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TMI Blog2023 (6) TMI 718X X X X Extracts X X X X X X X X Extracts X X X X ..... Chetan Agarwal, A.R. For the Respondent : Shri Shramdeep Sinha, Sr.DR ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- This appeal is filed by the Revenue against order dated 20.03.2017 passed by the Commissioner of Income Tax (Appeals)-4, Vadodara, as against the assessment order passed under section 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as the Act ) relating to the Assessment Year (A.Y) 2009-10. 2. The brief facts of the case is that the assessee is an individual deriving income from salary, business, house property and income from other sources. The assessee filed its Return of Income on 23.03.2010 for the Assessment Year 2009-10 declaring total income of Rs. 3,35,330/-. The regular assessment u/s. 143(3) of the Act was completed on 08.11.2011 assessing the admitted income. Thereafter the case was reopened by issuing a notice u/s. 148 on 18.02.2013, on the ground that during the search action carried on 19.01.2009 certain materials seized from the office premises of Mr. Chirag H. Patel, Proprietor of Chirag Construction, that he received Rs. 1,69,50,000/- on various dates from the assessee and he admitted the same as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence before proceeding to make huge addition merely on the strength of the statement of third party and some loose papers which are not pertaining to the appellant. Admittedly, these were seized from the office premises of Shri Chirag H. Patel, Prop, of Chirag Construction. The Assessing officer in his order has placed reliance only the evidences collected during the search action in case of Shri Chirag H. Patel. On the basis of these evidences, the A.O. contended that assessee entered into transaction with above party for an amount of Rs. 1,69,50,000/-. In this context, assessee clearly explained that he purchased house in Surya Valley project for total consideration of Rs. 36.51 lacs only. Assessee time and again asked the A.O. to supply copy of relevant seized materials the statement of above party. From the written submissions of the Authorized Representative, it transpires that during assessment proceedings, assessee has sought these vide letters dated 09/01/15, 25/02/15, 19/03/15 27/03/15. The copies of these letters were placed before me and were also sent to the A.O. during remand proceedings. However, the A.O. never bothered to supply the same to the assessee. Eve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Sri Chirag H. Patel This is evident from the copies of the letters dated 09/01/15, 25/02/15, 19/03/15 27/03/15 written by the assessee to the A.O. and properly received in the office of the A.O. However, instead of supplying the requisite documents which was the legal right of the appellant in order to defend his case, the Ld. A.O. has given him the copies of the statements of the appellant recorded u/s.131 of the Act on 06/03/2009 by ITO(lnv.), Baroda and on 18/03/2010 recorded by the DCIT, Central Circle-1, Baroda. Even during the remand proceedings, the A.O. has not provided the copies of the (i) Seized material pertaining to the appellant found from the premise of Chirag H. Patel during the search and (ii) Statement of Chirag H. Patel recorded during the search. 3.3.4. From the above sequence of events, it is clear without any doubt that the Assessing Officer has passed assessment order in very casual manner and has completely ignored the plea of the appellant to grant him opportunity to defend his case by providing him impugned documents. In this case, the reasons to believe are in three para but the order of the A.O. making huge addition o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat. Hence, the contention of the appellant that the learned Assessing Officer has made the addition of Rs. 1,69,50,000/- merely on surmises, conjectures as well as without any supporting evidences is fully acceptable. 3.3.5. Ld. Authorized Representative has further argued that when relevant materials are not supplied to assessee, no addition can be made to the income of assessee on the basis of such materials. Also it was pointed out in letter dated 27/03/15 that in above two statements of assessee no ambiguity/misconduct was found relating to any extra investment made by assessee. Further, as mentioned above, the Assessing Officer has not provided cross examination of Shri Chirag H. Patel although same was specifically demanded by assessee. The Assessing Officer has not given any reason for not providing cross examination. Also the detailed replies filed by assessee are completely ignored which manifests the capricious, vindictive arbitrary attitude of Assessing Officer. In view of these facts, no addition can be made to the income of assessee on the basis of statement of Shri Chirag H. Patel. The Authorized Representative has also placed reliance on following decisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further contended that only statement was supplied to the assessee. PSP was not put to cross-examination, and therefore, statement recorded from the back of the assessee cannot be used against the assessee. After considering the submissions of the appellant and analysing the legal aspect in great details, the Tribunal allowed the appeal of the assessee. In the present appeal also, it is also not the case of assessing officer that seized materials referred in assessment order are in the hand writing of assessee or that same bears signature of assessee. It was also pointed out during assessment proceedings that there are total 31 units in Surya Valley project whereas, presumption relating to extra payment is drawn in assessee's case only. No reason has been assigned for taking such an astonishing stand. It is thus clear that assessing officer has proceeded to make huge addition of Rs. 1,69,50,000/- merely because notice u/s 148 of the Act was issued on assessee. However, on merits of the case he has grossly failed to give any cogent reason for making such addition to the income of assessee. 