2010 (9) TMI 1174 - AT - Income Tax

Issues Involved:
1. Deletion of the addition of Rs. 22,41,141 under section 69 of the Income-tax Act, 1961.
2. Validity of assessment under section 153A without issuing notice under section 143(2).
3. Deletion of the addition of Rs. 73,50,000 under section 69 for investment in a plot.
4. Deletion of the addition of Rs. 10,00,000 under section 68 related to bank account credits.
5. Addition of Rs. 10,00,000 cash seized from an employee.
6. Addition of Rs. 10,00,000 each for investments in a plot at Narela and a flat in Vikrant Tower.
7. Deletion of additions related to investments and transactions in M/s Pragati Packaging.
8. Addition of Rs. 3,87,364 for unaccounted investment in jewelry.
9. Addition of Rs. 50,000 for expenditure incurred at Tivoli Garden.

Issue-wise Detailed Analysis:

1. Deletion of the addition of Rs. 22,41,141 under section 69:
The revenue challenged the deletion of Rs. 22,41,141 added by the AO under section 69 for investment in a property. The CIT(A) found that the property belonged to the assessee's wife, who had disclosed it in her returns. The Tribunal upheld the CIT(A)'s decision, noting no evidence suggested the assessee made the investment.

2. Validity of assessment under section 153A without issuing notice under section 143(2):
The assessee contended that the assessment under section 153A was invalid due to the absence of a notice under section 143(2). The Tribunal held that the AO's issuance of two questionnaires sufficed as notice under section 143(2), fulfilling the statutory requirement. The reliance on the Supreme Court's decision in Hotel Blue Moon was discussed, but the Tribunal concluded the requirements were met.

3. Deletion of the addition of Rs. 73,50,000 under section 69 for investment in a plot:
The AO added Rs. 73,50,000 for investment in a plot allotted by HUDA, which the assessee claimed belonged to M/s Jyoti Chadha, HUF. The CIT(A) found the property belonged to the HUF, which was a regular taxpayer, and deleted the addition. The Tribunal upheld this decision, granting liberty to the revenue to take action against the HUF.

4. Deletion of the addition of Rs. 10,00,000 under section 68 related to bank account credits:
The AO added Rs. 10,00,000 under section 68 for unexplained credits in the assessee's bank account. The CIT(A) accepted additional evidence showing the amounts were received from Pragati International Pvt. Ltd. The Tribunal upheld the CIT(A)'s decision, noting the AO did not dispute the evidence.

5. Addition of Rs. 10,00,000 cash seized from an employee:
The AO added Rs. 10,00,000 found with the assessee's employee, which the assessee claimed belonged to his nephew. The CIT(A) upheld the addition, finding the claim lacked credibility. The Tribunal agreed, noting the belated claim by the nephew appeared to be an afterthought.

6. Addition of Rs. 10,00,000 each for investments in a plot at Narela and a flat in Vikrant Tower:
For the Narela plot, the CIT(A) found it belonged to the company, not the assessee, and deleted the addition. The Tribunal upheld this decision. For the Vikrant Tower flat, the CIT(A) found the assessee's wife had a half share, and the investment was disclosed in her returns. The Tribunal upheld the deletion, noting the evidence supported the wife's ownership.

7. Deletion of additions related to investments and transactions in M/s Pragati Packaging:
The AO added amounts for capital, loans, and purchases related to M/s Pragati Packaging. The CIT(A) found the investments were made by the company and the assessee's son, not the assessee. The Tribunal upheld the deletion, noting the evidence showed the assessee had no connection with the firm.

8. Addition of Rs. 3,87,364 for unaccounted investment in jewelry:
The AO added Rs. 3,87,364 for unexplained jewelry, accepting only part of the assessee's explanation. The CIT(A) upheld the addition, finding the evidence insufficient. The Tribunal agreed, noting the contradictions in the assessee's claims and lack of supporting evidence.

9. Addition of Rs. 50,000 for expenditure incurred at Tivoli Garden:
The AO added Rs. 50,000 for a receipt found at the assessee's residence, which the assessee claimed belonged to his niece. The CIT(A) upheld the addition, finding the explanation unconvincing. The Tribunal agreed, noting the onus was on the assessee to provide evidence, which was not met.

Conclusion:
The Tribunal dismissed all appeals of the revenue and the cross appeals and cross objections of the assessee, upholding the CIT(A)'s decisions on all issues.

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