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TMI Blog2021 (11) TMI 673X X X X Extracts X X X X X X X X Extracts X X X X ..... nt in properties. 2. That the Ld. CIT(A) has erred in law and on facts in restricting the addition of Rs. 14,49,14,000/- on account of alleged unexplained investment in properties to Rs. 6,51,00,000/-. 3. That the Ld. CIT(A) has erred in law and on facts in deleting addition of Rs. 5,42,82,079/- on account of alleged unexplained investment in properties. 4. That the Ld. CIT(A) has erred in law and on facts in deleting addition of Rs. 13,46,94,265/- on account of alleged unexplained investment in properties. 5. That the Ld. CIT(A) has erred in law and on facts in deleting addition of Rs. 1,34,37,000/- on account of alleged unexplained investment in properties. 6. That the Ld. CIT(A) has erred in law and on facts in deleting addition of Rs. 20,00,000/- on account of alleged unexplained investment in properties. 7. That the Ld. CIT(A) has erred in law and on facts in deleting addition of Rs. 32,50,00,000/- on account of alleged unexplained investment in properties. 8. That the Ld. CIT(A) has erred in law and on facts in deleting addition of Rs. 34,00,000/- on account of alleged unexplained investment in properties. 9. That the Ld. CIT(A) has 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 ..... CIT(A) erred on facts and law in confirming the action of the AO of determining the assessed income at Rs. 6,80,71,080/-. 2. That Ld. CIT(A) erred on facts and law in confirming the addition of Rs. 6,51,97,000/-. The addition confirmed by the CIT(A) is on the basis of arbitrary interpretation of dumb documents. 3. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off. 5. The common grievance in the Departmental appeal as well as in assessee's appeal relates to the deletion / addition on account of alleged unexplained investment in properties. 6. The grievance of the Department in its appeal relates to the deletion of additions while the assessee is in appeal against the sustenance of addition made by the A.O. 7. Since the Ld. CIT(A) dealt with all the additions sustained and the deletions made simultaneously in the impugned order therefore we will also decide all the issues simultaneously. 8. The facts related to the issues under consideration, in brief are that a search under section 132 of the Income Tax Act, 1961 (hereinafter referred to as 'Act') was conducted at the residential premises of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - and Rs. 5,66,00,000/-in properties in Hans Nagar, Bathinda has been mentioned regarding purchase of property for Rs. 5,66,00,000/- it is total land of 7acres, the purchase price of which comes to Rs. 1600/- per sq. yards.-Vide this office letter dated 27.02.2013 the assessee was specifically requested to give the complete details regarding source of investments on these properties. The assessee file letter dated 11.03.2013 stating there in that no such property was purchased and it was only dumb document. The reply of the assessee has been considered and I find no merit in that because the specific figures along with the area of land and situation of property is also mentioned. As such it can not be treated as a dumb document. Since the assessee has failed to explain the source of these investments in the properties these amounts are added back to the total income of the assessee. Further the assessee has sold land out of this total of 7 acres of the land situated at Hans Nagar, the assessee has sold land measuring 6622 sq. yard for Rs. 1,66,32,800/- and land measuring 2200 sq. yards has been sold for Rs. 45 lacs. It is also revealed that 2 acres have been sold at Rs. 1,66,00,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee. Penalty proceedings u/s 271AAA is initiated separately for concealing the particulars of income. (c)Document No.28 of ISB-8 This document mentions the details of land transaction done by assessee with regard to 23155 sq. yards of land situated at Lai Singh Basti, Bathinda. From the details on this document it can be concluded that the assessee made investment of Rs. 3,92,75,215/- in the purchase of land measuring 23155 Sq. yards in Basti Lai sing Bathinda @ Rs. 1696/-per Sq. Yards. The following land has been sold by the assessee: a) land measuring 3666 Sq. Yards at the rate of Rs. 3800/- per sq yards for a total consideration of Rs. 13930800/- (b) Land measuring 9700 sq. yards at the rate of Rs. 2400/- per sq. yards for a total consideration of Rs. 23280000/- c) land measuring 1200 sq. yards has been sold for Rs. 25Lacs.s The land measuring 4308 sq. yards is still available with the assessee valued at the rate of Rs. 2500/- per sq. yards i.e. total value of Rs. 10770000/-. Therefore it is clear that the assessee has sold 14566 sq. yards of lad for a total consideration of Rs. 39710800/- and made a profit of Rs. 1,50,06,864/- (Rs. 39710800 -Rs. 24703936) on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e concluded that the assessee has made investment of Rs. 7,05,26,000/-and Rs. 4,67,50,000/- in various lands and profit of Rs. 1,74,18,265/- on the sale of the various lands situated at Bathinda. Since the assessee has failed to disclose the source of