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TMI Blog2019 (6) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... v with Shri Gagan Tiwary, Advocate For the Revenue : Smt. Ashima Gupta, CIT ORDER PER BENCH: The above captioned appeals are filed against the following orders of the ld. CIT(A): S No ITANo. Name CIT(A) order date Appeal filed by the Revenues or assessee 1 & 2 ITA(SS) No.88/Ind/2013 & CO NO.76/Ind/2014 Mukesh Sharma 30.01.2013 Revenue & Assessee 3 ITANo.189/Ind/2013 Vinod Vaish 31.01.2013 Revenue 4 ITANo.699/Ind/2016 Suresh Kumar Upadhya 22.03.2016 Assessee 5 ITANo.700/Ind/2016 Chandra Kumar Sharma 22.03.2016 Assessee 6 ITANo.701/Ind/2016 Sanjay Kumar Sahu 22.03.2016 Assessee 7 ITANo.702/Ind/2016 Sukhdev Singh Dhariwal 22.03.2016 Assessee 8 ITANo.703/Ind/2016 Khemraj Singh Chauhan 22.03.2016 Assessee 9 ITANo.704/Ind/2016 Kamlesh Kumar Choudhary 22.03.2016 Assessee 10 ITANO.705/Ind/2016 Santosh Kumar Sharma 22.03.2016 Assessee 11 ITA No.706/Ind/2016 Lalta Prasad Choudhary 22.03.2016 Assessee 12 ITANo.707/Ind/2016 Pradeep Kumar Sharma 22.03.2016 Assessee 13 ITANo.708/Ind/2016 Ramesh Chandra Parashar 22.03.2016 Assessee 14 ITANo.709/Ind/2016 Vijay Kumar Shrivas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. AO) assessee filed appeal before the Ld. CIT(A) and partly succeeded. 6. Now the revenue is in appeal against the addition deleted by the Ld. CIT(A) and assessee has filed cross objection raising following grounds: I.T.(SS) No.88/Ind/2013 (Revenue) "On the facts and in the circumstances of the case, the CIT(Appeal) has erred in 1. Not following the provisions of section 250(1) of the Income Tax Act 1961 by not giving a notice to the Assessing Officer of the date and place for the hearing the appeal, 2. Not following the provisions of section 250(2) of the Income Tax Act 1961 by not providing the Assessing Officer an opportunity of being heard at the hearing of the appeal. 3.admitting additional evidences without following the provisions of rule 46A of the Income Tax Rules and relying on the facts of the case not presented by the assessee before the AO 4. deleing the addition of Rs. 50500/- made by the AO on account of non- genuine agricultural income treated 5 deleing the addition of Rs. 15000000/- made by the AO on account of unexplained investment in share 6.deleting the addition of Rs. 580555/- made by the AO on account of unexplained investment in gold 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and/or at the time of hearing. Revenue's appeal for A.Y. 2009-10 in case of Mukesh Sharma 7. Though ground No. 1 & 2 of Revenue has challenged the validity of the order of Ld. CIT(A) contending that the ld. CIT(A) has not followed the provisions of section 250(1) of the Act by not giving the notice to the Assessing Officer of the date and place for the hearing of the appeal. 8. At the outset, Ld. Departmental Representative (DR) placed on record letter dated 13.03.2019 requesting for not pressing ground No.1 & 2 raised in this appeal. Learned Authorised Representative (in short AR) did not oppose. 9. We have heard the rival contentions and perused the record placed before us. From going through the letter issued by the Office of Commissioner of Income Tax (DR) bearing No.FCIT( DR)I.T.A.T./Ind/2018-19 dated 13.05.2019 we observe that the department has requested for not pressing ground No.1 & 2 raised by the Revenue in IT(SS) No.88/Ind/2013. We, therefore, dismiss ground No.1 & 2 as not pressed. 10. Now we take up ground no.3 through which revenue has challenged that the ld. CIT(A) admitted additional evidences without following provisions of Rule 46A of I.T. Rules. 11. At the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim by furnishing documentary evidences regarding holding of agricultural land, details of agricultural lands put to cultivation, crops grown, quantities produced, sale consideration, expenses incurred etc. and also to file the profit and loss account. We find that ld. CIT(A) while adjudicating the issue given following finding of facts by directing the assessing officer to estimate agricultural income of Rs. 25,000/- per acre for A.Y. 2003-04 and Rs. 30,000/- for A.Y. 2006-07 to 2009-10 respectively. 6) Ground No.3 This ground of appeal is directed against treating of part of the agricultural income as non-genuine and income from undisclosed sources. The AO has observed that the appellant was required to substantiate the claim of earning agricultural income shown at the declared amount by furnishing documentary evidences regarding holding of agricultural lands, details of agricultural lands put to cultivation, crops grown, quantities produced, sale consideration, expenses incurred, etc. and also to file agricultural profit and loss account. It was held that as per details filed, the agricultural income comes as high as Rs. 57,500/- per acre in A.Yr.2003-04 and Rs. 1,20,100/- i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 15,000/- per acre in A. Yr. 1998-99 and at Rs.I0,0001- in the block period 01.04.1996 to 17.02.2002, the AO has estimated the agricultural income at Rs. 20,000/-per acre in A.Yrs. 2003-(}4 to 2004-05 and at Rs. 25,000/- per acre in A.Yrs. 2005-06 to 09-10.pplying these standards, the following amounts were held as non-genuine agricultural income and treated the same as income from other sources. Ayr. Agril. Income treated as income from other sources Rs. 2003-04 75,000/- 2004-05 78,000/- 2006-07 8,048/- 