TMI Blog2014 (5) TMI 1224X X X X Extracts X X X X X X X X Extracts X X X X ..... y - HELD THAT:- The assessee claimed that regarding its income for the year 1996-97 was more than its outgoing and in view of the assessee having spent Rs. 56,302/- against bills on various dates, no addition was made by the Commissioner of Income Tax (Appeals). We are in conformity with the order of the Commissioner of Income Tax (Appeals) in this regard specially after the verification exercise carried out by the Commissioner of Income Tax (Appeals) during the appellate proceedings. Upholding the order of Commissioner of Income Tax (Appeals) we dismiss ground No. 2 raised by the revenue. Unexplained investment of FDR in the name of the wife of the assessee - HELD THAT:- Commissioner of Income Tax (Appeals) accepted the plea of the assessee in view of the said withdrawals which had been verified by the Assessing Officer and also in view of the approximate income of Rs. 75,000/- from different sources being available with the assessee. The ld. DR for the revenue has failed to controvert the findings of Commissioner of Income Tax (Appeals) and in view thereof, we find no merit in ground No. 3 raised by the revenue. Unexplained investment in the purchase of household items ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come from sale proceeds of the above land which was purchased in the year ending 31.3.1987. The loss on the sale of the plot was claimed at Rs. 5,000/- as the assessee had shown the cost at Rs. 35,000/-. In view thereof, the addition was deleted by the Commissioner of Income Tax (Appeals). We find no error in the order of the Commissioner of Income Tax (Appeals) and upholding the same, we dismiss ground No. 7. Addition made in the hands of the assessee on account of a hand written document found during the course of search which reflected that the assessee had sold property - HELD THAT:- Where the document was found from the possession of the assessee, the presumption is that the said document belongs to the assessee and the onus is upon the assessee to explain the nature of the document. In the instant case, the hand written document found from the possession of the assessee was claimed to be a dumb document as no proof of the property or date of the transaction was mentioned in said property - no evidence was found by the Department to establish its case of transfer of remittance of Rs. 10 lacs to London. In the absence of any corroborative evidence found to establish tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23.02.2005 is bad in law and facts of the case. 2. That the Ld. Commissioner of income tax (Appeals) gravely erred in treating the deposits in the hands of Mrs. Surjit Kaur, who is an independent and separate assessee in her own right, towards the income of the appellant. 3. That without prejudice to the above the Ld. C.I.T. (Appeals erred in sustaining an addition of Rs. 38,099/- out of an addition of Rs. 76,107/- made by the Assessing Officer in respect of deposits in bank in the name of Mrs. Surjit Kaur by treating these deposits as unexplained investment by the appellant. b) That without prejudice to the above the addition is highly excessive. 4. That the Ld. C.I.T. (Appeals) gravely erred in sustaining an addition of Rs. 30,000/- out of the addition of 40,000/- made by the Assessing Officer in respect of bank deposits of Rs. 5,000/- on 29.05.1993; Rs. 5,000/- on 02.06.1993; Rs. 10,000/- on 18.06.1993, Rs. 10,000/- on 21.08.1993 and Rs. 10,000/- on 18.09.1993 made by Mrs. Surjit Kaur as unexplained income of the appellant. b) That without prejudice the addition is highly excessive. 5. That the Ld. C.I.T. (Appeals) gravely erred in sustaining the addition of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on was made under section 69 of the Act as tabulated at page 3 of the assessment order. Further, during the course of search seizure operation, certain details of expenditure on additions and alterations of House No. 813, 3B/1, Mohali were found and the assessee was confronted with the details of the expenditure for repairs and renewal. The plea of the assessee in this regard was that it was earning rental income from the said property and out of the said rental income and also out of withdrawal from the GPF advance of Rs. 89,000/-, the assessee alongwith the amount received from USA of 10000 Dollars had made investments. As the assessee had failed to produce the corresponding evidence in support of its explanation, the same was rejected and the investment of Rs. 102,173/- in assessment year 1997-98 and Rs. 208,402/- in assessment year 1998-99 was treated as income of the assessee. Further Fixed Deposit and NSCs worth Rs. 1,37,000/- were seized from the residence of the assessee and it was explained by the assessee that out of the said deposits, FDR for Rs. 50,000/- belong to his wife Mrs. Surjit Kaur which was taken from her personal savings and shaguns received from her relativ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was made in the hands of the assessee as per tabulated details at page 8 of the Act. In totality, the undisclosed income was assessed in the hands of the assessee at Rs. 80,18,788/- on which tax @ 60% was charged. 10. Before the Commissioner of Income Tax (Appeals), the assessee filed elaborate submissions vis- -vis each of the entry against which addition was made in the hands of the assessee. The Commissioner of Income Tax (Appeals) asked the Assessing Officer to verify the same. The Commissioner of Income Tax (Appeals) thereafter dealt with each of the issue in line with the remand report submitted by the Assessing Officer and partly allowed relief on account of certain documents and confirmed the addition on other accounts. Both the assessee and the revenue are in appeal against the said order of the Commissioner of Income Tax (Appeals) which we shall consider in paras herein below while deciding the issue in each of the addition. 