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TMI Blog1990 (3) TMI 112X X X X Extracts X X X X X X X X Extracts X X X X ..... followed by the IT Department who were also intimated about finding of cash and other items in the premises of the assessee. The search resulted in seizure of cash Rs. 2,41,693, 14 gold biscuits, gold ornaments weighting 285 tolas, impure silver weighting 7 kg. 143 silver coins and hundi kokas of value of Rs. 6,02,590. At the time of search conducted by the Police in the presence of two witnesses, Smt. Bachan Devi, the mother of Shri. Harbans Lal Gupta was only present. From the records it appears that no statements was obtained from her at the time of the search. Smt. Bachan Devi's statement came to be recorded by the Excise Authorities on8th July, 1974. The statement of Shri. Harbans Lal Gupta during the course of the proceedings under s. 132(5) was recorded by the IT Department on2nd May, 1974. The statement of his wife Smt. Sudarshan Gupta was recorded during the course of the proceedings under s. 132(5) on13th May, 1974. Similarly, the statement of Smt. Bachan Devi was recorded on23rd May, 1974during 132(5) proceedings. Statement of Shri. Om Prakash, one of the brother of Shri. Harbans Lal Gupta was recorded on30th May, 1974under s. 132(5). Shri Meg Raj Singhal, brother of Sm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ks at any time, she had lent or given an advance to her daughter-in-law Smt. Sudarshan Gupta for Rs. 10,000 to be used by her in the business of money-lending. Relying on the above statement and also finding, as a matter of fact that there was no evidence to impute any motive in favour of Shri. Harbans Lal Gupta, Shri. Harbans Lal Gupta was held to be not connected at all with the gold biscuits. The ITO after examining Smt. Bachan Devi came to hold that the statement of Smt. Bachan Devi that she owned various items as stated by her was wrong and was intended to only provide a cover up her son Shri. Harbans Lal Gupta. Shri Om Prakash in his statement given to the Department under s. 132(5) on 30th May, 1974 had stated the claim that the mother had advanced Rs. 20,000 in cash to each of her four sons is false and that it was impossible for her to have had gold ornaments to the tune of 480 tolas but at best it should be in the range of 100-150 tolas. He pleaded ignorance in regard to the existence of the gold biscuits. He admitted that at the time of the death of his father there was some cash, some gold ornaments, some impure silver of about 30 Kg. and a few silver coins which were u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t as made by his mother was true in all respects and that his statement as was given should be treated as a nullity. The ITO, however, choose to place reliance on the statement of Shri Om Prakash made on30th May, 1974. The ITO also rejected the statement of Shri Megraj Singhal, brother of Smt. Sudarshan Gupta which was to the effect that at the time of marriage of Smt. Sudarshan Gupta to Shri. Harbans Lal Gupta, she received little over 100 tolas from Smt. Bachan Devi and almost an identical quantum of gold ornaments from her parents. The ITO also rejected similar claim made by Shri ved Prakash, brother of Shri. Harbans Lal Gupta. The ITO also rejected the order passed by the Excise collector wherein he had categorically observed that there was no evidence at all available hinting at Shri. Harbans Lal Gupta in regard to possession of the gold ornaments. The ITO further was of the view that even the cash could not be said to belong to her. He further included the value of gold ornaments, gold biscuits, impure silver, silver coins which was alleged to be belonging to Smt. Bachan Devi ass unexplained investment of Shri. Harbans Lal Gupta. CIT (A) had deleted the addition made on accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceived from Shri. Mohan Lal of an amount or Rs. 50,000. There were other amounts ranging from Rs. 5,000 to Rs. 10,000 received from a few of the parties, statements of accounts of them have been taken except two parties from whom Rs. 40,000 was alleged to have been received. The statements of various parties from whom advances were realised have been placed at Pages 102 to 132 of the paper book. The ITO came to hold that none of the statements are reliable and the assessee was only trying to create a fiction in regard to cash being advanced. He also emphasised to the fact that the assessee was having bank account and the parties from whom advances were realised in February and March, 1974 could be examined. The CIT(A) consider various statements and considering the order under s. 132(5) came to hold that out of Rs. 2,41,693, Rs. 95,000 stood explained i.e. amount received from Shri Mohan Lal and the amount belonging to the mother Smt. Bachan Devi. In regard to the hundi kokas, he came to hold that to the extent of Rs. 85,440 was not explained and he also came to hold that the hundi business of Smt. Sudarshan Gupta in fact belonged to the assessee. 