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TMI Blog2022 (6) TMI 683X X X X Extracts X X X X X X X X Extracts X X X X ..... ellers Ltd., M/s. PLB Infrastructure Pvt. Ltd., M/s. Shree Raj Mahal Diamonds Pvt. Ltd., at 2633 & 2634, Bank Street, Karol Bagh, New Delhi wherein papers/documents related to M/s. Solitaire World Pvt. Ltd. was found and impounded. Subsequently, the case was centralized from Ward-68(2), New Delhi u/s. 127 of the IT Act, 1961, by the jurisdictional CIT vide order F. No. CIT-B/Delhi/Centralization/2014-15/686 dated 06.02.2015 and the assessment u/s. 143(3) has been completed on 29.03.2016. 4. During the survey proceedings Annexure A-5, Page No. 8 was impounded which shows transactions and on top of the paper 'Received A/c' and 'Payment A/c' is written. In the said document, in the 'Received A/c' side property description "62/1 Ajmal Khan Park" was found mentioned. During the post survey proceedings, on being asked to explain the contents of the said document, it was submitted that the above property description belong to M/s. Solitaire World Pvt., Ltd. which is a part of SRM group of company. During the assessment proceedings, the assesses was asked vide letter dated 23.02.16 to furnish the following details with respect to aforesaid document. The letter of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount of Rs. 55,00,000/- and an amount of Rs. 20,00,000/- totaling to Rs. 75,00,000/- has been added to the total income of the assessee based on the notings on the documents on 04/12 being 5500 and 2000 CHQ. 7. Aggrieved the assessee filed appeal before the ld. CIT(A). 8. The ld. CIT(A) gave remission of Rs. 20,00,000/- paid by cheque as forming part of the regular books of accounts. The relevant portion of the ld. CIT(A) is as under: Ground no. 2 for the AY 2013-14 relates to contention of the appellant against addition of Rs. 75,00,000/- made by the AO. The fact of the case is that the AO made addition on the basis of contents of a document, annexure A-5, page no. 8 impounded during the course of survey action, in which certain transactions was mentioned. This document was impounded from the office premises of the appellant In the said document unexplained expenditure of Rs. 55 lacs and Rs. 20 lacs respectively was noted, since, the source of the impugned expenditure remained unexplained before the AO, therefore, he made addition of the same under section 69C of the IT Act. 5.1 The appellant has submitted as under:- "1. Ground No. 2 of the appeal memo pertains to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by, the appellant gets part relief on this ground." 9. The revenue accepted the decision of the ld. CIT(A) on the issue of remission of Rs. 20,00,000/- and no appeal has been filed. Aggrieved the assessee filed appeal before the Tribunal against the confirmation of Rs. 55,00,000/-. 10. Before us, the ld. AR argued that the entries cannot be read in isolation but they have to be read holistically. It was argued that the total receipts on the said impounded page have to be taken into consideration. It was argued as per the page the total receipts (Received A/C) were to the tune of Rs. 2,19,70,000/- whereas the total expenditure (Payment A/C) was Rs. 3,32,89,000/- (Payment A/C). 11. He relied on the orders of the Co-ordinate Bench of ITAT in the case of D. Suresh Vs. ACIT in ITA Nos. 462 & 463/Bang./2020, ACIT Vs Sharad Chaudhary 55 Taxmann.com 324 and the judgment of Hon'ble Kolkata High Court in the case of Pr. CIT Vs. Ajanta Foot Care 84 Taxmann.com 109. 12. On the other hand, the ld. DR relied on the order of the ld. CIT(A). Placing reliance on the ld. CIT(A)'s order and that no explanation was provided in appellate proceedings nor any supporting document was adduced a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee that they were allegedly loan taken by Mr. Neelamegan and repayments made by him to the Bank: account of the Assessee does not inspire any confidence. In our opinion, therefore, the fact finding Body below have rightly added the said amount in the hands of the Assessee as unexplained income/expenditure of the Assessee. Such addition does not appear to be perverse requiring our consideration under Section 260A of the Act...'' The Co-ordinate Bench of ITAT in the case of Somabhai Ambaalal Prajapati Vs. Assistant Commissioner of Income-tax, Central Ciircle-2(2), Ahmadabad [2017] 88 taxmann.com 369 (Ahmadabad - Trib.) 4. Ld. Counsel for the assessee contends as under:- (i) The incriminating paper based on which the addition was made was a dump document and a rough paper; (ii) Exact contents of the paper were neither opinion of the assessee nor the Assessing Officer could explain them; (ii) This amount was deducted from opening cash balance which has arisen on account of cash receipts on sale of land. 4.1 Ld. Counsel for the assessee further contends that the joint cash flow statement of three brother viz. Shri Somabhai Ambalal Prajapati, Chandubhai