9911796707
TMI Blog2021 (7) TMI 792X X X X Extracts X X X X X X X X Extracts X X X X ..... king order discussing all the material facts. The ld. AR has not brought out any new material to controvert the findings recorded by the ld. CIT(A) qua violation reopening the assessment. Unexplained income - violation of the provisions of section 269SS of the Act warranting penalty proceedingsu/s 271D - HELD THAT:- Both the provisions of Act i.e. Section 68 69 are not applicable in the present case. As Section 68 of the Act comes into operation only when `no satisfactory explanation is coming forth in respect of the cash credit found recorded in the books. In the present case, however, no such credit entry is recorded as evident from the books. Thus this section is not applicable in this case. Again, Section 69 of the Act is not applicable in the present case as the assessee was never found in 'possession' of such sum at any stage in any manner. Thus both the provisions of law are not operative in the present case. Copies of the alleged 'Prints Outs' received from the Investigation Wing, Ahmedabad and forwarded to the assessee subsequently in the assessment proceedings were 'deaf and dumb document' for all the purposes and had carried no evidenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant, without appreciating the facts of the case in right perspective. Thus the addition so made and confirmed by the Authorities Below deserves to be deleted summarily. 2(b) On the facts and in the circumstances of the case, the Authorities Below have factually and legally erred in observing that due opportunity was allowed to the appellant to cross examine the witness but the appellant did not avail such opportunity. In fact, the ld. AO had allowed only one `hour' for the purpose as explained vide letter dated 9.10.2017. Thus for practical reasons, the opportunity could not be availed. 3. On the facts and in the circumstances of the case, the both grounds Authorities Below have factually and legally erred in holding the impugned funds of ₹ 8,00,000/- as un-explained' income of the appellant and simultaneously penalty proceedings u/s 271D of the Act were also initiated and upheld by the Authorities for accepting the deposit in violation of the provisions of section 269SS of the Act. Both views are self-contradictory. This shows double state of mind of the Authorities Below. Obviously addition made on the basis of such vague findings is bad in Law and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f his family member i.e. M/s Laxmi Mobile, Opp. Rayrnonds, M.I.Road, Jaipur etc.) the assessee agreed and confirmed that both the names are of same person. Finally, the A.O. completed the assessment U/s 148/143(3) of the Act on 06/11/2017 determining total income of assessee at ₹ 9,39,680/- by making addition of ₹ 8.00 lacs as unexplained income. 4. Being aggrieved by the order of the A.O., the assessee carried the matter before the ld. CIT(A), who after considering the submissions of both the parties as material placed on record, upheld the action of the A.O.. Against the said order of the ld. CIT(A), the assessee has preferred the present appeal before the ITAT on the grounds mentioned above. 5. Grounds No. 1 and 2 of the appeal raised by the assessee relates to challenging the order of the ld. CIT(A) in confirming the reassessment proceedings U/s 147 of the Act. In this regard, the Ld. AR appearing on behalf of the assessee has reiterated the same arguments as were raised before the ld. CIT(A) and submitted that the notice u/s 147/148 of the Act was issued in 'incorrect' name. Such notice was not served upon the assessee properly and timely. The rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty was allowed by the concern AO of the witness. This fact was duly communicated to the Ld. AO vide our letter dated 9.10.2017 submitted in regular hearing on 9.10.2017 at about 11.30 AM (PB No.11 to 16). Vide order-sheet entry dated 9.10.2017 of the regular hearing on the same date, the ld. AO had required the AR to advise the appellant to be present at 12.30 PM in his office for the purpose. The AR of the appellant, who was attending such regular hearing on 9.10.2017 had expressed his inability to produce the appellant by 12.30 PM i.e. within one hour on the plea that the appellant did not accompany him in regular hearing and it was not practically possible to locate the appellant at such short notice and to request him to attend the office of the AO instantly on the same day. Accordingly, the AO was requested to allow reasonable opportunity vide A.R.'s hand written letter of the even date. Copy of the letter is submitted herewith for your kind perusal and record at PB No.17. The AO had however turned down such request and had proceeded to finalize the proceedings without allowing proper and adequate opportunity for the purpose. From these sequences, it is evident that the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... skipped to address this point while dismissing this ground. (c) Again, the ld. CIT (A) had skipped to give findings as to whether accepting of the alleged 'loan' in 'cash' tantamount to 'Escapement of Income' within the meaning of section 147 of the Act? The ld. CIT (A) had failed to address this point and did not give any finding on the point. Obviously as per provisions of Law, accepting the alleged loan in cash in violation to section 269SS of the Act attracts only penalty u/s 271D of the Act and warranting no addition either u/s 68 or 69 of the Act. The ld. CIT (A) did not dwell upon this fact and gave no finding on this fact. The ld. CIT (A) had felt satisfied to deal with the point regarding 'sufficiency of the reasons' only; which were never in question. In fact, the appellant had questioned the 'Correctness' of the reasons and not the 'Sufficiency' of the reasons as dealt with by the Authorities Below. Thus the Authorities Below had failed to deal with the point regarding 'correctness' of the reasons recorded as objected by the Appellant in the re-assessment proceedings. Thus the Authorities Below had turned dow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the ld. CIT(A) qua this issue. Accordingly, we uphold the same. Hence, grounds No. 1 and 2 of the appeal are dismissed. 