TMI Blog2009 (1) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... remises of the assessee. The contents of the document reads as under : "(1) Mr. Surendra Khandhar ) 22nd Jan. 91 (2) Mr. Mahenedra P.J. Shah ) In the presence (3) Mr. Bhupen Chheda ) of.. 3. On 22nd Jan'91 7.30 p.m. in the case of Surendra N. Khandhar Vs. Bhupen Chheda it is decided as under : (1) On or before 28 th Feb'91, (Bhupen Chheda) myself will pay Rs.5,00,000/- (Rupees Five Lacks) towards the payment of loan out of twenty lakh rupees. (2) Balance amount will be paid by 50% of collection cheques and current account will be operated by Mahendra P. Shah. I hereby agree to deposit all cheques only in United Western Bank Mandvi Branch. However, I further confirm I will pay at least rupees five lakhs even though I cannot collect collection to that extent. I further confirm I will pay all loan amount on or before 31 st May, 1991. Signed Delivered Bhupen Chheda, 22 nd Jan 1991. I, Mahendra P. Shah, stand guarantee for the above matter." 4. The statement of the assessee was recorded under Section 132(4) on 19.12.1991. In the course of recording the statement, the following question was put : "Q.20: I am showing you page No. 82 of the loose paper file No. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opportunity given, the A.O. has failed to bring on record any material evidence in support of the case made out by him as is evident from the reply received vide letter dated 19.12.1994. The reply deals with the contentions by assessee, that during the appellate proceedings the assessee had taken the plea before the CIT (A) that letter filed by Shri. Mahendra P. Shah and United Western Bank should be given to him. The A.O. replied that there is no reference to the letter in the assessment order and it has not been used against the assessee. The Commissioner, Appeals was pleased to hold that the case made out by A.O. has no legs to stand and deleted the addition. 8. Both the Assessee as also the Revenue preferred appeals before the I.T.A.T. Dealing with this addition, the tribunal noted that CIT (A) accepted the contention of the assessee that the intended transaction i.e. advance of Rs. 20 lacs. by the assessee to Bhupendra Chedda did not materialise and that the A.O. had not examined the issue properly and did not take any material evidence in support of his premise that the money in fact had passed hands in his case. After considering various contentions and judgements cited, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etaining Assets under Section 132(5) and their application under section 132B. Lastly it is submitted that for the purpose of section 69, the power conferred on the A.O. is that he may add such income but is not bound to do the same. 10. On the other hand, on behalf of the Revenue, the learned counsel submits that the appellant was made available all the documents in their possession and which were relied upon. It is secondly submitted that subsequent to the judgment of the Supreme Court, in the case of Mitrani (supra), the Income Tax Act has been amended and Section 292(c) has been inserted by Finance Act, 2007 with effect from 1.10.1975. The effect of said amendment is that where the document is seized in the course of search under Section 132 or section 133, it can be used against the assessee subject to what has been set out in the section. Dealing with the last contention, it is submitted that the tribunal considering the material evidence on record has rightly arrived at the conclusion that Income Tax had tobe added in the case of the Assessee. This was permissible on the material available and therefore, no fault can be found in the decision of the tribunal. 11. We m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , then, the provisions of sub section (1) shall apply as if such books of account, other documents or assets which had been taken into custody from the person referred to in clause (a) or clause (b) or clause (c), as the case may be, of sub section (1) of section 132A, had been found in the possession or control of that person in the course of search under section 132." 12. From the material on record what emerges is as under : 13. The document seized was a zerox copy. The appellant when question No. 20 was put to him, did not deny the said document. On the contrary, in the appeal memo and thereafter before the I.T.A.T. the stand taken was that it was an understanding which was not given effect to. The appellant also does not deny the existence of the two persons who have signed on the document namely Bhupendra Chedda and Mahendra Shaha. On the contrary the contention is that the statement and or application of the said persons were not considered. Considering the language of Section 292C, there is a presumption that the contents of the document are true, as the document was seized from the premises in control of the assessee and that the said document belongs to the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessee which inference can be drawn from the document itself. It was open to the assessee to have either led evidence or get an affidavit filed to rebut the presumption. Whether on such oral evidence, the contents of the document could be rebutted is another issue. That was also not done. The only contention advanced is that Bhupen Chheda's statement must have been recorded and he must have filed an affidavit and that must be made available. There was enough opportunity before the tribunals for the appellant to show that in fact statement of Bhupen Chedda was recorded. Similarly in so far as Mahendra Shah is concerned Mahendra Shah was the guarantor for the due repayment of the loan. Whether he opened a bank account or not is immaterial as the seized document clearly shows that the sum of Rs.20 lacs. was paid as loan by the assessee which Chheda had agreed to pay and to which Mr.Shah was a signatory as guarantor. The learned counsel also sought to rely on the judgment of the Supreme Court in Kisanchand Chellaram Vs. Commissioner of Income Tax, 125 ITR 713 (1980). The ratio of that judgment would be that if evidence is to be used against the assessee that evidence in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. Our attention is also invited to the order of this court dated 25.8.2008 where this court directed that the file pertaining to the case of the appellant be produced and that in the event the record is not produced, the court may be compelled to draw an adverse inference. This court earlier on 17.12.2002 had passed an order to produce the file pertaining to the case of appellant including statement of Mr. Mahendra Shah and Bhupen Chheda as well as statement of any bank officer, if at all recorded in the matter. In other words, only in the event such statements were available. An affidavit has been filed by Mr. Menon, Commissioner of Income Tax pursuant to order of 25 th August, 2008 setting out that the relevant original case records are not traceable in their office and that they are trying to locate the relevant records. In our opinion, even if the file is not available, there was nothing placed before the Commissioner (Appeals) or before the I.T.A.T. to contend that the statement of Mr. Chheda was recorded and/or that Mr. Mahendra Shah had written a letter. As pointed out earlier these were two persons who had signed the documents. There were the persons known to the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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