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TMI Blog2023 (4) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... . Addition on account of alleged plots buy back, sale and interest earned - Addition based on noting in loose papers found during search - Revenue made the addition holding that the assessee could not file any evidence to substantiate the claim that the loose papers do not belong to him - HELD THAT:- The contents reveal that there has been a house which has been sold and also purchased 16 plots. The revenue has not even proved that the notings on the loose papers found, were written by the assessee nor his handwriting has been tested for. Further, inspite of conducting a search, no documents pertaining to purchase of the said house or sale of said house and purchase of 16 plots were found. Even in the post search inquiries none of the 17 properties could be traced out. There was no evidence in any of the bank statement with regard to the dealings. The inferences drawn were not backed by any tangible evidences or corroborative evidences. The revenue failed to establish the person to whom these documents belong, name or details of the persons from whom the alleged income was earned, any type of correlation with the business of the assessee. The statement recorded u/s 132(4) on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r and being adjudicated by a common order. 3. In ITA No. 5559/Del/2016, following grounds have been raised by the assessee: 1. That on the facts and circumstances of the case, the Commissioner of Income tax (Appeals) -30, New Delhi [briefly the CIT(A) ] has erred in upholding the addition of Rs.75,00,000/- made on account of sale of an house by raising the presumption under section 292C of the Income tax Act, 1961 ( the Act ). 1.1 That on the facts and circumstances of the case, the CIT(A) did not appreciate that except for the undated and unsigned loose paper, no other document, paper, agreement or any other material indicating sale of the house property by the Appellant was found during the course of search. 2. That on the facts and circumstances of the case, the CIT(A) has erred in upholding the addition of Rs. 13,00,000/- made on account of interest earned by raising the presumption under section 292C of the Act. 2.1 That on the facts and circumstances of the case, the CFT(A) did not appreciate that except for the undated and unsigned loose paper, no other document, paper, agreement or any other material indicating outstanding loan / advance to any perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 573). A.Y. ITA No. CIT(A) Status before ITAT 2006-07 CIT(A) deleted No Revenue appeal 2007-08 5755/Del/2016 CIT(A) deleted Revenue appeal dismissed (low tax effect) 2008-09 5756/Del/2016 CIT(A) deleted Revenue in appeal (GR-2) 2009-10 5757/Del/2016 CIT(A) deleted Revenue in appeal (GR-2) 2010-11 5758/Del/2016 CIT(A) deleted Revenue in appeal (GR-2) 2011-12 CIT(A) deleted No appeal by the Department 2012-13 5565/Del/2016 CIT(A) partly confirmed Assessee in appeal 9. We have perused the Assessment Order and order of the ld. CIT(A). It is clear that the addition made was devoid of any incriminating material found and seized duri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y several other High Courts. 71. For all of the aforementioned reasons, the Court is of the view that the ITAT was justified in holding that the invocation of Section 153A by the Revenue for the AYs 2000-01 to 2003-04 was without any legal basis as there was no incriminating material qua each of those AYs. 13. Hence, we decline to interfere with the order of the ld. CIT(A) and the appeal of the Revenue on the issue of addition u/s 68 for the Assessment Years 2007-08 to 2010-11 stands dismissed. ITA No. 5559/Del/2016 : A.Y. 2006-07 ITA No. 5562/Del/2016 : A.Y. 2009-10 1. Addition on account of Sale of House: ITA No. 5559/Del/2016 : A.Y. 2006-07 ITA No. 5560/Del/2016 : A.Y. 2007-08 ITA No. 5561/Del/2016 : A.Y. 2008-09 ITA No. 5562/Del/2016 : A.Y. 2009-10 ITA No. 5563/Del/2016 : A.Y. 2010-11 ITA No. 5564/Del/2016 : A.Y. 2011-12 ITA No. 5565/Del/2016 : A.Y. 2012-13 2. Interest Earned: 14. During the course of search seizure operation u/s 132 of the Income Tax Act, 1961 at the residential premises of the assessee at C-168, Anand Vihar, New Delhi, incriminating documents were found and seized. Pages 17 to 19 of Anne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied with statement of affairs for these respective financial years. Before the ld. CIT(A), the assessee has reiterated the submissions made in the assessment proceedings and has further submitted that in the statement recorded u/s 132(4) of the Act, he has stated that the