9911796707
TMI Blog2017 (12) TMI 1334X X X X Extracts X X X X X X X X Extracts X X X X ..... in which, undoubtedly, the assessee was Director; but the documents cannot be passed on and the entries in the said documents be the basis for making addition in the hands of assessee from whose possession, no such document was found. Accordingly, we hold so. The learned Authorized Representative for the assessee had repeatedly stated that he was looking after Raviwar Peth branch and he was the Director of said branch and not of Yerwada branch, cannot be accepted as basis for deleting addition in the hands of assessee, since the assessee is Director of Co-operative Bank. However, in the absence of any physical FDRs being found from the possession of assessee or even from the bank which indicates that the same relate to the assessee, there is no merit in making the aforesaid addition in the hands of assessee and the same is directed to be deleted. Even in respect of the notings in FDR register, the statement recorded has not been provided to assessee nor cross-examination allowed. The Assessing Officer shall accordingly delete the addition. - ITA No.1615/PUN/2013 - - - Dated:- 11-12-2017 - MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM For The Appellant : Shri Nilesh Kh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or block period 1997-98 to 2003-04 (part) was set aside by the Tribunal vide its order dated 28.02.2011. The issues which were set aside by the Tribunal were against addition of ₹ 2 lakhs on account of FDRs discovered during search action from the premises of M/s. Agrasen Urban Co-op. Bank Ltd. and relatable interest of ₹ 29,760/- on the said FDRs. Another addition of ₹ 17,40,197/- was made on account of investment in FDRs which were found in fictitious names and were alleged to be owned by the assessee. The Assessing Officer had made the said additions on the basis of facts and evidences recorded during search operation and the said additions were confirmed by the CIT(A). However, the Tribunal held that since the documents, based on which addition was made in the hands of assessee were different from the possession of bank run by the Director i.e. assessee, the responsibility lies on the assessee or the bank to demonstrate that the ownership of impugned FDRs was not with them. The onus was on the bank or the assessee to demonstrate towards actual owners of FDRs. The assessee thus, was directed to furnish the requisite facts relating to ownership of FDRs before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant period, whereas FDRs in question were found in Yerwada Branch. The CIT(A) held that the FDRs were not found in the possession of assessee, was not relevant where the assessee was responsible Director of the bank and impugned FDRs i.e. bundle of 14 FDRs amounting to ₹ 2 lakhs were found at the main Branch of Agrasen Urban Co-op. Bank Ltd. at Yerwada. The assessee s name was mentioned in a slip attached to the bundle of 14 FDRs. The statement of Manager of the branch clearly indicated the assessee was owner of the FDRs. Thus, FDR of ₹ 2 lakhs is to be added in the hands of assessee along with interest. The CIT(A) also considered that though the assessee denied having FDRs in fictitious names in the statement recorded under section 132(4) of the Act on 05.09.2002 i.e. during the course of search on his premises but he subsequently accepted the ownership of FDRs vide letter dated 30.10.2002. In the subsequent statement recorded under section 131(1) of the Act on 02.01.2003, the assessee retracted from the admission of undisclosed income. The plea of assessee was that earlier offer was made under confusion and without understanding legal implications. Hence, it was retr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carried out by the Investigation Team. He further stated that there was an allegation of investment in FDRs by the Directors of the said bank. However, the finding was that several persons were investing in FDRs and loans were taken against such FDRs. The names did not tally between the persons investing and the loans taken. He further pointed out that the bank had two branches i.e. one at Yerwada and second one at Raviwar Peth and both the banks have different Directors. Referring to the two sets of FDRs found during the search, he pointed out that first FD was of ₹ 2 lakhs along with interest and the second was of ₹ 17,40,197/-. The learned Authorized Representative for the assessee here stressed that FDRs found from the premises of person searched belonged to Yerwada branch and the assessee was not the Director in the said branch and he was the Director in Raviwar Peth. Our attention was drawn to cross- examination of the party at pages 67 to 69 of the Paper Book. Our attention was further drawn to communication placed at pages 70 and 71 of the Paper Book. Our attention was drawn to page 119 of the Paper Book, wherein protective additions were made in the hands of