11. Both the authorized representatives made elaborate submissions in respect of the grounds of appeal raised in the revenue's appeal and also in assessee's appeal and we proceed to decide the issue in line with the explanation offered b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly was that in addition to the bank accounts of the assessee, certain bank accounts belong to his wife Smt. Surjit Kaur and certain bank accounts belong to his son Shri Jitender Pal Singh. Plea of the assessee before the Commissioner of Income Tax (Appeals) was that as both Mrs. Surjit Kaur and Shri Jitender Pal Singh were independent assessees, no addition could be made in the hands of the assessee in respect of the investments made in the name of the said persons. The Commissioner of Income Tax (Appeals), on the other hand, has given credit on account of savings of Smt. Surjit Kaur in view of the limited source of funds available with her and in the absence of any other evidence being filed by the assessee to prove its claim that Smt. Surjit Kaur had independent sources of income, additions partly were upheld in the hands of the assessee holding that the said assets belong to the assessee and certain additions were deleted being out of the savings of the wife of the assessee. In respect of the entries belonging to Shri Jitender Pal Singh, no addition was made in the hands of the assessee and addition, if any was considered in the hands of the son of the assessee. In the abovesai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer in the remand report totaling Rs. 49,40,056/- at pages 4 to 13 of the appellate order, which are being referred to but are not being reproduced for the sake of brevity. The Commissioner of Income Tax (Appeals) vide para 4.2 observed that from the perusal of the remand report, verification of bank accounts and after discussion with the counsel of the assessee, it was clear that large number of credit entries and the bank accounts stood explained. The Commissioner of Income Tax (Appeals) asked the assessee to explain further about certain entries where the Assessing Officer had either not verified or examined the credit entries fully, the details of such entries as appearing in the remand report are reproduced at pages 13 to 16 of the appellate order. The assessee made two-fold arguments before the Commissioner of Income Tax (Appeals) in respect of such entries that the entries relating to the wife of the assessee were sources out of her individual income and the same had to be considered in her hands and not in the hands of the assessee. The assessee, thereafter furnished explanation in respect of the entries noted by the Commissioner of Income Tax (Appeals) for which furt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -se that the said investment belong to the wife of the assessee and not the assessee. Rejecting the said plea of the ld. AR for the assessee, we proceed to deal with the various queries raised by the Commissioner of Income Tax (Appeals) and the evidences filed by the assessee to explain the nature of the entries which have not been accepted by the Assessing Officer in the remand report. The assessee had not filed complete information before the Assessing Officer in this regard and the Commissioner of Income Tax (Appeals) after considering the explanation of the assessee has partly confirmed the said addition and partly allowed relief to the assessee. Both the revenue and the assessee are in appeal against the said addition/deletion made in the hands of the assessee. 16. The first bunch of entries were regarding maturity of FDRs and deposit of the majority amount in the bank account of Mrs. Surjit Kaur, wife of the assessee. The second bunch of entries was regarding deposits made in different bank accounts against sale of shares. The third bunch of entries, query against which was raised by the Commissioner of Income Tax (Appeals), was regarding the tuition income of Mrs. Surjit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no evidence of the particulars of shares sold. .. 40 Deposit in CBI A./c No,.13473 of Surjit Kaur on 2.2.94 26000/- The same is stated to be on account of sale of shares. The amount has been received through cheque as per bank statement furnished but no evidence regarding description of shares sold 51 On 21.7.94 In A/c furnished. No. 14828 with CBI of A.S. Dhingra 10500/- It is stated to be on account of sale of shares received through cheque. However, the description of shares sold 54 On 27.10.94 in Pb. 7 Sind Bank A/C No.38490 of A.S. Dhingra 10000/- It is stated to be refund of share application money from Liberty shoes received through cheque. 47 24.5.94 in CBI A/c No.14828 of A.S. Dhingra 12000/- It is stated to be mutual fund encashment. 96 On 12.7.97 in A/c No,.16840 of Surjit Kaur 32020/- It is on account of sale of shares. The amount has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner of Income Tax (Appeals) was that the said related to maturity amount of fixed deposits which were deposited in the bank account of Smt. Surjit Kaur and the source of investment in the said account was out of her past savings. The explanation of the assessee before the Commissioner of Income Tax (Appeals) and even before us was that she had independent income from tuition for which she was filing the return of income and in addition, she had other income like her savings and gifts received from her family members. The assessee failed to furnish any cogent material regarding the income of the assessee from tuition before the Commissioner of Income Tax (Appeals) or even before us. In view of the status of the family and her qualifications and considering the fact that the gifts and savings could not be ruled out, the Commissioner of Income Tax (Appeals) had considered 50% of the amount as coming out of her savings and the balance 50% was considered as income of the assessee from undisclosed sources at Rs. 38,099/-. In the entirety of the facts and circumstances, we are in conformity with the order of the Commissioner of Income Tax (Appeals) in allowing credit on account of pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see by the Assessing Officer as the assessee had failed to furnish any evidence of the particulars of shares sold against various entries. Where the assessee has failed to furnish the basic particulars of the name of the company, the number of shares etc., then it is not possible to determine and co-relate the investment in the said shares. In the absence of any details having been furnished by the assessee, we find no merit in the order of the C.A. in this regard and consequently, we reverse order of the Commissioner of Income Tax (Appeals) and uphold the addition of Rs. 1,41,667/-. 