Tribunal shall not rest its decision on any other ground unless the party who may be affected thereby has had a sufficient opportunity of being heard on that ground." Tribunal is under statutory obligation not only to entertain plea but also to decide the same after providing sufficient opportunity of being heard to the other side. 5. There are direct decisions which deal with the subject matter of this submission relating to admission of additional ground in the second round of appellate proceedings before the Hon'ble Tribunal. These are in addition to and in continuation of the case law paper book already on record. A Case Law Paper Book - Volume 2 has been furnished with the similar submission made in the appeals of Mohd. Atique. g) Hon'ble Bombay High Court in the case of Inventors Industrial Corpn. Ltd - [1992] 194 ITR 548 - HEAD NOTE - "Section 251 of the Income-tax Act, 1961 - Commissioner (Appeals) - Powers of - Assessment year 1958-59 - Whether a g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n which could be waived and such jurisdictional provision or a mandatory provision enacted in public interest which could not be waived, because by consent no jurisdiction could be conferred on the authority unless the conditions precedent were first fulfilled. The Tribunal's view was clearly erroneous that the matter became final when the Tribunal passed the earlier remand order so that this point of jurisdiction got finally settled, which could not be agitated unless the assessee had come in the reference to the High Court at this stage. The Tribunal's view was also incorrect that in restoring the case to the file of the ITO by the earlier order, the only point left open was in respect of addition on merits and that the legal or jurisdictional aspect whether the re-assessment proceedings were legally initiated was not kept open. Even the Tribual's view was erroneous that even though this point went to the root of the jurisdiction and was a pure question of law, merely because the point was initially raised and not pressed when the matter was taken up before the AAC, it could be waived and it could not be reagitated." [emphasis supplied] k) Hon'ble Apex Court in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfirming the addition of Rs. 5 lakhs by not allowing the claim of opening cash balance as on 1.4.2000. Ld. Counsel for the assessee vehemently argued that the authorities below were not justified in allowing the cash balance. He submitted that the assessee has been engaged in business as well as earning agricultural income. Therefore, it cannot be presumed that he was not having any opening cash balance. 32. On the contrary, Ld. D.R. opposed these submissions and supported the order of the authorities below. He submitted that the assessee ought to have given supporting evidence in support of the contention. He submitted that the assessee was not filing any return of income. It was only when search was conducted the assessee has filed the return for first time in respect of assessment under consideration. 33. We have heard the rival contentions, perused the materials available on record and gone through the orders of the authorities below. Assessing officer had made addition on the basis that the assessee could not submit any piece of evidence in support of this contention. The explanation before the authorities below was that the assessee was having a business of transport, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee is also partly allowed based on the findings given in paras 34 & 35 above in IT(SS)A No.37/Ind/2016. The A.O. is directed to re-compute the net profit. 40. Now we take up IT(SS)A No.39/Ind/2016 pertaining to the assessment year 2003-04. The assessee has raised following grounds of appeal: 1. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in upholding the order of the assessing officer, where he had estimated the net profit at 8% on the gross receipts of Rs. 27,01,691/- and in confirming the addition of Rs. 1,32,135/- as made by the assessing officer. 2. The appellant craves leave to add, to alter and/or to modify the grounds of appeal on or before the date of hearing. 41. Since similar ground was raised by the assessee in the appeal in ground No.2 of IT(SS)A No.37/Ind/2016, except difference in figures, this appeal of the assessee is also partly allowed based on the findings given in paras 34 & 35 above in IT(SS)A No.37/Ind/2016. The A.O. is hereby directed to re-compute the net profit. 