9911796707
TMI Blog2022 (10) TMI 655X X X X Extracts X X X X X X X X Extracts X X X X ..... sment proceedings. Also see Sunshine Infra State Pvt. Ltd. [ 2022 (5) TMI 1297 - ITAT ALLAHABAD] In the present case, the assessee being under the jurisdiction of Hon ble Allahabad High Court, the ratio of the decision in the case of Raj Kumar Arora (supra) holds the field as it is binding on all the authorities under the jurisdiction of Hon ble Allahabad High Court. We therefore respectfully following the judgement of the jurisdictional High Court rendered in the case of Rajkumar Arora (supra) hereby dismiss the grounds of the assessee. Approval granted by Addl.CIT u/s 153D of the Act was a mechanical approval without application of mind and therefore assessment order was bad in law and contrary to the settled position of law - From the records, it is evident that the entire case file was placed before the competent authority who after perusing the same and due application of mind had accorded the requisite approval and therefore in our view, the contentions of the assessee is merely based upon suspicion without being backed by any material evidence and hence we do not see any merit in the contention of the Ld AR. Thus this Ground No.2 raised by the assessee is dismissed. Valuatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion - HELD THAT:- Considering the peculiarity of the facts, we are of the view that in the present case, the additions have been made purely on the basis of statement recorded at the back of the assessee without providing an opportunity of cross examination of the maker of the statements. Moreover, the statements do not reveal the specific details of the transaction with the assessee and the share applicant. Merely a sweeping statement without supported by relevant evidences cannot form the basis of making the addition. It is well settled that the addition cannot be made purely on the basis of suspicion and the AO is required to bring material evidences in its support. In the instant case, the AO has not brought any adverse material suggesting that the assessee had devised a colorable device for the purpose of routing its own money. In the absence of such evidence and in the light of the binding decisions cited hereinabove, we are of the considered view that the impugned addition cannot be sustained in the facts of the present case. We accordingly hereby direct the AO to delete the addition - Also the addition made by the AO on account of alleged payment of commission thereon u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see about the cash generated out of the sale of the paintings have not been controverted by Revenue by placing any adverse evidence on record - it is also a fact that assessee has also not produced any evidence that was called for by the AO regarding details of purchases of paintings - we are of the view that the disallowance of claim of assessee regarding sale of paintings in the present facts of the case is excessive and arbitrary. We therefore in interest of justice restrict the addition to the extent of Rs.6,00,000/- i.e. 30% of total disallowance made by the AO and rest of the addition is hereby deleted. Thus the ground of assessee is partly allowed. Unexplained investments u/s 69 in the property at Indirapuram, Gaziabad - HELD THAT:- Lower authorities have made addition purely on the basis of the notings in diary found in the possession of Shri B. B. Goel and the statement recorded in this regard. The Revenue did not provide opportunity of cross examination to the assessee in respect of any statement made by Shri B. B. Goel. The AO has also not brought any other material suggesting the actual fair market value of the property in question is higher than what is recorded in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abitat Infrastructure Ltd. [ 2019 (4) TMI 1104 - ITAT DELHI] held that there was no need to interfere with the findings of CIT(A) who deleted the addition on the basis that loan which was obtained and repaid by the assessee subsequently. We therefore respectfully following the binding precedents cited by the Ld. AR noted hereinabove direct the AO to delete the addition. Thus the ground of the assessee is allowed. Addition u/s 69A of the Act with respect to unexplained investment in jewellery and bullion - HELD THAT:- As in terms of CBDT instructions, 535.28 gms of jewellery, in the absence of any contrary material, is stood explained. Further, the contention that out of the total jewellery found at the premises of Shri Dinesh Yadav, jewellery weighing 160.358 gms belonged to Mrs. Shweta Yadav, who is stated to be the sister of Mr. Manish Yadav. The AO could not controvert the fact that at the time of search the jewellery in question was found in a separate pouch with the name of Mrs. Shweta Yadav. Therefore, looking to the fact that Shri Manish Yadav admitted the fact that the jewellery belonged to his sister, Mrs. Shweta Yadav and coupled with the fact that it is a normal practice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he judicial pronouncements, adopted CPWD rate for the purpose of estimation of cost of construction cannot be sustained. We, therefore, direct the AO to delete the impugned addition. The Ground of Assessee s appeal is allowed and corresponding ground and Revenue s appeal is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 22.12.2019 passed by the AO under section 153C of the Income Tax Act, 1961 ('the Act') on the ground of being beyond jurisdiction, bad in law and void ab initio. 1.1. That the CIT(A) erred on facts and in law in not appreciating that the impugned proceedings initiated by the AO under section 153C were beyond jurisdiction and bad in law, in the absence of satisfaction note being recorded by the AO in possession of the seized documents gathered during to search under section 132 conducted in the case of another person, viz., Shri Rajeshwar Singh Yadav on 10.11.2017. 1.2 That the CIT(A) erred on facts and in law in not appreciating that the impugned proceedings initiated by the AO under section 153C were beyond jurisdiction and bad in law, since no incriminating material/evidence/assets belonging to/relating to the appellant suggesting undisclosed income/investment were found in the course of search under section 132 at the premises of Shri Rajeshwar Singh Yadav, leave alone such material not being handed over to the AO of the appellant and consequently illegal satisfaction note was recorded by the AO of the appellant. 1.3 That the CIT(A) erred on facts and in law in observ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entire addition made by the AO under section 69B on the basis of valuation report of DVO, since the addition was not based on any evidence of unexplained investment made by the appellant and was merely made by estimating the fair market value of the property which was outside the scope of provisions of section 69B r.w.s. 142A of the Act. 7. Further without prejudice, that the CIT(A) erred on facts and in law in not rejecting the report of DVO which suffered from several inaccuracies qua the method of valuation followed, like adoption of CPWD rates instead of PWD rates/not allowing discounting of 20% on account of personal supervision, etc. 7.1 That the CIT(A) erred on facts and in law in observing that the DVO had adopted the appropriate method to determine the fair market value of the property and adopting CPWD rates for property situated in Noida, which was near to Delhi whereas PWD rates was not appropriate which was meant for entire state of UP. 8. That the CIT(A) erred on facts and in law in sustaining the addition of Rs.3,00,00,000/- made by the AO with respect to Rs. 1,50,00,000 crores each received from the share applicants, viz., Inspire 2 Aspire Business Solutions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us invoices issued in the name of the assessee were found and on the perusal of which he noted that assessee had purchased construction material /design for a total consideration of Rs.4,96,71,274/- during the Financial Years 2015-16, 2016-17 & 2017-18. He also pointed to the satisfaction note wherein it has been noted that Balance Sheet of M/s. Inspire 2 Aspire Business Solutions Pvt. Ltd. and the ledger account of the assessee in the books of Inspire 2 Aspire Business Solutions Pvt. Ltd. was found which