investment, the investment of Rs. 4,67,50,000/- an Rs. 7,05,26,000/- plus profit earned on the sales out of above property amounting to Rs. 1,74,18,265/- i.e. total of Rs. 13,46,94,265/- are added back to the total income of the assessee. Penalty proceedings u/s 271AAA is initiated separately for concealing the particulars of income. (e)Document No.30 of ISB-8 The document mentions the details of purchase of land for Rs. 1.25 Crore at Bir Talab, Bathinda and earned profit of Rs. 9,37,000/- by selling the same. Since the assessee has failed to give any explanation the amounts of Rs. 1.25 Crore (investment) and Rs. 937000/-(Profit) are considered as undisclosed income of the assessee and added back to his total income. Penalty proceedings under section 271AAA are initiated on this account.Vide this office letter dated 27.02.2013 the assessee was specifically requested to give the complete details regarding source of investments on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justice and to be fair the investment is taken at Rs. 32.5crores. Vide this office letter dated 27.02.2013 the assessee was specifically requested to give the complete details regarding source of investments on these properties. The assessee file letter dated 11.03.2013 stating there in that no such property was purchased and it was only dumb document. The reply of the assessee has been considered and I find no merit in that because the specific figures along with the area of land and situation of property is also mentioned. As such it can not be treated as a dumb document. Because the assessee has failed to explain the source of investments, as such the same is added back to the total income of the assessee i.e. Rs. 32.5crores. Penalty proceedings u/s 271AAA is initiated separately for concealing the particulars of income. (g) (2) Second part of this page mentions the details of some investment in the properties total of which comes to Rs. 34. however no denomination has been mentioned any where about the exact investment. Since the assessee has failed to explain the contents of this document, for the sake of natural justice and to be fair the investment is taken at Rs. 34 lacs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... added back to the total income of the assessee i.e. Rs. 21lacs. Penalty proceedings u/s 271AAA is initiated separately for concealing the particulars of income. The income of the assessee is computed as under;- Returned income Rs. 28,74,080/- Add: Addition as per para 2.1(a) Rs. 11,23,17,600/- Addition as per para 2.1(b) Rs. 14,49,14,000/- Addition as per para 2.1(c) Rs. 5,42,82,079/- Addition as per para 2.1(d) (1) Rs. 13,46,94,265/- Addition as per para 2.1(e) Rs. 1,34,37,000/- Addition as per para 2.1(f) Rs. 20,00,000/- Addition as per para 2.1(g) (1) Rs. 32,50,00,000/- Addition as per para 2.1(g) (2) Rs. 34,00,000/- Addition as per para 2.1(h) Rs. 1,42,28,500/- Addition as per para 2.1(i) Rs. 21,00,000/- Total income assessed Rs. 80,92,47,524/- 3.1 Charge interest u/s 234A, 234B & 234C. 3.2 Assessed as per I.T.N.S 150. Notice of demand U/s 156 of I.T. Act, 1961 determining the sum payable if any issued. Issue demand notice and challan. 3.3 This order is passed after seeking approval u/s 153D form the Addl. CIT, Central Range, Ludhiana vide F.No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tention or release of the assets under section 132(5) of the Act which cannot be extended to the assessment proceedings and that the presumption under section 132(4A) is rebuttable presumption and the same can only be raised by the department when a document is a speaking one and it reflects complete transaction without two interpretations. Reliance was placed on the following case laws: * P.R. Metrani Vs. CIT 287 ITR 209 (SC) * ACIT Vs. Satyapal Wassan (2008) 5 DTR (Jab) 202 para 31 * Gurlal Singh Grewal Vs. ACIT in ITA No. 1208/Chd/2011 vide order dt. 29/08/2012 (Chd) * CIT Vs. Atam Valves (P) Ltd. (2009) 184 Taxman 6 (P&H) * Satnam Singh Chhabra Vs. Dy. CIT (2002) 74 TTJ(Lucknow) 976 * CIT Vs. Ravi Kumar 294 ITR 78 (P&H) * Kantilal Chandulal & Co. Vs. CIT (1982) 136 ITR 889 (Cal) 9.2 It was further stated that in such type of cases there cannot be any extrapolation by presuming that the figures were in lacs or crores when no such figures had been written on the documents seized during the course of search. Reliance was placed on the following case laws: * CIT Vs,. Girish Chaudhary (2008) 296 ITR 619 (Del) * Atul Kumar Jain Vs. DCIT 64 TTJ 786 (Delhi) 9.3 The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sh. Inderjeet Singh Brar) had also sold land measuring 32 Kanal 14 Marla in Vill. Jai Singh Wala on 05/06/2009 and that no other property was purchased or sold during the period 01/04/2009 to 31/03/2011 by the assessee or his family members. 