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TMI Blog2015 (11) TMI 798X X X X Extracts X X X X X X X X Extracts X X X X ..... above said amount in his books of account. Accordingly, we set aside the orders of Ld CIT(A) in respect of the above said issues in all the years cited above and direct the AO to delete the disallowances, referred above. Hence the net result would be that there is no necessity to make any addition u/s 69C of the Act. Even otherwise, we notice that the assessing officer has made the additions u/s 69C of the Act without examining the claim of availability of sources out of drawings made by the assessee and his wife. Accordingly, we set aside the order of Ld CIT(A) on this issue in all the assessment years referred above and direct the AO to delete the impugned additions - Decided in favour of assessee. Suppression of professional fee receipts - Held that:- CIT(A) has rightly concluded that the assessing officer did not bring any material on record to support his case of estimation of professional receipts of earlier years. We also notice that the assessing offer has assessed the net profit on the alleged suppressed professional receipts, meaning thereby, the assessing officer has presumed that the assessee would have suppressed corresponding expenses also. Again it is only a guess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Das ORDER Per Bench: All these appeals and cross-appeals filed by the assessee and Revenue for the assessment years mentioned in the cause title are directed against the orders passed by Ld CIT(A)-40, Mumbai in quantum proceedings as well as in penalty proceedings. 2. The assessee has filed appeals numbered as ITA 711 to 715 against the orders passed by Ld CIT(A) in the quantum proceedings for the assessment years 2004-05 to 2008-09. The revenue has filed appeals numbered as ITA 857 to 862 for assessment years 2002-03to 2007-08 against the orders passed by Ld CIT(A) in the quantum proceedings. The remaining appeals have been filed by the assessee against the orders passed by Ld CIT(A) against the penalty orders passed by the AO u/s 271(1)(c) for assessment years 2005-06 to 2008-09 and u/s 271AAA for the assessment year 2008-09. Since all these appeals arise out of common set of facts, they were heard together and are being disposed of by this common order, for the sake of convenience. 3. The facts relating to the case are set out in brief. The assessee is a dentist and carries on his profession from different places and also through different hospital names. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The disallowances made by the AO was also confirmed by Ld CIT(A). The Ld A.R submitted that the car expenses disallowed by the assessing officer include proportionate amount of depreciation and interest on car loan. The L.R submitted that both the items are statutory deductions prescribed under the Act and hence the disallowance of the same was not justified. In this regard, he placed reliance on the decision rendered by the co-ordinate bench of Mumbai Tribunal in the case of Mukesh K Shah (2005)(92 ITD 349). The Ld A.R further submitted that the assessee has offered additional income of about ₹ 20.00 lakhs in order to cover up any other deficiencies. He submitted that the assessee has not capitalized the above said disclosure in his books of account. Accordingly he submitted that all the disallowances are to be telescoped against the additional disclosures. 8. The Ld A.R further submitted that the assessments of the assessment years up to AY 2006-07 were not pending as on the date of initiation of search and hence the AO was not justified in making the additions in those years without there being any incriminating materials. In this regard, he placed reliance on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ii)Mobile iii)TV iv)Jewellery Rs.35,000 Rs.16,000 Rs.71,000 Rs.26,380 Rs.1,48,380 2008-09 i)Talwalkar ii)Jewellery Rs.25,000 Rs.1,69,187 Rs.1,94,187 Total Rs.4,49,444 (Addition made is ₹ 22,808/-) 12. We heard the parties on this issue and perused the record. The main contention of the Ld A.R is that the assessee and his wife have drawn sufficient money for personal purposes and they are sufficient to cover up the expenses cited above. Alternatively, the Ld A.R also submitted that the additional disclosure of ₹ 20.00 lakhs is sufficient to cover these expenses. On the contrary, the Ld D.R placed strong reliance on the orders passed by Ld CIT(A). 13. We have already noticed that the assessee has offered additional income of about ₹ 20.00 lakhs over and above the excess cash balance found during the course of search. It is also an admitted fact that the revenue did not seize any other incriminating material which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -05, 2003-04 and 2002-03. Accordingly the assessing officer worked out the gross receipts. Then the AO worked out the difference between the gross receipts declared by the assessee and that was worked out by him. Thereafter he applied the net profit rate declared by the assessee on the difference and accordingly worked out the additions. The said workings are tabulated below by the AO as under:- S.No. A.Y./Receipt per day Gross receipts as per estimation Gross receipts as per return Difference Net profit% as per IT return Proposed additions on difference per net profit % 1 2007-08 ₹ 1,00,000 per day 300.00 165.41 134.59 29.00% 39.03 2 2006-07 ₹ 90,000 per day 270.00 167.71 102.29 34.17% 34.95 3 2005-06 ₹ 80,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. The finding is about certain expenses which were recorded on the loose papers and were not found to be recorded in the books of accounts. 