2013 (11) TMI 1740 - AT - Income Tax

2011 (4) TMI 1339 - AT

Issues Involved:
1. Addition of Rs. 2 Crores on a protective basis for A.Y. 2004-05.
2. Double addition of Rs. 2 Crores for A.Y. 2005-06.
3. Addition of Rs. 2,00,50,000 on a protective basis for A.Y. 2006-07.
4. Double addition of Rs. 3,14,83,870 for A.Y. 2006-07.

Summary:

Issue 1: Addition of Rs. 2 Crores on a Protective Basis for A.Y. 2004-05
The assessee challenged the addition of Rs. 2 Crores made on a protective basis by the Assessing Officer (A.O.) and confirmed by the CIT(A). The addition was based on the assessee's statement during a search operation u/s 132(4), where he admitted to earning consultancy fees for helping students gain admission to Bharati Vidyapeeth (BV). The Tribunal found no incriminating material or documentary evidence suggesting the assessee earned Rs. 2 Crores in F.Y. 2003-04. The statement was retracted, and the documents seized did not relate to F.Y. 2003-04. The Tribunal held that no addition could be made merely on surmises or presumptions and deleted the addition of Rs. 2 Crores.

Issue 2: Double Addition of Rs. 2 Crores for A.Y. 2005-06
The assessee argued that the addition of Rs. 2 Crores for A.Y. 2005-06 resulted in double taxation, as the entire cash of Rs. 3,14,83,870 found during the search was already taxed in A.Y. 2006-07. The Tribunal agreed, noting that the assessee had declared Rs. 2 Crores in A.Y. 2005-06 and Rs. 1.25 Crores in A.Y. 2006-07, totaling Rs. 3.25 Crores, which was more than the cash seized. The Tribunal found no justification for the double addition and deleted the addition of Rs. 2 Crores for A.Y. 2005-06.

Issue 3: Addition of Rs. 2,00,50,000 on a Protective Basis for A.Y. 2006-07
The A.O. made an addition of Rs. 2,00,50,000 on a protective basis based on documents seized from the assessee, indicating consultancy fees collected from 146 students. The CIT(A) sustained the addition for 34 students who were given admissions. The Tribunal found that the assessee admitted to using his position to help students gain admission and collect fees, and the documents supported this. The Tribunal sustained the addition of Rs. 2,00,50,000 on a substantive basis in the hands of the assessee, as the same addition was deleted in the case of Bharati Vidyapeeth.

Issue 4: Double Addition of Rs. 3,14,83,870 for A.Y. 2006-07
The A.O. added Rs. 3,14,83,870 on a protective basis for A.Y. 2006-07, which was the cash seized from the assessee's cabin. The assessee had already declared Rs. 2 Crores in A.Y. 2005-06 and Rs. 1.25 Crores in A.Y. 2006-07. The Tribunal found that the A.O. made a double addition of the same income, which was already declared and taxed in the respective assessment years. The Tribunal deleted the addition of Rs. 3,14,83,870 for A.Y. 2006-07.

Conclusion:
The Tribunal allowed the assessee's appeals for A.Ys. 2004-05 and 2005-06 and partly allowed the appeal for A.Y. 2006-07, deleting the double additions and sustaining the addition of Rs. 2,00,50,000 on a substantive basis.

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