9911796707
TMI Blog2023 (10) TMI 1025X X X X Extracts X X X X X X X X Extracts X X X X ..... n equivalent to the amount which is the rotation of the monies - addition made of the difference between the receipts and payments was re-determined by the ld. CIT(A) resorting to the peak theory and determined the undisclosed amount to Rs. 19.86 Cr. - HELD THAT:- We find that the ld. CIT(A) has made addition of expenditure incurred by the assessee reflected in the same excel sheets wherein the receipts and payments have been found out. The excel sheets reflect receipts, payments and expenditure. The expenditure as found in the excel sheets as determined by the Assessing Officer and allowed by the Assessing Officer We find that the investment in E-24 has been made in the name of Sh. Sanjay Gupta and the property has been duly registered in his name. The investment in property cannot be said to be a part of the expenditure incurred for earning of the income. Since, Sh. Sanjay Gupta is the owner of the property and all the documents are in the position of the revenue authorities, the same should have been rightly taxed in the hands of Sh. Sanjay Gupta. We make it clear that this amount of investment in E-24 cannot be considered as application of income or expenditure incurred for ear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainst the orders of ld. CIT(A)-24, New Delhi dated 13.08.2021. 2. In ITA No. 1818/Del/2021, following grounds have been raised by the assessee: "1. That on the facts and circumstances of the case, the order passed by the learned CIT(A) in modifying and enhancing the addition made by the A.O. from an amount of Rs. 90,66,389/- u/s 69A of the Act to Rs. 94,65,189/- (Rs. 91,30,339/- as peak credit and Rs. 3,34,850/- as unexplained expenditure u/s 69C), is unwarranted and is bad both in the eyes of law and on facts. 2. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in modifying and enhancing the addition made by the AO, without rebutting the claim of the appellant that: (i) the alleged party wise breakup into 48 parties provided to the appellant vide notice dated 30.10.2019 for explanation is not the verbatim data retrieved from the alleged personal laptop but redesigned, rearranged purposely. (ii) the appellant had neither received nor paid alleged receipts and payments in the nature of investments, expenditure etc. mentioned against alleged parties in the notice dated 30.10.2019. 3. That on the facts and in the circumsta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case, the learned CIT(A) has erred both on facts & in law in modifying and enhancing additions made by Ld. AO by ignoring the fact that such additions were made on the basis of un-authenticated seized document which were not found from the premises of the appellant during search action u/s 132 of the Act and hence, bad in law and is outside the scope of proceedings u/s 153A of the Act. 10. That on the facts and circumstances of the case, the learned CIT(A) has erred) both on facts & in law in modifying and enhancing additions made by Ld. AO by ignoring the fact that the case of relevant assessment year has already been concluded u/s 143(3) which could not abate on the date of search and no such additions were made on the basis of any incriminating material found / seized during search action at the premises of the appellant." 3. In ITA No. 1819/Del/2021, following grounds have been raised by the assessee: "1. That on the facts and circumstances of the case, the order passed by the learned CIT(A) in modifying and enhancing the addition made by the A.O. from an amount of Rs. 63,50.507/- u/s 69A of the Act to Rs. 3,14,06,822/- (Rs. 2.75,56,842/- as peak credit and Rs. 38,49,9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umption. 7. That on the facts and in the circumstances of the case, when the Learned CIT(A) himself has made peak credit addition in the case of appellant by considering all such debit and credit entries alleged to be found recorded in data / excel sheet retrieved from the personal laptop of Shri Saurabh Gupta, no separate addition of Rs. 4,20,400/- made by AO, should be sustained. 8. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in law and on fact by arbitrarily and mechanically discrediting Affidavits of the concerned parties and also rejecting the contention of the appellant by making opinion that there was no need / requirement of conducting independent enquiries by the Ld. AO from the alleged parties. 