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TMI Blog2020 (4) TMI 775X X X X Extracts X X X X X X X X Extracts X X X X ..... SIA [ 2017 (5) TMI 992 - DELHI HIGH COURT] has decided this issue that this document does not belong to Mrs. Vineet Chaurasia nor any adverse inference can be drawn, therefore, in the case of the assessee whose name is not even was mentioned in the seized documents, no addition can be made. Accordingly, the said addition is deleted and the order of the Ld. CIT(A) is confirmed. - Decided in favour of assessee. - I.T.A. No.2737/DEL/2016 - - - Dated:- 17-2-2020 - Shri Amit Shukla, Judicial Member And Shri Dr. B.R.R. Kumar, Accountant Member For the Appellant : Shri Sanjay Goel, CIT-DR For the Respondent : Shri Ved Jain, Adv. Shri AK Agarwal, Adv. ORDER PER AMIT SHUKLA, J.M.: The aforesaid appeal has been filed by the Assessee against the impugned order dated 22.02.2016, passed by Commissioner of Income Tax (Appeals)-XXIX, New Delhi for the quantum of assessment passed u/s.143(3) for the Assessment Year 2010-11. In the grounds of appeal, the Revenue has raised following grounds:- 1. That on the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law and on facts in deleting the addition of ₹ 16,42,68,522/- made on account o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uter of Mr. Lalit Modi nor any authorized person of the company. Mr. Modi has categorically mentioned that seized document contains some rough calculation and hence any transaction with the assessee has not been established. Though it is true that on the seized document the name of Mrs. Vinita Chaurasia has been mentioned but assessee has not been mentioned anywhere. It is a fact that assessee and Smt. Vinita Chaurasia has entered into an agreement for sale of a commercial property for which the assessee has received amount of ₹ 16,42,68,832/- through cheque. The addition has been made on the basis that other entry mentioned as PDC value in the seized document is payment received by the assessee other than cheque amounting to ₹ 16,42,68,522/-. The assessee has denied having received such amount and the Assessing Officer has not made it clear as to what is the mode of receipt. Further, there is no corroborative evidence was found to prove that this amount has been received by the assessee because seized document does not mention anything to show that this is a cash receipt from Mrs. Vinita Chaurasia by the assessee. So simply a mention of amount does not substantiate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o denied of having given any such amount in cash. Further, the AO has mentioned in the order that Mr. Lalit Modi is known to the appellant and Mrs. Vinita Chaurasia and was also witness to the agreement. However, this is already accepted by Mr. Lalit Modi in his statement. This does not proves the issue that the appellant has received cash over and above the transacted price as nothing is emanating from the document to show any receipt of cash by the appellant. As per the said document the cost has breakup in CH value and PDC value. The CH value has already been declared in the books. However, PDC value which is acronym for post dated cheque cannot be construed as cash receipt, especially when nothing of this sort is substantiated by corroborative evidence. AO was unable to establish that this document belongs to the appellant. Only name of the project of appellant mentioned in it cannot be held against appellant. It is also seen that the addition has been made ignoring the statement of Mr. Lalit Modi and Mrs. Vineeta Chaurasia and nothing has been brought on record by the AO to disprove the same. Therefore, the addition was made without any basis and evidence but on surmises, susp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed document; secondly , there is no corroborative evidence or any statement that the payment has been received by the assessee other than cheque amount as entered in the sale agreement; and lastly , on the bare perusal of the document it cannot be inferred or concluded that seized document belongs to or has any nexus with the assessee. Here, in this case, as pointed out by the ld. counsel similar matter had come for consideration before Tribunal in the case of Mrs. Vineeta Chaurasia where exactly same addition has been made based on same seized documents that the amount of ₹ 16,42,68,522/- is an unexplained investment. The Tribunal in a very detailed order has deleted the said addition on merits. Now Hon ble Delhi High Court in the appeal filed by the Revenue has dealt with exactly the same seized document in the case of PCIT vs. Mrs. Vineeta Chaurasia in ITA No.1104 and 1105/Del/2015 . The relevant observation of the Hon ble High Court is reproduced hereunder:- 3. The background facts are that the Assessee filed her return of income for the AY in question on 2ndAugust, 2010 declaring an income of ₹ 2,20,19,780 under the heads income from house property, shor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i at Lajpat Nagar- II, New Delhi. During the course of pendency of assessment proceedings in the case of Shri Lalit Modi for AY 2004-05 to 2010-11 (u/s.153A/143(3) the material seized from the ITA Nos. 1004 of 2015 1005 of 2015Page 5of 14premises of the Assessee has been examined. After examining such seized material I am satisfied that the following seized documents belong to persons other than Shri Lalit Modi. The detail of such paper is as under: Annexure No. Page No. of Annexure Brief description of documents Person to whom the document belongs Ann A-1 5 These papers contain detail of transaction entered in by Smt. Vinita Chaurasia for acquisition of property at Vasant Square Mall Smt. Vinita Chaurasia 2. On the basis of document found and seized enquiries were conducted during the course of post search proceedings and it has come to notice that the property was acquired by the Assessee for a consideration of ₹ 32,85,37,3541 out of which only ₹ 16,42,68,832 has been paid by cheque and rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n part. The operative portion of the order of the CIT (A) read as under: 15. Thus considering the receipt and the payment side of the unaccounted transactions on the seized paper, identified as page 5 of Annexure A-1 the total addition to be made in the case of the appellant are as follows: In AY 10-11, addition of ₹ 21,93,41,222 (₹ 22,59,11,969 - ₹ 65,70,747). This comprises of ₹ 16,42,68,522, which is the cash component of the total sale consideration of ₹ 32,85,37,354; and ₹ 59,56,943 appearing as 'to Refund' and ₹ 4,91,15,757 appearing as 'To Pay', which had remained to be added by the AO and in respect of which the notice for enhancement was issued. 10. The net result was that there was an enhancement of the assessable income by of the Assessee by ₹ 5,50,72,700. 11. Both the Revenue and the Assessee filed appeals before the ITAT which came to be disposed of by the impugned order. Interestingly it may be also mentioned that Revenue s appeal in the case of Mr. Lalit Modi was also heard along with these two appeals. The Revenue s appeals were dismissed and the Assessee s appeal was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntains the names of the vendor and the vendee being found with the broker. The mere fact that such photocopy of the sale deed was found with the broker would not lead to the conclusion that such a document 'belongs to either the vendor or the vendee. While in the present case the AO in his satisfaction note does record that the document in question does not belong to Mr. Lalit Modi i.e. the searched person, he does not indicate on what basis he proceeds as if the document belonged to the Assessee. 17. In this context, it requires to be noticed that a very detailed interrogation of Mr. Lalit Modi in relation to this document took place, the relevant portions of which have been extracted by the ITAT in the impugned order. Question No. 25 posed to Mr. Modi and his answer there to reads as under: Q.25. I am showing you page no. 5 to 8 of Annexure A-1, please explain the contents. Ans: Pages no. 5 to 8 are rough planning on page 5 proposal from Vasant Square Mall for sale was received and the deal did not materialise through me. 18. The above statement was made in the course of the search. In the assessment proceedings in the case of Suncity Project Ltd. alleg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the search and seizure operation took place. 20. There is no material whatsoever placed on record by the Revenue before the CIT (A) or the ITAT to justify the invocation of Section 153C of the Act against the Assessee on the basis that the above document belonged to her. 21. Turning to the decisions cited by Mr. Shivpuri it is seen that in Principal Commissioner of Income tax-8 v. Super Malls (P.) Ltd. (supra), a pen drive was recovered from the residence of Mr. Ved Prakash Bharti who was a Director of the Assessee. The AO recorded during the statement of Sh.Ved Prakash Bharti at the time of search, he has also stated that these documents (contained in the pen drive) pertain to him and Super Malls Pvt. Ltd., Karnal in which he is Director. It is on the basis of the above facts that this Court rejected the Assessee's contention that the said documents could not be said to belong to the Assessee. 22. As regards the decision in Principal Commissioner of Income Tax (Central)-2 v. Nau Nidh Overseas Pvt. Ltd. (supra), the searched person Mr. Jatinder Pal Singh, was one of the Directors of the Assessee. As noted by the Court in the course of the search, he cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of the document. Mr. Modi had suggested that it was some other broker who had given him the said document as a proposal . There appears to have been no attempt made by the AO to enquire into the matter further to find out if at all there was any such other broker who had prepared the document. Further, there is no attempt also made to ascertain whether the prevalent market value of the space purchased by the Assessee could at all fetch the value indicated in the document which is ₹ 32,85,37,354. This was too fundamental an issue to be left un-investigated. The AO appears to have proceeded purely on conjectures as regards what the document has stated without noticing the internal contradictions and inconsistencies. For instance, the document talks of rent payable for a period from 2006 onwards where in fact even according to the Revenue the Assessee purchased the property on 13thMay, 2009. The shifting of the burden on the Assessee without making these basic enquiries to unearth the truth of the document could not have been accepted and was rightly commented upon by the ITAT. The entire basis for making the additions to the assessable income of the Assessee was a s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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