demonstrated that assessee had received share capital amounting to Rs.1,50,00,000/- during the Financial Year 2015-16. Learned AR submitted that aforesaid material was not incriminating in nature which resulted in the detection of any undisclosed assets and income of the assessee. He thereafter submitted that the condition precedent for invocation of proceedings u/s 153C of the Act are that the assets/documents belonging to/pertaining to/relating to an assessee found during search u/s 132 of the Act at the premises and in possession of third party must be incriminating in nature, leading to detection of undisclosed income of such assessee. He submitted that Hon'ble Apex Court in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her submitted that the decision of Hon'ble Apex Court in the case of Singhad Technical Society (supra) is not applicable to the facts of the present case because the AO in the satisfaction note in this case has clearly recorded the fact that the invoices (LP 4, LP 5, LP 10) with regard to the purchase of construction material were found for three financial years whereas in the case of Singhad Technical Society (supra), no such invoices or any other incriminating material for the year in which the search took place was found. He further stated that the bills that were found during the course of search would have clear bearing on the income of the assessee. Therefore he submitted that it cannot be construed that the bills/invoices found are not incriminating in nature. 10. We have heard the rival submissions and perused the material available on records. The assessee vide the aforesaid grounds is challenging the assumption of jurisdiction by the AO in framing the assessment u/s 153C of the Act. 11. For the sake of clarity and effective adjudication of the dispute at hand, Section 153C of the Act is reproduced as under: "(1) Notwithstanding anything contained in section 139, secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A and in respect of such assessment year- (a) no return of income has been furnished by such other person and no notice under sub-section (1) of section 142 has been issued to him, or (b) a return of income has been furnished by such other person but no notice under sub-section (2) of section 143 has been served and limitation of serving the notice under sub-section (2) of section 143 has expired, or (c) assessment or reassessment, if any, has been made, before the date of receiving the books of account or documents or assets seized or requisitioned by the AO having jurisdiction over such other person, such AO shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A." 12. From a bare reading of the aforesaid section it is evident that the requirement of law for exercising jurisdiction u/s 153C of the Act are that in the event of a search any money, bullion, jewellery or any other valuable article or thing seized or requisitioned belongs to the persons other tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the present case, the assessee being under the jurisdiction of Hon'ble Allahabad High Court, the ratio of the decision in the case of Raj Kumar Arora (supra) holds the field as it is binding on all the authorities under the jurisdiction of Hon'ble Allahabad High Court. We therefore respectfully following the judgement of the jurisdictional High Court rendered in the case of Rajkumar Arora (supra) hereby dismiss the grounds of the assessee. Thus Ground Nos.1 to 1.3 are dismissed. 15. Vide Ground No.2 it is the contention of the assessee that the approval granted by the Additional Commissioner of Income Tax (Addl.CIT) u/s 153D of the Act was a mechanical approval without application of mind and therefore assessment order was bad in law and contrary to the settled position of law. 16. Before us, Learned AR submitted that in the present case the approval u/s 153D was granted by Addl. CIT vide approval dated 17.12.2019 (as noted by the AO in last para of the assessment order). He submitted that assessee had obtained copy of the relevant correspondence between the AO and Addl. CIT seeking the aforesaid approval. He submitted that on perusing the aforesaid correspondence, it was fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requisite approval and therefore in our view, the contentions of the assessee is merely based upon suspicion without being backed by any material evidence and hence we do not see any merit in the contention of the Ld AR. Thus this Ground No.2 raised by the assessee is dismissed. 19. In Ground Nos.3 to 7.1 the assessee has challenged the valuation adopted by the AO at Rs.1,58,86,369/- in respect of the construction of a property at Noida UP. 20. During the course of assessment proceedings, AO noted that assessee had claimed that a sum of Rs.93,02,377/- was incurred for the construction of the property at Noida. However, the fair market value estimated by the District Valuation Officer (DVO) of the property in question was stated to be at Rs.1,58,86,369/-. Assessee was therefore, asked to explain the difference between the value declared by it and the fair market value assessed by the DVO. The assessee offered its explanation regarding expenditure incurred by the Assessee on construction of the property in question stating that no expenditure out of books was incurred by the assessee however the same was not accepted by AO. He thereafter, on the basis of the DVO report made additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference to valuation officer has been given to only estimate the actual investment. 59. In the present assessment, it would be appreciated that no such finding was reached by the assessing officer or even Investigation Wing before making a reference to the valuation officer. There was no material nor any evidence, nor the same has been brought on record, which led to the inference at the first place, that excess investment than the amount recorded in book of account has been made by the appellant in the subject property. The reference was made to the valuation officer in the routine manner, without any material/evidence in the possession of the Deputy Director of Income Tax (Inv.) leading to the inference that amount invested in construction was more than that recorded in the books of account without having any incriminating document/ material suggesting the actual investment is more than as shown by the Assessee. The sole basis of making the addition under section 69B in the assessment order is the report of the valuation officer, which, too, it is respectfully submitted, is only an estimate/opinion of the Valuation Officer and do not lead to the conclusion that actual investm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would suggest that there was undisclosed and unexplained investment made by the Assessee. He thus supported the order of lower authorities. 24. We have heard the rival submissions and perused the material available on record. The factum of construction of the building and the incurrence of expenses thereof is not in dispute. The only dispute is regarding the quantum of expenses hence in the instant ground the issue revolves around the estimation of fair market value by the DVO adopting the CPWD rates for the valuation of FMV of the property. The AO undisputedly adopted the CPWD rate as recommended by the DVO for estimating fair market value of the property constructed by assessee. So far as the application of the rate for the purpose of arriving at the fair market value of the property is concerned, this issue is no more res integra. It has been decided in the catena of judgments that state PWD rates would be an appropriate guiding factor considering the local conditions for computing quantum of expenses incurred on construction of property in question. Learned CIT(DR) has not brought to our notice any binding precedent in support of his contentions that the fair market value est ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ereby direct AO to adopt PWD rates as prevalent at that point in time for ascertaining the correct and true figure of investment made by the assessee. In case, if the AO finds that upon applying prevailing PWD rates, fair market value of the property is lesser than the investment disclosed by the assessee, he shall delete the addition. 