9. That on the facts and circumstances of the case, the addition made / enhanced by the learned AO / CIT(A) is untenable in the eyes of law having been made without providing the opportunity to cross-examine Saurabh Gupta from whose personal laptop the alleged data/ excel sheets retrieved, which was found from the premises of his in-laws, which is the sole basis of making addition in the instant case and without following the principle of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the facts and in the circumstances of the case, the Learned CIT(A) erred in law in not appreciating that the alleged data in Excel worksheets retrieved from said computer as well as recreated 48 ledgers / parties does not qualify to admit as an "evidence" under section 658 of the Indian Evidence Act, 1872". 4. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in law and on fact in not appreciating that the additions made by invoking provisions of Section 69A of the Act are bad in law as the appellant has not been found in possession of alleged cash which is pre-requisite condition for invoking provisions of Section 69A. 5. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in making separate addition of Rs. 1,08.89.548/- as unexplained expenditure u/s 69C of the Act when all such debit and credit entries alleged to be found recorded in data / excel sheet retrieved from the personal laptop of Shri Saurabh Gupta have already been considered while making peak credit addition by the Ld. CIT(A) which tantamount to double addition and hence bad in law and is kable to be deleted. 6. That on the facts and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and Rs 15,23.979/- as unexplained expenditure u/s 69C) and confirming addition of Rs 13,60,604/- being ad-hoc estimated commission income, is unwarranted and is bad both in the eyes of law and on facts. 2. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in modifying the addition made by the AO, without rebutting the claim of the appellant that: (i) the alleged party wise breakup into 48 parties provided to the appellant vide notice dated 30.10.2019 for explanation is not the verbatim data retrieved from the alleged personal laptop but redesigned, rearranged purposely. (ii) the appellant had neither received nor paid alleged receipts and payments in the nature of investments, expenditure etc. mentioned against alleged parties in the notice dated 30.10.2019. 3. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in law in not appreciating "that the alleged data in Excel worksheets retrieved from said computer as well as recreated 48 ledgers / parties does not qualify to admit as an "evidence" under section 65B of the Indian Evidence Act, 1872". 4. That on the facts and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso rejecting the contention of the appellant by making opinion that there was no need requirement of conducting independent enquiries by the Ld. AO from the alleged parties. 11. That on the facts and circumstances of the case, the addition made / modified by the learned AO CIT(A) is untenable in the eyes of law having been made without providing the opportunity to cross-examine Saurabh Gupta from whose personal laptop the alleged data/ excel sheets retrieved, which was found from the premises of his in-laws, which is the sole basis of making addition in the instant case and without following the principle of natural justice. 12. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in law and on fact by arbitrarily and mechanically holding that proper opportunity of cross examination was provided to the appellant while no such cross examination of the alleged parties/ deponents were provided even though specifically requested by the appellant before both the lower authorities. 13. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in modifying and sustaining additions made by Ld. AO by ignoring the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Section 69A. 5. That in the facts and in the cumstances of the case the Learned CIT(A) erred making separate addition of Rs 1,33,80,174 an unexplained expenditure u/s 69C of the Act when all such debt and credit entries alleged to be found den data excel sheet retrieved from the personal laptop of Shri Saurabh Gupta have already been considered while making peak credit addition by the ld. CIT(A) which tantamount to double addition and hence bad in law and is be to be deleted. 6. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in not appreciating the claim of appellant that it has not pad aged amount of Rs. 17,00,00,000 for purchase of house at E-24, Preet Vihar without adducing any corroborative evidence on record which could prove that the same was actually paid by the appellant and without conducting independent enquiry or getting valuation of the said property from approved Get valuer even though specifically requested by the appellant. 