2007-08 1,24,412/- 2008-09 3,90,000/- 2009-10 960589/- 6.1) In the course of appeal proceedings, the ld. Counsel for the appellant has contended that the appellant owned agricultural lands with all agricultural facilities. All the necessary details were submitted during the course of assessment proceedings and since the agricultural income was exempt, no regular and proper books of accounts were maintained. According to the ld. A.R, the AO has not doubted agricultural landholdings and cultivation activity. He has accepted a part of agricultural income and estimated the balance as non-agricultural on the ground that bills, etc. were not maintained. It was co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The orders of the Han'ble ITAT Benches relate to different periods and the income held reasonable in the subsequent period is lesser than the preceding period. Thus, it is clear that the facts of those cases are different. However, in the absence of sufficient material to support the claim, the income prescribed in the Tribunal orders can be taken as indicative and after considering the consistent figure of agricultural income shown by the appellant, the AO is directed to estimate the agricultural income at Rs. 25,000 per acre for A. Y Rs. 2003 -04 and 2004-05 and at Rs. 30,0001- per acre in AYrs. 2006-07 to 2009-10. This ground of appeal is, therefore, partly allowed. date of bill being 28.01.2007, it relates to F.Yr.2006-07 relevant to A.Yr.2007-08 and not in the A.yr.2008-09. Therefore, the addition made by the AO is not correct. 11.2) I have gone through the observations of the AO and submissions of the appellant. Admittedly, this bill confirms the purchase of a phone in cash. The disputed paper being cash memo, mentioning of the appellant's name is not necessary. Further, as per of provision of Section 292C of the Act, the A.O. has rightly presumed that the said pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any PPTPL through various companies based in Kolkata. Later on in the income tax return filed in reply to notice u/s 153A of the Act the assessee failed to offer the alleged sum of Rs. 1.50 corers for tax. Ld. AO conducted necessary inquiry to come to a conclusion that the invested companies based in Kolkata are merely accommodation entries providers and the alleged amount was undisclosed income of the assessee. When the matter come up before the Ld. CIT(A) the addition was deleted. 21. Now the revenue is in appeal before the Tribunal. 22. At the outset, Ld. Senior Counsel for the assessee submitted that the alleged share capital & share premium of Rs. 1.50 crores was received in the hands of the company namely Prem Prakash Tube P. Ltd. in which Shri Mukesh Sharma is a shareholder. The Tribunal vide in ITANo.188/Ind/2013 in the case of ACIT vs. Prem Prakash Tube P. Ltd. has restored this issue of protective addition of Rs. 1.50 crores relating to A.Y. 2009-10 to Ld. CIT(A) for afresh adjudication vide order dated 09.07.2015. He prayed that this ground raised by the Revenue should also be set aside to the file of the Ld. CIT(A) for deciding afresh. 23. On the other hand, Ld. DR c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .5 of the revenue's appeal is allowed for statistical purpose. 27. Now we take up ground No.6 through which the Revenue has challenged the finding of the Ld. CIT(A) deleting the addition of Rs. 5,80,555/- made by the Ld. AO on account of unexplained investment in gold. 28. Brief facts relating to this issue are during the course of search gold jewellery having net weight of 1199.830 gms was found from the appellant residence and the lockers available in the name of the assessee, his mother and wife. Certain bills for the purchase of 900 gms gold jewellery was found during the search along with certain evidences showing that gold jewellery weighing 1602.330 gms were sold during the A.Ys. 2002-03 and 2007-08. The Ld. Assessing Officer asked the assessee to explain the total jewellery of 2802.16 gms. Necessary reply was submitted and after considering the same Ld. Assessing Officer treated 402.160 gms jewellery asunexplained and made a addition of Rs. 6,67,090/-. The assessee challenged this addition before the Ld. CIT(A) and partly succeeded. 29. Now the revenue is in appeal before the Tribunal. 30. Ld. DR vehemently argued supporting the order of the Ld. Assessing Officer and Ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details of jewellery sold and purchased were found and all these facts were accepted by the AO without any dispute. However, the AO has considered the jewellery received on marriages and other occasions by Smt. Vimla Rani Sharma, Smt. Neena Sharma and the appellant and received on inheritance only at 1500 gms. The jewellery received and owned by the unmarried children of the appellant i.e. son, Shri Indra Prakash and daughter Miss Ronak Sharma was not considered him. The balance quantity of 402.160 gms relate to the children. It was contended that even as per the CBDT's instructions regarding seizure of jewellery, jewellery in respect of unmarried daughter at 250 gms and unmarried son at 100 gm was to be considered reasonable. Therefore, even as per the standards of the Board, the credit of 350 gms should have been allowed and after giving credit of 350gms of jewellery of the children, only meager quantity of 52.160 gms remains to be explained and looking to the family status, this much of jewelery deserves to be accepted, specifically, when the A.O. has adopted ownership of inherited jewelery on estimate basis. 