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TMI Blog2021 (10) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... 06/M/2019 - - - Dated:- 1-10-2021 - Shri Rajesh Kumar, Accountant Member And Shri Ravish Sood, Judicial Member For the Assessee : Shri A.K. Gosh, A.R. For the Revenue : Shri Vijay Kumar Subramaniyan, D.R. ORDER PER RAJESH KUMAR, ACCOUNTANT MEMBER: The present appeal has been preferred by the Revenue against the order dated 12.11.2018 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2006-07. 2. The only issue raised in the grounds of appeal is against the deletion of addition of ₹ 5,30,92,953/- by Ld. CIT(A) as made by the AO on account of peak balance during the year in two bank accounts with HSBC Private Bank(Suisse) SA, Geneva. 3. The facts in brief are that the Respondent is an individual residing in Abu Dhabi, UAE since 1976. The Respondent is a Chartered Accountant, working with Al Nasser Holdings as Group Advisor Director (formerly as Managing Director). During FY 2005-06 (AY 2006-07), the respondent resided in India for a period of 45 days which does not exceed the maximum threshold limit specified in Section 6 of the Income-tax Act, 1961 ( the Act ) and accordingly, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .12.2011 before the DDIT (Inv.).Thereafter, the assessment was reopened u/s 147 of the Act vide notice u/s 148 of the Act dated 31.10.2014 after recording reasons to believe u/s 148(2) of the Act which were duly supplied to the assessee with notice u/s 148 of the Act. The AO noted in the reasons to believe that information had been received pertaining to respondent assessee having a bank account in HSBC Bank, Geneva bearing number BUP_SIFIC_PER_ID-5090154065 and the peak balance in such account was USD 1,194,388. The AO also supplied a copy of base note received from French Authorities under Indo-French Fiscal Treaty to the respondent assessee. As per base note copy of which is filed at Pg. 185to 189 of the paper book ,there are two accounts with HSBC Geneva. The first account bearing number 5094029263 is in the name of Blueridge Investment Corporation which was incorporated in Liberia having a peak balance of USD 1,184,851 in February 2006 and the other account bearing no 5094495795 was in the joint names of the respondent assessee and his brother Devendra Singhvi having a peak balance of USD 9,537 in November 2005. The respondent assessee filed objections vide letter dated 7.11.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der dated 25.03.2015 by making an addition of ₹ 5,30,92,953/- to the income of the assessee equal to peak balance in both the bank accounts. 4. The aggrieved assessee filed an appeal before the ld. CIT(A) and some additional evidences were also filed before ld CIT(A) which are placed at page nos. 257-335 of the paper book. The ld CIT(A) forwarded the additional evidences to the AO and directed to file a remand report . The AO submitted remand report to the Ld. CIT(A). The Ld. CIT(A) after considering the facts and the remand report admitted the additional evidence under Rule 46A held that in order to assess the asset/bank account held by a third party in the hands of the respondent assessee the department has to prove that the assessee has direct beneficial interest in the asset/bank account held by third party (i.e. Blueridge Investment Corporation). The ld CIT(A) observed that the department has failed to bring any evidences on record to show that the respondent is having any beneficial interest in the company i.e. Blueridge Investment Corporation or the bank account held by the company with HSBC Geneva. On the contrary the respondent filed three independent/third party ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... added a beneficiary. The ld DR stressed the importance that if the assessee is not having any interest in the corporation why he is one of the two signatory in the bank account. The ld Dr further argued that in the other account bearing no 5094495795, he was joint holder with his brother Devendra Singhvi having a peak balance of USD 9,537 in November 2005. The Ld. D.R. submits that had the assessee signed the consent waiver form, the Revenue Authority could have found out the truth behind the curtain. The Ld. D.R. finally submitted that the whole modus operandi which is adopted by the assessee to park the black money is so complex and intricate and also the fact that the assets are in foreign country, it is very difficult for the Revenue Authority to conduct the enquiry and dig out the truth. The ld DR finally argued that the taking into account the circumstantial evidences , it is quite clear that the money belonged to the assessee and therefore prayed that the order of ld. CIT(A) may be set aside and that of AO may be restored. 7. The ld AR while controverting the arguments of the ld DR submitted that the respondent is an individual residing in Abu Dhabi, UAE since 1976 and is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in November 2005, the ld AR submitted that the respondent assessee had opened a joint account along with his brother in HSBC Geneva in 1998 and had transferred funds since 1998 to this account from his other account in HSBC Abu Dhabi, UAE. The source of the funds transferred from HSBC Abu Dhabi, UAE were stated to be out of the income earned in Abu Dhabi and savings made by the respondent assessee during his stay in Abu Dhabi, UAE as a non-resident Indian since 1976.The ld AR argued that the revenue has failed to bring any independent evidences on records to controvert the facts and evidences as placed by the assessee before the authorities below. Besides the assessee is non resident during the year the ld CIT(A) has rightly deleted the addition which may kindly be upheld. In defense of his arguments the ld AR relied on the decision of ACIT Vs Suresh Nanda ITA No 4802 to 4806/Del/2015 CO 266 to 269/Del/2015 AY 2006-07 to 2009-10. The decision of the tribunal was upheld by the Hon ble Delhi High Court in CIT Vs Suresh Kumar in ITA No. 85/2013,100/2013 87/2013 order dated 25.02.2013. The ld AR also relied on the recent decision of the Hon ble ITAT Delhi Bench in the case of Jati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funds transferred from HSBC Abu Dhabi according to the respondent assessee to HSBC, Geneva had no source or income accruing or arising from India. The DDIT (Inv.) Unit-III, Mumbai investigated the account with HSBC, Geneva by issuing summons u/s.131 of the Act dated 9.12.2011 and the detailed submissions in reply were made vide letters dated 16.12.2011, 21.12.2011 and 29.12.2011 before the DDIT (Inv.).Thereafter, the assessment was reopened u/s 147 of the Act vide notice u/s 148 of the Act dated 31.10.2014 after recording reasons to believe u/s 148(2) of the Act which were duly supplied to the assessee with notice u/s 148 of the Act. The AO noted in the reasons to believe that information had been received pertaining to respondent assessee having a bank account in HSBC Bank, Geneva bearing number BUP_SIFIC_PER_ID-5090154065 and the peak balance in such account was USD 1,194,388. The AO also supplied a copy of base note received from French Authorities under Indo-French Fiscal Treaty to the respondent assessee. As per base note copy of which is filed at Pg. 185to 189 of the paper book ,there are two accounts with HSBC Geneva. The first account bearing number 5094029263 is in the nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g any beneficial interest in the company and he is only a joint signatory of the bank account of the company along with other director. The respondent assessee also filed before the AO the credit advices received from HSBC Geneva in respect of Funds transferred to his account from HSBC Abu Dhabi. Finally, the assessment was framed u/s 143(3) r.w.s. 147 of the Act vide order dated 25.03.2015 by making an addition of ₹ 5,30,92,953/- to the income of the assessee equal to peak balance in both the bank accounts. Ld CIT(A) after admitting the additional evidences and after considering remand report of the AOI on the additional evidences held that in order to assess the asset/bank account held by a third party in the hands of the respondent assessee the department has to prove that the assessee has direct beneficial interest in the asset/bank account held by third party (i.e. Blueridge Investment Corporation). The ld CIT(A) observed that the department has failed to bring any evidences on record to show that the respondent is having any beneficial interest in the company i.e. Blueridge Investment Corporation or the bank account held by the company with HSBC Geneva. On the contrary ..... X X X X Extracts X X X X X X X X Extracts X X X X
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