26. As far as the granting of rebate on account of self supervision charges is concerned, such rebate has been allowed by the Co-ordinate Bench and High Courts of different judicature. Even the Learned CIT(A) has given the rebate to the extent of 5% only meaning thereby that Revenue is not disputing the eligibility for such self supervision charges. Therefore, considering the experience, qualification and the expertise of the Director of the assessee company who is stated to have looked after the affairs of the construction of the building, the contribution made by such person in the saving of the expenses on construction cannot be overlooked in the absence of any contrary material on record. Under the facts of present case and looking to the totality of facts it would sub serve the interest of justice that if a rebate of self supervision @10% is gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Incredible India IT Solutions Pvt. Ltd., he placed on record the copy of its PAN Card to demonstrate the identity of the investor. He also placed on record its bank statement showing the payment received from the account of the investor company to assesseecompany, copy of its Balance Sheet showing the investment made by it in the assessee company. 31. He further submitted that during the course of assessment proceedings, AO had issued notice u/s 133(6) of the Act to both the aforesaid companies wherein those companies had duly confirmed about the investments made by them and had also filed supporting documents. He further pointed out that no adverse inference with regard to the transactions between the assessee and M/s. Inspire 2 Aspire Business Solutions Pvt. Ltd. was made by the AO of the share applicant in the assessment proceedings of the share applicant i.e. Inspire 2 Aspire Business Solutions Pvt. Ltd. He thereafter submitted that the subsequent confirmation received u/s 133(6) establishes the fact that M/s. Inspire 2 Aspire Business Solutions Pvt. Ltd. was an existing entity duly assessed to tax and hence the identity was established. 32. As far as the addition with respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Courts have held that it was obligatory on the part of the AO to collect sufficient evidences against the assessee to disprove the documentary evidences filed by the assessee and the failure to do so would make the addition unsustainable in the eyes of law. In support of his aforesaid contention, he placed reliance on the decision of Hon'ble Supreme Court in the case of Andaman Timber Industries vs. CCE 62 Taxmann.com 3 (2015). He also placed reliance on the decision of CIT vs. Sunita Dhadda [2018] 100 taxmann.com 526 (SC) and other decisions. He therefore submitted that since the Assessee has given requisite information regarding genuineness of the transaction, identity of the applicant and creditworthiness of the creditors, the addition of Rs.3 crore being the share application money and the addition of Rs.3 lakh u/s 69C of the Act being alleged unexplained commission expenditure deserves to be deleted. 35. Ld DR strongly opposed these submissions and supported the orders of lower authorities and further contended that looking to the nature of the transactions it can be easily inferred that the transaction was a colorable device to avoid tax liability. He further contended tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he payment of alleged commission for receiving the share application money from the aforementioned share applicants. 38. There is no dispute about the fact that the assessee had placed before the AO supporting evidences regarding the identity of the share applicants, genuineness of the transactions and the creditworthiness of the share applicants. However, the AO did not accept the evidences as placed by the assessee in support of his claim regarding share application money. The basis of making addition being the share application money received from Inspire 2 Aspire Business Solutions Pvt. Ltd. is stated to be a statement made by the director of the share applicant, namely shri Ghanshyam Gupta. It is the contention of the Ld. AR that the assessee was not provided any copy of the statement relied upon by the AO and further no cross examination of Shri Ghanshyam Gupta was allowed to the assessee. It is also the grievance of the assessee that by not affording opportunity of cross examination of Shri Ghanshyam Gupta has seriously harmed the valuable legal right of the assessee thereby it caused prejudice to the assessee and resulted into gross miscarriage of justice. Even before this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law that the crossexamination is a valuable right and a fundamental rule of legal jurisprudence. Looking to the facts of the present case, the assessee had placed before the AO the requisite evidences regarding the investments made by the share applicants. Moreover, in the case of the share applicant namely M/s. Inspire 2 Aspire Business Solutions Pvt. Ltd. and Incredible India IT Solutions Pvt. Ltd., qua the transaction in question no adverse inference has been made in the assessment proceedings by the concerned AOs. Even no action having been taken by the Revenue against the share applicants on this issue as has been brought to our notice. The AO has attributed to the assessee the share application money without bringing any credible evidence in support of the same. We are of the view that it was incumbent upon the assessing authority to make necessary enquiry and bring contrary material to rebut the claim of the assessee regarding share application money being genuine and did not belong to it/or routed through the share applicants its own money. Considering the peculiarity of the facts, we are of the view that in the present case, the additions have been made purely on the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, viz., Shri Rajeshwar Singh Yadav on 10.11.2017. 1.2 That the CIT(A) erred on facts and in law in not appreciating that the impugned proceedings initiated by the assessing officer under section 153C were beyond jurisdiction and bad in law, since no incriminating material/evidence/assets belonging to/relating to the appellant suggesting undisclosed income/investment were found in the course of search under section 132 at the premises of Shri Rajeshwar Singh Yadav, leave alone such material not being handed over to the assessing officer of the appellant and consequently illegal satisfaction note was recorded by the assessing officer of the appellant. 1.3 That the CIT(A) erred on facts and in law in observing that (i) the invoices for purchase of construction material incurred by the appellant towards construction of property at Noida, which was duly recorded and disclosed in the books of account, constituted incriminating material within the meaning of section 153C of the Act, merely because the value of such construction expenses was determined by the DVO, on a subsequent reference made by DDIT(Inv.), at a higher value for which no adverse material of excess construction cost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich suffered from several inaccuracies qua the method of valuation followed, like adoption of CPWD rates instead of PWD rates/not allowing discounting of 20% on account of personal supervision, etc. 7.1 That the CIT(A) erred on facts and in law in observing that the DVO had adopted the appropriate method to determine the fair market value of the property and adopting CPWD rates for property situated in Noida, which was near to Delhi whereas PWD rates was not appropriate which was meant for entire state of UP. Each of the above ground is independent and without prejudice to one another. The appellant craves leave to add, alter, amend or withdraw any ground or grounds of appeal at any time before or during the course of hearing of the appeal." 43. Before us, Ld AR submitted that the grounds raised in the present appeal are identical to that raised by the assessee in ITA No.1127/Del/2021 for A.Y. 2016-17 except for the year and the amounts involved and therefore the arguments made by him while arguing the appeal of the assessee for A.Y. 2016-17 may be taken as arguments made for the grounds raised in the present appeal. Ld DR did not have any objections regarding the aforesaid su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate the fact that during the course of assessment proceedings, the assessee company had failed to produce any bills/vouchers in respect of difference amount of Rs.1,64,83,690/-, during the assessment proceedings as well as at the time of valuation done by DVO. And had also failed to explain the source thereof despite giving several opportunities vide notices u/s 142(1) of the Income Tax Act, 1961. 