9.5 The A.O. submitted in his report that it was the Modus-operandi of the property dealers that generally they do not purchase the property by way of registration deed but only by way of power of attorney and the same land was sold on the basis of power of attorney, hence their name did not appear in the registration deed or in revenue records. It was further stated that since the assessee had not pin pointed the properties against which he had stated to be only proposals , he may be asked to explain the above properties so that the verification could be made. The Ld. CIT(A) further asked the A.O. to pursue the matter in terms of investigating the ramifications of the contents of the seized documents and to record the statement of the assessee as the same had not been done at the time of assessment proceedings. The A.O. was also directed to make inquiries with the land revenue authorities in the geographical locations recorded in the seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l during the last 7-8 years, not even remembering names of three persons or the location of lands against which proposals were made to him which he noted in his diary with specific amounts. During the post search enquiries by the investigation wing, the statements of Sh. Inderjit Singh Brar were recorded on 10.03.2011, he did not give answer or explanation to the seized documents confronted to him by the DDIT(Inv.). He just only stated that the entries contained in these documents as dumb paper and projections. Further, he also stated that he was not in frame of mind to give answer to the seized documents. Keeping in view the non-cooperative attitude of the assessee regarding explanation of seized documents, additions made on the basis of these documents may kindly be confirmed. Copy of statements of Sh. Inderjit Singh Brar dated 21.02.2014 is enclosed." The aforesaid letter of the A.O. was confronted to the assessee. In response the assessee submitted as under: "During the course of hearing of the appeal the issue regarding the additions made by the AO on account of alleged undisclosed investment and sale of immovable properties was discussed with your goodself. The compl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d any iota of doubt from the fact that the AO made additions of Rs. 32,50,00,000/- based on the notings of 35 cr. (which could be credit also) on left hand side of the document and 34,00,000/- on account of 34 written on right hand side of the document no. 7 of ISB-11 which shows that the figures have been extrapolated by the AO by presuming that they are in lac or crores as per his whims and fancies and the additions have been made in A.Y. 2011-12. So much so that the profit of 6,51,97,000/- has been determined from the sale of properties in which undisclosed investment have been determined at Rs. 7,97,17,000/- resulting in addition of Rs. 14,49,14,000/- in A.Y. 2011-12 on the basis of notings in the document no. 27 ISB-8. Similarly the word plots has been extrapolated in document no. 38 of ISB-13 and the alleged sale of Rs. 6,32,00,000/- has been taxed as undisclosed income for A.Y. 2007-08. The action of the AO in making exorbitant addition of Rs. 80,63,73,444/- for A.Y. 2011-12 and Rs. 6,32,00,000/- for A.Y. 2007-08 merely on the basis of notings in the seized records shows that the assessment framed by the AO is a typical case of assessment based summarizes and conjectures. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... computed @ Rs. 1600/-per sq. yrds which is without any details of working in the assessment order or in the remand report and the same comes to Rs. 1670/- if calculated actually for 7 acres which comes to 33180 sq. yrds. The saleable area would have been 18600 sq. yrds from the total 7 acres of land. But the AO has treated as 2 acres and 8852 sq. yrds. as sold which makes the projection incomplete because if ploting is done 2 acres cannot be sold without converting the same into plots and if Rs. 7017600/- has been earned from 8852 sq. yrds why 2 acres has been treated to be sold at cost price. Further the amount of Rs. 16632800/- taken as sale price by the AO of 6622 sq. yrds the same comes to Rs. 2500/- per sq. yrd as against the amounts of @ 2400/- and 2800/- has been mentioned in the document. All these facts proves that the noting on this document are only projections and estimations otherwise the complete details of the transactions would have been noted 2 Page 27 of ISB 8 Addition of Rs. 144914000/- (Page 3 of the assessment order) (Rs. 65197000/- + Rs. 79717000/-) The sale word has been used on this loose slip and under the same profit 1 acre and 2 acres has also been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... non application of mind by the AO. The word 1200 sold by 255/85 and 25 lacs has been interpreted as sale price of 1200 sq. yrds. Left area 5558 has not been taken into consideration for purpose of computation as 5558-1200=4308 has been taken as left area which shows that calculation have been made according to convenience and without application of mind by the AO. 4. Page 29 of ISB 8 Addition of Rs. 134694265/- (Page 5 of assessment order) (Rs. 46750000/- + Rs. 70526000/- + Rs. 17418265/-) The noting of 5.5 acres and 21.2 kanal at Jai Singh Wala on this loose slip has been taken as investment. The notings of Rs. 70526000/- has been taken as investment at Multania Road and profit of Rs. 17418265/- has been computed for which no details have been given in the assessment order but the same has been given in the remand report. There is no notings on this loose slip that whether this transaction of purchase or sale but the same ahs been treated as investment in property at Jai Singh Wala. There are no details of sale of this property in the seized record and this amount has also been mentioned on page 27 for which separate addition has been made. The total land was 27746.80 sq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the diary dated 21.01.2010 but the addition has been made in A.Y. 2011-12 for which no reason have been given either in the assessment order or the remand report. 