9911796707
TMI Blog2013 (5) TMI 745X X X X Extracts X X X X X X X X Extracts X X X X ..... essment proceedings, the addition on account of low household withdrawals was made to the extent of Rs. 3.60 lakhs on substantive basis. This addition was deleted by the Commissioner (Appeals) vide order dated 14th March 2006, on merits. The Assessing Officer during the course of regular assessment proceedings for assessment year 1998-99, has also made similar addition on protective basis of the same amount. The Assessing Officer, while making the addition has noted the following facts:- "During the course of survey u/s 133A which was conducted alongwith the search dated 21.1.99, the premises of M/s. Sunil Chemical Industries with which assessee is closely associated, was also covered. "A 125th Birth Anniversary Gandhi Diary 1994" was found and inventorised under serial no.17, Page 18 of this diary shows monthly cash withdrawal from various concerns of the assessee. The said page shows two kinds of withdrawal c.n 15.10.95, one at the top of the page and other at the lower half of the paco Vide Notice uls. 142(1) dated 23.2.2001, the assessee was asked to P nmish detail comment on the various books/diaries/loose paper folder identified and inventorised during the survey. But, this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clusion that these amounts as mentioned in the diary was withdrawn by the assessee. Lastly, it was pointed out by the assessee that his family members had made sufficient withdrawal which aggregated Rs. 3,90,425 for the family consisting of father, mother, wife and self. In addition to that, it was also pointed out that similar question had arisen in case of his father Mr. Manoj M. Thakkar, also in the assessment year 1997-98, wherein the Tribunal has deleted the similar addition. The break-up of the details of withdrawals were also furnished. 4. The Commissioner (Appeals), after appreciating the aforesaid facts and also in view of the fact that similar addition was deleted by the Commissioner (Appeals) in the block assessment order on merits deleted the addition. The relevant findings of the Commissioner (Appeals) given in the block assessment order have been reproduced by him in the impugned order. Thus, he held that once the substantive addition has been deleted on merits, the protective addition cannot be sustained. 5. Before us, the learned Departmental Representative, relying upon the findings of the Assessing Officer submitted that during the course of survey, it was found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by the member of the family were inadequate to run the household. It has been held in the cases of Shri Rajesh Kumar Jain (5O/lTD/l/Allahabad, Shri David Dhawan (77/ITD/1/Mumbai), Shri Sunhl Khanna (7733/B0M/90/C- Bench Mumbai) and Shri Padma J Parekh (2563/Murn/97 D-Bench, Mumbai) that AO should mention the positive material or documents while framing the block period assessment to prove that the assessee had actually spent more amount than he had shown in the books of accounts for household expenditure. From the above mentioned cases, it transpires that in absence of the material that show assessee's undisclosed in vestments or unexplained expenditure, it cannot be held that the assessee had earned undisclosed income or incurred undisclosed expenditure. The CIT(A) has not mentioned the total withdrawal made by the members of the family, whereas the assessee had strongly emphasized the point. Had the AO done this exercise, he himself would have reached to the conclusion that household expenditure incurred by the members of the family was sufficient. The Hon'ble Tribunal has vide its order dated 19.3.2002 (para 7) also deleted the addition made by the A0 on account of lower house ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the assessee had more than ten vehicles and also the assessee has been maintaining regular books of account which were audited under section 44AB. Thus, the addition was deleted. 13. Before us, the learned Departmental Representative relied upon the order passed by the Assessing Officer and the learned Counsel supported the order passed by the Commissioner (Appeals). 14. After carefully considering the rival contentions and also the findings of the Commissioner (Appeals) as well as the Assessing Officer, it is noted that the assessee was having eleven tankers which is not in dispute. Provisions of section 44AE, will only apply to the assessee who owns not more than ten goods carriages. Thus, in case of the assessee who is in possession of more than ten goods carriages, then by virtue of the provisions of sub-section (1) of section 44AE the deeming provision of section 44AE will not apply to the facts of the present case. Moreover, it has also not been disputed that the assessee has been maintaining regular books of account for the business of hire of eleven tankers which are also subjected to audit under section 44AB. On this ground also, the provisions of section 44AE will n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment year 2002-03, the matter had come up for consideration before the Tribunal wherein similar addition has also been deleted vide order dated 31st October 2008, passed in ITA no.3400/Mum./2007. The Commissioner (Appeals), following the decision of the Tribunal in assessee's own case, deleted the addition after observing and holding as under:- "6.3 I have examined the facts in this case. In A.Y. 2002-03, a similar issue arose in assessee's own case before the Tribunal. The Tribunal, vide its order dated 31st October 2008, being ITA no.3400/Mum./2007, has held that in A.Y. 1999-2000, the assessee status was that of r & NOR. In this regard, the Tribunal relied upon the order of the CIT(A), for the block assessment period. In the circumstances, the assessee's correct residential status would be that of R & NOR and in the circumstances, the interest income received would be exempt under section 10(15) of the Act. This ground of appeal is, therefore, allowed." 18. Both the parties agree before us that the issue for our adjudication is covered in favour of the assessee in assessee's own case in ITA no.3400/Mum./2007, order dated 31st October 2008, in assessment year 2002-03. 19. Aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the opinion that assessee was non-resident for the A.Y. 1992-93 and 1993-94. As he was Non-Resident for the said period and resident but Not Ordinarily Resident for succeeding eight years remittance sent by him from Dubai are held to be exempt from tax." 10. Since the above factual positions were not controverted and as the assessment year involved is 2002-03, i.e. before the amendment to section 6(6) w.e.f. 01.04.2004 the legal position as propounded by the Hon'ble Supreme Court has to be considered and the assessee is to be treated as Resident but not Ordinary Resident. Section 6(6) has been substituted by Finance Act, 2003 w.e.f. 1 July 2004. The substituted sub-section 6 of section 6 is prospective and hence cannot have retrospective implication in the present assessment year, i.e. assessment year 2002-03 as held by the Hon'ble Lucknow Bench in the case or 108 ITD 8. Consequently, the assessee being Not Resident in India in 9 out of 10 previous years preceding relevant previous year he has to be considered as Resident and Not Ordinary Resident in India though he satisfy the first condition of section 6(6)(a) even though it do not satisfy the second condition of not being in In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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