Ambalal Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese parties. A relevant extract from the assessment order reads as follows:- "The reply submitted by the assessee has been considered and is not acceptable. The assessee not only failed to produce the said persons but was also not able to provide the PAN No./Sales Tax No. or Pollution Clearance certificate of these parties from which he has claimed to have made substantial purchase which have been made in cash. Further, the suppliers mentioned have addresses which are clearly mentioned on their respective bills. Spot verification carried out has clearly shown that no such parties existed at those addresses even in the year under consideration. Thus the contention of the assessee that they were present on-site is not also acceptable. It is also worth mentioning that notices u/s. 133(6) of the Income-tax Act, 1961 for furnishing of information were also sent to the above mentioned concerns requiring them to provide a copy of the ledger of M/s. Harsoria Construction Co. These letters returned to the office undelivered." The Tribunal, however, has not dealt with this aspect nor has it chosen to record any opinion on the failure of the assessee to produce these parties or to prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons and perused the material available on record. In the given facts, we are inclined to dismiss this ground of the assessee inasmuch as the assessee did not furnish any explanation before any of the authorities, in respect of repayment of LIC loan of Rs. 3,05,000/- in cash hand nothing has been explained before us as well. The Hon'ble Madras High Court in the case of Grand Bazzar Vs. ACIT 166 Taxman 232 held that "in the present case, the assessee had not explained as to the source of purchases and the additions under section 69C of the Act are, therefore, sustainable. Further, the Commissioner of income-tax (Appeals) is not justified in reducing/deleting the additions. As rightly observed by the Tribunal, the funds introduced by the assessee as cash credits in the books of account had gone into the assessee's business account and so, the same could not have been utilised for making the unaccounted purchases and the assessee could not be given credit to any amount already introduced as credits in the account books as available to meet any unaccounted expenditure including the unaccounted purchases. We are, therefore, of the opinion that the Tribunal was justified in rest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e figures and also shows whether the payments were in cash or in cheque. The retraction made by the assessee, after a period of two years, was rightly rejected as an afterthought. As held in the case of T. Rangroopchand Chordia (supra), the loose sheets are also 'documents'. In terms of Section 2 of the Indian Evidence Act, 1872, they can be relied upon. In fact, the Division Bench took into consideration whether the loose sheets seized from the premises of the assessee would constitute 'documents', within the meaning of exception under Sub-Section (4) of Section 132 of the Act and has held as follows: "21. Coming to the two questions of law now before us, it is seen that they revolve around the loose sheets picked up during search. These loose sheets are documents within the meaning of section 2 of the Indian Evidence Act. It reads as follows:- "Document means any matter expressed or described upon any substance by means of letters, figures or marks, or by more than one of those means, intended to be used, or which may be used, for the purpose of recording that matter." 22. It is relevant to note that this definition is a re-production in Section 3(18) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h withdrawals. Hence, not applicable to the facts of the instant case before us. 16. CIT Vs. Narendra Kumar Gupta (55 Taxmann 371) dealt with the issue of bogus bills, hence, not applicable to the facts of the instant case before us. ACIT Vs. Subhash Verma (125 TTJ 865) deals with the issue of cash loans and subsequent payment to LIC. Hence, not applicable to the facts of the instant case before us. 17. Grand Bazar Vs. ACIT (166 Taxmann 232) dealt with the issue of cash credits in the books of account. Hence, not applicable to the facts of the instant case before us. 18. Similarly, the ld. DR's reliance on the judgment of Hon'ble Apex Court in the case Pradeep Kumar Vs. ITO (101 Taxmann 131) is not applicable to the facts of the instant case as the said judgment of the Hon'ble Apex Court dealt with the gross profit rate and the stock reconciliation. 19. In the instant case, the impounded material reflects receipts and payments and the assessee has already paid the difference of the amounts to taxation after going through the entire set of papers. The property 62/1, Ajmal Khan Park has been purchased on 08.11.2012 whereas the notings reflect 04.12.2012. The transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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