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TMI Blog2020 (11) TMI 493X X X X Extracts X X X X X X X X Extracts X X X X ..... d thus partly allowed the appeal filed by the assessee. 4. Aggrieved by the order of ld. CIT(A), Revenue has filed the present appeal before us on the grounds mentioned hereinbelow:- "1. Whether on the facts and in the circumstances of the case and in law that the CIT(A) was right in deleting the addition of Rs. 1,26,84,602/- made by the AO on account of unaccounted investment recorded in the seized document. 2. Whether on the facts and in the circumstances of the case and in law that the ld. CIT(A) was right in holding that the document found seized from the premises of the assessee, on which an addition was made by the AO is a dumb document. 4. Ground No. 1 and 2 raised by the Revenue are interrelated and interconnected and relates to challenging the order of the ld. CIT(A) in deleting the additions made by the AO on account of unaccounted investment recorded in the seized documents. The ld. DR appearing on behalf of the Revenue had relied upon the order passed by the AO and submitted that the ld. CIT(A) was not right in holding that the documents found and seized from the premises of the assessee on which an addition was made by the AO is a dump document. The ld. DR has al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 21,26,84,602/- is held as unaccounted investment of the assessee for the AY 2017-18 and added to the total income of the assessee u/s 69 r.w.s. 115BBE of the IT Act, 1961. Accordingly, penalty proceedings u/s 271AAB(1)(c) are also initiated on this issue on account of detection of undisclosed investment during the course of search from the seized document by way of issue of notice u/s 274 r.w.s 271AAB(1)(c) of the Act, 1961." 5. On the other hand, ld. AR reiterated the same arguments as were raised by the AO before ld. CIT(A). Ld. AR drawn our attention to para 4 of the order of the ld. CIT(A) wherein the written submissions filed by the assessee are reproduced and the same are also reproduced hereinbelow:- "4. During the course of appellate proceedings written submissions were made, the main portion of which are reproduced below. Ground of Appeal No. 1 to 1.3: In all these grounds of appeal, assessee has challenged the action of ld. AO in making addition of Rs. 1,26,84,602/- u/s 69 of the Income Tax Act, 1961, solely on the basis of rough notings found noted on an undated loose paper found and seized during the course of search, bearing no signature. Brief facts pertainin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch registry number of land purchased by Salasar Balaji Developers Pvt. Ltd. was mentioned, was registered on 17.10.2012, i.e. in A.Y.2013-14. In this scenario, it is beyond imagination that on what basis, AO has treated the noting on the other side of the document as pertaining to A.Y. 2017-18 that too belonging to assessee. Further, neither any asset for which the details appearing on such paper was found in possession of assessee as a result of search nor any registered document containing such details was found during the course of search in the name of assessee nor any corroborative evidence whatsoever was brought on record during the assessment proceedings, thus adverse inference drawn in the case of assessee solely on the basis of a loose paper is an arbitrary Act and not in accordance with law. It is submitted that there is no speck of evidence or any material to indicate that the details was ever executed by assessee or in the name of assessee, and thus it cannot be held that assessee has even entered into any transaction where such amount is involved. In fact, during the course of search, no query was made with respect to such document. It is submitted that no effort ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of income dehors the material in his possession. 72 ITD 342 D.A. Patel vs. DCIT (Mum) Section 158BC of the Income Tax Act, 1961 - Block assessment in search cases - Computation of undisclosed income - Block period 01.04.1986 to 15.07.1996 in search cases - Computation of undisclosed income - Whether simply because a sheet of paper was found during search at premises of assessee, he could not be saddled with tax liability when there was no evidence connecting appellant to seized paper - Held, Yes. Hon'ble Supreme Court in the case of CBI Vs. V.C. Shukia & Others ha's quoted certain judgements of the high courts which have bearing on the issue (page 1418 para 36 - 38) as under: "36. In Yesuvadiyan Vs. Subba Naicker, AIR 1919 Madras 132 one of the Ld. Judges constituting the Bench had this to say: "S. 34, Evidence Act, lays down that the entries in books of account, regularly kept in the course of business are relevant, but such a statement will not alone be sufficient to charge any person with liability. That merely means that the plaintiff cannot obtain a decree by merely proving the existence of certain entries in his books of account even though those books