7. Without prejudice to the Ground of Appeal No. 6 the leamed CIT(A) has erred both facts & in law in not considering the amount of Rs. 17,00,00,000 alleged to be paid for purchase of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hence, bad in law and is outside the scope of proceedings u/s 153A of the Act. 14. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in modifying additions made by Ld. AO by ignoring the fact that the no such additions were made on the basis of any incriminating material found/seized during search action at the premises of the appellant." 7. In ITA No. 1823/Del/2021, following grounds have been raised by the assessee: "1. That on the facts and circumstances of the case, the order passed by the learned CIT(A) in modifying the addition made by the A.O. from an amount of Rs. 27,45,37,948/- u/s 69A of the Act to Rs. 4,41,95,030/- as unexplained expenditure u/s 69C and confirming addition of Rs. 2,03,000/- being ad-hoc estimated commission income, is unwarranted and is bad both in the eyes of law and on facts. 2 That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in modifying and sustaining the addition made by the AO, without rebutting the claim of the appellant that (1) the alleged party wise breakup into 48 parties provided to the appellant vide notice dated 30.10.2019 for exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rediting Affidavits of the concerned parties and also rejecting the contention of the appellant by making opinion that there was no need requirement of conducting independent enquiries by the Ld. AO from the alleged parties. 9. That on the facts and circumstances of the case, the addition made / modified by the learned AO CIT(A) is untenable in the eyes of law having been made without providing the opportunity to cross-examine Saurabh Gupta from whose personal laptop the alleged data/ excel sheets retrieved, which was found from the premises of his in-laws, which is the sole basis of making addition in the instant case and without following the principle of natural justice. 10. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in law and on fact by arbitrarily and mechanically holding that proper opportunity of cross examination was provided to the appellant while no such cross examination of the alleged parties/ deponents were provided even though specifically requested by the appellant before both the lower authorities. 11. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in modifying additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1872". 4. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in law and on fact in not appreciating that the additions made by invoking provisions of Section 69A of the Act are bad in law as the appellant has not been found in possession of alleged cash which is pre-requisite condition for invoking provisions of Section 69A. 5. That on the facts and in the circumstances of the case, the Learned CIT(A) erred in making separate addition of Rs. 4,08,39,093/- as unexplained expenditure u/s 69C of the Act when all such debit and credit entries alleged to be found recorded in data / excel sheet retrieved from the personal laptop of Shri Saurabh Gupta have already been considered while making peak credit addition by the Ld. CIT(A) which tantamount to double addition and hence bad in law and is liable to be deleted. 6. That on the facts and circumstances of the case, the learned CIT(A) erred both on facts & in law in not appreciating the claim of the appellant that it has not paid alleged amount of Rs. 1,00,00,000/- as advance to Best View Properties without adducing any corroborative evidence on record which could prove that the same was actu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hable on the facts of the case. 6. That on the facts and circumstances of the case, the learned CIT(A) has erred both on facts & in law in imposing penalty u/s 271(1)(c) of the Act on addition enhanced by him being the additions made / modified/ enhanced on the basis of alleged data in Excel worksheets retrieved from laptop as well as recreated 48 ledgers / parties, does not qualify to admit as an "evidence" under section 65B of the Indian Evidence Act, 1872." 10. The issue involved in ITA Nos. 57 to 59/Del/2022 are similar, they were heard together and being adjudicated by a common order. The grounds raised by the Revenue in ITA No. 57/Del/2022 are as under: "1. The Ld. CIT(A) has erred in law and on the facts in deleting the addition of Rs. 3,95,52,573/- out of total addition of Rs. 17,49,29,190/- made on account of unaccounted cash received. 