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TMI Blog2013 (7) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... axminarayan Soni. Thereupon in consequence of the search action a statement on oath of the assessee was recorded on 19.1.2000. The AO has noted that in reply to a question no.10, the assessee had admitted "undisclosed income" of Rs.24,00,000/-. The said amount was alleged to have been received against the transfer of the land by the assessee to the said developer for the purpose of Dumbhal project. Since during the course of search at the developers premises, it was noted that certain payment was made to the assessee, therefore, a notice under Section 158BC was issued to the assessee on 1.3.2000. In response to the notice, the assessee had filed the return of undisclosed income at Rs.Nil/-. It has also been noted that a retraction has been made by the assessee on 19th of January, 2000. Facts of the case as recorded by the AO have revealed that in the said statement the assessee had admitted that total land was agreed to be sold for a consideration of Rs.1,13,00,000/- to the said developer M/s. Vrindavan Developers. It has also been noted that up till the date of search the possession of only 1/3 portion of the land was handed over to the said developer. On the basis of the admissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by DDIT, wherein the assessee had offered Rs.24,00,000/- but that statement was not conclusive being devoid of any corroborative evidence. Rather learned CIT(A) has narrated few case laws as listed below: "(i) Pullangod Rubber Produce Co. Ltd vs. State of Kerala & Anr (91 ITR 18). (ii) Kailashben Manharlal Choksi 174 Taxman 44 (Guj.) (iii) Assistant Commissioner of Income-tax Vs. Sushiladevi Agarwal, 49 TTJ 663(Ahd). (iv) Commissioner of Income-Tax Vs. Bhuvanendran and others 303 ITR 235 (Ahd). 3.1 Learned CIT(A) was of the view that once the impugned amount was deposited in the bank and that amount was actually accounted in the personal books of accounts, therefore, out of the clutches of the block assessment. He has also opined that those personal books of accounts were not found to be bogus by the AO. It was noted by learned CIT(A) that in the return filed by the assessee, in the regular course, the said amount was disclosed and capital gain of land has also been offered. He has held that AO had erred in treating the said amount as "undisclosed income" for the block period. Resultantly, the addition was deleted. 4. From the side of the Revenue, Shri T. Sankar, learned Sr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipts had already been accounted for in the books before the date of search even though the fixed deposits may have been purchased at a later date" No supporting evidence or material has been given by CIT(A) to show how he drew the above conclusion. Why will a prudent person keep cash idle for 7 months? Why was the cash deposited in bank just one day prior to recording to statement? The assessee had also confirmed in the statement on 19/01/2000 that the receipts were unaccounted. CIT(A) has not examined any contemporaneous evidence as to whether assessee had paid advance tax instalment on such receipts in September 1999 and December 1999. The details of advance taxes paid (page 24, 26 of PB) reveal the following: Date of advance tax Amount Rs. 09-09-1999 6,000 10-12-1999 5,000 15-03-2000 4,80,000 31-03-2000 1,29,792 The above table clearly brings out the factual aspect that the cash receipts were not recorded in the books as on the date of search, as otherwise the assessee would have paid advance taxes thereon. However, it is not the case and advance taxes have been paid only in March 2000, clearly showing the after-thought action of the assessee. If the funds were act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ITAT in the case of PA Chandran vs ACIT, 69 TTJ 556, has been over-ruled in subsequent decision of ITAT in the case of Krishnagopal Nagpal vs DCIT, 82 TTJ 481 (Pune) after considering the aforesaid decision. In short, CIT(A) has completely overlooked the fact that the cash receipts were not recorded by the assessee on the date of search, and the onus was on assessee to prove that they had been recorded and accounted for." 4.1 Before we proceed further, at this stage juncture, it is worth to mention the efforts taken by learned Sr. D.R. in placing before us all the facts in details, thus efficiently assisted the Court. 5. From the side of the respondent assessee, Sri Mehul Shah, learned A.R. appeared. He has pleaded that there was no afterthought. In fact the assessee has always intended to disclose the impugned amount, therefore, in good faith it was deposited in the bank. The statement which was recorded was made under confusion. The assessee wanted to explain that the said amount was not recorded in his proprietorship business accounts but it was recorded in the personal books. That statement was later on retracted. The assessee was never raided by the Revenue Department. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For ready reference, relevant section is reproduced below:- "Where the assessee proves to the satisfaction of the Assessing Officer that any part of income referred to in sub-section (1) relates to an assessment year for which the previous year has not ended or the date of filing the return of income and such income or the transactions relating to such income are recorded on or before the date of the search or requisition in the books of account or other documents maintained in the normal course relating to such previous years, the said income shall not be included in the block period." 6.1 As far as this provision is concerned, there is no ambiguity. If the assessee proves that the alleged income is duly recorded on or before the date of search in the normal course in the books of account in respect of an assessment year for which the previous year has not ended then such income is not required to be included in the block period. According to us, sub section (3) of Section 158BA is based upon the principle of equity and common sense. Naturally, if an income has already been disclosed in the books of account then such an income should not be treated as undisclosed income as if u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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