8. Page 6 of ISB 21 (Page 7 of the assessment order) Addition of Rs. 14228500/- Rough notings on this page has been treated as some payments made to various payments. The A.O. has not made any efforts either in the assessment order or remand report to give the nature of payments but have made the addition without application of mind. 9. Page 4 ISB 21 Page 7 & 8 of assessment order Addition of Rs. 2100000/- The total of 0.21 has been extrapolated as 2100000/- as payment of Rs. 2100000/- The figure 0.21 has been extrapolated as payment of 2100000/- without application of mind by the A.O. or giving the nature of payment either in the assessment order of in the remand report. 9.7 On the basis of the aforesaid submissions it was stated that the notings on the said loose slip were only projections and proposals for which estimates were noted but did not materialize into any transaction of actual purchase / sale resulting into any unaccounted investment or profit to the assessee. It was further stated that the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the judicial view on whether a particular seized document was speaking enough or not has been expressed in number of cases. The reference was made to the following case laws: * Gurlal Singh Grewal Vs. ACIT, Cirlce-VI, Ludhiana, ITA No. 1208/Chd/2011 order dt. 29/08/2012 9.9 The Ld. CIT(A) discussed the facts in the case of ACIT Vs. Satyapal Wassan (supra) decided by the ITAT Jabalpur on the issue of categorization of a particular document as dumb document wherein the A.O. relied upon the documents contained in the following details: " G.S 5 Ravi 2 Kotli 2 Umiya 2 Swamy 5 Ganpath 1-1/2 Radheshyam ½ Shyamjibhai 1 Dari .30 Lamba ½ BHu ½ Dev Bros. 2 22.30" 9.10 The Ld. CIT(A) reproduced the observations of the ITAT, Jabalpur in the aforesaid referred to case which are reproduced verbatim as under: "We have already pointed out above that this document is bereft of necessary details about year of transaction, ownership of transaction, nature of transaction, necessary code for deciphering the figures. It may be possible that a document may not be complete in all respects as the businessman or tax evaders may c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r and the fifth is the rate or rates at which tax is to be imposed. The rates are prescribed in the annual Finance Act. Therefore, this component has no value in determining total income on the basis of seized document. Our view in this regard is supported by the decision of Hon'ble Supreme Court in Govind Saran Ganga Saran vs. CST (1985) 155 ITR 144 (SC) wherein it was held that for the purpose of charging to tax, there should be four components to be satisfied. For the sake of convenience, we refer to the relevant headnotes from that decision : "The component which enter into the concept of a tax are well known. The first is the character of the imposition known by its nature which prescribes the taxable event attracting the levy, the second is a clear indication of the person on whom the levy is imposed and who is obliged to pay the tax, the third is the rate at which the tax is imposed and the fourth is the measure or value to which the rate will be applied for computing the tax liability. If those components are not clearly and definitely ascertainable, it is difficult to say that the levy exists in point of law. Any uncertainty or vagueness in the legislation scheme def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he is the one from whose possession the document is recovered or someone else. Merely because a document is recovered from the body of a person, does not automatically lead to the inference that it belonged to him. It is only for certain purposes that presumption under s. 132(4A) has been enacted and not for all purposes including the assessment. Further, this presumption is not conclusive. It is rebuttable. If the assessee has, by way of affidavit denied ownership of the document and, further, Smt. NirmalKanta, wife of Sri DharamvirWassan admitted that it belonged to her husband; it could not be inferred without rebutting those evidences (filed in the form of affidavits before the AO) that document and transactions recorded therein, in fact, belonged to Sri Satyapal Wassan. Onus under s. 132(4A) is always shifting. This sub-section provides that : Sec. 132 (4A)-Where any books of account, other documents, money, bullion jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search, it may be presumed- (i) that such books of account, other documents, money, bullion, jewellery or other valuable article or thing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not be said that onus did not shift to the AO. In our considered view, the affidavits, even