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TMI Blog2000 (2) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... ondonation of delay in filing the appeals. It was argued by the learned counsel that when the assessment order under s. 158BA were made the same were served on the appellants along with the notices under s. 156 of the Act. On the demand notices in respect of both the companies the authorities having appellate jurisdiction was mentioned as CIT(A)-XXIII,New Delhi. Accordingly the appeal in both the cases was filed in his office on27th Jan., 1998which was well within the time prescribed under s. 253(1)(b). The photocopy of the demand notices were also filed to support the claim. It was argued that even the CIT(A) had fixed the hearing in those cases when it was explained to the assessee that as the search and seizure operation took place prior to1st Jan., 1997the first appellate authority was the Tribunal. According the CIT(A)-XXIII passed the orders by holding that the appeals were not maintainable. The assessees have, therefore, filed appeal before the Tribunal on22nd May, 1998. It was argued that as there was a reasonable cause in filing the appeals late the same may be condoned. The learned Departmental Representative stated that in the circumstances mentioned above there appears ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such money, bullion, etc. or the entry in the books of accounts or the documents or transaction represent wholly or partly income which has not been or would not have been disclosed. Thus, the section cannot be applied on the basis of presumptions. It was stated that though the definition is inclusive and not exclusive but its scope has been put under limit due to the use of the words "which has not been or would not have been disclosed". While relying on the observations made by the Bombay Bench of the Tribunal in the case Sunder Agencies vs. Dy. CIT (1997) 59 TTJ (Mumbai) 610 : (1997) 63 ITD 245, 256 (Mumbai) the learned counsel argued that s. 158BA itself indicate that section deals only with those assessments which concern with the undisclosed income determined as a result of search and seizure operation. It was argued that s. 158BB(2) provides that in computing the undisclosed income the provisions of s. 68 shall apply. It is not a section which described what is undisclosed income. The Madras Bench of the Tribunal in the case J.K. Narayanan (HUF) vs. Asstt. CIT (1999) 64 TTJ (Mad)(TM) 823 : (1999) 69 ITD 104 (Mad)(TM) at 114 has observed that s. 158BB prescribes only the meth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mbers of the Kohli group with the appellant companies. This letter was initialled by one Shri U.S. Kohli. The learned counsel stated that the fact was otherwise. Actually Shri U.S. Kohli puts his full signature and various documents were filed by the learned counsel to prove this contention. A specific reference was made to pp. 82 and 86 of the paper-book. It was further argued that surprisingly the AO has relied on the annexure attached along with the letter, dt.10th Dec, 1997signed by the so-called Shri U.S. Kohli, he has not bothered to examine the confirmations filed by almost all the creditors of Kohli group whose names find place in the annexure filed along with letter, dt.10th Dec, 1997. The learned counsel also filed copies of such confirmations which are placed at pp. 82 to 92 of the paper-book. It was argued that once the confirmation from individual creditors have been filed before the AO giving their permanent account numbers how another person can deny the transaction on behalf of all such creditors. The learned counsel also argued that the AO has not examined these points. The AO has also not given any opportunity to the assessees to cross-examine Shri U.S. Kohli who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment for any one or more of the relevant assessment years is pending or not." 10. We also find that Pune Bench of the Tribunal in the case of Parakh Foods Ltd. vs. Dy CIT (1998) 64 ITD 396 (Pune) has also considered the definition of the word "undisclosed income" within the meaning of s. 158BB. The Bench at p. 398 has observed as under: "The contention of the assessee that undisclosed income must be assessed on the basis of material found as a result of search, or other material having nexus with the seized material also could not be accepted. According to the assessee, the words 'such other material' used in s. 158BB suggests such interpretation and the word 'such' must relate to the preceding words. The word 'such' may not necessarily refer to the word or words preceding to it. It is the settled law that words used by the legislature should be interpreted in the manner which advances its object and not which frustrates it. The object of the legislature is to find out all the hidden income of the assessee. Therefore, the word 'such other material' has to be understood as 'any other material'. Interpretation suggested by the assessee would again restrict the natural meaning of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rming the transactions with the appellant companies in different years. Thus there is a contradiction between these documents. Actually the learned counsel has challenged the very veracity of documents which has been relied on by the AO The AO has not reconciled the controversy between these two sets of documents which are contradictory to each other. He has relied on the documents which were against the appellants and skilfully ignored the other documents because these were in favour of the appellants. No plausible reason has been advanced by the AO for doing so. Moreover if there are two sets of documents and the AO chooses to rely on one set he was duty bound to give opportunity to the appellants as to why such set of documents could not be relied upon. But in the instant case no opportunity has been provided by the AO for cross-examination or to rebut a particular document which is relied on by the AO. This is against the principles of natural justice. 15. We also find that the AO has made substantial additions on account of rental income. While doing so he has observed that the appellants were receiving rental income in the past. Merely because the appellants were receiving c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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