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TMI Blog2013 (1) TMI 108X X X X Extracts X X X X X X X X Extracts X X X X ..... g the Revenue’s appeal for AY 2001-02, 2002- 03 & 2003-04 and has recorded the similar finding that with regard to the loose papers, Shri Yogesh Gupta had stated that these were unaccounted transactions in cash. In his statement, he also surrendered the income of Rs.13 crores in his name and in the name of the group concern & the Revenue was fully satisfied by the surrender made and closed their investigation. The above finding of the are squarely applicable to the year under appeal also because in this year also, the Revenue has brought no other material on record to establish that as per the loose papers, any amount was borrowed by the assessee. They have not even examined the person whose name is claimed to have been mentioned on the loose papers. In the loose papers, no where it is mentioned that they belonged to the assessee i.e. M/s Home Developers (P) Ltd. which is a company. All the entire addition is based upon the presumption of the AO. On the loose papers, there is noting of dates and amounts without any narration. The total of such amount is Rs.2,40,000/- & not as presumed Rs.2,40,00,000/-. The noting is relating to loan taken by the assessee & the loan was repaid d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er group concerns. Simultaneously, the search also took place at the residence of the directors/partners of the assessee and the group concerns. During the course of search at the premises of Shri Yogesh Gupta, certain documents were found and seized. His statement was also recorded on 31st May, 2006 in which he surrendered the sum of Rs.13 crores as under:- (i) In his own name Rs.2 crores (ii) Home Developers (P) Ltd. Rs.2 crores (iii) Realtech Project (P) Ltd. Realtech Construction (P) Ltd. Rs.9 crores 6. In his statement, Shri Yogesh Gupta had stated that these noting of the paper were unaccounted transactions. The Revenue was fully satisfied with the surrender and closed their investigation. However, during the assessment proceedings, the Assessing Officer held that the noting on the papers found and seized at the time of search was in respect of loan taken by the assessee. He presumed that such loan is repaid by the assessee alongwith interest. No addition was made by the Assessing Officer for the alleged loan claimed to have been taken by the assessee but, he made the addition for alleged repayment of loans alongwith inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06-07 8,46,33,100/- 8,36,33,100/- 10,00,000/- 13. The Revenue, aggrieved with the deletion of penalty, is in appeal vide ITA Nos.62/Del/2010 63/Del/2010 for AY 2004-05 2006-07 while assessee, aggrieved with penalty sustained, is in appeal before us vide ITA Nos.4903/Del/2009, 4905/Del/2009 4907/Del/2009 for AY 2004-05, 2005-06 2006-07. 14. Since in all these appeals, the issues are interrelated, they are heard together. 15. At the time of hearing before us, it is submitted by the learned counsel for the assessee that during the course of search, certain loose papers were found from the residence of Shri Yogesh Gupta and not the business premises of the assessee which is a private limited company. In pursuance to the search, the statement of Shri Yogesh Gupta was recorded on 31st May, 2006 in which he admitted that the loose papers are in his handwriting and he also explained that the loose papers contain details of various unaccounted transactions as well as certain unaccounted investments of the group concerns. He also surrendered the sum of Rs.13 crores partly in his hands and partly in the hands of M/s Home Developers Pvt.Ltd., M/s Realtech ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The total penalty worked out was Rs.16,48,98,940/- which was bifurcated in six assessment years as under:- Assessment Year Amount 2001-02 Rs.5,00,000/- 2002-03 Rs.48,25,000/- 2003-04 Rs.7,00,000/- 2004-05 Rs.3,84,60,000/- 2005-06 Rs.2,25,50,000/- 2006-07 Rs.9,78,63,940/- Total : Rs.16,48,98,940/- That the appeals for AY 2001-02, 2002-03 2003-04 came up before the ITAT Delhi Bench vide ITA Nos.4495, 4496 4497/Del/2009 in which the ITAT held that from these papers, the acceptance of loan in cash by the assessee is not proved. Accordingly, the ITAT upheld the order of the CIT(A) wherein the penalty levied under Section 271D was cancelled. The Revenue filed appeal before the Hon ble Jurisdictional High Court which also upheld the order of the ITAT and held that it is not established that the respondent assessee had taken loan/deposit in cash. He stated that the facts of the year under consideration are identical. That in those years also, same/similar papers were considered, same statement of Shri Yogesh Gupta was considered and same