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TMI Blog2021 (4) TMI 538X X X X Extracts X X X X X X X X Extracts X X X X ..... as conducted upon him, therefore, he could not look after incometax litigation for short period, and this appeal was accordingly time barred by 40 days. The affidavit of the assessee along with certificate of the doctor has been placed on record. 3. With the assistance of the ld.representatives, we have gone through the affidavit as well as medical certificate. Considering the explanation given by the assessee, we are satisfied that he was prohibited by reasonable cause for not filing the appeal well in time, therefore, we condone the delay of 40 days and proceed to decide the appeal on merit. 4. Though these are cross appeals, they pertain to different assessment years. But issues agitated in both the appeals are inter-connected with each other. Before specifying the grounds of appeal raised by the parties, we deem it appropriate to take note of brief facts of the case. 5. Search under section 132 of the Income Tax Act, 1961 was conducted in the case of B.R. Metal group on 21.9.2010. The assessee was the director in the company, and therefore, an authorization under section 132 was also issued in the case of the assessee. A notice under section 153A was issued on 30.6.2011. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash to the entry providers in the financial year 2008-09, and this income deserves to be assessed in the Asstt.Year 2009-10 instead of A.Y.2010-11. The AO has recorded statement of some of the persons who alleged to have provided entries to the assessee in the list of above 16 share applicants. Similarly, he made addition on protective basis in the Asstt.Year 2010-11, because the amount was returned by the assessee. 7. Dissatisfied with the above addition in the Asstt.Year 2009-10 and protective addition in the Asstt.Year 2010-11, the assessee went in appeal before the ld.CIT(A). It is also pertinent to mention that the assessee has further challenged estimation of commission alleged to have been paid for arranging such accommodation entry. The ld.AO has estimated at 2%. The ld.CIT(A) has accepted the appeal of the assessee in the Asstt.Year 2009-10 and deleted the addition by holding that this amount has already been offered for taxation in the Asstt.Year 2010-11 and taxes have been paid. 8. With regard to the estimation of commission income paid for arranging such entries in the Asstt.Year 2010-11, the ld.CIT(A) has reduced it to 1% as against estimated by the AO at 2%. Thus, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d through a few bank accounts before being invested as share capital through them. The AO has also heavily relied on the statement of the appellant to hold that the unaccounted money of the appellant had been invested in the form of fresh share capital in M/S B R Metal & Alloys (Guj) Pvt. Ltd. The AO however has not accepted the other part of the statement of the appellant wherein he has categorically stated that the unaccounted income was for the F.Y. 2009-10 relevant to A.Y. 2010-11. 4.1 The main issue to be decided in this case .is whether on the basis of the statement of the appellant, who is also a director in M/S B R Metal & Alloys (Guj) Pvt. Ltd., that the share capital infused in the company M/S B R Metal & Alloys (Guj) Pvt. Ltd. represented his unaccounted income for A.Y. 2010-11 can the AO hold that the fresh share capital represented the unaccounted income of the appellant for F.Y. 2008-09 relevant to A.Y. 2009-10. 4.2 It is settled law that when any evidence is considered then the same has to be either accepted fully or has to be rejected. The only exception which can be carved out from this general rule is that when the person evaluating the evidence has some other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect of TPL Finance the AO has found cash deposit of Rs. 50,00,000/- only whereas the company has subscribed to an amount of Rs. 3.0 crores. No enquiry has been conducted about the balance Rs. 2.50 crores. No statement of the directors/ principal officers of this company was recorded. 4.7 The account analysed by the AO other than the case of TPL Finance and that too to extent of only Rs. 50,00,000/- do not show cash deposits. This negates the theory of the AO that cash had been provided by the appellant for deposit in the bank account for onward transmission as. share capital in the hands of M/S B R Metal & Alloys (Guj) Pvt. Ltd. If all the money had come by cheques from various entities then there could not be a case of the cash belonging to the appellant being deposited in these accounts. The AO has not conducted enough enquiries to establish the deposit of cash in the accounts in order to establish the chain leading to the deposit of share capital in M/S B R Metal & Alloys (Guj) Pvt. Ltd. 4.8 No person who has been examined has categorically stated that the money had been provided for by the appellant. All the persons whose statements have been referred to by the AO in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Secutirities Ltd.. It is also to be noted that Shri Patel has given vague answer to the question regarding which person had given him the cash. The other very important aspect is that the appellant was not provided any opportunity to cross-examine Shri Patel despite requests for the same to the AO. In such situation where the opportunity of cross- examination was not provided and there are inherent anomalies in the statement, the complete reliance of the AO on the statement of Shri Deepak Patel does not appear to be justified. 