13.2 I have gone through the observations of the AO and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as registry charges, stamp and other fees were incurred as detailed below; S.No Name of the Purchasers Amount of Registry (Rs.) Stamp Duty (Rs.) Stamp Paper fee (Rs.) Other fees (Rs.) Khasra No./total aria Area sold 1 RC Parashar 2700000 239625 600 21775 556/(1.1 80 hec.) 0.100 Hec. 2 -do- 2595000 230310 280 20935 556/(1.180 hec 0.080 Hec. 3 Lalta Prasad Choudhary 2647000 235000 3000 21355 556/(1.1 80 Hec.) 0.100 hec. 4 Kamlesh Choudhary 479000 42520 2500 4010 559/(0.160 Hec.) 0.020 hec. 5 -do- 2168000 192500 3000 17520 557/(0.4 00 hec.) 0.080 hec. 6 -do- 2647000 235000 3000 21355 556/(1.180 hec.) 0.100 hec. 7 Khemraj singh Chouhan 12680 2647000 235000 3000 21355 556/(1.180 Hec.) 0.100 hec. 8 -do- 1563000 138720 680 12680 556/(1.160 hec) 0.060 Hec 9 -do- 1084000 96205 1000 8850 559/(0.1 60 hec. 0.040 hec. 10 Santosh Kumar Sharma 2647000 235000 2500 21355 558/(1.1 60 hec. 0.100 hec. 11 Sukhdev Singh 2647000 235000 3000 21355 557/(0.400 hec. 0.100 hec. 12 Suresh Upadhya 2647000 235000 3000 21355 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... some nexus with the seized document which included the reference to cheque payment of Rs. 50 lakhs, area of land, the figure 225 mentioned in the seized document denoting the cheque of Rs. 225 lakhs deposited in the bank account of co-purchasers. Ld. A.O also linked the amount of Rs. 323 lakhs mentioned on the seized documents with the cash deposited in the bank account of the co-purchasers. On the basis of these facts Ld. A.O came to the conclusion that the actual deal of land was carried out at Rs. 14,24,60,600/- out of which Rs. 5 crores was the stated purchase consideration and Rs. 49,18,335/- roughly to Rs. 50 lakhs was the registry charges, stamp and other charges. Ld. A.O also held that the land measuring 4.70 acres which is equal to 43,560 sq.ft sold @Rs. 660/- per sq.ft for total consideration of Rs. 13,65,60,600/- and Rs. 9,00,000/- was paid to a person named Kaushal Bhaiya for arranging entries in the name of various parties i.e. the copurchasers. This unaccounted payment in the entire deal was worked out by Ld. A.O at Rs. 8,74,60,600/- (Rs. 13,65,60,600/-+ Rs. 9,00,000/- (-) Rs. 5,00,00,000/-). Since the assessee's share in the stated consideration is 1/10th only, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey have shown for Assessment Year 2009-10 It was only for Assessment Year 2009-10 that they had disclosed higher income but in the subsequent assessment year normal income have been shown. These co-purchasers have also offered the unsecured loan taken during the year to tax. Cash was deposited in their respective bank accounts which is alleged to have been received from Mr. Mukesh Sharma. She further submitted that various figures mentioned in the alleged seized documents seems to have direct nexus with the actual land deal and Ld. A.O was justified in making the addition for "on money" paid at Rs. 8,74,60,600/-. 39. Per contra Ld. Counsel for the assessee submitted that the purchase of the land were made by the assessee along with other persons but there was no direct relation with them. Notings found in the papers reproduced at page 51 to 55 of the assessment order depicted in the seized document are rough notings. They do not contain any date, name or narration against the calculations. The assessee along with other buyers has made a planning regarding future prospects of the land after completion of the transaction and the alleged seized documents are dumb documents and they c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) 70 TTJ (Ahd) 122 Prarthana Construction (P) Ltd. vs. DCIT The presumption under the provision of section 132(4A) would in any case not applicable to a third party from whose possession such papers and documents have not been obtained Para 12 23-29 4 (1991) 39 ITD 183(Del) Ashwin Kumar vs. ITO The loose sheet forming part of seized material is a dumb document and no addition can be made in the hand of assessee on the basis of dumb documents Para 24 30-38 5 (2005) 1 SOT 515 (Del) Nem Chand Daga v. ACIT Whether entries found in loose paper can have any authenticity or evidentiary value value-in selfheld no Para 16 & 21 39-50 6 (2002) 82 ITD 85 (Mum) (TM) S.P. Goyal vs. DCIT Addition cannot be made on basis of entry on loose paper is has to be supported by circumstantial evidence and corroborative evidence Para 11 and para 15 of Second part 51-62 7 (2008) 307 ITR 137(Guj) CIT vs. Maulik Kumar K Shah The addition made by the AO toward "on money" on the basis of seized paper along without any corroborative evidence accnot be sustained Para 6 63-66 8 (2007) 291 ITR 36 (Delhi) CIT v. Kulwant Rai No addition can be made based on surmises and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the basis of legally inadmissible evidence in form of loose papers 154-162 21 (2018) 32 ITJ 510 (Trib- Indore) Assessment. CIT v. Narottam Mishra AO made additions without any basis and only on the basis of suspicion and doubts and the reference drawn by AO were also not base on the reliable evidence and material -CIT(A) was right in allowing relief to the assessee 36 163-193 Reliance was also placed on following judgments; (i) Central Bureau of Investigation V V.C. Shukhla (1998) Taxmann.com 