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TMI Blog2019 (3) TMI 1267X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosed Income of the Assessee. The Substantial Questions of Law is quoted below for ready reference : "Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in confirming the addition of Capitation Fee of Rs. 5,60,000/- as Undisclosed Income of the appellant without any evidence found as a result of search or any document or material to prove the payment of Capitation Fee ? 2. The facts, in brief, are as under : A Search was conducted at the residential premises of the Assessee on 02.05.2001 under Section 132 of the Income Tax Act, 1961, in short, 'Act'. In the statements recorded under Section 132 (4) of the Act, in an answer to two questions, the Assessee admitted that he got his son admitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the hands of the Assessee at Rs. 5,60,000/-, he filed an appeal before CIT (A), which came to be dismissed by CIT(A) and thereafter second appeal dismissed by the Tribunal. 4. Hence, the present Appeal before this Court under Section 260A of the Act. The findings of the learned Tribunal in this regard are also quoted below for ready reference : "8. Having accepted the fact in his sworn statement that the assessee has got his son admitted to Satyabhama Engg. College for which he paid Rs. 5,60,000/- towards capital fees and annual fees and even before the ld. CIT(A) has not denied this fact, in our opinion, merely on the basis of assessee's objection that no evidence regarding capital fees was found as a result of the search and hence no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t made by such person during examination may thereafter be used as evidence in any other proceedings under the Act. In this view of the matter, and also in the light of the decision of the Hon'ble Supreme Court in the case of P.R.Metrani v. CIT (287 ITR 209), we uphold the finding of the authorities below and confirm inclusion of Rs. 5,60,000/- in the total undisclosed income of the assessee in the block assessment." 5. Mr.R.Sivaraman, learned counsel for the Assessee, assisted by Mr.Mudit Bohra and Mr.Prasanth, urged before this Court that there is no admission on the part of the Assessee that the said Capitation Fee of Rs. 5,00,000/- besides Rs. 60,000/- as Annual Fee was paid out of Undisclosed Income of the Assessee, in addition to wha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in an addition ipso facto in the already declared Undisclosed Income in the hands of the Assessee in his Returns filed after the search. 9. In fact, on the basis of disclosure of Undisclosed Income made by the Assessee himself in the Return of Income after search was made to the extent of Rs. 23,65,700/- and the same was brought to tax, the Assessee has paid tax thereon. Therefore, even though such Capitation fee was presumed by the Assessing Authority to have been paid out of Undisclosed Income, there was no reason to impose tax separately on the said amount of Rs. 5,60,000/- and the same could have been very well taken as paid out of Declared Undisclosed Income in the Return filed by the Assessee after the search. 10. We cannot sustai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atter and such Capitation Fee is just extracted from them, making an affordable higher education a mirage for middle class families. What the Revenue-Department i.e., Income Tax Department, having come to know of such facts existing should have proceeded against such Engineering Colleges cancelling their Section 11 exemption entitlements, which most of them illegally enjoy, rather than punishing parents and students by imposing tax on such alleged Undisclosed Income merely on the basis of the so called admission made in the statements recorded under Section 132 (4) of the Act, which too, as we have found in the present case, does not support the case of the Revenue at all. 13. Therefore, we find that the orders passed by both the Appellate ..... X X X X Extracts X X X X X X X X Extracts X X X X
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