51. Before us, both the parties admitted that the ground raised in the present appeal of the Revenue is interconnected with the Ground Nos. 3 to 7.1 raised in assessee's appeal in ITA No.1127/Del/2021 for A.Y. 2017-18. 52. Before us, Ld. DR took us through the observations made by AO and submitted that in view of the categorical findings by the AO, Ld. CIT(A) was not justified in deleting the additions made by AO. He therefore submitted that the order of CIT(A) be set aside and the findings of the AO be restored. 53. On the other hand Learned AR of the assessee adopted the same arguments as in ITA No.1127/Del/2021 for A.Y. 2016-17. He thus supported the order of CIT(A) and submitted that the ld CIT(A) has rightly taken note of the fact that the assessee had incurred expenses of Rs.1,20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 69 on the basis of valuation report furnished by the DVO, pursuant to reference made by the DDIT(Inv.), on the ground that the AO was not empowered to refer the aforesaid report, without an independent reference to DVO under section 142A of the Act. 5.1 That the CIT(A) erred on facts and in law in observing that the AO was competent to refer the report of DVO submitted pursuant to reference made by DDIT(Inv.) under section 132(9D) of the Act since the same DVO - (i) was competent to issue valuation report under section 142A, (ii) as also issue report using the same method of valuation. Without Prejudice 6. That the CIT(A) erred on facts and in law in not deleting the entire addition made by the AO under section 69 on the basis of valuation report of DVO, since the addition was not based on any evidence of unexplained investment made by the appellant, more so after search conducted under section 132, and was merely made by estimating the fair market value of the property which was outside the scope of provisions of section 69 r.w.s. 142A of the Act. 7. Further without prejudice, that the CIT(A) erred on facts and in law in not rejecting the report of DVO which suffere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eclared construction value was at Rs.14,27,559/-. The AO therefore treated the difference in the amounts (i.e. the amount as determined in valuation report and that declared by the assessee in the books of accounts) as unexplained investments and made its addition. 61. Assessee preferred appeal against the action of AO before the Learned CIT(A) who after considering the submissions upheld the action of AO and sustained the additions. Aggrieved by the order of CIT(A), assessee is now in appeal before the Tribunal. 62. Learned Counsel for the assessee reiterated the submissions made before the lower authorities and further submitted that had the Govt. Valuer adopted the state PWD rates instead of CPWD rates as adopted by DVO in the present case, there would not have been any addition. He, therefore, reiterated the submissions as made in the case Ecstasy Buildcon Pvt. Ltd. (supra). He also placed a chart computing the fair market value of the property in question for different years after considering the State PWD rate and deduction on account of self supervision charges. For the sake of clarity, the chart so submitted by the Ld. counsel is reproduced as under: Assessment Year Amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w in not quashing the assessment order dated 27.12.2019 passed by the assessing officer under section 153A of the Income Tax Act, 1961 ('the Act') on the ground of being beyond jurisdiction, bad in law and void ab initio. 2. That the CIT(A) erred on facts and in law in sustaining the addition of Rs.8,33,505/- which was made by the assessing officer under section 69 of the Act alleging unexplained investment in property on the basis of higher fair market value thereof determined by the DVO. 3. That the CIT(A) erred on facts and in law in not quashing the impugned order passed under section 153A, since the same was passed pursuant to a mechanical approval dated 20.12.2019 granted by the Addl. CIT under section 153D, lacking complete application of mind and thus rendering the assessment order to be beyond jurisdiction. 4. That the CIT(A) erred on facts and in law in not deleting the aforesaid addition of alleged unexplained investment on the ground of being beyond jurisdiction and scope of assessment under section 153A, since the same was not based on any incriminating material found during the course of search. 5. That the CIT(A) erred on facts and in law in not deleting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment in property on the basis of higher fair market value thereof determined by the DVO. 3. That the CIT(A) erred on facts and in law in not quashing the impugned order passed under section 153A, since the same was passed pursuant to a mechanical approval dated 20.12.2019 granted by the Addl. CIT under section 153D, lacking complete application of mind and thus rendering the assessment order to be beyond jurisdiction. 4. That the CIT(A) erred on facts and in law in not deleting the aforesaid addition of alleged unexplained investment on the ground of being beyond jurisdiction and scope of assessment under section 153A, since the same was not based on any incriminating material found during the course of search. 5. That the CIT(A) erred on facts and in law in not deleting the aforesaid addition made under section 69 on the basis of valuation report furnished by the DVO, pursuant to reference made by the DDIT(Inv.), on the ground that the assessing officer was not empowered to refer the aforesaid report, without an independent reference to DVO under section 142A of the Act. 5.1 That the CIT(A) erred on facts and in law in observing that the assessing officer was competent to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mutatis mutandis. The grounds raised against the validity of the assessment framed u/s 153A and approval obtained u/s 153D of the Act are dismissed for the same reasons as were stated in ITA No.1127/Del/2021 (supra). In the result, the grounds in both the Appeals of the assessee are partly allowed. 72. In the result, both the appeals of the assessee in ITA Nos.1117/Del/2021 and 1118/Del/2021 are partly allowed. Now we take ITA No.1122/Del/2021 in the case of Dinesh Yadav for A.Y. 2018-19 (arising out of the order of Ld.CIT(A) Kanpur-4 dated 12.08.2021): 1. "That the CIT(A) erred on facts and in law in not quashing the assessment order dated 18.12.2019 passed by the AO under section 143(3) of the Income Tax Act, 1961 ('the Act') on the ground of being beyond jurisdiction, bad in law and void ab initio. 1.1 That the CIT(A) erred on facts and in law in not quashing the impugned order passed under section 143(3), since the same was passed pursuant to a mechanical approval dated 12.12.2019 granted by the Addl. CIT under section 153D, lacking complete application of mind and thus rendering the assessment order to be beyond jurisdiction. 2. That the CIT(A) erred on facts and in l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of old paintings which were bequeathed to his wife by his late father in law. His father in law had affection for collecting various paintings which were accumulated over the past several years. He submitted that during the F.Y. 2017-18, the said paintings were sold for cash and the proceeds of the sale were kept at the residence. He pointed to the table of the paintings sold which is listed at pages 7 & 8 is as under: Sr. No. Painting Name Artist Name Year Painting of Valuation as on 31.03.2007 Cash selling Price 1. My Dream City Shamnath 1955 95,000 1,50,000 2. Puzzled Man Kirpal Singh 1955 95,000 80,000 3. Sanjhi Paper Cut Madan 1955 81,000 1,40,000 4. Pichwai Painting Nala Ram 1964 90,000 70,000 5. The Folk Dance Aparna 1955 81,000 1,70,000 6. The Music Backon Jeet 1955 63,000 1,00,000 7. The Road to Heaven Damyanti 1964 67,000 1,20,000 8. The Serene Walk Bhawandla 1955 95,000 1,50,000 9. The Waterfall Dilip Narayan 1964 67,000 70,000 10. Tree of Life Bal Krishan 1955 95,000 1,70,000 11. Udaka Bharat Lal 1955 95,000 60,000 12. A collage on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by Revenue by placing any adverse evidence on record. At the same time, it is also a fact that assessee has also not produced any evidence that was called for by the AO regarding details of purchases of paintings. Considering the totality of the aforesaid facts and circumstances of the present case, we are of the view that the disallowance of claim of assessee regarding sale of paintings in the present facts of the case is excessive and arbitrary. We therefore in interest of justice restrict the addition to the extent of Rs.6,00,000/- i.e. 30% of total disallowance made by the AO and rest of the addition is hereby deleted. Thus the ground of assessee is partly allowed. 