2155(SC) (ii) Chuharmal V/s Commissioner of Income Tax (1998) 172 TR 250/251 (SC) (iii) Prarthana Constructions Pvt. Ltd V/s Deputy Commissioner of Income Tax (2001) 70TTJ (Ahd) 122 (iv) Ashwin Kumar Vs Income Tax Officer (1991) 39 ITD 183 (Del) (v) Nem Chand Daga V/s Assistant Commissioner of Income Tax (2005) 1 SOT 515 (Delhi) (vi) S.P. Goyal Vs Deputy Commissioner of Income Tax (2002) 82 ITD 85 (Mum) (TM) (vii) Commissioner of Income Tax V/s Maulikumar K. Shah (2008) 307 ITR 137 (Guj.) (viii) Commissioner of Income Tax Vs. Kulwant Rai (2007) 291 ITR 36 (Delhi) (ix) Assistant Commissioner of Income Tax Vs. Kences Foundation Pvt. Ltd (2007) 289 ITR 509 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... repetition we are again reproducing the details of 21 sale deeds; S.No Name of the Purchasers Amount of Registry (Rs.) Stamp Duty (Rs.) Stamp Paper fee (Rs.) Other fees (Rs.) Khasra No./total aria Area sold 1 RC Parashar 2700000 239625 600 21775 556/(1.180 hec.) 0.100 Hec. 2 -do- 2595000 230310 280 20935 556/(1.180 hec 0.080 Hec. 3 Lalta Prasad Choudhary 2647000 235000 3000 21355 556/(1.180 Hec.) 0.100 hec. 4 Kamlesh Choudhary 479000 42520 2500 4010 559/(0.160 Hec.) 0.020 hec. 5 -do- 2168000 192500 3000 17520 557/(0.400 hec.) 0.080 hec. 6 -do- 2647000 235000 3000 21355 556/(1.180 hec.) 0.100 hec. 7 Khemraj singh Chouhan 12680 2647000 235000 3000 21355 556/(1.180 Hec.) 0.100 hec. 8 -do- 1563000 138720 680 12680 556/(1.160 hec) 0.060 Hec 9 -do- 1084000 96205 1000 8850 559/(0.160 hec. 0.040 hec. 10 Santosh Kumar Sharma 2647000 235000 2500 21355 558/(1.160 hec. 0.100 hec. 11 Sukhdev Singh 2647000 235000 3000 21355 557/(0.400 hec. 0.100 hec. 12 Suresh Upadhya 2647000 235000 3000 21355 556/(1.180 H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oncerned it has been stated that the co-purchasers including the assessee were planning to sell the land in future @660/- per sq.ft. It is contended by Ld. Counsel for the assessee that the land purchased is agricultural land and as per the stamp valuation authorities the circle rate of the alleged land was below the stated purchase consideration of Rs. 5 crores and by no stretch of imagination the value of the land can be Rs. 13,65,60,600/- as shown in the alleged seized document at page-74 arrived at by multiplying 206910 sq.ft with the rate of Rs. 660/- per sq.ft. 45. Ld. Counsel for the assessee also contended that notings made on the loose papers were rough notings and they have no relation with any transaction happened on or before the date of search and no addition can be made on the basis of rough jottings. Further all the other co-purchasers have duly reflected their investment in the purchase of land and they have also offered income for tax which is not in dispute. The seller has also not stated to have received any 'ON MONEY' from the purchaser. Sale deeds have been singed by all the concerned parties in the presence of the registering authority. It is not the case tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er held that cheque payment of Rs. 50,00,000/- mentioned in page no.74 backside gets corroborated with the actual cheque payment ofRs. 50,00,000/- made on 23.05.2008. The area of the land and the registration expenses tally with the actual area of the land and the amount of expenditure incurred with the registration. The amount of 225 mentioned in this document denotes the amount of Rs. 225,00,000/- deposited in DDI cheque in the bank account of 14 purchases of Dabra. The amount of Rs. 3,23,00,000/- mentioned on this document is the amount of cash deposited in the bank accounts of these 14 purchases. It was also held that the documents at page no. 74 backside and 75 also corroborated with each other. Accordingly, the AO has inferred that the total payment of Rs. 14,24,60,600/- was made for purchasing the land and the unaccounted payments in the entire deals works out to Rs. 8,74,60,600/- (Rs.l3,65,60,600 + 9,00,000 _ 50,00,000/-). Since, the assessee's share was 1I10th, the AO has added Rs. 87,46,OOO/- as his undisclosed income. 15.2 In the course of appeal proceedings, the Id. Counsel for the appellant has contended that the action of the ld. AO is not justified. Though th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions. Under these circumstances, the appellant has stated that the addition made by the AO is not correct. Finally, the appellant has relied on several case laws to support this contention that no addition is possible on account of imaginary and non- reliable entries found in diary/loose papers. 15.3 I have gone through the observations of the AO and submissions of the appellant. The AO has made the addition mainly on the basis of inferences drawn about the jottings contained in loose papers - LPS-1I1 page no.74 back side and page no. 75 . The AO has summarized the basis of his conclusions at page no.58 of the assessment order by stating that the cheque payment of Rs. 50,00,000/- on the backside of page ~ no.74 tallies with the actual amount of Rs. 50 lakhs paid on 23.5.2008. The area of land and registry expenses tally with the actual land area and the expenses incurred on registration. The figure of '225' mentioned at page no.75 denotes the amount ofRs. 225 lakhs deposited by DD/ cheque in the bank accounts of 14 persons ofDabra. The figure of '3.23' mentioned in these documents tallies with the amount of cash deposited in the bank accounts of the 14 persons p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld. A.O was justified in making the addition merely on the basis of loose papers found during the course of search without establishing any nexus with the actual transaction or placing any corroborative evidence on record. 