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TMI Blog2023 (10) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... ce. Further, by surrendering the aforesaid amount and offering to pay tax, the assessee has prevented further enquiries by the department , obviously because it could have led to further revelations / unraveling of truth as to the persons who are also implicit with assessee in transporting of cash as well other transactions undertaken by the assessee in the past. The assessee retracted its own statement firstly by filing income tax return on 31.08.2015 wherein Rs. 49,00,000/- was not included as income and was not offered for tax, while Rs. 21,10,000/- being the remaining amount out of surrendered amount of Rs. 70,10,000/- was offered for tax while filing return of income. The assessee during the course of assessment before the AO, on 15.12.2017, also retracted from the aforesaid surrendered amount of Rs. 49,00,000/-. Thus, the retraction by the assessee of the aforesaid surrendered amount of Rs. 49,00,000/- does not inspire confidence, and was rightly confirmed by ld. CIT(A). So far as deletion of income of Rs. 21,10,000/- by ld. CIT(A) is concerned, it was rightly done by ld. CIT(A) as the same was duly added by the assessee voluntarily in its return of income filed with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e outset , it is observed that this appeal is filed late by assessee beyond the time prescribed u/s 253(3) of the 1961 Act. This appeal is filed belatedly by 44 days. The assessee has filed an application supported by an affidavit dated 12th August, 2023 executed and signed by Managing Partner of the assessee firm , Mr. Kiritkumar Kantilal Patel. It is averred in the said affidavit that this appeal is filed with Tribunal belatedly by 44 days, as Managing Partner of the assessee , Mr. Kiritkumar Kantilal Patel who looked after taxation matters was travelling to USA , and the appellate order passed by ld. CIT(A) was delivered during his absence from India, and on return to India, the steps were taken to file an appeal with the Tribunal. The ld. DR has not raised any serious objection to the condonation application filed by the assessee for condoning 44 days delay in filing this appeal with Tribunal. After hearing both the parties and perusing material on record, we are of the view that the assessee has shown sufficient cause for filing this appeal belatedly by 44 days beyond the time prescribed u/s 253(3). In our considered view, the delay of 44 days needs to be condoned. If the tech ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name of New India Angadia Service , Branch at Shop No 2. Building 3-213, Gazipura Kalaburagin, requisitioning him to handover the Cash Jewellery Documents. The Police handed over same to income-tax department , on 30- 03-2015. 4.3 The summon u/s 131(1) of the1961 Act was issued by Revenue to Shri Ratilal Patel, Managing Partner of M/s New India Angadia Service who was camping at Kalaburagi. The statement u/s 131(1) of the 1961 Act was recorded of Shri Ratilal Patel, Managing Partner of assessee firm. Shri Ratilal Patel could not give proper explanation about the sources of cash seized by the Police amounting to Rs 70,15,390/-. He admitted that the firm will pay tax on Rs 70,10,000/- as income of M/s New India Angadia Service for assessment year: 2015-16 4.4 The Managing Partner, Shri Ratilal Patel of M/s New India Angadia Service also confirmed in his statement recorded before department that the aforesaid firm is acting as a transporter of cash from one place to another for a commission on cash transported. During the course of search conducted by the Police, cash of Rs 70,15,390/- was seized from the possession of employees of assessee firm having branch at Kalaburagi. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fabricated or adjusted after the search took place. 4.7 The AO after considering the replies of the assessee observed that the Managing Partner, Sh. Ratilal Patel in his statement dated 09-04-2015 had admitted about the cash seized of Rs. 70,10,000 by the Police. In the aforesaid statement , he had also mentioned that since the firm have accumulated cash balance of Rs. 49,00,000 and since he is not able to offer any explanation , Mr. Ratilal Patel, Managing Partner admitted total cash seized by the police as income of the assessee, and agreed to pay tax on it. Moreover, the aforesaid statement dated 09.04.2015 was verified in the verification it is mentioned that: Whatever is stated above is true to the best of my knowledge and belief. The statement is given voluntarily without any fear, force, coercion, threat or undue influence. I certify that the statement is recorded as deposed by me. The statement has been read over and explained to me in Hindi 4.8 The AO further observed that it clearly shows that the Managing Partner Sh. Ratilal Patel had consciously knowing the full facts admitted the cash found and seized by Police and later handed over to the Department. