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2023 (9) TMI 1078 - AT - Income TaxAssessment u/s 153A pursuant to search - Addition based on loose paper - Assessee stated loose papers does not carry any name and it also not clear whether the amount if received or paid, the totaling also not proper - Assessee (Deceased) was an Executive Engineer with PWD Department, Government of Madhya Pradesh showing income from salary and house property - HELD THAT - As materials available on record including the Paper Book filed by the assessee. In these additions made by the A.O. on loose papers, the assessee has not justified the initial burden cast upon him/her by producing cogent evidences and materials. The assessee claimed that the transactions are relating to the office work calculation of allotment receipts, but the assessee failed to adduce any evidence from the office of PWD to prove his contention. Entry with loose paper seized assessee initially stated that these entries relating to the payments received by PWD for civil construction and maintenance work done for Medical College as deposit. But the assessee failed to adduce in support of the same either from Medical College or from the office of the PWD. Similarly the purchase of a Scorpio Vehicle, the assessee failed to prove that it belonged to the senior officer of the department, when various payments break-up are entered into the loose paper seized. Regarding Rs. 7,50,000/- treated as illegal gratification on the basis of loose paper seized, the assessee failed to substantiate the above payments were made to Shri Vinod Gupta, Anil Songra for the work done by them by PWD Department with necessary evidences. Thus the assessee failed to discharge the initial onus cast upon him/her. Unexplained expenditure - AO was not satisfied with the reply given by the assessee as the assessee has not given any details regarding the person mentioned as Sahab in the Loose Paper Seized nor has any proof of the claim of the payment of the amount mentioned in the Loose Paper seized by the so called Sahab has been furnished. The assessee has also not discharged its onus of submitting any documentary evidence in respect of the claim that the transaction could be in the official record of the department. Had it been expenditure incurred for any official vehicle, the assessee could have furnished the relevant documents/confirmation from the office of PWD to explain the above transaction. Assessee has not produced the Registration Certificate of the so called scorpio vehicle before any of the lower authorities to sustain his stand that it belongs to the higher officer or to the PWD Office. In the absence of any proof to that extent, the explanation offered by the assessee cannot be accepted. AO was justified in treating as unexplained expenditure incurred by the assessee out of this undisclosed income. Therefore the same addition is hereby confirmed. Purchase of Plot at Gora Bishan Khedi - Assessee and his wife had never earned any income from conducting tuition or running Beautician for the earlier years which are source of purchasing the lands. There was no return of income filed for the above years. In the absence of the source of income, AO was justified in holding the additions on substantive basis in the hands of the husband and protective additions in the hands of the wife are hereby deleted. Investment in ICICI Prudential Policy - A.R. claimed that the investments were from the past savings and by teaching activity and beauty parlour which are unorganized activities, hence no details of the same could be produced before the Authorities - Assessee failed to produce Shri Shakil Ahmed and confirmed that she do not have detail about the Shakil Ahmed. Further it is stated that the sum of Rs. 51,00,000/- was received in cash for surrendering of rights in the said property which are also made up story just to try to show that the availability of cash in the hands of the assessee. A.O. clearly added the same as the unexplained investment in the hands of the assessee. Thus the findings of the Lower Authorities is not contravented by the assessee by producing relevant documents/ evidences before the any authorities. In the absence of the same, the substantive additions made in the hands of late Jitendra Bhasne does not require any interference, however protective additions made in the hands of Smt. Bharti Bhasne is liable to be deleted. Thus the grounds raised by the assessee are devoid of merits and the same is liable to be dismissed. Addition on account of cash found during the course of search - The Insurance Policy that too of higher denomination of Rs. 50,000/- and above cannot be paid by cash. Those transactions is to be routed through only cheques or DDs in favour of the Insurance Company. Further past savings of Rs. 86,000/- why it was seized from the briefcase of the assessee is not properly explained. In the absence proper explanation by the assessee with necessary evidences, the additions made by the Assessing Officer does not require any interference. Thus the ground raised by the assessee is hereby rejected. Addition towards Registry expenses for purchase of plot at Kerwa Dam - A.O. has rejected the explanation of the assessee that the payment is from the past savings of the assessee - Since the cash flow chart/statement of affairs of Smt. Bharti Bhasne submitted during the course of assessment proceedings already stand rejected and it was held that she was not having any regular source of income before commencing her work as an Insurance agent. The Ld. CIT(A) also confirmed that Smt. Bharti Bhasne did not have regular source of income before starting her profession as an agent of ICICI Prudential Insurance in 2006. There is no evidence to show that she had earned income from private tuition and beauty parlour business. Thus rejected the cash flow statement submitted by the assessee. In the absence of any evidence, we have no other option but to confirm he addition made by the AO. Thus the ground raised by the assessee is devoid of merits and the same is hereby dismissed.
Issues Involved:
1. Addition based on loose papers. 2. Investment in plots at Gora Bishankhedi. 3. Investment in ICICI Prudential Policies. 4. Cash found during search. 5. Registry expenses for Kerwa Dam plot. Summary: 1. Addition based on loose papers: The assessee argued that the loose papers seized were either rough jottings or related to official work, but failed to provide supporting evidence from the PWD office. The Tribunal upheld the additions made by the Assessing Officer (AO), citing the assessee's failure to discharge the initial burden of proof. Specific additions included Rs. 8,27,000 for A.Y. 2005-06, Rs. 15,00,000 and Rs. 45,000 for A.Y. 2006-07, Rs. 1,50,000 for A.Y. 2007-08, Rs. 51,579, Rs. 4,30,000, and Rs. 7,50,000 for A.Y. 2008-09, and Rs. 21,15,828, Rs. 63,576, and Rs. 3,82,500 for A.Y. 2009-10. The Tribunal confirmed these additions, rejecting the assessee's claims of these being dumb documents or related to official work. 2. Investment in plots at Gora Bishankhedi: The AO made substantive additions in the hands of the husband for investments in plots, as the wife had no regular source of income before becoming an ICICI Prudential agent. The Tribunal upheld the substantive additions in the husband's hands and deleted the protective additions in the wife's hands. 3. Investment in ICICI Prudential Policies: The AO added Rs. 1,63,16,166 in the name of Smt. Bharti Bhasne and Shri Jitendra Bhasne as unexplained investments. The Tribunal upheld the substantive additions in the husband's hands, noting the lack of credible evidence for the claimed sources of funds, such as past savings, teaching, and beauty parlour income. The protective additions in the wife's hands were deleted. 4. Cash found during search: The AO added Rs. 3,86,000 as undisclosed income for A.Y. 2009-10, found in the husband's briefcase. The Tribunal upheld this addition, rejecting the assessee's explanation of the cash being related to insurance policies and past savings, citing lack of supporting evidence. 5. Registry expenses for Kerwa Dam plot: The AO added Rs. 30,000 for registry expenses, rejecting the explanation of past savings due to lack of evidence of regular income before the wife became an insurance agent. The Tribunal confirmed this addition, agreeing with the AO and CIT(A)'s findings. Conclusion: The appeals in the case of Shri Jitendra Bhasne were dismissed, while the appeals in the case of Smt. Bharti Bhasne were partly allowed, with protective additions deleted.
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