48. In the case of Ashwin Kumar V/s ITO (supra) the Tribunal held that "when a dumb document, like the present slip, is recovered and the revenue wants to make use of it, it is the duty of the revenue to collect necessary evidences which may provide acceptable narration to the various entries. The evidences collected should be such that any reasonable man would accept the hypothised advanced by the revenue, that the figure written on the right side of the slip represent incomes earned by the assessee. It was conceded by the Departmental Representative that no such evidence have brought out on record". Hon'ble Supreme Court in the case of Dhakeshwari Cotton Mills Ltd V/s CIT 1954 261 ITR 775 held that "in making assessment u/s 23(3) of the Indian Income Tax Act, the ITO is not fractured by technical rules of evidence and fluctuations and he is entitled to act on material which may not accept an evidence in the court of law, but the IT is not entitled to make ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the document recovered during the course of search a dumb document and lead nowhere". 54. Hon'ble High Court of Madras in the case of CIT vs. P. V Kalyanasundaram (supra) wherein also addition was made in the appellants income towards purchase consideration of land merely on the basis of statement of sellers who gave contradictory statements. No independent enquiry was carried out to value the property in order to support the addition. For proper understanding we are reproducing the issue involved, facts and the judgment as follows; "A) Whether or not when the Returns and the Statements of the seller admit higher sale consideration actually received, the revenue is justified in fixing the sale consideration at the higher amount than what has been declared? B) When the Assessee did not give any explanation to the notings found and at the same time the revenue is able to corroborate the same with the statement of the seller for the purpose of determination of actual sale value, would the lower authority be justified in interfering with the same? C) When consistent sworn statements were taken into consideration along with evidences found at the time of search, would all be liabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 95/- disclosed by the assessee in his cash flow statement. This had resulted in an addition of Rs. 3 0,75,005/- as undisclosed income for the Block Period 01.04.1998 to 0 8.12.1998. ii) Aggrieved by the order, the assessee filed an appeal to the Commissioner of Income Tax (Appeals). The Commisioner of Income Tax ( Appeals), noted that due to conflicting nature of the statements given by the seller, his statement could not be relied upon and hence he deleted the addition made by the Assessing Officer. Aggrieved by the order of the C.I.T. (A), the Revenue filed an appeal before the Income Tax Appellate Tribunal. The Tribunal dismissed the Revenue's appeal and confirmed the order of the C.I.T. (A). The learned counsel for the Revenue submitted that the value declared by the assessee for the purchase of the plot was Rs. 100/- per sq.ft. even when the guideline value was Rs. 400/- per sq.ft. and hence the order of the Tribunal was perverse, wrong and without basis. 3. We heard the counsel. The seller had initially given conflicting statement about the sale consideration he received. When confronted by the Revenue on 11.12.1998, the seller admitted that he had deposited Rs. 4.10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Under the circumstances, we do not find any infirmity in the order of the Id. CIT(A) and we uphold the appellate order in this regard." We also found that the Assessing Officer did not conduct any independent enquiry relating to the value of the property purchased. He merely relied on the statement given by the seller. If he would have taken independent enquiry by referring the matter with the Valuation Officer, the controversy could have been avoided. Failing to refer the matter was a fatal one. 4. In view of the foregoing conclusions, we find no error in the order of the Income Tax Appellate Tribunal and requires no interference. Hence no substantial questions of law arise for consideration of this Court. Accordingly, the above tax case is dismissed. No costs." 55. In the case of CENTRAL BUREAU OF INVESTIGATION v. V.C. SHUKLA 1998 Taxmann.com 2155 (SC), the Hon'ble Supreme Court, on the question of whether entries appearing in loose papers seized from one person can constitute evidence for another person, held as under: "34. Now that we have found (in disagreement with the High Court) that entries in MR 71/9'/ would be admissible under Section 34 of the Act we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been proved that the books of account were regularly kept in the ordinary course of business and that, therefore, all entries therein should be considered to be relevant and to have been prove, said that the rule as laid down in Section 34 of the Act that entries in the books of account regularly kept in the course of business re relevant whenever they refer to a matter in Which the court has to enquire was subject to the salient Proviso that such entries shall not alone be Sufficient evidence