consolidate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the premises of the assessee company or of its Directors show huge receipt and payment of cash loan/deposits. These have been analyzed and it is seen that the transactions in violation to the provisions of 269SS are as per below; Default as committed u/s 269SS r.w. Sec. 271D SN Narration Reference Amount of default 1 Cash loan/deposits of 1,48,50,000 received upto 17- 05-2004 as found referred in Annexure A-7/Page 42 relevant to AY 05-06 1,48,50,000 2 Loan/Deposit of Rs.2.40 cr. received from Paliwal in AY 04-05 shown in Ann. A-7 2,05,00,000 3 Additional loan/deposit received on 18-05-04 as referred in Annex. A-7 page 43 in AY 05-06b 10,00,000 4 Cash loan/deposits received upto 31-03-2004 as referred in Annexure A-7 page 43 in AY 04-05 25,00,000 5 Cash loan/deposit on which interest of 4.68 lacs paid from 01-1-04 to 31-03-04 as referred in A-7 page 43 in AY 04-05 93,60,000 6 Cash loan/deposits (minus cheque amts) received mentioned in A-12 Page 17 falling in AY 01-02; 02- 03; 03-04 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The relevant finding by the ITAT reads as under:- 13. We have carefully considered the rival submissions in the light of the material placed before us. From the contents of the seized document, it cannot be said with certainty that the assessee being a company has contravened the provisions which stipulates that no person shall, after the 30 day of June, 1984, take or accept from any other person (hereinafter referred to as depositor), any loan or deposit otherwise than by an account payee cheque or account payee bank draft, if the said amount in any case exceed Rs.20,000 or more. The first condition to be fulfilled is that the acceptance by the person upon whom the penalty sought to be levied of loan or advance from any other person. The document itself does not indicate that the assessee itself has accepted from any other person any loan or deposit otherwise than by an account payee cheque. The name of the assessee is completely absent from the said document. It is not the case of the revenue that the said document was further corroborated with some material to indicate that the said amounts were paid to the assessee company in the form of loan or deposit. In the absence o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l for the appellant- Revenue submits that appeals of other years are pending before the tribunal. We express no opinion on other appeals, as the decision will depend on the facts of each case. (emphasis by underlining provided by us) 21. From paragraph No.7 of the above decision of Hon ble Jurisdictional High Court, it is clear that the Hon ble High Court has clearly mentioned that they are not expressing any opinion on the appeal of other years which are pending before the Tribunal and the same will depend on the facts of each case. 22. Now, the question arises whether the facts in the appeals before us are different or similar. 23. It has been admitted by the parties before us that the facts of all the three years under appeal before us are similar. Therefore, for the sake of brevity, we shall discuss here the facts of AY 2004-05. The Assessing Officer, in the assessment order dated 31st December, 2007, recorded the following finding relating to loose papers:- Analysis of the seized material in regard to loan transactions repayment Annexure A-7 1. One Annexure A-7 was seized from the residence of Shri Yogesh Gupta. This Register contains interalia detail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayable comes to Rs.15 lacs. Total addition on account of this page would work out to Rs.90 lacs (75 + 15). I am satisfied the assessee has furnishing/concealed particulars of his income. Penalty proceedings u/s 271(1)(c) is being initiated on this point separately. 24. From the above, it is evident that the papers were seized from Shri Yogesh Gupta and as per the Assessing Officer, these papers recorded the transactions of loan received by the assessee. Here, it would be relevant to consider the statement of Shri Yogesh Gupta from whom the papers were seized. The relevant portion of his statement reads as under:- Q.4 During the search seizure operations carried out at your residence on 28/03/2006, you had made a voluntary disclosure of an additional income of Rs.13 Crores. Do you confirm the same? Ans. - Yes, I confirm the above disclosure of Rs.13 Crores of additional income. Q.5 Please give the assessee wise break up of the above mentioned disclosure. Ans. I have made a disclosure of Rs.13 Crores the break up of which is as under: 1. In my own hands Rs.2 Crores (Two Crores) 2. M/s Home Developers Pvt.Ltd. Rs.2 Cro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is annexure is in my own handwriting and it contains the details of same unaccounted transactions which are contained in Annexures