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TMI Blog2023 (2) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... a return of income u/s 139(1) on 29.09.2011 declaring total income at Rs.29,10,97,142/-. Subsequently a revised return of income was filed on 30.11.2011 declaring total income at Rs. 19,34,16,486/-. However, there was a search conducted on the appellant on 16.01.2013 u/s 132 of the Act and action u/s 153A against the appellant was consequently initiated. Thus, the assessment u/s 153A was completed on 30.03.2015 at an income of Rs.41,07,52,967/- against the returned income of Rs. 19,34,16,486/-. Against the income assessed u/s 153A on 30.03.2015, the appellant filed an appeal before the C.I.T. (Appeals) which was decided on 27.03.2017 and the C.I.T. (A) enhanced the income assessed to Rs.52,02,50,970/ -. Against this first appellate order, the appellant filed an appeal before the Tribunal which is still pending. 2.1 There was another search action against the appellant u/s 132 on 17.10.2016. In response to notice issued u/s 153A the appellant filed a return of income declaring income at Rs.19,34,16,486/- on 27.03.2018. In the order of assessment passed u/s 153A read with section 143(3) of the Act on 30.12.2018, the Assessing Officer framed order of assessment at an income of Rs. 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt in appeal against the addition made of Rs.104,50,00,000/- to the income already assessed. 3. Ld. CIT(A) had deleted the and the Revenue has approached the Tribunal raising following grounds :- "1. The Ld. CIT(A), having plenary powers under the Income tax Act, erred in law and on facts in deleting the addition of Rs. 104.50 crore on the ground that copy of the seized material and the statements and opportunity of cross-examination were not provided to the assessee. 2. The Ld. CIT(A), having plenary powers under the Income tax Act, erred in law and on facts in deleting the addition of Rs. 1.04.50 crore on the ground that the complete name of the assessee, i.e. Vatika Ltd., was not appearing in the seized documents and ignoring the fact that the name 'Vatika' showed sufficient nexus and, if further fact-finding was called for, it was incumbent upon him to get that done. 3. The Ld. CIT(A), having plenary powers under the Income tax Act, erred in law and on facts in holding that the amount mentioned in the seized documents was only Rs.10,855.43 ignoring the incontrovertible evidence that it was actually Rs.104.50 crore 4. The Ld. CIT(A) has erred in law and on facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral)-1 vs. Jakson Engineers Ltd. , 2015(12) TMI 1523, Dated 07.12.2015 9. Smt. Jami Nirmala vs. The Principal CIT, Bhubaneswar and Others, 2021(8) TMI 594, Dated: 10-08-2021 (Orissa High Court) 10. Pr. CIT vs. Gahoi Dal & Oil Mills, 2019(7) TMI 1050, Dated : 12-07-2019 (Madhya Pradesh High Court) 11. Pr. CIT vs. LKG Builders Pvt. Ltd. 6.3 It was submitted that if information of search upon India Bulls Group was relied against the assessee being third party, then assessment should have been u/s 153C of the Act. Ld. Sr. Counsel submitted that even the material which was retrieved from the employee of M/s. India Bulls Group were not supplied to the appellant. 6.4 It has been submitted on behalf of the assessee that the grounds as raised before the Tribunal on the lack of exercise of plenary powers of the ld. CIT(A), are not sustainable. Ld. Sr. Counsel submitted that in fact Ld. CIT(A) made all efforts and even called for remand report and having failed to have material for sustaining the finding deleted the addition. 6.5 It was submitted that the burden was in the revenue establish that the assessee has made investment of the alleged sum, for the purpose of section 69 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e making submissions certain facts of allegedly following in public domain were narrated in written submissions as follows :- "A) In F.Y. 2009-10 Albasta infrastructure Limited, a 100% subsidiary of M/s Indiabulls Real Estate Limited subscribed to 40,00,000 debentures of face value Rs. 10,000 each at 0.0001% interest issued by M/s Vincent Developers Pvt. Ltd. (later known as Vatika Propbuild Pvt. Ltd.), which amounted to interest cost of just Rs.4,000/ - per annum. Such