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TMI Blog2018 (12) TMI 1253X X X X Extracts X X X X X X X X Extracts X X X X ..... see to depreciation claim in case of companies, it also holds good for this grounds of appeal. Further during the course of search when the above paper when confronted to assessee he voluntarily admitted vide question number 18 of the statement recorded under section 132 (4) of the act that the above sum was paid by assessee for purchase of one property at Gurgaon. For the reasons given by us in confirming the addition in ground number one and two of the appeal of revenue, we also reverse the finding of the learned commissioner appeals and confirm the addition of 1293832/– on account of cash paid. Addition based on seized documents during the course of search - Held that:- We are not in a position to uphold the above finding for the simple reason that assessee himself has confessed that h he is inflating cost of assets, therefore CIT (A) could not have held so. Further document found during the course of search are correct and belonging to the assessee is the presumption available to the revenue in accordance with the provisions of section 132(4A) and section 292C of the income tax act. However, presumption is rebuttable but assessee has not produced any evidence to rebut that pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of undisclosed amount paid to Sh.Ram Dulari for purchase of land lot appreciating the fact that in his statement recorded at the time of Search proceedings the assessee had himself admitted on the basis of documents seized during Search action, the entry of the seized document, explained the content of the entry and voluntarily surrendered the above amount. vi) That the Ld .CIT (A) has grossly erred in restricting the addition made by the AO on account of personal element towards usage of telephone, car and traveling expenses to 10% as against 20% disallowed by the AO. vii) That the Ld .CIT (A) has grossly erred in deleting the addition made by the AO on account of personal element towards conveyance expenses. viii) That the Ld .CIT (A) has grossly erred in deleting the addition made by the AO summarily accepting the submissions of the assessee and by passing a cryptic, unreasoned, nonspeaking order. ix. That the grounds of appeal are without prejudice to each other." 2. First, we state the facts of the case, the assessee Dr. Umesh Gupta and Dr. Kalpana Gupta running group of hospital and diagnosis centre in the name of UMKAL GROUP at Gurgaon and Delhi. Dr. Umes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are capital of Umkal Healthcare pvt ltd out of cash back received. Further ₹ 20 lacks and ₹ 28.50 lakhs introduced in the share capital of Umkal Hospital P Ltd in the name of two private limited companies were out of cash back received. He therefore, submitted that at the most, depreciation on the fixed assets constructed required to be reduced and the disclosure amount is not required to be taxed as income of the assessee. 3. The ld AO disbelieved the above explanation of the assessee and issued a show cause notice rejecting the manner of surrender suggested by the assessee on 19.11.2010. The assessee submitted his reply on 25.11.2010 confirming his retraction. The ld AO rejected the explanation of the assessee for the reason that i. Assessee has made disclosure in his statement of the assessee u/s 132(4) of the Act, ii. explanation of the assessee does not deserve any attention as same is an afterthought, iii. no details were provided by the assessee about the suppliers of construction material who returned cash to the assessee. Consequently, he held that various investments and income is chargeable to tax in various years in the hands of the assessee starting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal of the assessee was partly allowed. The ld AO aggrieved with the order of the ld CIT (A) has preferred this appeal. 5. The ground No. 1 and 2 of the appeal is with related to addition of ₹ 29.5 lakhs on account of share capital introduced in one of the company of the assessee i.e. M/s. Umkal Healthcare Pvt. Ltd. 6. The ld Departmental Representative submitted that additions have been made in the hands of the assessee for three Assessment years i.e. for A.Y. 2007-08, 2008-09 and 2009-10. He informed that the appeal of the revenue for A.Y. 2007 - 08 and 2008 the 09 were dismissed by the coordinate bench for low tax effect, despite it being a consolidated order. Therefore, the only appeal that survives is for A.Y. 2009 - 10. 