if regarded as selfserving do not lose their evidentiary value if there is no material contrary to the averments made in the affidavit. When sufficient other material is found in the search which corroborates that document belonged to the assessee, then denial of such ownership merely by affidavits will be meaningless and they do not carry any weight to rebut the presumption lying on the assessee. In the present case, nothing is shown by the AO that there was other material correlated with the impugned document clearly showing that it belonged to the assessee. Under these circumstances, the assessee has successfully shifted the onus on to the AO by filing the affidavits. They may be self-serving but carry enough weight to shift the burden or rebut the presumption. Once the onus is shifted to the AO, he was duty-bound to collect evidence so as to belie the contents of the affidavit and hold that document and transactions recorded therein, in fact, belonged to Satyapal Wassan. If the AO has not done so, it could not be said that the second component of levy of charge has been properly estab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xed these advances as wealth of the assessee. There is also no material to show that the assessee has taken.any action to recover the money from the alleged debtors. It is not believable that the assessee or his legal heir would forget their money lying with the debtors. By one way or other, he or his legal heir would try to recover the money. The Department has not done anything to find out that after the search in April, 1995. We are also unable to satisfy ourselves as to why the alleged transactions are considered in the asst. yr. 1989-90 when there is no date mentioned on the document. Once search took place in April, 1995, then undated -aper could be presumed to be belonging to that period and hence, the year of taxability would be asst. yr. 1996-97. Thus, it is merely by surmises that the AO has taxed it in the year 1989-90. Our view is supported by the decisions of Tribunal in several other cases. In Bansal Strips (P) Ltd. vs. Asstt. CIT (2006) 100 TTJ (Del) 665 : (2006) 99 ITD 177 (Del), the AO has found certain loose papers during the course of search which indicated that certain figures against certain names were written. They were decoded to make the total to Rs. 53,69 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In Steel Home vs. Asstt. CIT (1999) 65 TTJ (Del) 393 : (1999) 69 ITD 240 (Del), the Tribunal held that where the entries recorded on a document found in the course of the search could not be related to the assessee, then any mentioning of low withdrawals or purchase of plots or the mentioning of stock or the figures of stock could not be added as the assessee's income as they could not be related to the assessee. It shows that it is very important for the AO to find out that the entries and related transactions belonged to the assessee. In our case, where affidavit is filed that entries related to DharamvirWassan and not to the assessee, it was incumbent on the AO to carry out necessary enquiries and relate the transactions with Sri Satyapal Wassan. Since such exercise has not been done, the & document could not be considered in the assessment year in question or even otherwise in the case of the assessee. - In the case of Smt. NeenaSyal vs. Asstt. CIT (2000) 69 TTJ (Chd) 516 : (1999) 70 ITD 62 (Chd), the decision of Tribunal in the case of Ashwani Kumar vs. ITO (1991) 42 TTJ (Del) 644 : (1991) 39 ITD 183 (Del) was referred in which it was held that where documents foun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... produced herein. 9.12 The Ld. CIT(A) observed that the common feature amongst all the documents was that there was a general specification of location of some property and recording of certain amounts as purchases / sales and resultant figures as profits as well. However no specific dates were recorded on the seized documents neither there was any detail of receipts /payments either in cash or in cheque on a sequential basis. He further observed that recordings were infact a summary of various either estimates or transactions which could have happened, it therefore becomes apparent that apart from seizure of the impugned documents during search no further efforts had been made by the investigation wing to bring on record any corroborative evidence to establish the veracity of such documents and also to establish that transactions as recorded had actually taken place at some point of time and at the given locations. He further observed that even during the course of assessment proceedings, no such efforts had been made by the Assessing Officer as well. However, during the appellate proceedings the A.O. was directed to pursue the matter further and in this regard investigation was d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the same transaction was recorded at page no. 29 in a more descriptive way as followed: Jai Singh Wala ½ acres @ 15 = 1,27,50,000/- Back 21-2 @ 16 = 3,40,00,000/- 4,67,50,000/- 9.16 The Ld. CIT(A) also observed that the working on page no. 29 was therefore carried to page no. 27. He also pointed out that the working at page no. 30 with respect to