42. Now we take up IT(SS)A No.40/Ind/2016 pertaining to the assessment year 2004-05. The assessee has raised following grounds of appeal: 1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s order which reads as under: 9.1 The A.O. has made this addition on the basis of seized documents pages 1 to 34 of Annexure A-2 which showed that a transport contract was obtained from MP State Civil Supplies Corporation Ltd. in the name of Bombay Transport Company. The appellant claimed said that M/s. Bombay Transport Co. was a proprietary concern owned by one Naved Bhai. However, he failed to produce Shri Naved Bhai before the A.O. Information was called from MP State Civil Supplies Corporation Ltd. which confirmed payment of Rs. 74,50,000/- and Rs. 90,47,913/- to Bombay Transport Co. in the F.Y. 2003-04 and 2005-06 respectively. In view of the non-production Shri Naved Bhai or any other evidence in this regards, the A.O. held that the contract had been executed by the appellant and estimating net profit on the same @ 8% made an addition of Rs. 5,96,000/- in A.Y. 2004-05 and of Rs. 7,23,873/- in A.Y. 2005-06 in the hands of the assessee. A.Y. Contract Receipts from MP State Civil Supplies Corp. Ltd. Net Profit @ 8% 2004-05 Rs. 74,50,000/- Rs. 5,96,000/- 2006-07 Rs. 90,47,916/- Rs. 7,23,873/- 47. From the above, it is evident that addition us sustained solely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f appeal: 1. On the facts and in the circumstances of the case, the Ld. CIT(A) was not justified in confirming the addition made by the assessing officer by not accepting the unsecured temporary loans (squared up during the accounting year) as below:- a. Syed Abdullah Rs. 17,000.00 b. Memboob Khan Rs. 1,00,000.00 c. Rashid Vahid Rs. 1,00,000.00 d. S. Mahmood Ali Rs. 1,20,000.00 Rs. 3,37,000.00 2. The appellant craves leave to add, to alter and/or to modify the grounds of appeal on or before the date of hearing. 53. This solitary ground is on account of unsecured temporary loans. Ld. Counsel for the assessee submitted that all the details were filed before the authorities below. He drew our attention to paper book pages 50, 51 & 52. It is stated that amount was repaid during the year under consideration. 54. Ld. D.R. opposed these submissions and submitted that no evidences were placed before the A.O. and therefore he supported the orders of the authorities below. 55. We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. The assessing officer has not given any findin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 38,946/- and also claimed agricultural income of Rs. 68,682/-. The assessment u/s 153A r.w.s. 143(3) of the Act was framed vide order dated 31.12.2008. The assessing officer while framing the assessment made various additions on account of disallowance of agricultural income at Rs. 68,682/-, disallowance of rental income of Rs. 65,520/- and addition on account of unexplained cash credit of Rs. 2 lakhs. Further, the A.O. made addition of Rs. 97,000/- and Rs. 1,54,334/- in respect of the business receipts and substantive addition of Rs. 97,000/- in the case of Farida Sultana. Aggrieved by this, the assessee preferred an appeal before Ld. CIT(A), who after considering the submissions partly allowed the appeal. Thereby, the application of net profit @ 8% on the gross receipts was sustained and the addition of Rs. 97,000/- was deleted. Further, addition of Rs. 2 lakhs treating as a cash credit was upheld. Aggrieved against this order, the assessee is in present appeal. 59. First we take up the additional ground of the assessee. The additional ground of the assessee reads as under: 1. On the facts and in the circumstances of the case and in law, Learned Assessing Officer err ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of additional ground in the second round of appellate proceedings before the Hon'ble Tribunal. These are in addition to and in continuation of the case law paper book already on record. A Case Law Paper Book - Volume 2 has been furnished with the similar submission made in the appeals of Mohd. Atique. m) Hon'ble Bombay High Court in the case of Inventors Industrial Corpn. Ltd - [1992] 194 ITR 548 - HEAD NOTE - "Section 251 of the Income-tax Act, 1961 - Commissioner (Appeals) - Powers of - Assessment year 1958-59 - Whether a ground by which jurisdiction to make assessment itself is challenged can be urged before any authority for first time - Held, yes - Whether, therefore, assessee was entitled to challenge jurisdiction of Income-tax Officer to initiate reassessment proceedings before Appellate Assistant Commissioner in second round of proceedings even though he had not raised it earlier before Income-tax Officer or in earlier appeal before AAC - Held, yes" [emphasis supplied] n) Hon'ble ITAT Bench of Kolkata 'A' in the case of Peerless Gen. Fin. & Inv. Co. Ltd. - [2008] 21 SOT 440 - HEAD NOTE - Section 253 of the Income-tax Act, 1961 - Appellate Tribunal - Appeals to - Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only point left open was in respect of addition on merits and that the legal or jurisdictional aspect whether the re-assessment