2. The Ld. CIT(A) has erred in law and on the facts relying on peak credit / highest credit while computing addition made on account of unaccounted cash received by considering that the nature of transactions made by the assessee are similar to that of an Entry Operator. In the assessment order in Para 6.1, the assessing off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examination of the inflow and outflow and after eliminating the repeated, duplicate entries collated the excel sheets into 7 main heads and tabulated the receipts and payments depicted as under: S. No. Heads Receipt Payment 1. Paandan 31,15,89,836 5,57,95,819 2. Paandan 15,50,00,000 - 3. Kuber Securities(KS) 14,98,71,730 50,000 4. Sanjay Garg 1,50,00,000 80,00,000 5. Rajinder Gupta 79,91,000 3,44,637 6. Mamta Jain 1,30,00,000 4,000 7. Richa Arneja 40,88,528 - Total 65,65,41,094 6,41,94,456 14. The Assessing Officer determined an amount of Rs. 59,23,46,638/- being the difference between the receipts and payments as the undisclosed income of the assessee for the entire period of assessment u/s 153A. 15. The year-wise amount of unaccounted income determined is as under: A.Y. Receipts Payments Amount 2012-13 91,03,889 37,500 90,66,389 2013-14 63,50,507 - 63,50,507 2014-15 61,56,250 52,35,339 9,20,911 2015-16 10,04,91,000 4,71,90,617 5,33,00,383 2016-17 17,84,79,190 35,50,000 17,49,29,190 2017-18 27,85,87,948 40,50,000 27,45,37,948 2018-19 7,73,72,310 41,31,000 7,32,41,310 Total 65,65,41,094 6,41,94,456 59,23,46,63 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so, the ld. CIT(A) considered the entire receipts at Rs. 157,48,09,680/- and payments of Rs. 144,00,97,270/- as against the receipts determined by the AO of Rs. 65,65,41,090/- and payments of Rs. 6,41,94,456/-. 23. Aggrieved with the order of the ld. CIT(A), the assessee as well as the Revenue filed appeal before us. 24. During the hearing before us, the ld. DR relied the order of the Assessing Officer and the ld. AR supported the order of the ld. CIT(A) to the extent of relief accorded. Heard the arguments of both the parties and perused the material available on record. The ld. AR reiterated the submissions taken up before the ld. CIT(A). The crux of the arguments is as under: (i) Alleged data or excel sheets allegedly retrieved from the personal laptop of Saurabh Gupta found from the premises of his in-laws, but wrongfully recorded in the Panchnama drawn of Premises of Saurabh Gupta at 3031/I, 3rd Floor, Old Ranjeet Nagar, Street No 4. Delhi, does not belong to the appellant company and the data contained therein also does not pertain to the appellant company. The alleged data, excel sheets is incorrect, inflated, corrupt. manipulated or may be recorded in haphazard manner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a, Director of the appellant company, personally appeared before the learned assessing officer on the said date i.e. 24.12.2019 while Saurabh Gupta tailed to turn up for cross examination and also without considering the Affidavits of concerned parties filed by the appellant confirming that no such cash was paid to or received from M/s OPG Securities Private Limited. (v) The impugned assessment has been completed de-hors any incriminating material/ document found/seized during the course of search conducted in the case of the appellant, which is contrary to the very concept of assessment of search under section 153A of the Act. The impugned assessment order has been passed by merely relying upon ex -party details/ data belonging to third party, that too, without allowing opportunity of cross-examination the appellant. Addition has been made on account of alleged receipt of cash, merely on the basis of suspicion, that too, on the basis of unsubstantiated/ unreliable/ unauthentic third-party data, not corroborated by actual movement/receipt of cash. Allegation or unaccounted investment/expenditure, too, is on basis or suspicion, not corroborated by actual movement/ payment of cash. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not know how to operate computer system/ laptop, so the statement of Shri Saurabh Gupta, is factually incorrect and hence, not reliable and the appellant company disputes and denies the contents of the data as recorded in the alleged laptop and the said alleged data does not pertain to the appellant company. (xi) The AO vide Summons dated 20.12.2019 issued under section 131 of the Act to the appellant company offered the opportunity for cross-examination of Saurabh Gupta at 4 P.M. on 24.12.2019 at his office. Sh. O P Gupta, Director of the appellant company in compliance of the said Summons duly attended the office of the Ld, AO on the given date which can be verified from the visitor register maintained at the entry gate. However, Shri Saurabh Gupta was not present there for his cross-examination. Hence cross examination of Saurabh Gupta could not take place/ materialize. However, the AO in the impugned assessment order