4.11 Similarly, the statement of Shri Hitesh Panchal, it has been stated that M/s Genus Commu Trade Ltd. has invested Rs. 2.0 crores in M/S B R Metal & Alloys (Guj) Pvt. Ltd. Shri Panchal has stated that he is not associated with any other concern other than M M/s Genus Commu Trade Ltd. noted above. He has further stated that he does not have any other bank account other than the two accounts belonging to M/s Genus Commu Trade Ltd. It is to be noted that there are no cash deposits of matching amounts in the bank account of M/s Genus Commu Trade Ltd. If Shri Hitesh Panchal is stating the truth then it is impossible to have received the money from the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence has to be considered. It is not open to the AO to choose part of the statement or evidence and reject the other part. In the case of Glasslines Equipment Co. Ltd Vs CIT 253 ITR 454 (Guj) the jurisdictional High Court has upheld that the contents of an uncontraverted affidavit have to be accepted. The jurisdictional ITAT in the case of Ghanshyambhai R. Thakkar (1996) 88 Taxman 65 (AHD) has held that part of the statement cannot be accepted while negating another part. In the case of Chander Mohan Mehta Vs ACIT (1999) 65 TTJ 327 Pune the tribunal in Para 8 of the order has categorically held that "Revenue cannot be permitted to use that part of the statement which is beneficial to it and reject the other part of the statement which is detrimental to it". In the case of DCIT Vs Glamour Restaurant (2003) 80 TTJ 763 Mum in which it was seen that in the statement recorded, the assessee had offered income for A.Y. 1989-90. During the order passed u/s 132(5), the AO assessed the income as that of A.Y. 1989-90. However, during the assessment proceedings the AO assessed the income offered in different years from A.Y. 1986-87 to A.Y. 1988-89. It is seen that the income assessed was nea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantive basis in the Asstt.Year 2009-10 and other on protective basis in the Asstt.Year 2010-11. The ld.CIT(A) has observed that when the AO has accepted and acted upon one portion of the statement of the assessee made under section 132(4) of the Act, he cannot renegade from acting the second part of the same statement of the assessee for sheer interest of the Revenue. In other words, the law does not permit a person to both approbate and reprobate. In other words, the AO cannot choose a part of the statement and reject the other part of the same statement. In the instant case, question is what are the corroborative pieces of evidences with the Department which would goad any adjudicating authority to confirm the action of the AO ? Answer is nothing except voluntary statement of the assessee himself, and merely based on which the ld.AO has made the impugned addition for the Asstt.Year 2009-10. Addition has been made only on the basis of the voluntary admission on the part of the assessee; there is no material with the Department that the undisclosed income declared by the assessee pertained to the Asstt.Year 2009-10, which fact rightly observed by the ld.CIT(A) in his impugned or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... challenging deletion of addition of Rs. 20,50,00,000/-. We uphold the same and reject this ground of appeal. 12. Next ground raised by the Revenue is against deletion of addition of Rs. 41.00 lakhs by the ld.CIT(A), which was imposed by the AO on account of brokerage and commission income earned from undisclosed income. 13. After going through the record, we find that the impugned brokerage and commission income was allegedly incurred by the assessee on the undisclosed income of Rs. 20.50 crores. However, since the said undisclosed income disclosed by the assessee has been deleted by the ld.CIT(A) and confirmed by the ITAT as per the discussion hereinabove, the impugned addition of Rs. 41.00 lakhs for the Asstt.Year 2009-10 has no leg to stand, and the same is accordingly cancelled. This ground of appeal of the Revenue is dismissed. 14. In the result appeal of the Revenue is dismissed. 15. Coming to the appeal of the assessee for the assessment year 2010-11, the assessee has four grounds of appeal. However, the main ground is with regard to confirmation addition on account of brokerage expenses incurred by the assessee for introduction of share capital/premium. The assessee al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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