22. The last set of entries considered by the Commissioner of Income Tax (Appeals) were entry No. 97-106 which related to encashment of two FDRs. The Commissioner of Income Tax (Appeals) from the details noted as under : 4.9. NRE account no. 329 is maintained in Vijay Bank, Chandigarh in the name of Sh. Jasbir Singh, brother of the appellant's wife where different amounts have been deposited from time to time. There was no deposit in this account during the block period. All the deposits were before the block period. From this account, FDR was made for Rs. 7,50,000/- in the name of the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... withdrawn cash of Rs. 25,000/- on 21.04.1992, Rs. 6,000/- on 07.05.1992 and Rs. 5,000/- on 27.04.1992 which were deposited later on in the bank account. The plea of the assessee in this regard was not accepted by the Commissioner of Income Tax (Appeals) because of long gap in the deposit of the cash in the bank accounts and addition of Rs. 33,000/- was upheld. The Commissioner of Income Tax (Appeals) in totality upheld an addition of Rs. 101,099/- (Rs. 38,099/- + Rs. 30,000/- + Rs. 33,000/-). We have already upheld the addition of Rs. 38,099/- in the paras herein above and also are in conformity with the order of Commissioner of Income Tax (Appeals) with regard to Rs. 30,000/-. The addition of Rs. 33,000/- in the hands of the assessee is also justified in the absence of any proof being filed by the assessee with regard to the availability of the cash in hand. In addition to the three additions upheld by the Commissioner of Income Tax (Appeals), we further uphold the addition relatable to the deposits made in the bank accounts against sale of shares totaling Rs. 141,667/-. In view thereof, we partly allow the ground of appeal No. 1 raised by the revenue. 27. The assessee is in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... verification exercise carried out by the Commissioner of Income Tax (Appeals) during the appellate proceedings. Upholding the order of Commissioner of Income Tax (Appeals) we dismiss ground No. 2 raised by the revenue. 30. The issue in ground No. 3 raised by the revenue is against deletion of addition of Rs. 50,000/- made on account of unexplained investment of FDR in the name of the wife of the assessee. The FDR for Rs. 50,000/- was issued on 07.06.1997 from Central Bank of India and the assessee claimed that the said FDR was taken out of the personal income of his wife. During the remand proceedings, it was noted that the assessee had made withdrawal of Rs. 20,000/- on 13.03.1997 and Rs. 48,000/- on 26.03.1997. The Commissioner of Income Tax (Appeals) accepted the plea of the assessee in view of the said withdrawals which had been verified by the Assessing Officer and also in view of the approximate income of Rs. 75,000/- from different sources being available with the assessee. The ld. DR for the revenue has failed to controvert the findings of Commissioner of Income Tax (Appeals) and in view thereof, we find no merit in ground No. 3 raised by the revenue. 31. The ground N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the revenue and the same is dismissed. We also find no merit in the issue raised by the assessee vide ground No. 6 where the old car was sold later than the date of purchase of the new car and consequently, the said sale proceeds of old car not being available with the assessee, the claim in this regard was not justified. We uphold the addition of Rs. 77,153/- and dismiss ground No. 6 raised by the assessee. 33. The next ground of appeal No. 6 is against the deletion of addition of Rs. 14,000/-. The assessee had purchased an item of jewellery from the jewellery and the Assessing Officer had made the addition in the absence of any explanation of sources of investment. The Commissioner of Income Tax (Appeals) deleted the addition because of the salary drawn by the assessee. In the entirety of the abovesaid facts and circumstances, we find no merit in ground No. 6 raised by the revenue. 34. The ground No. 7 is against deletion of addition of Rs. 30,000/-. The assessee was asked to explain sources of investment in plot No. 422 Giani Zail Singh Nagar, Ropar which was purchased in the year 1986-87 and was sold for Rs. 30,000/- in 1987-88. In the absence of any details, the cost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. 37. The facts relating to the issue are that during the course of search seizure operation at the residence of the assessee, a hand written document No. 62 file No. A-3 was found which reflected the assessee to have sold the property for Rs. 21,5000/- out of which sum of Rs. 10,00,000/- was transferred to London. The assessee failed to discharge the onus of explaining the contents of the said document and in view of the provisions of section 132 of the Act, assumption was drawn against the assessee from whose possession the said document was found and an addition of Rs. 21,60,000/- was made in the hands of the assessee. 38. During the appellate proceedings, the assessee claimed that it never sold such property which was allegedly sold by the assessee. The document No. 62 written on the pad of M/s. Raj Travels Tours Ltd. found from his premises was denied by the assessee to be not in his hand writing, not pertaining to him. In the remand proceedings, the Assessing Officer rejected that the hand written document depicted only calculation showing sale price of the property which was sold for Rs. 21,60,000/- out of which Rs. 10 lacs was sent to London. It further gave det ..... X X X X Extracts X X X X X X X X Extracts X X X X
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