mentioned that "Cross Examination of Sh. Saurabh Gupta has been provided to the assessee but the assessee did not turn up on the appointed date to cross examine Sh. Saurabh Gupta" which is factually incorrect and wrong. It is also pertinent to ment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure of the amount mentioned in receipts payments column has not been described/ specified by the AO i.e. whether the said alleged unaccounted receipts/payments were made by / to the appellant company in the nature of profit/ loss or bank / cash or trading / margin or balancing figure / transaction amount, etc (xvii) The said assertion made by the AO is factually incorrect as Shri Sanjay Gupta in his statement recorded under section 131(1A) of the Act on 12.06.2018 has not admitted "that some of the transactions found in the excel sheets pertained to him or his group companies" rather he stated that these transactions appear to be office related expenses of OPG' Securities Private Limited.. Further, on first instance after seeing printouts taken by the Department of these excel sheets, Shri Sanjay Gupta given the same answer in response to several questions that these transactions appear to be office related expenses of OPG Securities Private Limited, which are in the nature or day to day expenses. (xviii) It is settled principle when a document / evidence / statement is being relied upon, a portion of it cannot he disregarded on the whims and fancies of a person. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... designated to general maintenance & housekeeping work of the appellant company, to copy financial data of their company instead of Gaurav Gupta who is an Account Executive and know the value of business and its proposed or executed financial transactions. (xxiii) The AO to substantiated his contention that transactions reflected in the said alleged. Excel worksheets (retrieved from the personal laptop of Saurabh Gupta) pertaining to the appellant company referred certain transactions (for the period 13.12.2016 to 25.10.2017) on the alleged Excel worksheets and Page no. 14, 45, 57, 79, 08, 111, 116 & 121 of Diary of Gaurav Gupta [refer pages 9 to 13 of the paper book] found from his residential premises and stated that several transactions recorded in diary of Gaurav Gupta matched with transactions recorded in Excel sheets. However, on perusal of the said pages, it appears to be containing rough noting / jottings etc, for own use or reference of Gaurav Gupta and no transaction were found to be matching exactly with the transactions referred of alleged excel sheets. (xxiv) The appellant has not received or paid any amount in cash as mentioned in receipts and payments column of 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansactions / entries in alleged Excel Sheet were regularly kept in the course of business of the appellant company cannot be admissible as evidence for making addition in the hands of the appellant company. The alleged data in Excel Work sheets and rearranging/ re-grouping of the same into 48 ledgers / parties does not qualify any of the condition as mentioned in sub section (2) of Section 65B of the Indian Evidence Act, 1872. (xxviii) Pre- requisite condition for invoking provisions of section 69A of the Act has not been met, being the appellant is not found in possession of amount of Rs. 90,66,389/- alleged to be received in cash which was found during search in the form of cash money, bullion, and the AO has completely failed to adduce any corroborative evidence either found or seized during search or collected by conducting independent enquiry. (xxix) The appellant in support of its claim that it has not paid or received any cash in respect of transactions with Sanjay Singhal (Paandan) has furnished affidavit of Shri Sanjay Singhal (Paandan) confirming that he or / and his family member neither received / nor paid any amount in cash from / to M/s OPG Securities Private Limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etrieved from die personal laptop and bring on record cogent material / evidences to establish that any cash was received by the appellant. Reliance was place upon following decisions: a) D.C.I.T vs. M/s Angel Infra 2020 (3)TMI 1196(TT'AT -- Ahmedabad) b) Hon'ble Gujarat High Court in the case of Commissioner of Income Tax V. Maulikkumar K. Shah 2007 (7) TMI 267 (307 ITR 137) c) Commissioner of Income Tax vs. Orissa Corporation, 159 VTR 7S (SC) d) Riveria Properties (P) Ltd. v Income Tax Officer [2017] ITA No. 250/Mum/2013, ITAT No.2748/Mum/2016(ITAT Mumbai) (xxxiii) The AO has completely failed to adduce any cogent or substantive material on record which could prove that the alleged amount of Rs. 59.23 crore was