8. It is on the basis of the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , was that it was admitted by Smt. Bachan Devi that she had received these gold biscuits from prior to her husband's death and there was no occasion of she having it told to any of her children and, therefore, the children not knowing about it was correct. His pleas was that on these facts, the Collector of Customs vide his order of September, 1976 had found as a matter of fact that there was no evidence available at all indicating directly or even remotely any connection of the gold biscuits with Shri. Harbans Lal Gupta. It was, therefore, came to be held by the Excise Collector that the gold biscuits belonged to Smt. Bachan Devi any they had, however, been confiscated. Therefore, on the same set of facts which had been relied by the CIT(A), different view or conclusion cannot be taken unless the Revenue could show by means of some evidence that the gold biscuits belonged to Shri. Harbans Lal Gupta. The CIT(A) had deleted the addition of Rs. 5,000 representing impure silver and 143 silver coins as they were made by the Assessing Officer on a mere premise. The Commissioner of Appeals also accepted the claim of Shri. Harbans Lal Gupta as well as Smt. Bachan Devi as she could be said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by the assessee which indicated that the business was carried on since1st April, 1971. It was accordingly on these basis that the businesses of coal and lime was accepted as belonging to Smt. Sudarshan Gupta. The hundi business, however, was not accepted for according to the CIT(A) the fact that she was a school teacher prior to her marriage and that she saved her entire salary which she brought alongwith her for starting the hundi business and as stated by her on 25th May, 1974 in a letter was held to be not reliable and sufficient evidence. For coming to this conclusion, reliance was placed by the CIT(A) as well as the assessing Officer that initially the hundis were issued favouring Shri Harbans Lal Gupta but, however, on there renewal Smt. Sudarshan Gupta. IT was an admitted position that hundis were advanced in the name of Smt. Sudarshan Gupta. The parties were also examined and even their copy of accounts were examined. In the case of Tulsi Dass Bhagwan Dass, he was found to have carried money lending with Shri Harbans Lal Gupta, Smt. Sudarshan Gupta as salsa Shri Meg Raj Singhal. One other party M/s. Theatre,Gwaliorhad also advanced loans in the name of minor son of Smt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITA No. 495/80, the Delhi Bench of the Tribunal vide its order dt.9th Aug., 1982had clearly held that Shri Meg Raj Singhal had available capital of Rs. 61,600 out of total investment of Rs. 80,000 shown by him. The investment as shown by him included the deposit of Rs. 50,000 made with the assessee. The plea made in the behalf was that this very deposit have been given to Shri Harbans Lal Gupta was examined by the Tribunal in the creditor's case and accepted in the creditors case, no addition in the hands of the assessee could be sustained. In fact Shri Mohan Lal from whom Rs. 50,000 which receipt was accepted by the CIT(A), his plea was that Shri Mohan Lal left this money with the assessee's mother to be given to him and he has so confirmed it. He also confirmed that he had handed over the money to Smt. Bachan Devi, the mother of Shri Harbans Lal Gupta and stating that he was going to meet Shri Meg Raj Singhal, the brother-in-law of the assessee. THE Revenue was irked by the fact that Shri Megraj Singhal had withdrawn the money on20th March, 1974said to be brought it to be given to Shri Harbans Lal Gupta meets Shri Meg Raj Singhal and proceeds toAgra. The amount was said to be wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the admission of the party, followed by producing the party before the ITO which all have been done by the assessee in the instant case. There being no evidence contrary to the statements provided by the party in regard to the advance of Rs. 98,000, the addition in the assessee's hands cannot be sustained. He pleaded that there are couple of small items of Rs. 5,000 who have confirmed to have advanced the monies to the assessees. In respect of Dy. Prasad Jain and Prem Kumar there is neither any statement nor any confirmation. His plea was that even excluding the said two amounts of about Rs. 65,000, the assessee has been able to establish the available of Rs. 3,28,000 as against the seized cash of Rs. 2,42,693 which included Rs. 15,000 belonging to mother, Rs. 25,000 received from the wife Smt. Sudarshan Gupta. His plea was that on no count, the addition could be allowed to remain. He also placed reliance on Smt. Shanta Devi vs. CIT (1988) 68 CTR (P H) 52 : (1988) 171 ITR 532 (P H) and CIT vs. Glaxo Laboratories (India) Ltd. (1982) 26 CTR (Bom) 237 : (1983) 140 ITR 67 (Bom). 13. On the part of the Revenue, the arguments advanced was that in regard to the gold biscuits the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iance on the fact that there was considerable gap between the alleged sale of land and the retention of money for allowing time before being given to the assessee. He also submitted that in the case of four brothers advancing Rs. 98,000 the cultivated land was just about 250 bighas and this land could have at the amount generated Rs. 6,000 to Rs. 10,000 per annum from which the four brothers had to meet their living expenses especially when all of them were living separately. In regard to similar other items, his plea was that onus has not been discharged by the assessee. He placed reliance on Oriental Wire Industries (P) Ltd. vs. CIT (1981) 20 CTR (Cal) 264 : (1981) 131 ITR 688 (Cal). He also pleaded that though the CIT(A) has come to accept that the business was that of the assessee's wife Smt. Sudarshan Gupta, but investment in plots casts a serious doubt especially when she had to borrow money for purposes of carrying on her business. 