seized papers do not belong to him and also not aware to whom they belong. The ld. CIT(A) confirmed the addition on the grounds that the assessee failed to discharge its primary within the meaning of 292C of the Act, by filing any evidence in the assessee proceedings and also in the appellate proceedings, in order to substantiate its claim these papers do not belong to him. 18. Before us, it was argued that there is no immovable property or any other assets held by the appellant, which would have been sold for Rs. 75,00,000/- as has been held by the A.O. The assessee is holding exclusively only one residential house property situated at C-168, Anand Vihar, Delhi-92, which is a joint property alongwith his wife Mrs. Ranjit Kaur, wherein he has been living since 2001 and continuing to reside in this house also till this date. As such, there is no sale/purchase deed of any such property presumed to have been sold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence to substantiate the claim that the loose papers do not belong to him. The requirement of the revenue could not be met as it would difficult for the assessee to prove the negative. The revenue also alleged that the assessee has not controverted the contents of the loose papers by filing any evidence. The assessee has been stating that the loose papers do not belong to him and hence expecting the assessee to file any evidence to controvert contents is akin to asking for performing a logically impossible task. The contents reveal that there has been a house which has been sold and also purchased 16 plots. The revenue has not even proved that the notings on the loose papers found, were written by the assessee nor his handwriting has been tested for. Further, inspite of conducting a search, no documents pertaining to purchase of the said house or sale of said house and purchase of 16 plots were found. Even in the post search inquiries none of the 17 properties could be traced out. There was no evidence in any of the bank statement with regard to the dealings. The inferences drawn were not backed by any tangible evidences or corroborative evidences. The revenue failed to establ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and also cloth mill- no year mentioned in the loose papers - addition of Rs. 1.36 crores made on the basis that 'on money' was received in respect of flats sold - no tangible evidence in the form of unexplained investment found during search -forensic report obtained by AO not supplied to assessee despite request - copies of statements of members of housing societies recorded at the back of the assessee also not supplied - important witnesses not examined - no addition could be made in the hands of the assessee. 30. Commissioner of Income-tax vs. Anil Bhalla [2010] 322 ITR 191 (Delhi HC) Where no independent material or evidence had been brought on record by Assessing Officer to establish that notings/jottings recorded on loose sheet of paper seized during search represented an unaccounted transaction and Tribunal held that entries in question belonged to some company, inasmuch as assessee could explain from books of such company that these projects were undertaken by it, and Tribunal held that loose sheet did not represent any expenditure incurred by assessee, deletion of addition based on loose sheet, treating it as unexplained expenditure in assessee's hands wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e lender, audited financial statement for the concerned year was filed which duly reflected the advance given to Shri Gurmeet Singh of Rs.50,00,000/-. The lender has a capital of Rs.77.53 crores and total advances given were to the tune of Rs.1.72 crores. The said amount has been lent on 12.03.2012, 15.03.2012 and 17.03.2012 from the regular account of Corporation Bank A/c No. 000190. The confirmation dated 01.08.2014 is also on record and the revenue has not disputed the fact that this said account was not an undisclosed account. Hence, keeping in view the entire facts, we hold that no addition is called for on this account. 37. In nutshell, The addition made on account of unsecured loans u/s 68 which has been duly deleted by the ld. CIT(A) owing to absence of any incriminating material found and seized during the search and based on the judgment of CIT Vs. Kabul Chawla (supra) is affirmed. With regard to the interest earned, in the absence of any corroborative material and in the absence of non-taxing of the principle amount, the same is directed to be deleted. With regard to the sale of house and purchase of plots, in the absence of any documents, the same is h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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