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TMI Blog2015 (12) TMI 902X X X X Extracts X X X X X X X X Extracts X X X X ..... al gains. There is nothing to suggest that the amount is on capital account, or in lieu of a capital asset. Why, any unexplained deposit or money, etc., is, by virtue of the provisions of the Act, and for the same reason, also deemed as income. That is, the onus to establish the nature (as well as the source) of the money, i.e., as being not in the nature of income, is on the assessee, and which he has clearly not.There is, under the circumstances, no case for or no basis to consider the impugned sum as not received (during the relevant year) and, two, of it being not in the nature of income. The assessment of the amount, sought to be paid to the assessee initially vide Pay Order (No. 004 06298 027 43 2895), as income, is, accordingly upheld. We decide accordingly, and the assessee gets part relief. Addition on account of life style other expenditure - Held that:- Though the assessee subsequently, vide his statement u/s.131 dated 01.5.2007, does state that the said estimate by him was only for the current year f.y. 2006-07, and that the household expenditure earlier was much lower at ₹ 20,000/- p.m., there is nothing to indicate that his lifestyle of few years earlier was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han, VP And Sanjay Arora, AM For the Appellant : None For the Respondents : Shri Girish Dave Ms Kadambari Dave ORDER Per Sanjay Arora, AM Vide this Appeal the Assessee agitates the Order by the Commissioner of Income Tax (Appeal) Central-I, Mumbai ('CIT(A)' for short) dated 17.11.2008, dismissing the Assessee's appeal contesting its assessment u/s.143(3) r/w s. 147 of the Income Tax Act, 1961 ('the Act' hereinafter) for the assessment year (A.Y.) 2000-01 dated 19.3.2008. 2. None appeared for and on behalf of the assessee when the appeal was called out for hearing, even as the assessee has caused to place on record a General Power of Attorney dated 02.2.2010, duly accepted, in favour of one Shri Sunil Shinde, CA on record (zerox copy), authorizing him to represent the assessee before the Tribunal in, among others, Income-tax matters. Despite several attempts, no service of the notice of hearing could be affected on the assessee. The last such attempt, vide notice dated 10.4.2015 for 09.6.2015, sent through RPAD, came back unserved with the postal remarks 'Not claimed, return to the sender' on 15.4.2015. The hearing of this group ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 007-08), object, stating that the same cannot be admitted in-as-much as the document is not notarized or apostiled. Both India and Switzerland are signatories to the Hague Convention. Banking industry in Switzerland, it needs to be appreciated, encourages opening of bank accounts, and information in their respect is protected by privacy laws of that country. In our view, in-as-much as the document under reference clearly relates to an addition for the current year, which stands disputed by the assessee per the instant appeal, it would firstly be of little consequence that the assessee's application is for A.Ys. 2001-02 to 2007-08, i.e., the years to which the evidence in the main relates, and not the current year. Before we may discuss the merits of the objections raised by the ld. Departmental Representative (DR), we observe that the letter under reference is unsigned. Its contents, therefore, carry little weight, i.e., as evidence. The same accordingly cannot be admitted in evidence. 3. The assessment in this case was made u/s. 143(3) r/w s. 147 of the Act, with the proceedings initiated on the basis of information found by the Revenue during searches u/s.132 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 India Fresh Pay Orders are in the process of being issued along with the amended name of Robert Mclean Companies Limited to Robert Mclean and Companies Limited. I shall courier these pay orders to you at the earliest. And shall be informing the courier details to you telephonically. VERY IMPORTANT The validity for encashment of pay orders carry a thirty calendar days. Please ensure that the fresh pay orders are encashed within the stipulated period in order to avoid the repetition of this exercise. I sincerely regret the inconvenience caused. Thanking you, Yours truly, Sd/- Dr. P. Wiely Chief Manager UBS AG' The assessee, on being questioned in the matter, denied any knowledge of the said document. No revised pay orders have been received, i.e., after 12.04.1999, or at any time later, and toward which he furnished (uncertified) copy of his bank account with Bombay Mercantile Bank at Hyderabad, which was stated to be the only bank account maintained by him. An Affidavit was also furnished averring to have no foreign bank accounts. Summons u/s. 131 of the Act were issued to the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppears to be an Indian company and is only to be regarded as a distinct legal entity. And income due to or receivable by it could be regarded as the assessee's income only on the strength of evidence which leads to the inference of it being the assessee's money, being transferred to it, or the like. There is, in fact, no mention or even a whisper in this regard, or of any association or link between