83. In the result, the appeal of the assessee in ITA No.1122/Del/2021 is partly allowed. Now we take ITA No.1123/Del/2021 in the case of Smt. Shashi Yadav for A.Y. 2018-19 (arising out of the order of Ld.CIT(A) Kanpur-4 dated 12.08.2021): 84. It is contended by the Learned Representatives of the parties that the effective issue in present appeal is related to unexplained investments in the property at Indirapuram, Gaziabad. 85. A search and seizure operation u/s 132 of the Act was conducted on 10.11.2017 at t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appreciating that the aforesaid document was a dumb document and the inferences drawn by the AO /CIT(A) were based on surmises and conjectures; and the presumptions under section 132(4A) and 292C could not have been drawn against the appellant since the document was not found from the premises of the appellant. 3.3 That the CIT(A) erred on facts and in law in not deleting the aforesaid addition made by the AO, without bringing on record any adverse statement or providing any opportunity to the appellant to cross examine Mr. B. B. Goel, from whose premises aforesaid document was found, to substantiate the contents of such documents, before drawing adverse inference / conclusion against the appellant on assumption and presumptions. 3.4 Without prejudice, that the CIT(A) erred on facts and in law in not holding that the aforesaid addition was beyond the scope of the provisions of section 69 of the Act. 3.5 Further, without prejudice, that the CIT(A) erred on facts and in law in assuming the alleged excess investment during the year under consideration, whereas if the assumption drawn by the AO/ CIT(A) was to accepted, then the aforesaid excess investment would have been made in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re in M/s. Clavecon India Pvt. Ltd. wherein assessee and Shri Yugank Goel were directors in the company. AO also noted that the Shri B. B. Goel is a contractor in Irrigation department where Shri Rajeshwar Yadav, husband of the assessee worked as a Superintending Engineer. AO therefore concluded that families of Shri B. B. Goel and the assessee knew each other. AO was further of the view that Page 71 of Annexure - LP - 1 found at the residential premises of Shri B. B. Goel indicated that the family of Shri B. B. Goel and the family of the assessee had jointly invested in a project namely the Habitat Centre and it also reflected that the cost of shop was at Rs.25,000/- per sq.ft. for which according to AO, approximately 60% of the cost was paid in cash from unaccounted money. AO noted that no convincing reply was furnished by the assessee about the difference. He therefore treated the difference of the amount found in Annexure LP1 and the amount disclosed by the assessee amounting to Rs.1,09,87,004/- as unexplained investment towards purchase of shop No. 384 and made its addition u/s 69 of the Act. 91. Aggrieved by the order of AO assessee carried the matter before CIT(A), who uphe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part payment of sale consideration is made in cash in property transactions and therefore the registration by the stamp valuation authority at lower rate as per the stamp valuation Act such amount does not reflect the true and correct fair market value of the property. He therefore, submitted that the AO has rightly treated the amount mentioned in diary as unexplained investment. 94. We have heard the rival submissions and perused the material available on record. There is no dispute with regard to the fact that the additions have been made purely on the basis of the certain loose papers found at the premises of third party. It is also undisputed that except the loose papers, there are no other documents suggesting that assessee had entered into an agreement at a higher rate than disclosed in the sale deed. The AO has also not brought any other sale instances of similarly situated properties. The law is well settled that there has to be corroborative evidences to prove any figure written in the loose sheet of paper. Moreover, it has been held by the Hon'ble Supreme Court in the case of CBI vs. V. C. Shukla [1998] 3 SCC 410, that writing in his diary by a third party is not a relia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed. 95. In the result, the appeal of the assessee is partly allowed. Now we take ITA No.1119/Del/2021 in the case of Smt. Poonam Yadav for A.Y. 2015-16 (arising out of the order of Ld.CIT(A) Kanpur-4 dated 12.08.2021): 96. In this case, in response to notice u/s 153A of the Act, assessee electronically filed her return of income on 31.08.2019 declaring income of Rs.6,60,330/-. Thereafter, assessment was framed u/s 143(3) r.w.s 153A of the Act vide order dated 25.12.2019 and the total income was determined at Rs.56,60,330/- inter alia by making addition of Rs.50,00,000/- u/s 68 of the Act. 97. Aggrieved by the order of AO, assessee carried the matter before CIT(A) who vide order dated 09.08.2021 in Appeal No.CIT(A)-IV/KNP/11368/2019-20 granted partial relief to the assessee by deleting the addition of Rs.20,00,000 in respect of the loan received from M/s New Delhi Buildcon Ltd. 98. Aggrieved by the order of CIT(A), assessee is now in appeal and has raised the following grounds: 1. "That the CIT(A) erred on facts and in law in not quashing the assessment order dated 25.12.2019 passed by the AO under section 153A of the Income Tax Act, 1961 ('The Act') on the ground of being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised in the case of Ecstasy Buildcon Pvt. Ltd. in ITA No.1127/Del/2021(supra) and therefore, they have same arguments to make. Further, it was contended that submissions made and contentions raised in that case may be treated as the part of submissions of this appeal as well. 101. We have heard the rival submissions and perused the material available on record. We have taken a view against the assessee in the case of Ecstasy Buildcon Pvt. Ltd. (supra) and dismissed the grounds related to the framing of assessment u/s 153A of the Act and approval u/s 153D. Since the issue raised in the present appeal is identical to that raised in the case of Ecstasy Buildcon Pvt. Ltd. (supra), therefore for the same reasoning the Ground Nos. 3 & 4 are dismissed and our finding in ITA No.1127/Del/2021 shall apply mutatis mutandis to the present grounds. Thus the grounds of assessee are dismissed. 