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Issues Involved:
1. Whether the addition of Rs. 21,63,070 as undisclosed income was justified. 2. Whether the Tribunal should consider arguments from both sides equally. 3. Whether the Tribunal should issue a speaking order addressing all arguments. 4. Whether the Tribunal can ignore arguments from the revenue. 5. Whether the Tribunal should consider surrounding circumstances and human probabilities. 6. Whether the Tribunal should consider arguments based on material not considered in other orders. Summary: Issue 1: Addition of Rs. 21,63,070 as Undisclosed Income The Tribunal was divided on whether the addition of Rs. 21,63,070 as undisclosed income was justified. The Accountant Member believed that the share capital was genuine, supported by affidavits, bank passbooks, and confirmations from shareholders, and thus deleted the addition. The Judicial Member, however, found that the presence of blank signed share transfer forms, sale bills, cash receipts, and affidavits with the Chartered Accountant raised doubts about the genuineness of the transactions. The Judicial Member emphasized the need to consider the totality of the picture and restored the issue to the Assessing Officer for further verification. Issue 2: Consideration of Arguments from Both Sides The Judicial Member highlighted that the Tribunal must give due deliberation and consideration to the arguments of both the assessee and the revenue. The Accountant Member was criticized for not adequately addressing the arguments of the revenue, particularly those based on the material found during the search. Issue 3: Issuing a Speaking Order The Judicial Member stressed that the Tribunal must issue a speaking order that deals with the facts, circumstances, and evidence on record, considering the arguments from both sides. The Accountant Member was found to have inadequately discussed the arguments of the revenue. Issue 4: Ignoring Revenue's Arguments The Judicial Member argued that the Tribunal cannot ignore the arguments of the revenue and must address them before reaching a conclusion. The Accountant Member was found to have not considered the submissions of the revenue adequately. Issue 5: Surrounding Circumstances and Human Probabilities The Judicial Member emphasized the importance of considering surrounding circumstances and human probabilities, citing the judgments in Sumati Dayal v. CIT and CIT v. Durga Prasad More. The Accountant Member was found to have ignored these aspects, which were crucial in determining the genuineness of the share capital. Issue 6: Considering Arguments Based on New Material The Judicial Member argued that the Tribunal should consider arguments based on new material not addressed in other orders. The Accountant Member was criticized for not considering the new material and arguments presented by the revenue. Conclusion: The Third Member agreed with the Judicial Member, emphasizing the need for a comprehensive examination of the facts, circumstances, and arguments from both sides. The matter was restored to the Assessing Officer for further verification, ensuring that all relevant material and arguments are considered.
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