9. Ground No. 3 of the appeal raised by the assessee relates to challenging the order of the ld. CIT(A) in confirming the addition of ₹ 8.00 lacs as unexplained income of the assessee. In this regard, the ld. AR appearing on behalf of the assessee has reiterated the same arguments as were raised before the ld. CIT(A) and also relied upon the written submissions filed before the Bench and the contents of the same are reproduced below: Regarding addition of ₹ 8,00,000/- The Ld. CIT (A) had dismissed this ground of appeal vide para (x) of the Appeal Order. On going through the findings of the Ld. CIT (A), it is noted that the Ld. CIT (A) had dismissed this ground in 'summary manner' 'solely' on the plea that the appellant was not willing to cross examine the witness on the given date of 9.10.2017 so his various contentions on the point were not sustainable. Obviously such findings are lopsided, devoid of merits and contrary to the principles of 'Equity' Natural Justice', to be assailed vehement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... categorically and specifically informed that he did not recall the details of such transactions and he was unable to narrate any detail of the transactions undertaken through him. More-over no name what-so-ever of any of the `recipient' of the alleged funds could be mentioned by the witness in his statement recorded u/s 132(4) of the Act. In the circumstances, no adverse inference was called for on account of such `general' and `vague' statement recorded u/s 132(4A) of the Act, and valid addition could be made. Thus the Ld. AO had incorrectly taken an adverse view on account of such general and non-committal statement u/s 132(4A) of the Act. (b-1) Moreover, the presumption u/s 132(4A) is available only against the person from whose possession the document is found and not against the third person. Kindly refer to the judgment of honorable ITAT, Pune Bench (B) Pune in the case of Vinit Ranawat (ITA Nos. 1105 and 1105/PN/2013 dated 12.6.2016 (copy placed in the PB at as held by number of judicial authorities in number of cases. In the circumstances, no adverse view was called for in the case of the appellant on the basis of the statement of Shri Khilnani u/s 132(4A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the funds etc. are not forthcoming. In absence of such vital and relevant details, the papers and material under consideration are 'Deaf and Dumb' papers only and carry no evidentiary value as for all purposes and carry. The Authorities Below had however turned down this contention on the plea that 'Tabulated Sheets' cannot be considered as 'Deaf and Dumb' documents as these contained complete details and 'dates' of the payments under consideration. Such findings of the Authorities Below are factually incorrect. On perusal of the printouts of the sheets, it is noted that there is no mention of any date, receipt and other supporting details in respect of such transactions. Thus the judgment as relied upon by the Authorities Below has no bearing on the facts of the present case. The Authorities were not justified in rejecting such contention of the appellant on the basis of this judgment. As on date, it is a settled law that no addition could be made on dumb document/note book/loose slips found during the search and the basis of the entry of noting on loose sheet or figures etc. and on the basis of the same it could not be concluded that those r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Authorities Below had however kept mum on the point and did not give any finding on the point. Thus the addition so made and confirmed the same in absence of any specific findings. Thus the addition so made and confirmed deserves to be deleted summarily. (f) As the alleged funds under consideration had already been considered and assessed in the case of Shri Asharam so no further addition was made on account of the same funds in the case of Shri Khilnani., being a finance broker. Like-wise, the appellant is also a `Commission Agent' and the alleged transfer of the funds from a broker to broker should be treated alike on the same footings and analogy. As the funds were transferred further by Shri Khilnani to the appellant who is again a broker, so the funds transferred from one broker to another is not inevitably a loan as taken by the Revenue. On the basis of same analogy, no further addition is called for in the case of the appellant also. The Authorities Below had however erred to ignore this vital fact and had made and confirmed the addition without appreciating this fact that this would tantamount to double addition. Thus the addition so made is bad in law and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicable in the present case. As Section 68 of the Act comes into operation only when `no satisfactory explanation is coming forth in respect of the cash credit found recorded in the books. In the present case, however, no such credit entry is recorded as evident from the books. Thus this section is not applicable in this case. Again, Section 69 of the Act is not applicable in the present case as the assessee was never found in 'possession' of such sum at any stage in any manner. Thus both the provisions of law are not operative in the present case. 13. We further observe that again on the date, it is a settled law that no valid addition can be made on the basis of the material found from the custody of 'Third Party' as held by the Hon ble Supreme Court in the land mark judgment in the case of Common Cause vs UOI (Sahara Diaries) in IA No.3 4 of 2017 in W.P (Civil) No. 505 of 2015 dated 11.1.2017, wherein, the Hon ble Apex Court has held that section 34 of the Evidence Act, entries in loose papers/ sheets are irrelevant and inadmissible as evidence. Such loose papers are not books of account and the entries therein are not sufficient to charge a person ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