102. With respect to Ground No.2, Learned AR submitted that the issue is with respect to the addition of Rs.30,00,000/-made u/s 68 of the Act being the amount of unsecured loan received from M/s. Zarf Trading & Marketing Pvt. Ltd. 103. AO during the course of assessment proceedings and on perusing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that loan that was taken was repaid in the year of borrowing itself and therefore it cannot be considered to be not genuine so as to invoke the provision u/s 68 of the Act. He further contended that even otherwise also no addition can be sustained u/s 68 of the Act as the assessee is not required to maintain the books of accounts and Section 68 of the Act presupposes the maintenance of the books of accounts. He contended that in view of the decisions of the coordinate Benches of this tribunal wherein it has been categorically held that if the loan was received and repaid in the same year, no addition u/s 68 will be called for. For this proposition he placed reliance on the decision of Delhi Bench of the Tribunal in the case of Navyug Iron Traders vs. DCIT in ITA No.553/Del/2017 dated 24.09.2019 and the decision of Delhi Tribunal in the case of ITO vs. Habitat Infrastructure Ltd. in ITA No. 6155/Del/2015 dated 11.02.2019. He further submitted that addition made by the AO is bad in law and needs to be deleted as the provisions of Section 68 of the Act presupposes the maintenance of books of accounts wherein the disputed sum should have been found credited. He submitted that during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unts statutorily due to falling in a special class of assessee. Thus this argument of the Ld. AR is devoid of any merits. However, regarding unsecured loans received from M/s. Zarf Trading & Marketing Pvt. Ltd. the Assessee had provided income tax return acknowledgement, bank statements of those parties. The AO without carrying out requisite enquiry proceeded purely on the basis of surmise and therefore, such approach of the assessing authority is not in accordance with the settled position of law. Admittedly in the present case no addition has been made in the case of the lender. Hence, it can be safely inferred that no addition has been made in the hand of the lender meaning thereby the source of such amount has been duly accepted in the hand of lender since no addition has been made by AO. Therefore, in our considered view source is explained. Now AO cannot blow hot and cold at the same time. There is no finding regarding the unsecured loan being routed through dubious route by the assessee to bring her own unexplained money through the lenders. In the absence of specific finding by the AO supported by relevant evidence that the assessee has adopted the route of the unsecured le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O was not empowered to refer the aforesaid report, without an independent reference to DVO under section 142A of the Act. 5.1 That the CIT(A) erred on facts and in law in observing that the AO was competent to refer the report of DVO submitted pursuant to reference made by DDIT(Inv.) under section 132(9D) of the Act since the same DVO - (i) was competent to issue valuation report under section 142A, (ii) as also issue report using the same method of valuation. Without Prejudice 6. That the CIT(A) erred on facts and in law in not deleting the entire addition made by the AO under section 69 on the basis of valuation report of DVO, since the addition was not based on any evidence of unexplained investment made by the appellant, more so after search conducted under section 132, and was merely made by estimating the fair market value of the property which was outside the scope of provisions of section 69 r.w.s. 142 A of the Act. 7. Further without prejudice, that the CIT(A) erred on facts and in law in not rejecting the report of DVO which suffered from several inaccuracies qua the method of valuation followed, like adoption of CPWD rates instead of PWD rates, discounting of 20% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pra), therefore for the same reasoning the other grounds related to the valuation and investment of the property at Noida are allowed and our finding in ITA No.1127/Del/2021 shall apply mutatis mutandis to the present grounds. Thus the grounds of assessee are allowed. 116. In the result, the grounds in the appeal in ITA No.1448/Del/2021 of the assessee are partly allowed. 117. The grounds raised in ITA No.1120/Del/2021 reads as under: 1. That the CIT(A) erred on facts and in law in not quashing the assessment order dated 25.12.2019 passed by the assessing officer under section 153A of the Income Tax Act, 1961 ('the Act') on the ground of being beyond jurisdiction, bad in law and void ab initio. 2. That the CIT(A) erred on facts and in law in sustaining the addition of Rs. 11,20,916, out of total addition of Rs.68,13,945/-, and not deleting the aforesaid entire addition, which was made by the assessing officer under section 69 of the Act alleging unexplained investment in property on the basis of higher fair market value thereof determined by the DVO. 3. That the CIT(A) erred on facts and in law in not quashing the impugned order passed under section 153A, since the same was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without prejudice to one another. The appellant craves leave to add, alter, amend or withdraw any ground or grounds of appeal at any time before or during the course of hearing of the appeal. 118. Ground Nos. 1, 3 & 4 are against the validity of the assessment framed u/s 153A and approval granted u/s 153D of the Act. 119. It is submitted on behalf of the Ld. Authorized Representatives of the respective parties that the issues raised in these grounds are identical to the ground raised in the case of Ecstasy Buildcon Pvt. Ltd. in ITA No.1127/Del/2021(supra) and therefore, they have same arguments to make. 120. We have heard the rival submissions and perused the material available on record. We have taken a view against the assessee in the case of Ecstasy Buildcon Pvt. Ltd. (supra) and dismissed the grounds related to the framing of assessment u/s 153A of the Act and approval u/s 153D. Since the issue raised in the present appeal is identical to that raised in the case of Ecstasy Buildcon Pvt. Ltd. (supra), therefore for the same reasoning the Ground Nos.1, 3 & 4 are dismissed and our finding in ITA No.1127/Del/2021 shall apply mutatis mutandis to the present grounds. Thus the grou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law in holding that, on reading the aforesaid seized documents it follows that cash was paid by the appellant towards purchase of impugned property. 3.2 That the CIT(A) erred on facts and in law in not appreciating that the aforesaid document was a dumb document and the inferences drawn by the AO / CIT (A) were based on surmises and conjectures; and the presumptions under section 132 (4A) and 292C could not have been drawn against the appellant since the document was not found from the premises of the appellant. 3.3 That the CIT(A) erred on facts and in law in not deleting the aforesaid addition made by the AO, without bringing on record any adverse statement or providing any opportunity to the appellant to cross examine Mr. B.B. Goel, from whose premises aforesaid document was found, to substantiate the contents of such documents, before drawing adverse inference / conclusion against the appellant on assumptions and presumptions. 3.4 Without prejudice, that the CIT(A) erred on facts and in law in not holding that the aforesaid addition was beyond the scope of the provisions of section 69 of the Act. 3.5 Further, without prejudice, that the CIT(A) erred on facts and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Pvt. Ltd. (supra) and dismissed the grounds related to the framing of assessment u/s 153A of the Act and approval u/s 153D. Since the issue raised in the present appeal is identical to that raised in the case of Ecstasy Buildcon Pvt. Ltd. (supra), therefore for the same reasoning the Ground Nos. 1, & 2 are dismissed and our finding in ITA No.1127/Del/2021 shall apply mutatis mutandis to the present grounds. Thus the grounds of assessee are dismissed. 129. Ground Nos. 3 to 3.5 are with respect to the addition of Rs.3,46,20,962/- u/s 69 of the Act. 130. Learned AR submitted that issue raised in this ground is identical to the ground raised in the case of Shashi Yadav in ITA No.1123/Del/2021. On these issues, the Learned AR relied upon the submissions made therein. He submitted that impugned addition deserves to be deleted. On the other hand Ld. DR supported the orders of the authorities below. 