3.3.6. The facts of the present case are also identical with the case of Ash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, and that they are only corroborative evidence. It has been held even then independent evidence is necessary as to trustworthiness of those entries which is a requirement to fasten the liability. The Authorized Representative for the appellant has also relied upon the judgment of Hon'ble Supreme Court in the case of CBI Vs. V.C. Shukla Others [1998] 35 SSC (Page 410) wherein it was held that the evidence collected by the Department is not worthy of credence, more particularly in view of there is no independent evidence on the record. The Authorized Representative has argued that addition made with the help of material gathered from the third party alone cannot be sustained in view of this judgement. Here at the cost of repetition it is necessary to point out that in the present case, there is no other material with the A.O. than such third party statement and loose papers which have never been confronted to the assessee. The Assessing Officer has not used any power under the Act to make any enquiry of any sort from any quarter including the person on whose statement he has relied for reopening of the assessment. Thus, the facts of the present case are identical with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In this year also, the A.O. was of the opinion that addition of Rs. 44.80 lacs is required to be made in respect of payment by Shri Vikas A Shah as dalali/brokerage but since addition Rs. 91.50 lacs was made on account of on money, a separate addition of Rs.44.80 lacs was not made in this year. The addition of Rs.91.50 lass in this year was deleted by Ld. CIT(A) on this basis that except the noting on the reference paper and the statement of Shri Vikas A Shah, there is no other corroborative material/evidence to suggest that the assessee paid on money of Rs. 92 lacs. It is further noted by Ld. CIT(A) that Shri Vikas A Shah stated that he is yet to receive Rs.32 lacs form the assessee, which appears to be improbable because no prudent man could leave such a huge amount outstanding when the sale transaction is registered. He further noted that the land was purchased by the assessee and Kantibhai jointly and as per the documents for purchase which is registered with the sub-registrar at a value of Rs.9 lacs and this valuation has not been challenged by the Stamp Duty Authority and, therefore, there is no reason for presumption that the assessee has made any payment in excess of the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered following decisions. . I. Prathana Construction Pvt. Ltd. 70 TTJ122 (Ahmedabad) II. Prabhat Oil Mills reported in 52 TTJ 533 (Ahmedabad) III. JaindalStainless Ltd. 9 DTK 345 (ITAT, Delhi) After considering all the facts and legal position of this issue, we do not find any reason to intervene in the order of the CIT(A). Accordingly, we uphold the order of the CIT(A). Hon'ble High Court of Gujarat has again affirmed the decision of ITAT, Ahmedabad in Tax Appeal No. 910 of 2013 vide their order dated 11/11/2013 as under:- 4.1. It is required to be noted that the order passed by the ITAT in the case of the co-purchaser-Abhalbhai Arjanbhai Jadeja was further carried before this Court by way of Tax Appeal No. 233/2013 and other allied appeals and it is reported that vide order dated 03/04/2013, the Division Bench of this Court has dismissed the said appeal confirming the order of deletion of similar addition in the case of Abhalbhai Arjanbhai Jadeja-copurchaser. 5. In view of the above, when in the case of the co-purchaser, similar addition came to be deleted by the CIT(A), which came to be confirmed up to this Court, it cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discussed above. A similar proposition which lays down the law of the land and hence is binding has been enunciated by the Supreme Court in Ramji Dayawala Sons (P.) Ltd. v. Invest Import AIR 1981 SC 2085. 3.3.9. In view of the undisputed facts of the case, remand report of the A.O., judicial decisions cited in para above and the rejoinder filed by the Ld. Authorized Representative of the appellant, it is held that there is no independent evidence, direct or circumstantial, to link the documents seized from the premise of Chirag H. Patel to the assessee. This record does not bear the initials or endorsement of the appellant. The record has not been found at the premises of the appellant. The record does not belong to the appellant. The Department has recorded the statements of the assessee twice who has categorically denied the payment of on money. In the rejoinder filed by the appellant it has been argued that in para 10 12 of remand report, assessing officer has incorrectly stated that material statement was supplied to assessee vide letter dated 16/03/2015. It has been submitted by the A/R that The assessing officer in remand report has referred to para 8 10 of ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Officer on the supply of seized material and copy of statements of Chirag Patel itself supports the assessee. The misplaced zeal of the Assessing Officer in adopting the reasons to believe as the main stay of the department's case for making huge addition without providing copies of the impugned material to the assessee and without allowing him opportunity to cross-examine Sri Chirag H. Patel cannot be upheld. It is also true that no corroborative evidence was collected by the Assessing Officer and no field enquiry was conducted by him before unilaterally proceeding to make huge addition in case of the appellant completely ignoring the judicial decisions on the subject including decisions of jurisdictional Tribunal as well as High Court. Under these circumstances and considering various judicial decisions relied upon by the Authorized Representative and also mentioned by me in above para, the addition of Rs.1,69,50,000/- made by the Assessing Officer is deleted. Thus, the main Ground of Appeal is allowed. 4. Aggrieved against the same, the Revenue is in appeal before us raising the solitary Grounds as follows: 1. The Ld. CIT(A) has erred in law and on facts in del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lley project which were purchased by various parties, whereas extra on money payment of Rs. 1,69,50,000/- was made only in the name of this particular assessee. The A.O. had not justified for making such an addition in the hands of the assessee with relevant seized materials and by supplying the same to the assessee, thus no addition can be made in the hands of the assessee as held by various judicial precedents. Further the Assessing officer has not provided cross examination of Shri Chirag H. Patel although the same was specifically demanded by the assessee. It is also seen that the replies filed by the assessee are completely ignored by the Assessing Officer, which manifests the capricious, vindictive arbitrary attitude of the Assessing Officer. Therefore the Ld. CIT(A) after considering the following case laws deleted the addition made by the A.O.: i) Kishanchand Chellaram Vs. CIT, 125ITR 713 (SC) ii) CIT Vs. N. Swamy, 241 ITR 363 (Mad) iii) CIT Vs. P. V. Kalyansundaram, 282 ITR 259 (Mad); iv) Shankerlal Nabhumal HUF Ors.Vs.DCIT, 80 TTJ (Ahd) 69; v) ACIT Vs. Govind bhail M. Patel-215 Taxman 575(Guj) vi) CIT Vs. Indrajit Singh Suri-85 CCH 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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