A-1 to A-6 and have been fully covered under the disclosure made above. Specifically Page no.7 of this annexure contains details of Investment of Rs.37,80,000/- made in Property at Kotla which is not recorded in the books of accounts. The figure of 29,300 on this page represents the cost of plot and actually means Rs.29,30,000/- and similarly the figure of 8.5(C) represents the cost of construction and means Rs.8,50,000/-. Therefore the total cash amount invested in this property is Rs.37,80,000/- which is being offered for taxation as an additional income. Q. Please tell the source of this cash investment of Rs.37.80 lakhs. Ans. The source of this investments is Cash receipts by M/s Home Developers Pvt.Ltd. through the business of sale/purchase of properties and are not accounted for in the regular books of accounts. Q.8 I am showing the Annexures A-8 A-9 seized from your residence during the search seizure operations carried u/s 132 on 28/03/2006. Please explain the contents of the same. Ans. These annexures contain var ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same. Ans. This annexure contains various business correspondence, copies of cheques, bank statements and some bills etc. Q.12 I am showing you the Annexure A-2 seized from the residence of Shri Jatinder Kumar Gupta at 1649, Sector 7E, Faridabad, Haryana during the course of search seizure operations carried u/s 132 on 28/03/2006. Please explain the contents of the same. Ans. Page no.1 2 are receipts issued by Joyce Titus in respect of payments made by me for purchase of property no.F/5/2, Vasant Vihar, New Delhi. Out of this Rs.25 lakhs was paid in cash and the same is being surrendered i.e. offered for taxation. Pages no.45 to 52 are agreement to sell regarding purchase of property no.E-6/13, Vasant Vihar, New Delhi by M/s Kirti Realtors Pvt.Ltd. A cash payment of Rs.31 lakhs was made by the company to the vendors. I would also like to state that although the agreement to sell is for Rs.3.61 crores, the sale deed of this property was executed for Rs.2 crores i.e. in the sale deed the property was undervalued by Rs.1.61 crores. Therefore an amount of Rs.1.61 crores is being offered for taxation as an additional income in my own hands, since I had made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e papers, no where it is mentioned that they belonged to the assessee i.e. M/s Home Developers (P) Ltd. which is a company. Admittedly, the loose papers were found from Shri Yogesh Gupta and not the assessee company. The undisclosed income represented by such loose papers had already been offered by Shri Yogesh Gupta and other group companies which has been accepted by the Revenue. Photocopy of the loose papers have also been produced by the assessee in his paper book. For the sake of brevity, we shall mention herein below only one loose paper i.e. page No.43 in which, according to the Revenue, there is an evidence of loan of Rs.2,40,00,000/- taken by the assessee. We find that the Assessing Officer has considered the entries at the left hand side of the paper which is totaled to Rs.2,40,000/-. On this loose paper, only one name Paliwal is written and there are dates and amounts without any narration. The total of amounts is Rs.2,40,000/-. It is the inference of the Assessing Officer that the assessee is making the entries ignoring 00 / 000 (2/3 zeros). It seems that in Rs.2,40,000/-, he increased 00 (2 zeros) and made it Rs.2,40,00,000/-. As per the Assessing Officer, the entr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d then made the addition and levied the penalty on the basis of his presumptions. We find that similar situation was dealt with by the ITAT while considering the Revenue s appeal for penalty for AY 2001- 02, 2002-03 2003-04 and the ITAT has held that the document does not indicate that the assessee has accepted loan or deposit from any other person. The name of the assessee is completely absent from the said document. Identical is the situation in the years under appeal before us. None of the documents indicate that the assessee i.e. M/s Home Developers (P) Ltd. has taken any loan or deposit from any other person. The above finding of the ITAT has been upheld by the Hon ble Jurisdictional High Court. The Hon ble Jurisdictional High Court held that though there is a doubt but it is not established that the respondent assessee had taken loan/deposit in cash. Their Lordships further observed that there is suspicion but this alone without any further verification and investigation cannot justify the finding that the respondent-assessee had taken loan/deposit in cash. With these observations, their Lordships upheld the finding of the ITAT. In our opinion, the above observation of thei ..... X X X X Extracts X X X X X X X X Extracts X X X X
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