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; judgment and order of Hon ble Delhi High Court in the case of CIT v. M.S. Aggarwal (2018) 93 taxman.com 247 (Delhi) and judgment and order of Hon ble Supreme Court in the case of Bannalal Jat Constructions (P) Ltd. v. ACIT (2019) 106 taxmann.com 128 (SC). The ld. CIT(A) observed that voluntary confession is an important piece of evidence and can be used against that person as there is an presumption that no person will make a statement against himself unless it is true. The ld. CIT(A) did not believe the retraction made by the assessee, as the same was made 21 months after the surrender of the amount as income of the assessee. It was observed that the search was conducted by Police Department on 26th March, 2015, and cash amount of Rs. 70,15,390/- was found and seized. No satisfactory explanation was provided to the Police Department by the employees of the assessee from whom the cash was seized by Police Department, and the Police seized the cash amount. The Police Department passed on the information to the Income Tax Department, and the ACIT, Circle 1, Kalaburgi recorded the statements of five employees who were present when the police conducted the search. The statement of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der dated 16th June, 2022. 6. Aggrieved by the appellate order passed by ld. CIT(A), the assessee filed second appeal with Tribunal. The ld. Counsel for the assessee Shri K.C. Thaker, Advocate opened arguments before the Bench and submitted that there was seizure of cash by the Police of Rs. 70,15,390/- at the Gulburg Office(Karnataka) of the assessee , on 26th March, 2015. Requisition u/s 132A was issued and the said cash was handed over by Police to Income Tax Department , on 30th March, 2015. The cash was seized from the employees of the assessee. It was submitted that the statements of the employees were recorded by Income Tax Department . The statement of the Managing Partner, Shri Ratilal Patel was also recorded by Income tax Department u/s 131, on 9th April, 2015. Seizure of the cash took place in the State of Karnataka. It was submitted that the statement of partner was recorded, which is placed in paper book from page nos. 34 to 35. The ITR was filed in August , 2015 and an amount of Rs, 21,10,000/- out of total cash seized of Rs. 70,10,000/- which was earlier surrendered as an income of the assessee was offered for taxation by the assessee. It was submitted that balanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 388(Guj. HC). 6.4 The ld. Departmental Representative, Shri Ravindra , Sr. DR on the other hand relied upon the appellate order passed by ld. CIT(A). 7. We have considered rival contentions and perused the material on record including cited case laws. We have observed that there was a search conducted by Police Department at the Business Premises of the assessee being Branch office of the assessee situated at Shop No. 2 , Building No. 3- 213, Gazipura, Kalaburgi(Gulbarga), Karnataka, on 26.03.2015. The cash of Rs. 70,15,390/- was , inter-alia, found by the Police during search operations at the aforesaid Branch Office of the assessee. There was no proper explanations given by the assessee, which led to seizure of cash by Police after conducting preliminary enquiry. The Police passed on information to the income-tax department. The Income-tax Department issued requisition dated 30.03.2015 u/s 132A of the 1961 Act in the name of the assessee, requiring Police to handover cash. The Police handed over seized cash of Rs. 70,15,390/- to Income-tax department on 30.03.2015. The ld. ACIT, Circle-1, Kalaburgi recorded statement of employees of the assessee. The ld. ACIT, Circle-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd from the Kalaburgi(Gulberga) , Karnataka branch , of the assessee on 26.03.2015 when search by Police took place. There were four employees and one person present in the said branch office. They could not offer proper explanation before the Police, which led to seizure of cash. The statement of the assesse s Managing Partner Mr. Ratilal Patel was recorded on oath by income-tax department, on 09.04.2005 u/s 131 who admitted that the assessee is engaged in transporting cash from one place to another for commission on cash transported. The said Managing Partner, offered for taxation the entire amount of Rs. 70,10,000/- as income from undisclosed sources. He could not offer any explanation w.r.t. Rs. 21,15,319/-, and hence offered for tax Rs. 21,10,000/-, while for remaining Rs. 49,00,000/- it was submitted that the said cash amount was accumulated for purchasing shop at Kalaburgi. It was claimed that the said cash amount of Rs. 49,00,000/- was transferred from Ahmedabad office on 23.03.2015 and received at Kalaburgi(Karnataka) Branch office on 25.03.2015. No details as to how cash was transported , the mode of movement , the person who carried such a huge cash etc. has been brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ission, when India is now well connected with the banking system and there is a robust internet banking facility available, obviously it was done to transport unaccounted money of the others. The assessee has claimed that they were planning to buy shop at Kalaburagi(Gulbarga), Karnataka, but no details of the shops identified, price of the shop identified, details of the owners as well need of paying cash instead of making payment through banking channel were explained/elaborated by the assessee rather there is no whisper about the same. Thus, it is clear beyond doubt that the cash of Rs. 70,10,000/- surrendered by the assessee is an unexplained money found in the possession of the assessee and the assessee has not offered any satisfactory source and nature of acquisition of the said money, thus, the AO has rightly invoked provisions of Section 69A of the 1961 Act. Further, the assessee surrendered an amount of Rs. 70,10,1000/- on 09.04.2005 , while the Police search took place on 26.03.2005, and there was a sufficient gap of 14 days, and it cannot be said that the assessee has given statement offering to tax an amount of Rs. 70,10,000/- out of cash seized , being under mental tens ..... X X X X Extracts X X X X X X X X Extracts X X X X
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