9911796707
TMI Blog2012 (11) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... addition was called for is not acceptable as the disclosure made of Rs.23,77,949/- was specific and did not cover the undisclosed income evidenced by the seized document which is the basis of this addition. Therefore, we confirm the order of CIT(A) and dismiss ground raised by the Assessee - against assessee. Undisclosed Agriculture income - Held that:- The search had taken place on 28.12.2007. Even prior to the search, the order u/s.143(3) for AY 04-05 has been passed in which, out of Agricultural income declared by the Assessee a sum of Rs.1,04,190/- was treated as Income from other sources. Thus the very same addition cannot be made in assessment u/s.153A and doing so would amount to taxing the same income twice. Therefore direct that the addition so made be deleted - in favour of assessee. Difference in Chit Commission received - Held that:- Assessee who could not substantiate as to how a sum of Rs.69,000 was expenditure incurred in relation to chit commission income therefore confirm the order of CIT(A) and dismiss ground raised by the Assessee - against assessee. Excess cash found as undisclosed income - Held that:- CIT(A) was justified in rejecting the claim of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 52,53,137 TOTAL 2,43,70,000 Accordingly, while filing the returns of income u/s.153A/143(3) of the Act, whatever has been declared u/s. 132(4) i.e., Rs.2,43,70,000/- has been offered to tax. While concluding the assessment u/s. 153A of the Act for the A.Y. 2002-03 to 2007-08 and u/s. 143(3) of the Act for the A.Y. 2008- 09, the following additions were made by the AO. Sl. No. Assessment year Agricult -ural income treating it as normal income Inadequate drawings Unexplained investments Other disclosed income Total 1. 2002-03 1,37,333 NIL NIL 8,47,227 9,84,560 2. 2003-04 1,15,667 54,943 36,00,000 4,90,700 2,00,000 44,61,310 3. 2004-05 1,15,665 66,380 1,60,528 NIL 3,42,573 4. 2005-06 NIL 16,579 15,90,000 43,540 16,50,119 5. 2006-07 23,317 NIL 21,91,000 3,99,104 26,13,421 6. 2007-08 NIL NIL 15,00,000 2,93,720 17,93,720 7. 2008-09 NIL NIL 18,21,700 10,87,281 29,08,981 Total 1,47,54,684 4. Against the assessment order, the appellant has filed appeals before the CIT(Appeals), Mysore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Indiranagar, Bangalore. The loose paper evidenced the fact that a sum of Rs.36 lacs was paid by cash over and above the sum, which was paid by cheque and which is duly reflected in the registered document which was in favour of the Assessee and his wife. In a letter dated 27.11.2009 filed in the course of assessment proceedings, the Assessee admitted having paid a sum of Rs.36 lacs by cash but took a stand that the person from whom the Assessee purchased the property was a contractor and the sum of Rs.36 lacs cash was given to the seller in his capacity as a contractor for renovation of the house. The sale consideration paid by cheque which was reflected in the registered sale deed was Rs.38,52,000/-. The Assessee claimed that the seller did not carry out the renovation but returned the cash to the Assessee. The other assets which was offered to tax in the assessment for various assessment years was from and out of the aforesaid cash and therefore no separate addition be made. The AO, however, rejected the plea of the Assessee and held that there was outflow of Rs.36 lacs of cash and the Assessee failed to explain its source and therefore addition u/s.69B of the Act has to be mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was seized from the residential premises of the Assessee. This document is the basis of similar addition made in other Assessment years 04-05 to 08-09 which the Assessee has challenged in the appeals relating to those years. In the course of recording the statement of the Assessee u/s.132(4) of the Act on 28.12.2007, a question was put to the Assessee to explain the contents of the aforesaid seized document. The reply of the Assessee [answer to Q.No.19 of the statement u/s. 132(4) of the Act dated 28.12.2007] was as follows: Ans. Page 1 contains details of money amounting to Rs.6 lakhs invested at Ulsoor by me, Page 2 contains details of money amounting to Rs.5.5 lakhs invested at Shivajinagar by me, Page 3 contains details of money amounting to Rs.6 lakhs invested at Ulsoor by me, Page 2 contains details of money amounting to Rs.5.5 lakhs invested at Shivajinagar by me, Page 3 contains details of money amounting to Rs.15,30,000 invested by 9 persons, I am not able to recollect my exact share in this. I will provide these details on 31st December, 2007. Page 4 contains details of money amounting to Rs.14,17,500/- invested by 10.5 persons, I am not able to recollect my exact sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t contains details of loans of Rs 15.30 lakhs advanced to some parties at Madiwala, Bangalore. However, as of now, I will not be able to furnish you the names and addresses of the debtors. Page-4 : It contains details of loans of Rs 14.17.500/- advanced to some parties at Market (Chmrajpet), Bangalore. However, as of now, I will not be able to furnish you the names and addresses of the debtors. Page-5: It contains details of loans of Rs 3.60 lakhs advanced to some parties at Chintamani. However, as of now. I will not be able to furnish you the names and addresses of the debtors. Page-6: It contains details of loans of Rs 3.3 lakhs advanced to some parties at Vijayapura. However, as of now. I will not be able to furnish you the names and addresses of the debtors. Page-7 : It contains details of loans of Rs 4.80 lakhs advanced to some parties at Davangere. However, as of now. I will not be able to furnish you the names and addresses of the debtors. Page-8: It contains details of loans of Rs 6.00 lakhs advanced to some parties at Thirupathur. However, as of now, I will not be able to furnish you the names and addresses of the debtors. Page-9: It contains details of loans o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffices in these places. Q.14 Please