7. Adverting to the addition of ₹ 29.50 lakhs, ld DR submitted that , assessee disclosed the sum in 132 (4) statement and then created an unsubstantiated story about the lower claim of depreciation without submitting any cash flow statement with names and evidences and date chart of amount of share capital. No details were submitted of the suppliers who repaid cash. Details of shareholders are admittedly bogus. He also refuted that there is a do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ily surrendered a sum of ₹ 123 lakhs in a statement recorded under section 132 (4) of the act on 6/2/2009. However in the month of October 2010, assessee retracted the total surrender stating that ₹ 29.50 lakhs ( for AY 2009-10) introduced by him in the shape of share capital of a private limited company in name of two companies and one lady, is out of the cash funds available with him which was received back from suppliers and contractors who inflated bills of fixed assets to that extent, in construction of a multispecialty hospital under name of UMKAL healthcare private limited where the total spending of the assessee as stated by him is ₹ 45 crores approximately. A further sum of ₹ 1 2.93 lakhs he submitted that documents is an undated and unidentifiable sum mentioned in the document which was also out of the inflation on the cost of the assets. He further stated that the written down value of the fixed assets on the date of the commissioning of the fixed assets on 1/3/2009 has been replaced by the actual cost from inflated cost and thus the depreciation claim in the return of income for A.Y. 2009 - 10 and A.Y. 2010 - 11 is required to be reduced. He furt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the hands of the assessee as income. According to him, it is inflation in cost of assets. Assessee received cash back to the extent of disclosure from suppliers. Hence, hence there is only impact in the reduced depreciation of assets in the hands of the companies where assets are capitalized. Now we deal with each of the issues involved in the appeal. 12. According to us, the Assessee has retracted the statement made u/s 132 (4) of the act after 19 months of the date of the search, the disclosure is also in the form of letter before the ld AO during assessment proceedings. The contention of the assessee is that as there was no occasion with the assessee to retract the disclosure until the first notice was received is also devoid of merit. At the first instances of the payments of advance tax at least as early as that assessee could have explained the disclosure before the Ao/ ADIT/DDIT/CIT etc. However, assessee did not avail that opportunity. Further, the disclosure retracted by the assessee is also not supported by any evidences. Therefore, we reject the retraction filed by the assessee for this reason, which is not the only reason. Honorable Delhi high court even in case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with respect to avoiding the tax on the income disclosed by him and get it adjusted the same against the depreciation claim of the other companies. 18. Assessee has not submitted any cash flow statement, which can be substantiated by the assessee with actual dates of receipt of cash and introduction of share capital by the various unknown persons. The ld CIT (A) even did not examine how and in what manner, assessee obtained share capital from various persons when apparently they are bogus. 19. The learned commissioner appeals failed to understand that how the addition has been made on substantive basis in the hands of the assessee and protective basis in the hands of the company amounts to double addition. Even the withdrawal of the claim of depreciation is made by assessee and those companies at their own will to force the revenue to believe their story. Hence, it also does not result in to double addition. 20. Learned CIT (A) failed to understand that the assessee has voluntarily surrendered the amount during the course of search and survey carried out at various premises. He stated that the surrender was made under section 132(4) of the act. The disclosure is also not bald. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uphold the above finding for the simple reason that assessee himself has confessed that h he is inflating cost of assets, therefore ld CIT (A) could not have held so. Further document found during the course of search are correct and belonging to the assessee is the presumption available to the revenue in accordance with the provisions of section 132(4A) and section 292C of the income tax act. However, presumption is rebuttable but assessee has not produced any evidence to rebut that presumption. Further, it is not the claim of the assessee that no such transaction has taken place. He merely pleaded that it is a dumb documents. Therefore, such addition could not have been deleted. Accordingly, we reverse the finding of the ld CIT (A) and confirm the addition of ₹ 30 lakhs in the hands of the assessee. Ground no 4 and 5 of the appeal are allowed. 23. With respect to ground no 6 to 9, ld DR relied heavily on assessment order where the ld AR relied on the orders of the ld CIT (A). On careful reading of the order of the ld CIT (A), we do not find any infirmity in the order of the ld CIT A () as she has merely reduced the appropriate portion of the disallowance. Hence ground no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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