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TMI Blog2018 (1) TMI 1747X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 3.50 crores made by cheque and subsequently retracted without giving any supporting evidence to the contrary? 3. In this case, search and seizure action u/s. 132 of the Act was conducted on 24.01.2011. The assessee is a well known actress of Indian Film Industries. Various incriminating documents were found during search. On this issue during the course of search an amount of Rs. 50 lacs was declared as undisclosed income for cash payment for purchase of Studio Aesthetique. Various incriminating material were found during search. When the same was confronted to Smt. Madhu Chopra, the mother of the assessee who was managing the affairs of the assessee, she admitted the following with respect to Q. No. 19 as under: Q. 19 Do you want to state anything else? Ans. Yes, I admit that based on the above seized papers and the answers to the Q Nos. 11 to 17, I offer following undisclosed incomes, which had accrued to me and Priyanka Chopra through various Events, Shows and Sale of flats in the Years as mentioned above. The application of this cash by the above mentioned activities are as under F.Y. (Rs.) Description Amount 2005-06 Cash-Payment in Evershi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Madhu Chopra and since she has admitted that the above mentioned payments are unaccounted, I state that the same is correct and I agree and abide by the same as my mother is fully aware and competent to know everything related to my Finance." 4. Subsequently, Smt. Madhu Chopra, the mother of the assessee vide letter dated 13.4.2011 filed in the office of Income Tax Office on 06.06.2011, retracted the above said statement. In this background, the Assessing Officer was of the opinion that as per the seized material Rs. 50 lacs in this regard was to be added as undisclosed income of the assessee. Regarding the retraction statement of Smt. Madhu Chopra, the said retraction stated that no cash payment was made for purchase of Studio Aesthetique, except the payment made by a cheque of Rs. 3.50 crores. However, the Assessing Officer was not convinced. He observed that the assessee has not contradicted the seized material on the basis of which she had disclosed an amount of Rs. 50 lakhs being made for purchase of Studio Aesthetique. Instead, the assessee has simply stated that there is no cash component as agreed in the statement recorded during the course of search. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es. In the said case, where the tribunal's decision was authored by one of us, the issue related to on money payment in respect of immovable property based on conflicting statement of the seller and certain figures noted in loose sheets. Hence, this decision was rendered in a different context and does not help the case of the assessee. Hence, we set aside the order of the ld. Commissioner of Income Tax (Appeals) and restore that of the Assessing Officer. 9. In the result, this appeal by the Revenue stands allowed. Assessee's appeal (in ITA No. 2769/Mum/2015): 10. The assessee's appeal relates to sustenance of following additions by the ld. Commissioner of Income Tax (Appeals) : 1) Addition of Rs. 40 lacs being unaccounted/undisclosed income in the form of Gifts from LVMH Watch and Jewellery India Pvt. Ltd. 2) Addition of Rs. 15 lacs on account of unaccounted/undisclosed income in respect of professional remuneration received from Ramee Royal Hotel, Dubai, UAE. 3) Addition of Rs. 4,64,000/- made by the Assessing Officer for perquisites given by Ramee Royal Hotel, Dubai, UAE. 4) Addition of Rs. 14 lacs for notional rent for penthouse at Flat no. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer has rightly taken the gift of watch as perquisite and taxed it correctly u/s. 28(4). He observed that in the written submission, the assessee has accepted the same. However, he noted that the assessee has mentioned that the value of the watch is much less. However, since the assessee has not able to produce any of the evidence in this regard, the ld. Commissioner of Income Tax (Appeals) did not accept the demand of the assessee. Accordingly, he confirmed the addition. 15. Against the above order, the assessee is in appeal before us. 16. We have heard the counsels and perused the records. The ld. Counsel of the assessee submitted that the assessee has received gift of watch as per the agreement from which the assessee acted as model for its advertisements and promotional activities for an agreed remuneration of Rs. 1.4 crores for 2 years. Furthermore, it was submitted that the value of the watch is much less. 17. Per contra, the ld. Departmental Representative relied upon the orders of the orders of the authorities below. We find that it is clear that the assessee has received watch worth of Rs. 40 lacs from the same company and in the same agreement in which she ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticulars of income and thereby concealing the said income. 19. Upon the assessee's appeal, the ld. Commissioner of Income Tax (Appeals) confirmed the addition. However, as regards the addition of Rs. 16 lacs, he restricted the same to Rs. 15 lacs and added Rs. 1 lac in the case of Mr. Chand Misra. 20. Against the above order, the assessee is in appeal before us. 21. In this regard, we note that the assessee has raised an additional ground wherein it has been argued that this addition is not based upon any incriminating material found during search for the document relied upon were impounded during survey. We find that in this case, the assessee has filed original return on 29.09.2008. Subsequently, this assessment has been done u/s. 153A pursuant to search and seizure. Now it is the settled law that the Hon'ble jurisdictional High Court decision in the case of CIT vs. Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015] 58 taxmann.com 78 (Bom), order dated 21.04.2015 dehorse any seized material/incriminating material found during search, addition in the case of abated assessments u/s. 153A is not sustainable. We further note that this additional grou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e purpose and why annual value under the provisions of sec. 23(l)(c) should not be determined treating it as income from House Property by disallowing depreciation. In reply to the same the assessee's representative orally stated that the said penthouse is used for keeping the assessee's dresses as godown, however he has not furnished any documentary evidence that it has been utilized for official use. Further, it can be seen that the property under consideration is a penthouse which is located in the residential area. Hence, it cannot be considered as commercial property. Therefore, the annual value of the above said properties has to be determined under the provisions of sec. 23(l)(c) and charged under Income from House property. Relying on the case of Smt. Radhadevi Dalmiya Vs. CIT 125 ITR 134 the Tribunal had 'adjudged that a fair return of about 7% on the investment in properties can be taken into account for determining annual rateable value and shall be regarded as just and fair for determining the annual value of the above said properties. Therefore, the annual value of the above said properties is computed as under: S.No Flat No. Investment Value ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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