A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts of the case, block assessment order has been passed by the Assessing Officer under section 158BC of the Act for the block period 1997-98 to 2003-04 (part upto 05.09.2002). The original assessment was completed by the Assessing Officer vide order dated 29.11.2004. Survey action under section 133A of the Act was conducted on the premises of Agrasen Urban Co-operative Bank Ltd., Yerwada branch on 13.08.2002 to verify the information of FDRs being made in fictitious names. Certain FDRs were seized during survey action. Consequent thereto, search action under section 132(1) of the Act was conducted on the residential and business premises of the persons to whom the said FDRs were linked i.e. Shri Nandlal Jethani, Shri L.K. Agarwal and others. Further, enquiries conducted by Investigation Wing, Pune revealed that the Co-operative Bank in its Yerwada branch and Market Yard branch used to keep deposits from the Directors as well as depositors from their unaccounted income, which in turn, was deposited in various fictitious names, in connivance with the bank employees to increase the bank deposit limits. It was found by the Investigation Wing that Shri Vinod Kumar Bansar i.e. assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereafter on maturity, the same were encashed and were deposited in Personal Deposit (PD) account on the request of assessee. In view thereof, we find no merit in the plea of assessee in this regard and uphold the addition of ₹ 2 lakhs being the amount of FDRs held in different names and the addition of interest thereon of ₹ 29,760/-. 14. Now, coming to the second issue i.e. addition made on account of FDRs in fictitious names in the bank register which was earmarked allegedly in the name of assessee. During the course of search and even during the course of survey on the premises of Agrasen Urban Co-operative Bank Ltd. and even in the residential and business premises of the assessee no FDRs were found. However, FDRs register was maintained by the Co-operative Bank and from the same, certain details were unearthed on the premise that the said FDRs were earmarked for Shri Vinod Kumar Bansal. The case of Revenue was that in the FDRs register maintained in the bank in respect of some FDRs, made by various persons when confronted with the real owners, they voluntarily admitted the income and paid the taxes thereon. The statements of number of persons in this regard wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscussed in the original assessment order, we find that it is a case of block assessment under section 158BC of the Act, under which assessment can be made on the basis of evidence found during the course of search, which in turn, belongs to the assessee. In the first instance, no physical FDR has been found, the addition is based on narrations in the FDRs register, which was found from the premises of Co-operative Bank. In view of the law being developed after the order of Tribunal, we hold that onus was upon the bank to explain the source of FDRs found from its possession. The said FDRs were not in the name of assessee but were entered in the names of different persons. During the course of survey and/or search, none of FDRs were found from the possession of assessee or the Co-operative Bank and in the absence of the same, the question which arises is whether the entries found in the documents can result in making the addition in the hands of assessee. The Assessing Officer has relied on the statements of bank employees who have alleged that in the bank FDRs register, the names of persons to whom the same belongs to were mentioned i.e. assessee before us. However, the said statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 26.11.2007 denied the information, against which the assessee filed an appeal. The Appellate Authority vis- -vis statement recorded observed that the statement of Shri Ramesh Kole, branch manager of the Co-operative Bank had not been received by him and he was not sure that the statement existed or not. The said stand was taken by the ITO, Ward-1, Pune and the Addl.CIT, Pune. With regard to other statements, it was held that they were exempt under section 8 of the RTI Act. In view of the above said facts and circumstances, where even the basic statement which had been relied upon had not been provided to the assessee and also no physical FDRs were found either from the premises of Co-operative Bank or the assessee, where both the premises were searched under section 132(1) of the Act and also survey proceedings were conducted against the bank; in the absence of the same, merely because certain notings were made in the FDR register, the addition cannot be upheld in the hands of assessee. The alleged FDRs were in the name of different persons and merely because some star marks were written on the letters cannot result in holding them to be unaccounted and addition being made in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