a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other calculations, no addition could be made on the basis of such a dumb documents. In view of above submission, it is submitted that addition made by Id.A0 deserve to be deleted as: Noting on the page 10 of Exhibit 4 of Annexure AS was merely a rough noting; Such document was not in the handwriting of assessee; Such document was undated and noting did not bear any signature nor the name of parties; - No registered document whatsoever was found during the course of search, which was registered in the name of assessee at amount noted in such rough noting; No effort whatsoever was made by Id.A0 to bring such alleged registered document in the name of assessee on record, if assessee had actually invested anything out of unaccounted sources when the AO had vital powers u/s 133(6) to even call for information even from Sub Registrar office; and, No material was brought on record to prove from which sources assessee had made such alleged investment. In the circumstances, it is humbly prayed that the addition made by Id. AO solely as assumptions and presumptions may please be directed to be deleted." 6. We have heard the counsel for both the parties and we have also gone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harged in respect of the income of a period other than the previous year, income-tax shall be charged accordingly. (2) In respect of income chargeable under Sub-section (1), income- tax shall be deducted at the source or paid in advance, where it is so deductible or payable under any provision of this Act from a reading of above section, we find following components which enter into the concept of taxation. The first is the taxable event which attracts the levy, the second is the person on whom the levy is imposed and who is obliged to pay the tax. The third is the assessment year in which charge of income-tax is levied. The fourth is the total income of the previous year and the fifth is the rate or rates at which tax is to be imposed. The rates are prescribed in the annual Finance Act. Therefore, this component has no value in determining total income on the basis of seized document. Our view in this regard is supported by the decision of Hon'ble Supreme Court in Govind Saran Ganga Saran v. CST wherein it was held that for the purpose of charging to tax, there should be four components to be satisfied. For the sake of convenience, we refer to the relevant head notes from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this document." 7. After having gone through the facts of the case and after hearing the counsels at length, we find that during the search proceedings at the residential premises of Shri Rajendra Kumar Kedia, several incriminating documents were found and seized. These documents were inventorized as Annexure-AS, Exhibits 01 to 05 however, at page 10 of Exhibit 4 of Annexure-AS, certain transactions were found recorded and the AO noticed on this page, 1,20,80,572/- as cash and 6,04,030/- as stamp were written. Therefore, it was concluded that the amount of cash paid and stamp duty are written specifically, which according to the AO, these nothings pertain to actual transaction and are not mere estimations as claimed by the assessee. Therefore, it was concluded that the assessee made an unaccounted payment of Rs. 1,20,80,572/- in cash for making undisclosed investment and also paid stamp duty of Rs. 6,04,030/- on the same and therefore, the AO made addition by holding the same as unaccounted investment of the assessee for the year under consideration and added the same to the total income of the assessee U/s 69 r.w.s. 115BBE of the IT Act, 1961. On the contrary, the ld. CIT(A) to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the figures were unaccounted investment made by the assessee for the year under consideration, without there being any material on record to support such presumption. Therefore we are of the considered view that the entries on the page 10 of Exhibit 4 of Annexure AS are merely rough scribbling. Such Scribbling were not in the handwriting of assessee. Such document was undated and noting did not bear any signature and the name appearing therein are not of assessee. No registered document whatsoever was found during the course of search, which was registered in the name of assessee with amount for which addition is made. No efforts whatsoever were made by the AO to bring on record such alleged registered document in the name of assessee more particularly when the AO had vast powers U/s 133(6) to even call for information from Sub-Registrar office. No material was brought on record to prove from which sources assessee had made such alleged investment and while reaching to the above conclusion we also strength from the decision and reliance was placed on the following case:- 1. 211 ITR 178 CIT vs. R.Y. Durlabhji (Raj) 2. 25 tax world 87 CIT vs. Rajendra Prasad Gupta ( Raj. Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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