profit was the sale of land at Bir Talab to the tune of Rs. 9.37 lacs & Rs. 9.10 lacs had been recorded which was carried on to page no. 27 and the recording on the lower half portion of page no. 29 in respect of Multania road (Aulakh) had been done wherein investment of Rs. 1,79,53,000/- had been worked out which gets reflected at page no. 27 on the lower half portion, further the sale of Hans Nagar on upper portion of page no. 27 to to the tune of Rs. 1.66 Crore had been recorded which finds mentioned at page no. 25 as well as sale of Hansnagar at the same figure of Rs. 1.66 Crores. Similarly, recording of Rs. 4 Crores on page no. 27 with reference to Hans Nagar on lower portion could also be seen at page no. 26 which shows that the A.O. had been wrong in taking each ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) observed that the addition made by the A.O. to the tune of Rs. 1,42,28,500/- on the basis of seized document at page no. 6 was related to the recordings at page no. 7, the same figures had been repeated again. He further observed that the recordings were not descriptive enough to hold independently and even if the same was presumed to be record of payments made by the assessee there is nothing to discount the possibility that same could be part of transactions with respect to other properties which had been held as unaccounted in the earlier portion of the impugned order. According to him there was not enough evidence to warrant an independent addition on the basis of this document. Similar was the case with respect to addition of Rs. 21,00,000/- on the basis of document at serial no. 4 and 5, even otherwise, the availability of unaccounted income to the tune of Rs. 6,51,00,000/- would be sufficient to take into account the possibility of unaccounted expenditure of Rs. 21,00,000/- and Rs. 1,42,00,000/- as recorded on page no. 4 and 6. Accordingly the addition of Rs. 6,51,00,000/- was sustained and the remaining additions were deleted. 10. Now the department is in appeal agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 7,05,26,000/- alongwith profit of Rs. 1,74,18,265/- totaling of Rs. 13,46,94,265/- was rightly made by the A.O. 11.3 It was further stated that the document no. 30 of ISB-8 mentioned the purchase of land at Bir Talab for consideration of Rs. 1.25 Crore on which profit of Rs. 9,37,000/- was earned by the assessee. Therefore the addition of Rs. 1,34,37,000/- (Rs. 1,25,00,000/- + Rs. 9,37,000/-) was rightly made by the A.O. 11.4 It was further contended that on the back side of the documents no. 5 of ISB-11, details of investment in the properties amounting to Rs. 20,00,000/- was mentioned and the claim of the assessee that it was a dumb document was not accepted by the A.O. therefore the addition of Rs. 20,00,000/- was rightly made and the Ld. CIT(A) wrongly deleted the same. 11.5 It was further contended that the document number 7 of ISB-11 had two parts, one mentioned investment of Rs. 35,00,00,000/-. However the A.O. noticed that there was calculation mistake and the correct value was Rs. 32.5 Crore the A.O. rightly considered that those documents were not dumb documents as the specific figures of investments alongwith area of land and its situation were mentioned therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he search proceedings, assessment proceedings and during the remand proceedings also. d) The assessee before the CIT (A) had submitted that additions were made only on the basis of notings in the diary which has not been correlated to any documents found during the course of search. The diary contains details of unaccounted transactions/investments, how can they be correlated with books of accounts or land revenue records. e) The assessee before the CIT (A) had relied upon case law in the case of ACIT vs Satyapal assan (2008) 5 DTR (Jab) 202 (para 32). This case law is in favour of revenue as the seized documents are speaking ones having specific figures and area of land. f) The assessee had referred some other case laws wherein additions have been deleted as the documents seized in those cases were not speaking ones. However, in the case of the assessee, the seized documents have specific amounts and area, so the case laws referred by the assessee does not apply to this case. g) The AO in the remand report has stated that it is the modus operandi of the property dealers that they do not purchase the property by way of registration deed but only by way of power of attorney ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9;invest' 'not invested'. On the other hand he stated that word 'sold' is used for 'to be sold' and 'paid' for to 'be paid' (Q4). Moreover, 'sold' or 'to be sold' comes only when the assessee is holding the land, however, he is denying having invested in the properties at the first place, how come he can write 'sold' or 'to be sold' when he is not holding the land. Thus, the statement of the assessee is against human probabilities and therefore, the same is not reliable. i) The assessee has time and again stated that the entries in the diary were only projections, however, nowhere words like estimate, proposals, projections etc. are mentioned. Moreover, there are no calculation errors. Even on page no. 27 of ISB-8 specific amounts of profits are written. During the recording of statement the assessee was asked how these profits were calculated, he again gave the same reply that he had been giving to other questions that these were only estimates. How can someone estimate profit on land which he has yet not acquired. As per the assessee he was not holding any of the land mentioned in the seized documents. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rief summary of the submissions made before the Ld.CIT(A) which read as under: (i) The document was confronted to the assessee in A.Y.2008-09 which is evident from the reply to the show cause notice submitted during the course of A. Y. 2008-09 ft no show cause notice was issued for A. Y. 2007-08. (ii) The date mentioned on the seized document is 25/2 ft wild guess on the basis it has been adopted as 25.02.2007 despite the fact that the seized document is a page of diary on which the printed date is 26th of October ft the year mentioned is 2007. (iii) The A.O. has interpreted the notings as sale of properties by taking the figures of 4,77,00,0001- & 1,55,00,000/- despite the fact that neither there is mention of word plots against the figure of 4,77,00,0001- & nor there is mention of the word plots against any other figure the total of which has been taken at Rs. 1,55,00,000/-. (iv) The assessee filed an affidavit during the course of assessment proceedings that he did not indulge in any purchase or sale of property. (v) That the department did not get any sale deed/agreement or any other document relating to unaccounted purchase/sale of property for any assessment year du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... debtors concerned are existing, their identity; whether advance so taken is reflected in their books; whether any interest is paid on such transaction, what are the documents executed for recovery of such advances or what arrangement the assessee has done for recovery of such advances; whether there are any other related document found in the search; whether any person recorded in the impugned documents had, otherwise any other transaction with the assessee recorded in the regular books. (PB-20) * The second component is the person from whose possession the document is recovered. * The third component is the assessment year to which the income belongs. * The fourth & last component is quantum of income. * According to the Jabalpur Bench of the ITAT the speaking from the document should speak either out of itself or in the company of other material found on investigation and/or in the search. The speaking from the document should be loud, clear and unambiguous in respect of all the four components as described above. If it is not so, then the document is only a dumb document. No charge can be levied on the basis of a dumb document. (PB-24) * The Jabalpur Bench of the ITAT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain deal available in the market. The CIT(A) has further recorded a finding that the AO has merely simplistic presumptions and nothing has been brought on record to corroborate the possibility of transaction suggested by the impugned seized document. (PB-28) (iii) That in para 16 on page 28 ft 29 of the appellate order the CIT(A) has further recorded a finding that the AO had been directed to take out information from the land revenue authorities in order to find out if the appellant or any of his family members or business entities has purchased or sold any immovable property in the year under consideration. The enquiries so conducted by the Assessing Officer revealed that no such transaction had been carried out and Specific transaction that have been revealed by the land revenue authorities was found recorded and declared by the assessee. In the circumstances, with extremely limited description recorded on the seized documents, It would be extremely presumptuous to conclude that the assessee had unaccounted income to the tune of Rs. 6,77,00,0001 - especially when no unaccounted assets had been found during search operations nor any title papers or agreements to sell/purchase h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first appellate proceedings the A.O. made enquiries from the revenue authorities of Bathinda, the result of the enquiries had been reproduced by the Ld. CIT(A) at page no. 25 of the impugned order which read as under: "A letter was written on 04.12.2013 to the Sub-Registrar-cum Tehsildar, Bathinda regarding purchase/sale of properties by Sh. Inderjeet Singh Brar and his family members during the period 01.04.2009 to 31.03.2011 in the area of Hans Nagar, Bathinda; Bir Talab, Bathinda; Vill Jai Singh Wala, Bathinda; Lai Singh Basti, Bathinda and Multania Road, Bathinda. A reply was received from him vide letter no. 575 dated 12.12.2013 in which it has been stated that Sh. Inderjeet Singh Brar had sold 35 canals of land in vill. Jai Singh Wala on 05.06.2009. Further Smt. Jaswinder Kaur W/o Sh. Karnail Singh (mother of Sh. Inderjeet Singh Brar) and also sold land 32 canal 14 Maria in vill. Jai Singh Wala on 05.06.2009. No other property was purchased or sold during the period 01.04.2009 to 31.03.2011 by Sh. Inderjeet Singh Brar or his family members as reported by the Tehsildar, Bathinda as per his letter referred above." 