131. We have heard the rival submissions of the parties and perused the material on record. Admittedly, the facts in these grounds are identical to the grounds raised in the case of Sashi Yadav in ITA No.1123/Del/2021 (supra). We have elaborately examined the issues therein and by followi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esh Yadav due to security reasons and hence the jewellery found and seized at the residential premises of Shri Dinesh Yadav belonged to his wife and sister and therefore considering the statement made by the husband of the assessee and Shri Dinesh Yadav, AO held that the out of the total jewellery of 2916.158 gms found at the residential premises of Dinesh Yadav, 80 gms of jewellery valuing Rs.2,37,920/- belonged to Shri Dinesh Yadav and his family members and the remaining jewellery valued at Rs.94,38,552/- belonged to Smt. Poonam Yadav. It is further recorded by the AO that during the course of assessment proceedings, assessee was asked to explain the source of acquisition of jewellery along with supporting evidences and its source of investment. Assessee inter alia submitted that some of the jewellery was received by her as gift from Late Smt. Sonwati (grandmother in law) and some jewellery belonged to Shri Gajendra Singh (uncle) and his family. Assessee also filed a gift deed in support of gift of jewellery in question received from Late Smt. Sonwati along with some purchase bills of Shree Jewellers. AO has recorded that on perusal of the site of Commercial Tax state of UP, tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant circular of CBDT. Less : Relief allowed by AO of 451.45 Gms [80 Gms + 371.450 Gms] Total : 331.70 Gms Mrs. Arshi Manoj (Sister in law of Mr. Dinesh Yadav) 535.28 Gms • Arshi Yadav submitted an affidavit interalia explaining her family's entitlement at 1100 gms (Husband - 100, Wife - 500, Two daughters - 500). It was claimed to be covered by entitlement as envisaged in relevant CBDT Circular. • While in search at her premises 31Gms and 535.28 Gms found from Mr. Dinesh's premises stand explained reasonable, same should be accepted. Mrs. Shweta Yadav (Sister of Mr. Manish Yadav) 160.358 Gms • Found with her name on pouch at search, coupled with admission of Manish Yadav, so submitted that explanation is reasonable. Mr. Gajendra Singh Yadav & Family 1500 Gms. • Affidavit of Mr. Gajendra Singh Yadav • Family Entitlement 1700 Gms while found only 92.50 Gms so 1500 gms was explained reasonable in hand of Gajendra and family Late Smt. Sonvati (Grandmother of Mr. Manish Yadav) 3755.8 Gms • Purchase bill and gift deed Total 6283.138 Gms 136. He therefore, submitted that the assessee had duly explained the ownership of jewelle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the benefit of CBDT instructions and considered the evidences in the form of gift deed, affidavit, bills and vouchers the impugned addition would have reduced substantially. We are therefore of the considered view that not granting the benefit of CBDT Instructions No. 1916 (supra), and in the light of binding precedents has resulted into gross injustice to the assessee. We therefore, direct the AO to grant benefit of CBDT instructions to Shri Dinesh Yadav and his family members. Admittedly, it is not the say of the Revenue that the CBDT instructions are not applicable in the present facts and attribute the gold jewellery weighing 950 gms to the family of Shri Dinesh Yadav. It is also brought to our notice that some of the jewellery related to Mrs. Arshi Manoj who is stated to be sister-in-law of Shri Dinesh Yadav, and had given an affidavit showing her entitlement based on CBDT instructions at 1100 gms. The AO without rebutting the contents of the affidavit merely made addition without conducting adequate inquiry attributed the entire jewellery to the assessee. Therefore, in terms of CBDT instructions, 535.28 gms of jewellery, in the absence of any contrary material, is stood expla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the identity of the lender is established by the PAN Card of the lender, the genuineness of the transactions was also fully established by the fact that the transaction was duly recorded and confirmed in the accounts of the lenders and was received through banking channels. In support of his contentions, he placed reliance on the judgment of the Delhi High Court rendered in the case of CIT vs. Kishori Lal Construction Ltd., [2010] 5 Taxmann.com 60 (Delhi). He further submitted that Learned CIT(A) without appreciating the fact that assessee has discharged its primary onus to establish the identity, genuineness and creditworthiness of the lender, had simply held that since the assessee failed to furnish the ITR, the creditworthiness of the creditor stands unverified and therefore upheld the addition wrongly. He also placed reliance on the following decisions: • CIT vs. Ganeshwari Metals Pvt. Ltd. 2013-TIOL-96-HC-DEL-IT • CIT vs. Kamdhenu Steel & Alloys Ltd., 2012-TIOL-236-HCDEL-IT, SLP filed in this case by the Department has been dismissed by the Hon'ble SC vide order dated 27.09.2012 in CC15640/2012. • ITO vs. Neelkanth Finbuild Ltd.; 2015-TIOL-1082-ITAT- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Manish Yadav for A.Y. 2018-19 (arising out of the order of Ld.CIT(A) Kanpur-4 dated 12.08.2021): 149. Assessee has raised the following grounds: 1. That the CIT(A) erred on facts and in law in not quashing the assessment order dated 27.12.2019 passed by the AO under section 143(3)/153A of the Income Tax Act, 1961 ('the Act') on the ground of being beyond jurisdiction, bad in law and void ab initio. 2. That the CIT(A) erred on facts and in law in not quashing the impugned order passed under section 143(3)/153A, since the same was passed pursuant to a mechanical approval dated 20.12.2019 granted by the Addl. CIT under section 153D, lacking complete application of mind and thus rendering the assessment order to be beyond jurisdiction. 3. That the CIT(A) erred on facts and in law in sustaining the addition of Rs. 1,20,07,849/- made by the AO under section 69 of the Act alleging unexplained investment in property at Indirapuram, Ghaziabad, on the basis of some documents found during the course of independent search at premises of third party, i.e., Shri B.B. Goel, containing name of, inter alia, appellant with amount invested in the aforesaid property. 3.1 That the CIT(A) er ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epresentatives of the respective parties that the issues raised in these grounds are identical to the ground raised in the case of Ecstasy Buildcon Pvt. Ltd. in ITA No.1127/Del/2021(supra) and therefore they have same arguments to make. 152. We have heard the rival submissions and perused the material available on record. We have taken a view against the assessee in the case of Ecstasy Buildcon Pvt. Ltd. (supra) and dismissed the grounds related to the framing of assessment u/s 153A of the Act and approval u/s 153D. Since the issue raised in the present appeal is identical to that raised in the case of Ecstasy Buildcon Pvt. Ltd. (supra), therefore for the same reasoning the Ground Nos. 1 & 2 are dismissed and our finding in ITA No.1127/Del/2021 shall apply mutatis mutandis to the present grounds. Thus the grounds of assessee are dismissed. 153. With regard to Ground Nos. 3 to 3.5, the Learned Authorized Representative of the assessee adopted the same arguments as were in the case of Smt Shashi Yadav (ITA No.1123/Del/2021) wherein, similar grounds were raised against the impugned addition related to investments made in the property at Noida on the basis of the notings in the diary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee were not found acceptable to AO. AO held that in the absence of any explanation or documentary evidences, the investment of Rs.4,56,000/- in the jewellery to be unexplained and made its additions u/s 69A of the Act. Aggrieved by the order of AO, Assessee carried the matter before CIT(A) who upheld the order of AO. Aggrieved by the order of CIT(A), assessee is now before us. 159. Before us, Learned AR reiterated the submissions made before the lower authorities and further submitted that addition on account of unexplained jewellery of Rs.84,01,956/- weighing 2379.6 gms added in the hands of the assessee stands explained as in respect of the identical issue of addition on account of unexplained jewellery which was subject matter in the case Poonam Yadav in ITA No.1121/Del/2021 for A.Y. 2018-19 wherein the whole jewellery has been explained in the hands of the Poonam Yadav and the Learned Counsel for assessee submitted that for the same reasoning and similar submissions the addition of Rs.84,01,956/- in respect of the jewellery weighing 2379.6 gms added in the hands of the assessee stands explained and therefore the addition be deleted. 160. Further, in respect of addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idential premises of the assessee and his locker. Looking to the facts and material placed before us, we are of the considered view that the action of AO is not justified for not giving set off of jewellery belonging to other persons and duly explained by the assessee. We, therefore, taking a holistic view restrict the addition to the extent of 300 gms jewellery in the hands of assessee. Rest of the addition is hereby deleted. Thus the ground of the assessee is partly allowed. 