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TMI Blog2012 (9) TMI 437X X X X Extracts X X X X X X X X Extracts X X X X ..... s made on the basis of statements made by seller and broker that unaccounted payment received by them - Assessee contended that the statements were made under coercion which was endorsed by both the persons by retracting from their statements during cross examination - Held that:- The addition made merely on the basis of statements which allegedly given under pressure. The assessee filed sufficient material in support of retraction. There is no other material on record basis of which it can be said that on money was paid in transaction. Appeal decided in favour of assessee Addition made on account of unaccounted cash u/s 69A – During course of Search cash seized by AO from assessee residence - The assessee filed cash flow statement without supporting with evidence – The assessee could not maintain the personal book account - Held that:- No one has appeared before us even proper notice has been served on the assessee’s legal heir. Assessee submitted before the AO cash was found withdrawal made by him as a Director from the company. As per balance sheet submitted before the A.O., the assessee had shown hardly cash balances. Appeal decide in favour of revenue. Addition on accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sues in both the assessment years against deletion of additions of Rs.12,26,132/- and Rs.11,55,287/- made on account of unaccounted investment in factory building in A.Y. 1993-94 and A.Y. 1994-95 respectively u/s 69 of the IT Act. 3. The brief facts of the case are that there was a search in the group cases of Ramdev Masala on 03-03-1993 in the residential premises as well as business premises of the assessee. The assessment for AY 1993- 094 was completed u/s 143 (3) of the Act. The assessee is owner of Sola Factory Premises in which manufacturing activity of Ramdev Food Products Pvt. Ltd. and Ramdev Masala was carried out. The construction work of the factory was carried out for the period of more than four years. However, major part of it was completed in previous year and also in the financial year 1993-94. The factory premises was referred to DVO by the ADIT (Inv. II and III). The DVO estimated the cost of construction of the property at Rs.81,31,106/- during the period April, 1992 to March, 1993. Since, there was vast difference between the estimated cost of construction as per valuation report and the investment in construction of the factory as per the book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eport is on record. Since, the matter is pending for long; therefore, this case is decided on the basis of the materials available on record. It is found from the assessment order as well as from the order of the learned CIT(A) that the assessee pointed out various defects in the DVO s report. The AO had taken different view for AY 1993-94 on same identical set of circumstances. The assessee produced two valuation reports from Government Approved Valuer and one from Insurance Company and the other was from independent valuer for determining the fair cost of acquisition. The value determined by the Government Approved Valuer was quite low as compared to that of the DVO. The learned AO had not referred the valuation made by both the Government Approved Valuer either to the DVO or had not considered in assessment order. Even, he had not disapproved the same. The AO was not technical person; therefore, both the valuation reports should have been referred to the DVO to determine the correct cost of acquisition of the factory. As discussed above, there was a search. During the search proceedings no incriminating document was found relating to the cost of construction of the factory. No i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first ground in A.Y. 1993-94 is against deleting the addition of Rs.7,01,600/- which made on account of unexplained investment in purchase of land. The A.O. observed that during the course of search u/s 132, it was gathered that one plot of land admeasuring 9680 Sq. Yd. No. 319/2 was purchased by the assessee from Shri Vijaykumar Hatheesingh through registered sale deed dtd. 23.9.1992. The actual consideration was Rs.120 per Sq.Yd. amounting to Rs.11,61,600/-. But the document was made at the rate of Rs.49.58 per Sq.Yd. amounting to Rs.4,80,000/-. Shri Vijaykumar Hatheesingh has confirmed that the above facts and accepted the fact of unaccounted payment received by him to the extent of Rs.6,81,600/- from her in his statement on oath dt.10-11/3/93. The above land transaction was done through one broker namely Shri Dahyabhai P. Patel of Sola Gam. He had also accepted the consideration at Rs.11,61,600/- ( @ Rs.120 per Sq. Yd.) and further admitted that he received Rs. 20,000/- as brokerage from both the parties. The assessee has shown investment on plot of land at Rs.4,80,000/-. The A.O. had given reasonable opportunity to the assessee of being heard during the course of assessment p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the course of cross examination held later on. The similar addition was made in A.Y. 1990-91 which was identical on the basis of statement of Shri Dahyabhai P. Patel, which was deleted by the ITAT, same is reproduced from the order of ld. CIT (A) at paragraph no.2 of page no.10:- The addition made merely on the basis of statements which allegedly given under pressure. The assessee filed sufficient material in support of retraction.there is no other material on record basis of which it can be said that on money was paid in transaction. The addition considered on account of on money in hands of sellers have been deleted by ITAT. Under the circumstances, we do not find any justification in sustaining addition of Rs. 7,33,245/- on account of on money,therefore same is deleted. 11. By respectfully following the ITAT order on similar addition in A.Y. 1990-91 and verified the facts which are similar to A.Y. 90-91 as addition was made on the basis of statements of sellers as well as broker in the year under consideration. Therefore, we do not find the order of the ld. CIT(A) perverse. 12. In the result, the Revenue s appeal is dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kelvinator Fridge of Rs.13,000/- (iii) Dining table with 6 chairs of Rs. 3,000/-. The assessee had not admitted the ownership of these valuable items. He only claimed that these were purchased by Shri Chirag A. Patel from one Shri I.K. Patel on 25.11.92 for Rs. 6,500/- in case of Onida TV and 13,000/- for Kelvinator Fridge but no evidence as well as source of investment, had been explained by the assessee. Dining Table with 6 chairs was purchased from the fund of M/S Ramdev Food Products Pvt. Ltd. But, no evidence was furnished before the A.O. Therefore, he made the addition of Rs.30,000/- in the income of the assessee. At the time of appeal, ld. CIT(A) also confirmed the addition as the assessee even did not file any evidence that the TV and Fridge was purchased by the Chirag A. Patel and also dining table has been purchased by M/S. Ramdev Food Products Pvt. Ltd. 16. Now the assessee is in appeal before us. The search was conducted u/s 132(2) at the residence premises of the assessee as per Section 132. It is primary duty of the assessee to explain the source of things/valuables found during the course of search at his residence. He similarly relied on various case law ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8,000/- in the income of the assessee. 21. The assessee was in first appeal before ld. CIT(A). The assessee challenged the addition on ground that ld. A.O. estimated household expenses without bringing on record any data/evidence or material and claimed that A.O s. order was wholly arbitrary and pleaded to be deleted. The CIT(A) had confirmed the addition in absence of any evidence submitted before him. 22. Now the assessee is in appeal before us. During the course of assessment proceeding, the household withdrawal of three sons were also not submitted with evidence before the A.O. or before the ld. CIT(A). It is undisputed that he was having independent establishment for running the kitchen at his house. The assessee had not withdrawn a single penny for household purposes. There is no evidence produced by the assessee that he had received food from factory canteen. Therefore, we confirm the addition made by the A.O. which was confirmed by the CIT(A). 23. The results of the appeals are summarized as under:- In ITA Nos. 1464 1465/Ahd/2006, the Revenue s appeals are dismissed. In ITA No. 1536/Ahd/2006, the assessee s appeal is partly all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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