14. We have given our careful considerations to the rival submissions and also perused through the various documents as have been placed by either side on which reliance was placed on both the sides. Briefly recapitulating the facts the appeal b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ements of Shri Meg Raj Singhal, brother of the assessee, that at the time of marriage his parents had gifted about 100 tolas to Smt. Sudarshan Gupta, combined with the gift by Smt. Bachan Devi of an equal quantity in the year 1960 at which point of time the gold ornaments were of the value of Rs. 100 or so per tolas, meaning about Rs. 10,000 only, we are of the view that the claim is reasonable, giving weight to the fact that in the community to which Smt. Sudarshan Gupta belongs, this is a normal feature. Considering the fact of statements given the Shri Harbans Lal Gupta and brothers as well as Smt. Bachan Devi that 100 tolas were gifted, when r/w the wealth-tax assessments of the wives of other brothers which shows similar quantum of jewellery or more, the year involved being 1960, the amount required being Rs. 10,000 only which cannot be said that be excessive in a family of a community where this is a normal feature. Giving weightage to the statement made by Smt. Bachan Devi who is an old lady of about 80 that she had sufficient gold in 1949 when her husband died, of which she had gifted 400 tolas to four of her daughter-in-law and the wealth-tax assessments of the other daugh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w from the one taken at the time of summary assessment stage i.e., s. 132(5) proceedings. The capital so accumulated by her in respect of the business which she had carried on since 1971 from out of belonging from her husband and her own savings aggregating to near about Rs. 31,000 part of which was utilised in purchasing of a plot of the value of Rs. 15,000 cannot be said to be excessive. While coming to the conclusion, we have also to observe that it is not the case of the Revenue that Shri Harbans Lal Gupta was diverting funds to his wife Smt. Sudarshan Gupta. It is also not the case of the Revenue that there is any evidence to indicate that she never carried on the business. In this light when the facts are reviewed, we see no reason for coming to the conclusion as desired by the Revenue that the business really belongs to Shri Harbans Lal Gupta. The CIT(A) in our opinion having examined all the facts in the proper perspective has rightly relied on the orders of the Assessing Officer passed at the time of s. 132(5) proceedings, noting that there was no addl. Material available at the stage of the s. 143(3) assessment or even at the time of hearing of the appeal. Even before us, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surmise or a subjective opinion which would render the conclusion as an invalid and a nullity. Anything that is apparent has to be taken as real unless it is established that the real is something totally different from what is apparent. We are, therefore, of the view that Smt. Sudarshan Gupta owned the hundi business and the hundis found to the tune of Rs. 71,065 representing her business only. The addition on this account made in the hands of Shri Harbans Lal Gupta are accordingly deleted. 18. One of the arguments raised was that these are unexplained and unrecorded. It is an admitted position that neither Shri Harbans Lal Gupta nor Smt. Sudarshan Gupta are maintaining any books of accounts. Therefore, it is wrong to hold that these found to the unrecorded. Non-maintenance of books of accounts is not something as maintaining of books of accounts and not recording of transaction in the books of accounts. But at the same time, the assessee when found having made certain investments such as hundis in the instant case has to necessarily explain, which she has done, which is duly supported by evidence. Therefore, even on this basis, the claim of the assessee that it is explained is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d money to the assessee and similarly the four brothers Kela Prasad and others admitting of having given an advance of Rs. 98,000 to the assessee which was said to be made available on the basis of sale of land on various dates starting from June, 1973 to February 1974. There is hardly any gap between the realisation of sale proceeds from the sale of land and the date on which the amounts were given to the assessee. Considering these facts and also the facts that it is not found or established by the Revenue that the parties Kela Prasad and others did not sell the land or that they did not sell the land, realised the sale price but have invested elsewhere, therefore, the claim that they had advanced the money assessee was false. Therefore, the assessee having discharged its primary onus of not only identifying the creditors but also establishing that the monies were received from the creditors, further the creditor himself having admitted of paid the money by sale of agricultural land, which statements have not been found to be erroneous or wrong and, therefore, the addition made by rejection of the claim would be totally wrong. The deposit of Rs. 50,000 by Shri Meg Raj Singhal hav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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