to charge any person with liability. It is not, therefore, enough merely to prove that the books have been regularly kept in the Course of business and the entries therein are correct. It is further incumbent upon the person relying upon those entries to prove that they were in accordance with facts. " 56. Hon'ble Apex Court in the case of Common Cause (A registered Society) Vs. Union of India (2017) 77 taxmann.com 245 (SC) held as follows:- "22. In case of Sahara, in addition we have the adjudication by the Income Tax Settlement Commission. The order has been placed on record along with I.A.No.4. The Settlement Commission has observed that the scrutiny of entries on loose papers, c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by the Birla Group and Sahara Group, we are of the opinion that it would not be legally justified, safe, just and proper to direct investigation, keeping in' view principles laid down in the cases of Bhajan Lal and V.C. Shukla (supra). 57. Hon'ble Jurisdictional High Court recently in the case of Principle CIT V/s Pukhraj Soni Income-tax Act, 1961, No.53/2017 dated 6.2.2019 adjudicated the similar issue relating to addition made by the Ld. A.O on the basis of notings found in the seized documents, confirmed the order of the Tribunal by relying on the judgment of Hon'ble Apex Court in the case of CBI V/s V.C. Shukla (Supra) and in the case of Common Cause (A registered Society) Vs. Union of India (2017) 77 taxmann.com 245 (SC) (supra). 58. Respectfully following the above judgments of Hon'ble Apex Court/Hon'ble High Courts and Tribunal we are of the considered view that the impugned addition for unaccounted investment in the land has rightly been deleted by Ld. CIT(A) as they were merely based on the rough jottings on the alleged seized loose papers which were not signed by any of the parties, nor transaction mentioned therein have actually taken place nor revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he addition u/s 68 of the Act was made. When the matter came up before the Ld. CIT(A) assessee filed additional evidences in order to prove the identity genuineness and creditworthiness of the cash creditors. Ld. CIT(A) failed to comply to the provision of Rule 46A of the IT Rules before admitting additional evidences and deleting the addition of Rs. 65,00,000/-. 62. We find that the additional evidences filed by the assessee are vital for adjudication of the issue and the ld. CIT(A) before admitting the additional evidence should have given a proper opportunity to the Ld. Assessing Officer to file a remand report on the additional evidences filed by the assessee. Both Ld. Senior counsel for the assessee and Ld. DR have no objection if the issue for unexplained cash credit of Rs. 70,00,000/- is set aside to the file of the Ld. CIT(A) for deciding afresh. 63. In the given facts and circumstances of the case and in the interest of justice we accept the request of both the parties and set aside this issue of unexplained cash credit of Rs. 70,00,000/- to the file of Ld. CIT(A)for afresh adjudication with a direction that the additional evidences filed by the assessee which were not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not sent to the Ld. A.O for calling remand report. We therefore allowed revenue's ground for statistical purposes. Accordingly Ground No.5 of the Cross Objection is allowed for statistical purposes. 71. Ground No.6 is general in nature which needs no adjudication. 72. In the result the Cross objection of appeal of the assessee is partly allowed for statistical purpose. 73. Now we take up revenue's appeal in the case of Mr. Vinod Vaish in Appeal No.189/Ind/2013 for Assessment Year 2009-10 which reads as follows:- "On the facts and in the circumstances of the case, the CIT(Appeal) has erred in 1. Not following the provisions of section 250(1) of the Income Tax Act 1961 by not giving a notice to the Assessing Officer of the date and place for the hearing the appeal, 2. Not following the provisions of section 250(2) of the Income Tax Act 1961 by not providing the Assessing Officer an opportunity of being heard at the hearing of the appeal. 3. deleting the addition of Rs. 87460600/- made by the AO on account of undisclosed income. The appellant reserves his right to add, amend or alter the grounds of appeal on or before the date, the appeal is finally heard for disposal. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in the case of Mr. Mukesh Sharma for his share of 'ON MONEY' , therefore no addition could be made in the hands of the seller Mr. Vinod Vaish also. Therefore the Ld. CIT(A) has rightly deleted the addition of Rs. 8,74,60,600/- made by the Ld. A.O on account of undisclosed income giving following finding of fact. All these grounds of appeal re directed against the addition of Rs. 8,74,60,600/-made on account of receipt of 'on money' against sale of lands located at Vill. Ratanpur, Misrod, Bhopal. The A.O. has held that in the course of search conducted on 21.07.2008 in the case of Shri Mukesh Sharma, B-99, Rajvaidh Colony, Kolar Road, Bhopal, one of the buyers of the land, various incriminating documents were found and on the basis of such documents, it was held that the buyers have paid .on money to the above extent to the appellant. The appellant did not disclose receipt of the same as his income. Accordingly, the above amount was added to the total income of the appellant after reproducing the observations made in the assessment order in the case of Shri Mukesh Sharma. 