13.3 It was further submitted the A.O. in his remand report ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no. 25 and 26 of the assessee's compilation which is the copy of the said affidavit. It was submitted that the addition sustained by the Ld. CIT(A) was not justified and deserves to be deleted. Reliance was placed on the following case laws: * Assistant Commissioner of Income Tax V/s Satyapal Wassan 5 DTR 202, ITAT, Jabaipur Bench * P R Metrani V/s Commissioner of income Tax 287 ITR 209 (SC) * Gurlal Singh Grewal V/s ACIT, ITA NO.1208/CHD/2011, ITAT Chandigarh Bench, Chandigarh order dt. 29/08/2012 * Commissioner of Income tax V/s Atam Valves (P) Ltd 184 Taxman 6 P&H-HC * Commissioner of Income Tax V/s Ravi Kumar 294 ITR 78 P&H-HC * Kantilal Chandulal & Co. V/s Commissioner of Income Tax 136 ITR 889 CAL-HC * Commissioner of Income Tax V/s Girish Chaudhary 296 ITR 619 DEL-HC * Atul Kumar Jain V/s Deputy Commissioner of Income tax 64 TTJ 786 DEL * Satnam Singh Chhabra Vs. Deputy Commissioner of Income Tax 74 TTJ 976 ITAT-LKW * CIT Vs. Ravi Kumar (2008) 168 Taxman 150 (P&H) * Manav Singla Vs. DCIT in ITA No. 229/Chd/2013, Chandigarh Bench, Chandigarh order dt. 07/05/2019 * DCIT V/s Harvinder Pal Singla ITA No. 456-458/CHD/2014, ITAT Chandigarh Bench, Chandigarh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce when the enquiries were made by the A.O. from those authorites and no such sale deeds were found where in the name of the assessee was appearing as power of attorney holder. In the instant case during the course of search no valuable or cash was found or seized except 200 gms of gold and no document in the form of agreement to sell or registered sale deed had been found evidencing any unaccounted purchase / sale by the assessee. This fact has been categorically stated by the Ld. CIT(A) in para 5 at page 37 of the impugned order. Therefore the Ld. CIT(A) was not justified in presuming that certain transactions were carried on by the assessee particularly when he himself admitted that no documents in the form of agreement to sell or registered sale deed had been found evidencing any unaccounted purchase / sale by the assessee. 14.1 On a similar issue the Hon'ble Jurisdictional High Court in the case of CIT Vs. Ravi Kumar [2008] 168 Taxman 150 (P&H) held as under; " In the instant case, the assessee was found to be in possession of loose slips and not of any valuable articles or things. Neither the possession nor the ownership of any jewellery mentioned in the slips could be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hose documents, the Assessing Officer had not brought on record any other evidence to support the additions made towards unaccounted cash receipts as undisclosed income of the assessee." It has also been held that "The Assessing Officer had not made any attempt to corroborate the entries mentioned in the scribbling pad to the names and address of suppliers and vendors. In the absence of any specific reference to the source of cash receipt and from whom cash had been received and the nature of expenditure for which cash had been paid and the persons to whom said cash had been paid, it was very difficult to accept the contents of the scribbling pad as undisclosed income of the assessee outside the books of account. The Department had failed to bring on record any cogent evidence to prove conclusively that the notings in the seized papers referred to the unaccounted cash receipts of the assessee." 14.3 Similarly the ITAT Delhi 'F' Bench in the case of Picheswar Gadde Vs. ITO, ITAT 202 DTR 41(supra) held as under: "It appears that the, entire additions have been made on the presumption that provisions of s. 292C clearly apply on the facts of the case. The additions made merely on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocument because of the absence of vital feature to permit the same to be taken as the basis for an addition. He also categorically stated that the same figures had been repeated again and again, the recording were not descriptive enough to hold independently and even if the same was presumed to be record of payments made by the assessee, there was nothing to discount the possibility that the same could be part of transaction with respect to other properties which have been held as unaccounted. 14.6 In the instant case neither the dates pertaining and relevant to the year under consideration were mentioned on the loose papers / documents found during the course of search nor the notings were backed by direct or corroborative evidence that the notings have materialized into sale / purchase of property or there was any agreement to sell, which clearly shows that there was no corroborative / demonstrative evidence to justify the additions so made / sustained. 14.7 Therefore by considering the totality of the facts of the present case and in view of the various judicial pronouncements made in the aforesaid referred to cases, in our opinion, the Ld. CIT(A) was not justified in holding ..... X X X X Extracts X X X X X X X X Extracts X X X X
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