163. In the result, the appeal of the assessee is partly allowed. Now we take ITA No.1500/Del/2021 (Revenue's appeal) and ITA No.1126/del/2021 (Assessee's appeal) in the case of Sita Devi Memorial Siksha Sansthan for A.Y. 2017-18 (arising out of the order of Ld.CIT(A) Kanpur-4 dated 12.08.2021): 164. Grounds raised by Revenue in ITA No.1500/Del/2021 are as under: 1. On facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition made by AO to the tune of Rs.8.25 Crores. the Ld. CIT(A) has not appreciated the fact the denominations of lacs has also not been mentioned on the impounded page. The assessee has failed to prove, alongwith documentary evidence, that the figure wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in law in not deleting the aforesaid addition made under section 69B of the Act on the basis of valuation report furnished by the DVO, pursuant to reference made by the DDIT, on the ground that the assessing officer was not empowered to refer the aforesaid report, without an independent reference to DVO under section 142A of the Act. 4.1 That the C1T(A) erred on facts and in law in observing that the assessing officer was competent to refer the report of DVO submitted pursuant to reference made by DDIT under section 132(9D) of the Act since the same DVO - (i) was competent to issue valuation report under section 142A, (ii) as also issue report using the same method of valuation. Without Prejudice 5. That the CIT(A) erred on facts and in law in not deleting the entire addition made by the assessing officer under section 69B on the basis of valuation report of DVO, since the addition not based on any evidence of unexplained expenditures made by the appellant, and was merely made by estimating the fair market value of the expenditures which was outside the scope of provisions of section 69 r.w.s. 142A of the Act. 6. Further without prejudice, that the CIT(A) erred on facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation was furnished by the donors. He noted that assessee had also failed to furnish the required details inspite of various opportunities granted by the AO. AO therefore held that assessee had failed to establish identity and creditworthiness of the donors and genuineness of the transactions. He accordingly held that aggregate amount of Rs.8,25,00,000/- received by the assessee to be non-genuine donation and treated it as unexplained cash credit. He was further of the view that the assessee being an educational institutions, the admission in courses were given by the management after taking handsome amount under the guise of donation and the amount so generated was utilized for the construction of college buildings, maintaining the decent life styles of the promoters/trustees etc. He thereafter while relying on the various decisions cited in the order held the amount of Rs.8,25,00,000/- received by the assessee to be unexplained cash credit u/s 68 of the Act and made its additions. 167. When the matter was carried before CIT(A), assessee inter alia submitted that the provision u/s 68 of the Act were not applicable as the corpus donation was duly accounted in the books of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while deciding the issue in favour of the assessee has given finding of fact by observing as under: "7.5 I have carefully examined the submission filed by the appellant and found force in it. Further, contention of the appellant is correct that donation received by appellant trust was corpus donation, received through banking channel, and all ingredients of section 68 have been satisfied during the course of assessment proceedings. Donations received were not the anonymous donation. Appellant has also submitted that AO's observations in the assessment order is devoid of any merit and no addition can be made on the basis of imagination, surmises and conjectures. In the year under consideration appellant has shown total receipt of Rs.40,08,116/- which includes bank interest of Rs.38,52,541/- meaning thereby the fee of Rs.1,47,880/- has only been received and which shows that school was in the initial stage and few admissions were taken. The story of AO that it is general perception that the admissions in these courses under management quotas are given by taking handsome amounts in lacs under the guise of donation or otherwise is devoid of any merit and on incorrect appreciation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -17 were found wherein it reflected an amount of Rs.12,72,00,000/- was written to be paid to M/s Metamorphosis Construction and out of which Rs.5,75,00,000/- was written in cash. Assessee was asked to explain the transactions recorded therein along with necessary supporting evidences. AO noted that assessee had failed to furnish documentary evidences to support the transactions. He therefore considered Rs.5,75,00,000/- treating the same to have been made by the assessee in cash to M/s. Metamorphosis Construction as unexplained expenditure and made its addition u/s 69C of the Act. 174. Aggrieved by the order of AO, assessee carried the matter before CIT(A) who after examining the records had stated that the figure is actually in lakh and not in crores and hence the said amount was in fact Rs.5,75,000/-. CIT(A) further observed that the amount of Rs.5,75,000/- was duly recorded in the books of accounts of the assessee. He therefore deleted the addition of Rs.5,75,00,000/-. Aggrieved against the order of CIT(A),Revenue filed appeal before us. 175. Before us, Learned DR took us to the order of AO and supported his order. 176. Learned AR on the other hand reiterated the submissions m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd. In this regard, I perused the para 13 of the Assessment Order wherein the details of such addition made by the AO are mentioned, wherein no notice of any nature was found to be mentioned. 8.4 The Appellant further submitted that the amount of Rs. 6.97 as mentioned on the said page to be made by cheque is duly recorded in the books of account. As a proof of the same, the Appellant submitted the copy of payment voucher wherein a payment of Rs. 6.86 lakh has been shown to have been paid to the said contractor vide Cheque no 086822 of Corporation Bank issued by the Appellant. Therefore Appellant succeeded in proving that the said handwritten scribbling referred by the AO is actually figure in lakhs and not in crores. The Appeiiant further submitted that the cash portion of Rs. 5.75 is actually 5.75 lac and is duly recorded in the books of account of the Appellant. To prove the same, the Appellant filed the copy of the Imprest ledger wherein a total expenditure of Rs. 5.75 lac has been shown to be incurred in cash for meeting the petty construction expenses and other expenses of the Appellant. In this regard it is observed that neither the authorized officer of survey nor the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluded the differential value between the valuation made by DVO and that declared by the assessee amounting to Rs.4,02,36,123/- as unexplained investment and made its addition u/s 69B of the Act. 181. Aggrieved by the order of AO, assessee carried the matter before CIT(A). After considering the submissions of the assessee CIT(A) at para 9.8 of the order has noted that as per the Valuation Report the construction of the property was valued at Rs.16,97,37,700/-, and then the same was bifurcated at Rs.3,89,01,331/- for F.Y. 2015-16 & Rs.13,08,36,369/- for F.Y. 2016-17. CIT(A) noted that the actual expenses incurred by the assessee in F.Y. 2016-17 was Rs.9,06,00,243/- and the actual expenses incurred from 01.04.2017 to 23.01.2018 was Rs.3,39,08,178/- and thus the total expense incurred by the assessee in the construction was of Rs.12,45,08,421/- which was valued at Rs.13,08,36,369/- by the DVO. Learned CIT(A) has also noted that actual expenses of Rs.3,39,08,178/- that was incurred by the assessee during the period of 01.04.2017 to 23.01.2018 was included by DVO while arriving at the value of property of F.Y. 2016-17 at Rs.12,45,08,421/-. He noted that if the actual expenses incurred ..... X X X X Extracts X X X X X X X X Extracts X X X X
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