interest was negligible compared to then prevailing market rates of interest. In 2014-15 the debentures were redeemed by M/s Vatika Propbuild Pvt. Ltd. and reissued by another company M/s Deneb Developers Pvt. Ltd. B) Also, publicly available information about M/s Vatika Propbuild Pvt. Ltd. shows that their was no significant business activity in the company till it received investment of Rs.400 Cr. from Indiabulls group company. C) Both M/s Vatika Propbuild Pvt. Ltd. and M/s Deneb Developers Pvt. Ltd. had same registered address. Also that address happened to be the same on which this assessee i.e. M/s Vatika Ltd. is registered. D) One Sh. Brij Kishore Singh who was regular employee of this assessee i.e. Va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blic domain information is nothing unless brought on record as evidence and confronted to assessee. 10. It can be noted that Ld. AO has primarily relied the digital information retrieved by the Investigation Wing, Mumbai and allegedly seized from the office Chamber of Mr. Ashok Sharma, the C.F.O. of Indiabulls Group at the time of search on the Indiabulls Group on 12.07.2016 and 14.07.2016. On the basis of this the Ld. AO show caused the assessee with following :- "2. Further, as per information available on record, it has been noticed that you had made various cash payments to Indiabulls Group during the F.Y. 2010-11 totalling to Rs 1 08,55,42,562/-. During the same period, you have received cash payments of amounting to Rs 54 55,83.500/-. The Indiabulls Group has filed an application before the Hon'ble ITSC on 03.10 2017 u/s 245C(1) of the Income Tax Act, 1961. In the application, the Indiabulls Group has admitted that it was accepting unaccounted funds in cash from various parties. The Indiabulls Group has categorised the cash transactions in the name of Vatika as cash loans and has offered the peak credit of these transactions as its unaccounted income. You are hereby requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material." 11. When aforesaid settled principles of law are taken considered there leaves no doubt in the mind of this Bench that there is no error in the findings of Ld. CIT(A). Ld. CIT(A) has rightly concluded following in para 5.11.28 reproduced as below :- "5.11.28 Considering the facts that: (1) The copy of seized material was not provided to the appellant (2) The copy of statement on oath was not provided to the appellant and opportunity of cross examination was not allowed (3) The complete name of the appellant i.e. M/s. Vatika Ltd. is not appearing on the seized papers (4) The total amount mentioned on the seized papers is only Rs. 10,855.43 and no justification with supporting evidence has been furnished by the Assessing Officer to hold it to be Rs. 104,50,00,000/- (5) A copy of the application filed before the Hon'ble ITSC on 03.10.2017 u/s 245C(1) of the Income Tax Act, 1961 in Indiabulls Group was neither available with the Assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... added to the assessable income of the assessee for the F.Y. 2010-1 1 relevant to the A.Y. 2011-12 as its undisclosed business income. (Addition: Rs.1,04,50,00,000/-) Satisfaction is hereby recorded by the undersigned that the assessee has undisclosed business income to the tune of Rs.l,04,50,00,000/- as per provisions of section 271(1 )(c) of the Act. Accordingly, penalty proceedings u/s 271(1 )(c) of the FT. Act, 1961 are initiated separately by issue of statutory notice." 13. The Bench is of considered opinion that Ld. AO has fallen in error in casting a burden upon the assessee for explanation of the admissions made by Indiabulls Group. The burden on the assessee would have been justified had the transactions initiated at the end of the assessee. However, there was no material on record to show that the admissions of Indiabull groups had anything in the form of evidence that funds had come from the end of assessee. 14. There is force in the contention of the ld. Sr. Counsel for the assessee that revenue cannot take a plea of lack of exercise of plenary powers by the ld. CIT(A) rather what transpires from the order of Ld. AO and ld. CIT(A) is that where Ld. AO had nearly ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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