give the complete name and address of the persons who has maintained the note book mentioned in the above question. Ans: His name is Sri Karthik and he was working as my accountant till September, 2007. He has left my concern and presently living some where in Madurai. However, I am unable to furnish you his complete address. Q.15 Do you have anything more to say? Ans: No. I have nothing more to say. 13. The AO based on the above statement added a sum of Rs.4,90,700/- as undisclosed income in finance business in AY 03-04. Before CIT(A), the Assessee took a plea that the amounts mentioned in the seized document pertain to his business associates. The ld. CIT(A) found this plea to be contrary to the statement at the time of search and u/s.131 of the Act. Even otherwise the ld. CIT(A) found that the claim of the Assessee has not been established by furnishing name and address of other persons and the amount invested by them. The ld. CIT(A) therefore confirmed the addition made by the AO. 14. Before us the learned counsel for the Assessee pleaded that the disclosure made in the returns of income would be sufficient and no separate addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28.12.2007. Even prior to the search, the order u/s.143(3) of the Act for AY 04-05 has been passed in which, out of Agricultural income declared by the Assessee a sum of Rs.1,04,190/- was treated as Income from other sources. Thus the very same addition cannot be made in assessment u/s.153A of the Act and doing so would amount to taxing the same income twice. We therefore direct that the addition so made be deleted. Ground No.II is thus allowed. 20. In the result, the appeal by the Assessee is partly allowed. ITA No.343/Bang/11: (AY 05-06) 21. Ground No.I, III IV are general in nature and do not call for any specific adjudication. 22. Ground No.II raised by the Assessee reads as follows: a) The learned CIT(Appeals), Mysore is not justified in law in confirming the additions by the Assessing Officer to the extent of Rs.14,20,700/- as unexplained investment in financial business. 23. This ground of appeal is identical to the ground No.III raised by the Assessee in Gr.No.III in ITA No.341/Bang/11 for AY 03-04. The parties agreed that the same arguments as raised in AY 03-04 be considered as argument advanced in respect of this ground. 24. We have already held, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by the AO. 32. Before CIT(A), the Assessee claimed that Rs.3,84,000 was the gross commission income and that after deducting expenditure a sum of Rs.1,00,000 which is the net commission, income was offered to tax. The ld. CIT(A) found that in the statement of the Assessee recorded u/s.131 of the Act on 31.3.2008, the net income from chit commission was revised to Rs.1,69,000/-. The CIT(A) found this disclosure was fair and reasonable. He therefore restricted the addition to Rs.69,000/-. Still aggrieved the Assessee is in appeal before Tribunal. 33. We have heard the submission of the learned counsel for the Assessee who could not substantiate as to how a sum of Rs.69,000 was expenditure incurred in relation to chit commission income. We therefore confirm the order of CIT(A) and dismiss Gr.No.II raised by the Assessee. 34. In the result, the appeal by the Assessee is dismissed. ITA No. 345/Bang/11: (AY 07-08): 35. Grounds No. I, III and IV are general in nature and calls for no specific adjudication. 36. Gr.No.II raised by the Assessee reads as follows: II. Difference in Chit Commission received amounting to Rs.1,13,720/- a) The learned CIT(Appeals), Mysor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of search proceedings, the assessee claimed that as per his cash book updated, the cash balance as on 27/12/2007 was Rs.22,33,047/- and for the difference amount of Rs.13,80,953/- there was no explanation forthcoming and he had agreed to offer the excess cash to this extent for taxation for A.Y. 2008-09. This amount has been disclosed as additional income in the return filed. 43. The claim of the assessee that the cash balances as per updated cash book was Rs.22,33,047/- was re-examined with reference to the cash balances appearing in other books impounded/seized and the collection under various heads made as under: Closing cash balance as on 26/12/2007 as per page 10 of PPF/48 Rs. 10,32,862 Add: Collection on 27/12/2007 as per page 1 of PPF/47 Rs 1,46,725 Total Rs. 11,79,587 Less: Expenses for 27/12/82007 as per PPF/47 1,015 Add: Loan issued on 27/12/2007 PPF/43 2,66,000 Rs. 2,67,015 Difference represents cash balance on 27/12/2007 which is opening balance on 28/12/2007 Rs. 9,12,572 44. The AO asked the assessee to explain the actual cash found of Rs.36,14,000/- as against the opening cash balance on 28/12/2007 as arr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .6,38,990/- for taxation under suppressed commission income. 47. Before the CIT(A), the assessee submitted that whatever cash was found pertained to the Assessee s finance business, since he is a small financier mainly dealing in cash transaction and whatever cash found was already offered for tax in the finance business as unexplained under Section 132(4) in the return of filed for the assessment year under question. Therefore, if at all the said alleged excess cash is brought to tax, it would amount to double taxation. 48. The ld. CIT(A) observed that cash of Rs 36,14,000/ was found during the search. The assessee explained that cash balance as per books was Rs. 22,33,047 and the difference was disclosed as additional income. However during the course of the assessment proceedings, the AO worked out that actual cash balance as per the books was only Rs. 9,12,572. After allowing for the additional receipts by way of chit commission etc. and the unexplained cash already disclosed by the appellant, the AO held that there was excess cash of Rs 4,48,291 which required explanation. As the appellant could not explain it, the amount was treated as appellant s income. Since the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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