TMI Blog2024 (3) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... ing no connection with the disputed foreign bank account. Therefore, to verify the veracity of assessee s claim, in order to subserve the ends of natural justice and to be fair to both the parties, we restore this issue to the file of the AO for decision afresh - Ground is allowed for statistical purposes. Addition as perquisite u/s 17(2)(iv) - payments towards assessee's credit card bills have been done through assessee's own bank account - whether payment for credit card bills made by the company on her behalf to not be treated as her perquisites ? - HELD THAT:- Considering the fact that the assessee has been able to prove that the expenses in question were incurred in connection with the business of the company in which she was director, we are of the considered view that the lower authorities were not justified in treating these payments as perquisite of the assessee and no addition thereof could be made in the hands of the assessee. Accordingly, orders of the authorities below on the issue in question are set aside and the addition on this account is deleted. - SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER R For the Appellant : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arbitrarily rejecting the explanation and evidences submitted by the assessee in support of its contention. 8. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that Ld. AO has made the assessment without bringing any material or evidence that such amount represents income chargeable to tax in the hands of the assessee for the assessment year under consideration. 9. (i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the addition ignoring the fact that the documents relied upon by the AO clearly indicated that there have been no transactions in the alleged bank account since 2009 and hence the same cannot be the basis for making addition under section 69 in the year under consideration. (ii) That the addition has been made ignoring the settled law that income tax authorities have no option to rely upon any document selectively against the assessee, and ignoring the portions of the document which are in favour of the assessee. 10. (i) On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion made by the AO of Rs. 11,77,102/- on account of balance lying in foreign bank account by alleging the assessee a joint holder along with her husband. 2. Brief facts of the case are search and seizure u/s 132 was conducted on Mon Mohan Kohli Group on 11.02.2014 and the case of assessee was also covered in the search operation. 3. During the search operation, it was alleged that the assessee has a foreign bank account having balance of US$ 39,414.09 as on 28.06/2013 at Standard Chartered Trust (Guernsey) (i.e. SCTGL) in the name of Five Seasons Ltd. in which she was alleged to be a sole beneficiary along with her husband. The Ld. AO asked the assessee to furnish details of sources of funds deposited in the account. 4. The assessee vide letter dated 04.11.2016 replied that she has no knowledge of the account and the companies. Copy of such reply is placed at PB pg. 23-27. 5. However, Ld. AO ignored the replies and explanations given by the assessee and proceeded to make an addition of 50% of US$ 39,414.09 by the alleging the assessee to be a joint holder in the foreign bank A/c. For this purpose, conversion rate of 28.06.2013 was taken at Rs. 59.73 and thus addition amounting to R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unds as she had no authority to operate the account and to withdraw the funds. Also, in the remand report, para 3.1.4, it is mentioned that no transactions have taken place since 2009. And the department has no information as to the source of funds and the department has not brought on record any evidence that justifies that the assessee had any role in the said funds. 11. The assessee further vide written submission dated 21.08.2020 (PB Pg. 89-100) submitted that a letter was received from Standard Chartered Trust (Guernsey Ltd) which said that the funds will be returned to the source being the account of Mr. Mon Mohan Kohli and the company will be terminated. Copy of letter is placed at PB Pg. 117. This clearly justifies that such amount was not contributed by the assessee and the money does not belong to the assessee. The assessee also submitted that the Ld. AO had not brought on record any document evidencing that such account was opened with the consent of the assessee or such amount was deposited by the assessee in the account. No transactions have been brought on record to support that the assessee had any knowledge of such account. 12. The assessee also submitted that the D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 21 (4) TMI 1025 - ITAT DELHI - Dated.- April 23, 2021 28...Since, the proceedings u/s 147 are extraordinary proceedings, the onus is on the Revenue to establish the existence of undisclosed income. Mere discovery of a foreign bank account in the name of the assessee is not sufficient to thrust the tax liability without bringing on record the chargeability of the same under the provisions of the Income Tax Act, 1961. It is the settled proposition of law that assessment cannot be carried out on the basis of guess work and there must be more than mere suspicion. In the present case, it is seen that there is no whisper of any enquiry or investigation carried out by the Assessing Officer to demonstrate the existence of source of income in India in respect of deposit found in foreign bank account. Moreover, the Assessing Officer has not brought anything on record to prove that there is money trail which actually flew from India to the foreign bank account maintained abroad. Further, the learned counsel for the assessee also clarified that Sh. Ladli Pershad Jaiswal was not having any major stake or financial interest or business connection in India during the AY 2006-07 and 2007-08. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g on decision of the special bench in the case of All Cargo logistics Ltd (supra) and decision of the honourable jurisdictional High Court in the case of Continental Warehousing Corporation (supra), made a plea that no incremental material found during search to make the addition in the assessment completed under section 153A whereas the assessing officer used the information obtained from the external agencies, which is not the information obtained from the possession of the assessee during search. 8.1 We observe from the decision of the coordinate bench in the case of Arunkumar Ramniklal Mehta (supra) and ITAT Kolkata bench in the case of Bishwanath Garodia (supra) held that no additions can be made in respect of unabated assessment which have become final, if no incriminating material is found during the course of search. The facts are similar in the present case and it is fact on record that the addition made by the assessing officer wholly based on the information contained in Base Note which was not the material found during the search proceedings either in possession ion of the assessee or found in the premises were search conducted. The information obtained from outside age ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quisites. 3. The assessee vide written submission dated 21.08.2020 (PB Pg. 89-100) submitted that assessee uses her credit card both for official and personal purposes. However, the credit card bills amounting to Rs. 5,17,507/- which were paid by M/s Travancore Management Resources Pvt. Ltd. were incurred by the assessee on the behalf and in interest of the company. Details of such payment are enclosed at PB Pg. 35-39. Those were business expenses of the company and hence the same had also been charged to regular expense account in the books of the company. The assessee has also submitted the copy of ledger account of all credit card payments (PB Pg. 40- 43) made by the company which clearly show that the payments were made for official purposes. The assessee further submitted that the company i.e. M/s Travancore Management Resources Pvt. Ltd. was also assessed by the same jurisdictional office and no adverse inference was drawn by the Ld. AO. A copy of order passed by Ld. AO in the case of M/s Travancore Management Resources Pvt. Ltd. is placed at PB Pg. 136-142. Thus, where the expense has been accepted by the Ld. AO as genuine business expense, it cannot be added as a perquisite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the additions made on the basis of surmises and conjectures are not sustainable and liable to Be deleted. 12. Reliance is placed on the following judicial pronouncements wherein it has been held that no addition can b made on surmises and conjectures: SUPREME COURT in the case of LALCHAND BHAGAT AMBICA RAM VERSUS COMMISSIONER OF INCOME-TAX, BIHAR AND ORISSA, [1959] 37 ITR 288 It is, therefore, clear that the Tribunal in arriving at the conclusion it did in the present case indulged in suspicions, conjectures and surmises and acted without any evidence or upon a view of the facts which could not reasonably be entertained or the facts found were such that no person acting judicially and properly instructed as to the relevant law could have found, or the finding was, in other words, perverse and this court is entitled to interfere. We are, therefore, of opinion that the High Court was clearly in error in answering the referred question in the affirmative. The proper answer should have been in the negative having regard to all the circumstances of the case which we have adverted to above. SUPREME COURT in the case of COMMISSIONER OF INCOME- TAX, WEST BENGAL VERSUS CALCUTTA DISCOUNT C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e bank account in question was held jointly by the assessee with her husband. It is contended that the assessee was not having any knowledge about the opening of the account and the sum credited into such account. The account was operated and managed by the husband of the assessee. Therefore, the action of the AO for attributing 50% of the sum credited into such account to assessee is not justified. The finding of lower authorities that the assessee is the beneficiary of the account is contrary to the records. In support, the contention the assessee has placed reliance on various case laws. 6.1 The stand of assessee is that she was having dispute with her husband and was disowned from being beneficiary in all assets of her husband. In support a copy of divorce proceedings was also filed. The assessee also relied on a letter received from Standard Chartered Trust (Guernsey Ltd) which stated that the funds would be returned to the source being the account of Mr. Mon Mohan Kohli and the company will be terminated. It is also contended that the assessee had made complaint to Enforcement Directorate on 21.05.2012 much before conducting of search and seizure on 11.02.2014 regarding no co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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