proceedings were legally initiated was not kept open. Even the Tribual's view was erroneous that even though this point went to the root of the jurisdiction and was a pure question of law, merely because the point was initially raised and not pressed when the matter was taken up before the AAC, it could be waived and it could not be reagitated." [emphasis supplied] q) Hon'ble Apex Court in the case of S. Nelliappan - [1967] 66 ITR 722 - HEAD NOTE - "Section 254 of the Income-tax Act, 1961 [Corresponding to section 33(4) of the Income-tax Act, 1922] - Appellate Tribunal - Power of - Whether in hearing an appeal Tribunal may give leave to assessee to urge grounds not set forth in memorandum of appeal, and in deciding appeal Tribunal is not restricted to grounds set forth in memorandum of appeal or taken by leave of Tribunal - Held, yes" [emphasis supplied] r) The legal and jurisdictional issue raised in the instant additional grounds by the appellant was dealt by the Hon'ble Delhi High Court in the case of Kabul Chawla - [2016] 380 ITR 573 - Para 2 - ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ings. Hence,itwas filed as additional evidence before Ld. CIT(A). Ld. CIT(A) did not admit this additional evidence and proceeded to sustain the addition made by Ld. AO. 27. Ld. AO referred to Annexure- A2 page no. 1 to 34 (Books of accounts of Bombay Transport Company proprietor NavedBhai) and Annexure -2 page 31 impounded from office of M/s. Ekta Transport Company. For the addition made net profit is estimated @ 8% and after giving benefit of income as filed in return, balance of Rs. 1,51,334 was added. Ld. CIT(A) sustained the addition so made by Ld. AO. 28. Aggrieved assessee is in appeal before Your Honors. E. Submission: a. Ground No. 01 - Addition of Rs. 2,00,000 received from Anees Ahmed 8. Para 3of assessment order u/s 153A rws 143(3), dated 31.12.2008 - "In the year under consideration assessee society has received loan of Rs. 2,00,000/- from Anees Ahmed. In the order sheet entry dated 10.10.2008 assessee was asked to submit copy of Bank Statement and Return of Income of Anees Ahmed." 9. Para 9.4ofCIT(A) order dated 04.03.2016 - "As the appellant has not furnished any explanation or documentary evidence regarding the credit worthiness of ShriAne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AO and sustained by Ld. CIT(A) be deleted. d. Direction given by Hon'ble Bench in the hearing fixed on 03.10.2018 1. In the hearing fixed on 03.10.2018Hon'ble Bench gave a direction to Ld. CIT(DR) to submit report of Assessing Officer in the case of Mohd. Atique and Mohd. Shafique. Vide letter dated 01.02.2019, Ld. CIT(DR) provided the copies of page 262 and 263 & 274 to 278. It is pertinent to mention here that page 262 and 263 & 274 to 278 are not related to assessee i.e. Mohd. Shafique. Page 262 and 263 is the affidavit of Mohd. Atique to obtain license for use of Revolver.and has already been considered by the Hon'ble Co-ordinate Bench vide order dated 31.01.2013 at PB 377 internal page 6 para 6. Page 274 to 278 is the partnership deed for the business run under the name and style of M/s. S T Developers. Assessee i.e. Mohd.Shafique is not a party to this deed Both the above referred documents neither belongs to nor pertains to assessee i.e. Mohd. Shafique. Considering the above facts, circumstances of the case, submissions made, documents on record and judicial precedence, appeal of the assessee may please be allowed by deleting the additionsmad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee i.e. Mohd. Shafique) used to give her money for household expenses out of which she saved some money every month. It is out of these savings that the amount of Rs. 45,000/- was deposited. 2. In view of the above it is submitted that the addition made may please be deleted. In the hearing fixed on 3.10.2018 Hon'ble Bench gave a direction to Ld. CIT(DR) to submit report of Assessing Officer in the case of Mohd. Atique and Mohd. Shafique. Vide letter dated 1.2.2019, Ld. CIT(DR) provided the copies of page 262 and 263 & 274 to 278. It is pertinent to mention here that page 262 and 263 & 274 to 278 are not related to assessee i.e. Mohd. Shafique. Page 262 and 263 is the affidavit of Mohd. Atique to obtain license for use of Revolver and has already been considered by the Hon'ble Coordinate Bench vide order dated 31.1.2013 at PAPER BOOK 377 internal page 6 para 6. Page 274 to 278 is the partnership deed for the business run under the name and style of M/s. ST Developers. Assessee i.e. Mohd. Shafique is not a party to this deed. Both the above referred documents neither belongs to nor pertains to assessee i.e. Mohd. Shafique. Considering the above fact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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