the two. Clearly, no case for including the amount received or receivable by the said company (US $ 2 million) in the assessee's hands is made out. Coming, next, to the amount paid to the assessee. Again, in view of the clear prescription of section 292C, it is the assessee who is to disprove the said document as not representing the truth. Merely denying the knowledge of the said transaction/s or stating of not having any foreign bank account, etc. would be of little assistance to the assessee. Monies are payable in India, so that the non maintenance of any bank account abroad would even otherwise be of little consequence. In fact, as clarified by the A.O., the seized material itself reveals several accounts with UBS AG, Zurich (refer para 7.7 of the assessment order). T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sued in the first place, was made payable, also indicating its receipt. The non-receipt of money in India, not proved conclusively, would thus not be of much help to the assessee. Continuing further, how, one wonders, the non-receipt of the sum extinguishes the assessee's right thereto. To, again, no answer by the assessee. The assessee has in fact not divulged either its banking relationship with UBS AG, or even the activity/s resulting in or leading to the impugned amount being due to him, and which prompted us to suggest that the monies may have been diverted to a different destination. There is, in any case, nothing on record to rebut the statutory presumption of section 292C, so that it cannot be said that the earlier pay order/s was not followed, as the letter states, by fresh pay order/s. The existence of cross border transactions, or foreign bank accounts, as the seized material bears out, only strengths this presumption. Income, it is well-settled, could be brought to tax either on accrual or receipt basis. In the present case, the underlying transactions having not been divulged, much less explained, it is difficult to issue any definite finding with regard to accr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 9/DPB pg. 28): Credit Amount Debit Amount i) To balance carry forward Rs.17,29,032 Ornament Rs.1,29,032 ii) Watches Rs.11,00,000 iii) Cash on hand Rs.5,00,000 Rs.17,29,032 Rs.17,29,032 The same did not find favour with the Revenue authorities. The assessee had admittedly not filed any returns since A.Y. 2000-01, i.e., prior to the initiation of the assessment proceedings for these years. The returns for A.Ys. 1990-91 to 1999-2000 (filed at Hyderabad) were for meager sums, ranging from ₹ 41,000/- to ₹ 65,000/-. Further, the same were not accompanied by any balance-sheet, capital account, etc. No books of account were produced for the current year. The assessee's claim for opening capital was under the circumstances found not acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim of having produced computerized books of account before the A.O., so that the latter's stating of him as not maintaining any books of account is incorrect, is neither here nor there. The 'opening capital' has nothing to do with the books of account for the current year. Rather, the books of account could only be of a business, while the bulk of the 'opening capital' is claimed to be in the form of assets carried over from generations, as part of the family heirloom. The books of account for the earlier years have admittedly been not produced. How and why have the same, having been acquired without incurring any cost, been valued? The income as returned for the nine years preceding the current year is meager, being not sufficient for the family even to meet two ends. Then, again, is the question of valuation. The claim of the opening capital, to the extent it relates to cash-in-hand of ₹ 5 lacs, is thus, again, without any explanation, none being even otherwise furnished. The addition is, accordingly, confirmed. We decide accordingly. Ground 3: Addition on account of life style other expenditure ₹ 28.50 lacs 9. We may next consider the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d which the Revenue therefore considers as corroborative of the assessee's own estimation of his annual income of ₹ 30 lacs, is comprised of such assets, i.e., as found with him or his near relatives, stated to be gifted thereto by him. The assessee's stating of his admission being confined only to A.Y. 2007-08, i.e., the year during the previous year relevant to which the statement u/s.132(4) was made, is thus without any merit in the given facts and circumstances of the case. At the same time, the Revenue, having already made separate additions qua the assets found, is not justified in adding, once again, based on the assessee's statement of his annual earnings. Rather, if the assessee's disclosed income agrees, on an average, with his admitted income, no case for any further addition to the income would be made out, apart from the redistribution of the said income across different years! The income in respect of an asset could only be where the assessee is found to be in its' possession physical or constructive, or otherwise found to be its owner, i.e., based on definite evidences and materials. The same, where contested, would require being decided o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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