TMI Blog2012 (11) TMI 1284X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case, the Learned CIT(Appeals) has erred in deleting the addition of ₹ 65,446 made by the A.O. on account of interest earned on money advanced outside the books of account, 3. (a) The order of the CIT(A) is erroneous and not tenable in law and on facts. (b) The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal . 3. Both the substantial grounds are inter-connected to each other. The brief facts of the case are that a search and seizure operation was carried out on 15.12.2004 at a premises of Shri Brij Mohan Gupta. A diary containing entries in the coded language was found from the premises of Shri Brij Mohan Gupta. It was inventorised as Annexure A-50. Statement of Shri Brij Mohan Gupta, his son Rajiv Gupta and his accountant Shri Ram Avtar Singhal were recorded. Shri Ram Avtar Singhal while disclosing the entries made in the diary in abbreviated form pointed out that 667 dated 31.3.2003 written on this pages means ₹ 6,67,000. These were received from one person whose name in abbreviated form is noted on the diary and these were advanced as a loan. Shri Brij Mohan Gupt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence against the assessee to hold that assessee made investment in advancing the loan to certain parties through Shri Brij Mohan Gupta. The revenue in order to prove its case is harping upon the narrations available in the diary, statement of Shri Ram Avtar Singla and Shri Brij Mohan Gupta. We have perused the seized material available on page 46 of the assessee s paper book. On this page, there are various entries against the names of various persons, they are in abbreviated form or in a coded form. At the bottom of the page against Atul , there are certain entries, namely, 4, 4, 2, 1 1.5 totalling to 12.50 are available. No doubt, this is a narration made by Shri Ram Avtar Singla in his handwritings. Shri Ram Avtar Singla has explained what for the latter mentioned in abbreviated form stands for e.g. HD means Hanuman Dass. KMF, Krishan Kumar Manoj Kumar, Karol Bagh, New Delhi. Learned Investigating Offifer at the time of recording the statement of Shri Ram Avtar Singhla almost put every abbreviated letter to Shri Ram Avtar Singhla. He was able to give the complete form but not the address. With regard to the assessee, no question was put. The revenue failed to establish a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r A.Y. 2003-04 to A.Y. 2006-07 and allowing the adjustment of excess surrender of ₹ 19.00 lakhs against this income. 4. a) The order of the CIT(A) erroneous and not tenable in law and on facts. b) The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal . 11. The brief facts of the case are that a search and seizure operation was carried out at the premises of the assessee on 23.3.2006. The assessee has filed his return of income on 30th October 2006 declaring an income of ₹ 541,95,570. Learned Assessing Officer has made an addition of ₹ 21,06,777 in the income of the assessee by observing as under: 3. it was found at the time of search that the assessee is a benami owner of M/s. Mount Fragrances whose proprietor on record was shown as Sh. Gaurav Mittal. While framing the assessment of Sh. Gaurav Mittal, so called proprietor of M/s. Mount Fragrances for A.Y. 2002-03, it was held that the firm M/s. Mount Fragrances is a benami concern of Sh. Mahabir Prasad Gupta. Similarly, it was held in the A.Y. 2003-04 to A.Y. 2006-07. Detailed facts are available in the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irst appellate authority has gone through all these evidences and thereafter held that only evidence possessed by the Assessing Officer for treating the assessee as benami owner is the statement of Shri Ram Babu Mittal father of Shri Gaurav Mittal. In his statement, he has disclosed that Gaurav Mittal is a partner only for name sake. Learned CIT(Appeals) has held that this statement is not sufficient to treat the assessee as 100% owner of Mount Fragrances. Learned CIT(Appeals) has further held that profit to the extent of 75% from this firm is to be assessed in the hands of the assessee. This order was not challenged by the revenue in further appeal. 14. Learned DR took us through the findings of the Learned CIT(Appeals) in assessment year 2003-04 available on page Nos. 93 to 106 of the paper book. He submitted that even if revenue has not challenged the order of the Learned CIT(Appeals) in assessment year 2003-04, it can challenge those findings which are still effective in the present assessment year. In this way, he submitted that no discussion is discernible in the impugned order and, therefore, for the purpose of the facts and reasoning, Tribunal is required to look into t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ram Babu Mittal who has disclosed during the course of search that his son is a partner only for name sake. Learned CIT(Appeals) has observed that statement of Gaurav Mittal was never recorded. In his assessment order, it was observed by the Assessing Officer that it may be possible, therefore, may be drawing salary in the share of 25%. Learned CIT(Appeals) also considered sales-tax registration certificate, bank statement, return of Gautav Mittal etc., more so, this order was not challenged. Thus, we don t find any merit in ground No.2 of the revenue. 17. As far as ground No.1 is concerned, after looking into page 87 of the paper book, wherein details of surrender income of ₹ 9 crores, how it is allocated to the stock and assets and details of unrecorded sales, we are of the opinion that a sum of ₹ 19 lacs was still available with the assessee for allocation. Benefit of set off of this amount has been given to the assessee by the Learned CIT(Appeals), otherwise in principle Learned CIT(Appeals) has confirmed the addition of ₹ 21,06,777 in the findings extracted supra. Taking into consideration the findings of the Learned CIT(Appeals), we are of the view that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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