5.1) In the course of appeal proceedings, the ld. Counsel for the appellant has contended that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t assessment order in the case of Shri Mukesh Sharma, were supplied to him. Similarly, the A.O. has not allowed cross examination of Shri Mukesh Sharma, whose statement given in proceedings u/s.l32, was used in the appellant's case. Therefore, according to the Ld. AR, the principles of natural justice were not complied with and the assessment is bad in law. Perusal of the assessment records reveal that no such opportunity was given to appellant during assessment proceedings, which is a fact. However, after considering the facts of the case, contents of the loose papers and the appellant's submission in case of Shri Mukesh Sharma, the addition made on account of payment on money was deleted in that case. Therefore, it is not considered necessary to allow cross examination of Shri Mukesh Sharma by the appellant at this stage. The other contentions of the present appellant are identical to the contentions raised and considered in the case of Shri Mukesh Sharma. The operative part of the order at page Nos. 21 &22 in ITA No.584/10-11, dated 30.01.2013 is reproduced below: "15.3 I have gone through the observations of the A 0 and submissions of the appellant. The AD has made th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs may generate a suspicion, they are not sufficient enough, without corroborating evidences, to conclude that actual money has changed hands. In this view of the matter, the addition covered in this ground of appeal is not sustainable, hence deleted This ground of appeal is, accordingly, allowed. ' In this view of the matter, I am of the considered opinion that the addition made by the AO on account of receipts of on money in the appellants case is not suitable, hence deleted. According, these two grounds of appeals are allowed. 78. We therefore uphold the finding of Ld. CIT(A) and dismiss the revenue's Ground No.3. 79. As regards Ground No. 1 & 2 revenue is challenging that no notice was given to the Ld. A.O providing opportunity of being heard before Ld. CIT(A). At the outset the Ld. Departmental Representative requested for not pressing their grounds. Since the revenue has not pressed Ground No. 1 & 2 as per the letter given by them before us during the course of hearing, we dismiss Ground No. 1 & 2 as not pressed. 80. In the result appeal of revenue in the case of Mr. Vinod Vaish for Assessment Year 2009-10 stands dismissed. 81. Now we take up the bunch of 14 appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4.That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5.That the Ld. CIT{A) has erred in law and on facts in confirming the addition of Rs. 19520/-. 6.That the Ld. CIT(A) has erred in law and on facts in confirming the addition of Rs. 46,01,538/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee's possession. 7.That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 8. That the Ld. CIT{A) erred in law a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ranted and perverse and is devoid of any merit. 8. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 9. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.701/Ind/2016 1. That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) has erred in law and on facts in confirming the addition of Rs. 17,78,235/- claimed as expenses by the assessee. 6. That the Ld. CIT(A) has erred in law and on facts in confirming the addition of Rs. 50,13,003/-- made on the basis of a dumb document unrelated to the assessee and not found from the assessee's possession. 7. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 7. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 8.That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.704/Ind/2016 1. That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) has erred in law and on facts in confirming the addition of Rs. 46,00,814/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee's possession. 6. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 8. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hand is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 9. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.707/Ind/2016 1.That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) and the AO were not justified in law and on facts in sustaining the addition of Rs. 4,33,000/-. 6. That the Ld. CIT(A) has erred in law and on facts in confirming the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ining the addition of Rs. 3,38,643/-. 6. That the Ld. CIT(A) has erred in law and on facts in confirming the addition of Rs. 25,73,411/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee's possession. 7. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 8. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT(A) 9. That the Ld. CIT(AJ has exceeded her jurisdiction in giving directions to the AO to reopen the case for AY 2010-11 and giving directions for examining the opening capitol which are I10t within the scope of the assessment year under co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directions for examining the opening capitol which are I10t within the scope of the assessment year under consideration and which were not even the Subject matter of assessment. ITA No.711/Ind/2016 1.That the Ld. CIT{A} erred both in law and on facts in upholding the validity of reassessment proceedings u/s 148. The Id. CIT(A} has failed to appreciate that the reassessment proceedings' initiated by the AO were illegal, void and without jurisdiction. 