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TMI Blog2015 (6) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 11,71,687/- was on estimation basis and not on the basis of any concrete evidence found in the course of search towards incurrence of unaccounted expenditure qua the impugned property. Therefore, having regard to the facts and circumstances of the present case, we affirm the action of the CIT(A) in deleting the penalty with respect to the addition of ₹ 11,71,687/- on account of unexplained investment in house property. On account of unexplained marriage expenditure CIT(A) has thoroughly examined it and his inference that addition is based on estimate basis is a reasoned one. Before us, no cogent material or reasoning has been advanced by the Ld. Departmental Representative to say that any document or evidence was found in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truction, purchase and sale of plots and is a partner in partnership firms. A search action u/s 132(1) of the Act was conducted in the case of the assessee on 02.02.2000, as a consequence of which the Assessing Officer finalized a block assessment u/s 158BC r.w.s. 143(3) of the Act dated 27.02.2002 for the block period comprising of assessment years 1990-91 to 2000-01 (upto 02.02.2000 03.02.2000 to 31.03.2000) whereby the total undisclosed income was assessed at ₹ 1,62,93,506/-. The aforesaid assessment was subject-matter of appeal before the CIT(A) as well as before the Tribunal. As a result of the order of the Tribunal dated 28.02.2011 certain additions were sustained. The Assessing Officer thereafter has passed an order u/s 158BF ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alty for the reasons stated in the impugned order. As per the Ld. Representative, the addition with respect to the unexplained investment in house property was primarily based on estimation and that there was no clinching evidence found in the course of search which showed any unexplained investment. Even with regard to the unexplained expenditure incurred on the marriage of assessee s daughters, it was pointed out that the addition was made on the basis of estimate only. The Ld. Representative submitted that levy of penalty u/s 158BFA(2) of the Act is directory and not mandatory as held by the Hon ble Bombay High Court in the case of CIT vs. Dodsal Ltd., (2008) 218 CTR 430 (Bom). In the present case, the CIT(A) has appropriately found it f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retion of deleting the penalty, having regard to the facts and circumstances of the case. 7. In the above context, we have perused the orders of the authorities below in the penalty proceedings as well as in the quantum assessment proceedings. With respect to the addition on account of unexplained investment in house property of ₹ 11,71,687/-, the relevant facts are that in the books of account assessee had shown investment of ₹ 18,29,313/- prior to the search action. The Assessing Officer estimated the investment in the house property known as Chandravel Bungalow at ₹ 40 lakhs. The assessee relied upon the report of an Approved Valuer who valued the investment in property at ₹ 17,01,401/- and accordingly assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the course of search could not be reconciled and the addition has been sustained. However, it was pointed out that the loose papers did not clinchingly suggest that the expenditure was relatable to the construction in the impugned property and that the valuation made by the DVO at ₹ 19.64 lakhs also justifies the investment shown in the account books, which is almost near about the value of investment estimated by the DVO. The Ld. Representative pointed out that if the expenditure referred to in the loose papers of ₹ 9.99 lakhs pertained to the construction of the impugned property then the report of the DVO would have been much higher than ₹ 19.64 lakhs. It was pointed out that assessee could not co-relate the loose pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se property of ₹ 11,71,687/- was on estimation basis and not on the basis of any concrete evidence found in the course of search towards incurrence of unaccounted expenditure qua the impugned property. Therefore, having regard to the facts and circumstances of the present case, we affirm the action of the CIT(A) in deleting the penalty with respect to the addition of ₹ 11,71,687/- on account of unexplained investment in house property. 10. With respect to the addition on account of unexplained marriage expenditure of ₹ 1,96,335/-, in this regard the relevant facts are as follows. The quantum assessment proceedings revealed that in the course of search certain loose papers were found which indicated marriage expenses and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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