6.5.5 On the basis of the facts narrated above, it is apparent that the ld. AO does not have, in his possession, any material evidence to suggest that cash income of similar nature was earned during the years prior to the year of search, and in any given proportion. Under the circumstances, the presumption has always to be made that the unaccounted income relates to the assessment year pertaining to the date of search. The appellant s explanation has to be believed unless a finding to the contrary can be deducted from the seized material or pursuant enquiries. 6.5.6 Under the circumstances, it is held that in view of the fact of the cash seizure of ₹ 1,13,57,110/-, the appellant s offer of additional income in different AYs under, has to be believed, unless material to suggest the contrary exists. A.Y Additional income offered 2008-09 Rs.1,05,00,000 2007-08 Rs.10,00,000 2006-07 5,00,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon ble Punjab Haryana High Court has considered a case, wherein materials were found during the course of search. However, in the instant case, no material relating to suppression of professional fee receipts was found. Accordingly, we are of the view that the ld CIT(A) was justified in deleting the additions in all the years. 17. Now we shall stake up the penalty appeals filed by the assessee for assessment years 2005-06 to 2008-09 against the penalty levied u/s 271(1)(c) of the Act. The assessing officer levied penalty u/s 271(1)(c) of the Act on the following items:- (a) Additions made u/s 69C of the Act in AY 2005-06 to 2008-09. (b) Additional income disclosed by the assessee in AY 2005-06 to 2007-08. In the preceding paragraphs, we have deleted the additions made u/s 69C of the Act and hence the penalty levied on those additions is liable to be deleted, since the said additions themselves does not survive. 18. With regard to the penalty levied on the additional income surrendered by the assessee, the Ld A.R submitted that the assessee has offered excess amount of about ₹ 20.00 lakhs voluntarily and the revenue did not seize any material to support the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... analyze the facts behind the additional disclosure of about ₹ 20.00 lakhs made by the assessee, we notice that he has voluntarily offered the same and no material was seized during the course of search warranting the additional disclosure. The assessee has duly disclosed the income voluntarily offered by him in the returns of income filed in response to the notices issued u/s 153A of the Act. During the course of penalty proceedings also, the assessee has offered the explanation to that effect and the said explanation was not found to be false. During the course of search proceedings, the revenue has noticed/seized all the materials available with the assessee and no incriminating material supporting the additional disclosure was found. Under these set of facts, we are of the view the tax authorities are not justified in presuming that the additional disclosure voluntarily made by the assessee shall constitute concealed income warranting penalty u/s 271(1)(c) of the Act. 22. In view of the foregoing discussions, we set aside the order of Ld CIT(A) in all the impugned years and direct the assessing officer to delete the penalty levied u/s 271(1)(c) of the Act in all the ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er:- Undisputedly the assessees have shown the undisclosed income under the head income from business in the returns filed by them and that was accepted by the Department by passing the assessment orders accordingly. Therefore, the cases of the assessees fall exactly within the purview of sub-s (2) of s. 271AAA. Therefore the provisions contained in sub.s (1) of s. 271AAA are not applicable 26. On the contrary, the Ld D.R contended that the assessee did not specify the manner in which the undisclosed income was derived. 27. We have heard rival contentions on this issue. There is no dispute with regard to the fact that the assessee has disclosed the undisclosed income as his professional income and the same has been accepted by the assessing officer. In fact, the assessing officer has proceeded to estimate the professional income of the preceding years on the basis of the above said disclosure. Hence, we are of the view that the decision rendered by the Cuttack bench in the above said case squarely applies to the facts prevailing in the instant case. We also notice that the Nagpur bench of Tribunal has also taken identical view in the case of Concrete Developers V/s AC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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