2. That the Ld. CIT(A) erred in law and on facts in failing to appreciate that reassessment proceedings were initiated on the basis of incorrect facts since the income alleged to have escaped assessment was already offered to tax in the return of income. 3. That the Ld. CIT(A) erred both in law and on facts in deciding the entire appeal on a preconceived hypothesis and predetermined notion without considering the written submissions and facts on record. Most of the findings in the appellate order are without any basis and appear to be on presumptions and surmises. 4. That the Ld. CIT{A} has erred in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red in law and on facts in not appreciating that since no addition has been made in respect of the income on the basis of which assessment was reopened therefore the addition made for item in respect of which reason of reopening was not recorded is unsustainable. 5. That the Ld. CIT{A) and the AO were not justified in law and on facts in confirming the addition of Rs. 48,76,208/- made on the basis of a dumb document unrelated to the assessee and not found from the assessee's possession. 6. That the manner in which the Ld. CIT(A) has upheld the addition in para 14 over the alleged excess investment in land without even discussing the alleged document, submissions of the assessee and simply relying on the Assessment order is unwarranted and perverse and is devoid of any merit. 7. That the Ld. CIT{A) erred in law and on facts in confirming the protective addition as substantive addition in the hands of the appellant. The CIT(A) on one hand is doubting the financial capacity of the appellant to make the investment and on the other hond is confirming the protective addition os substantive addition. The said finding is perverse and contrary to the entire matrix built up by the CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re Ld. CIT(A) and failed to succeed and now all the assessee's are in appeal before the Tribunal. 85. Ld. Counsel for the assessee reiterated the submissions made before the lower authorities and Ld. Departmental Representative supported the orders of the lower authorities. 86. We have heard rival contentions and perused the records placed before us. As regards the first common issue challenging the validity of reassessment u/s 148 of the Act, we find that there was certain information relating to these 14 assessee's found by the search team during the search u/s 132 of the Act conducted on 21.7.2008 at the premises of Mr. Mukesh Sharma including a memorandum of agreement for purchase of land by Mr. Mukesh Sharma and 14 other parties. Certain loose papers were also seized which as per the Ld. A.O indicated some undisclosed investment. Return were filed on 31.03.2010 and notice u/s 148 of the Act issue within 4 years i.e. before 31.03.2014. Proper opportunity was given to assessee(s) to reply to the reasons recorded for reopening. In our considered view the cases of 14 assessee's were fit case for issue of notice u/s 148 of the Act and for conducting reassessment proceedings u/s 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in bank/loan Amount admitted as undisclosed income Difference 1 Suresh Kumar Upadhyay ITANo.699/Ind/2016 26,52,750 26,33,230 19,520 2 Chandra Kumar Sharma ITANo.700/Ind/2016 46,65,000 42,96,651 3,68,349 3 Sukhdev Singh Dhariwal ITANo.702/Ind/2016 40,00,000 22,21,765 17,78,235 4 Lalta Prasad Choudhary ITA No.706/Ind/2016 26,50,569 22,94,656 3,55,913 5 Pradeep Kumar Sharma ITANo.707/Ind/2016 68,55,000 57,33,205 1,21,795 6 Ramesh Chandra Parashar ITANo.708/Ind/2016 32,87,750 28,54,750 4,33,000 7 Vijay Kumar Shrivastava ITANo.709/Ind/2016 50,00,000 46,61,357 3,38,643 8 Dharmendra K. Choudhary ITANo.710/Ind/2016 26,50,569 21,95,008 4,55,561 9 Ram Kumar Swami ITANo.711/Ind/2016 26,50,569 22,88,974 3,61,595 10 Virendra Kumar Sharma ITANo.542/Ind/2017 26,51,070 23,58,560 292010 90. We find that the alleged difference was claimed by the assessee as expenses incurred to have been incu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, in the course of the proceeding before it and such other material as may be brought on his record, confirm, reduce, enhance or annul the assessment;] (b)in an appeal against an order imposing a penalty, he may confirm or cancel such order or vary it so as either to enhance or to reduce the penalty; (c)in any other case, he may pass such orders in the appeal as he thinks fit. 2.The Commissioner (Appeals) shall not enhance an assessment or a penalty or reduce the amount of refund unless the appellant has had a reasonable opportunity of showing cause against such enhancement or reduction. Explanation.- In disposing of an appeal, the Commissioner (Appeals) may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the Commissioner (Appeals) by the appellant. 93. From going through the above provision we understand that the Commissioner (Appeals) has the powers to decide the appeal against the assessee of a particular assessment which he/she may confirm/reduce or enhance or annulled. The order of the assessment relates to particular assessment year or assessment yea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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