TMI Blog1996 (10) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... rms at 201, J.K Chambers, Panni Phint, Bhaga Talav, Surat, vide search warrant in the name of M/s. Raj Housing Corporation and its associate concerns. The search was also carried out at the residential premises of the assessee at 706, Mahavir Apartments, Athwa Gate, Surat. At the residential premises, the assessee, his family, assessee's brother Shri Rajendra and his family and the assessee's mother were jointly living with common kitchen. During the course of the search at the residential premises cash amounting to Rs. 20,20,039 was found from the cupboard in the bedroom of the assessee. Out of this cash, cash of Rs. 20 lacs was seized. Cash of Rs. 20,839 was claimed to be out of personal savings of family members of the assessee's group which claim was accepted by the Assessing Officer and the remaining cash of Rs. 20 lacs was claimed to be belonging to 9 different partnership firms and his son Shri Sunish in whose hands total disclosure of Rs. 85 lacs was made as additional income for assessment year 1990-91 as follows : -------------------------------------------------------------------------------------------------------------------------------------------------- Name of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elongs to Sunish Shah. This income is invested in bogus creditors, unaccounted advances and cash." The assessee's Tax Consultant vide his letter dated 26-3-1990 requested the Commissioner of Income-tax, Surat to adjust the cash seized of Rs. 20 lacs against the advance tax payment of ten declarants and their partners. The CIT, Surat vide his letter dated 29-3-1990 allowed adjustment of the said cash against tax payments. 2.1 In the course of assessment proceedings the Assessing Officer vide his letter dated 22-12-1992 addressed to M/s. Raj Housing Corporation asked for evidence in support of the assessee's claim that cash of Rs. 20 lacs pertained to various firms and also asked to produce the detailed break-up of disclosure of this cash of Rs. 20 lacs in the hands of various firms. The assessee vide his letter dated 24-12-1992 gave a detailed explanation which has been reproduced by the Assessing Officer verbatim in his order. It was stated by the assessee that presumption under section 132(4A) was a rebuttable presumption which had been rebutted in the course of the statement under section 132(4) itself as complete bifurcation of disclosure made under section 132(4) was furnis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the assessee, the CIT(A) confirmed the addition of Rs. 20 lacs on the same lines as narrated by the Assessing Officer. It was also observed by him that it was not possible that cash balance of Rs. 20 lacs be kept in the bedroom of the assessee and belonged to ten persons. It was also observed by him that the assessee raised the ground of appeal without any addition made in the assessment order and the appeal ought to have been preferred against the order under section 154. 4. Aggrieved by the order of the CIT(A), the assessee is in appeal before us. Shri R.B. Shah, the learned counsel for the assessee submitted that the observation of the CIT(A) that as no addition had been made in the order under section 143(3) in the computation the appeal should have been preferred against the order under section 154, is not correct, because the addition was made but it was not taken into account in the computation of total income originally while passing the order under section 143(3). This mistake was corrected by way of passing order under section 154. According to the learned counsel the order under section 154 is therefore valid once it is held that addition was made under section 143 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Enterprises but it is the business of bill discounting in the cloth trade. The sales in this business were only Rs. 30,138 and in this business the assessee incurred the loss of Rs. 9,231. The learned counsel for the assessee reiterated that Rs. 20 lacs is part of total disclosure of Rs. 85 lacs. The balance amount of Rs. 65 lacs represented cash with custodian which was also brought in the books of the firms and total tax on disclosed income was therefore paid by utilising this cash. In the statement under section 132(4), there is specific mention of name of project, name of the firm, the area constructed in each project, etc., while giving bifurcation of disclosure. According to the learned counsel when declaration of Rs. 65 lacs was admittedly assessed treating it as income of the respective concerns without any demur or protest on the part of the department, the assessee finds no satisfactory reason as to why cash to the tune of Rs. 20 lacs which is part of Rs. 85 lacs declared be assessed as his personal income. The learned counsel further submitted that the Assessing Officer did not doubt about the bifurcation of Rs. 85 lacs in the hands of different persons which was done ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruth of the contents of books seized from a person. However, it is a presumption which can be rebutted. Moreover, the presumption envisaged there is only a factual presumption. It is in the discretion of the court, depending upon other factors, to decide whether the presumption must be drawn. The expression used in sub-section (4A) of section 132 is 'may be presumed' as in section 114 of the Evidence Act, 1872. It is not a mandate that whenever the books of account are seized, the court shall necessarily draw such a presumption irrespective of any other factors which may dissuade the court from doing so." In Addl. CIT v. Thahrayamal Balchand [1980] 124 ITR 111, the Hon'ble Rajasthan High Court has explained the rebuttal of a legal presumption in the following words :-- "What quantum of evidence would rebut a legal presumption in a given set of facts does not admit of any rigid rule. The evidence may be direct or circumstantial or both and a mere statement of the assessee may be enough in some cases. It does not raise a question of law." 6.2 Against the cash of Rs. 20,20,839, found during the course of search the assessee's brother Shri Rajendra made a disclosure of Rs. 85 lac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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