received in cash and the appellant company is found to be in possession of the said alleged cash of Rs. 59.23 crore as per the provisions of Section 69A of the Act. Therefore, arbitrary addition of Rs. 59,23,46,638/- for all the seven assessment year (i.e. 201213 to 2018-19) and Rs. 90,66,389/- for the assessment year under consideration is bad in law and is liable to be deleted. Reliance was place upon following decisions: a) Commissioner of Income-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Sanjay Singhal in the impugned assessment order, it is submitted that "amount mentioned in attachment of these e-mails under the description "RECD" while trading into scrip "KDTWL" which alleged to be not found recorded in the books of account of Sanjay Singhal, it is submitted that the nature and reason of the same to non recording or these amount can be explained by Shri Sanjay Singhal only. (xxxvi) There was no evidence of any cash being received by the appellant. Independent/ corroborative evidence of actual movement of cash is necessary to make any addition. The Revenue having failed to discharge the heavy onus, which was on it, of proving actual payment or money, the additions made without independent/ corroborative evidence is not permissible in law [refer K.P. Verghese v ITO: 31 ITR 597 (SC)], Reliance was also placed upon following decisions: a) Supreme Court in the case of Lalchand Bhagat Ambica Ram vs. CIT: 37 ITR 288 b) CBI vs. V.C. ShukIa. &Ors.(supra) c) Common Cause vs. Union of India (supra) (xxxvii) Reliance was also placed on the following decisions wherein it has been held that any allegation of movement of money must be corr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral, Jaipur v. Smt. Sunita Dhadda 2017 (7) TMT 1164 i) Supreme Court in the Case of Union of India v Tulsiram Patel AIR 1985 SC 1416 j) A K Kraipak v Union of India AIR [1970] SC 150 (Supreme Court) k) State of Kerala v K T Shaduli Grocery Dealer AIR [1977] SC 1627 (Supreme Court) 25. The assessee vide reply dated 28.07.2021 furnished written submission before CIT(A) which is reproduced above. The primary arguments of the appellant are summarized below; (i) Without prejudice to its earlier written submission, since the large number of credit and debit entries is unexplained and the Ld. AO also failed to adduce any cogent or substantive material on record which could prove that the same has been carried out by the appellant, peak credit theory may be applied in such case to avoid double addition. The basic idea behind the peak credit theory is to avoid double addition and to bring only the actual income of the assessee where there are large number of unexplained credit and debit entries and it is not possible to work out the exact quantum of undisclosed income by adducing some cogent or relevant material on record. Reliance was placed upon following judgments: a) Commis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AO in order dated 31.12.2019, which is bad in law. vi. No separate addition was warranted in the case of application of fund while considering Peak Credit theory. The AO in the impugned assessment orders has given finding as regard to certain entries alleged to be unexplained investment / expenditure under section 69/69B/69C of the Act of Rs. 34,14,38,883/-, though in respect thereof himself has not made any separate addition being the same was treated as application of net amount of Rs. 59,23,46,638/- alleged to be received from transaction with certain parties as unexplained income u/s 69A of the Act and therefore, applied the theory of telescoping as both unexplained income and unexplained investment / expenditure represent only one income and since the AO had made addition on account of entire source of Rs. 59.23 crore, so he had not made addition on account of alleged application/ utilization of said fund into alleged unexplained investments / expenditure separately to avoid double taxation of same income. vii. When the peak credit theory is applied after considering all the unexplained debit and credit entries (i.e. inclusive of unexplained income and unexplained invest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation at Securities Appellate Tribunal (SAT). 26. The assessee has submitted reply dated 03.08.2021 before CIT(A) which is summarized below: i. The AO had issued show cause notice dated 30.10.2019 wherein alleged soft data/ excel sheets retrieved from personal laptop of Saurabh Gupta during search action has been categorized/break up / regrouped into 48 ledgers /partywise at Pages 66 to 166 of the said notice and were asked to be explained by the appellant which worked out to total receipts and payments of Rs. 176,09,76,572/- and Rs. 207,81,38,233/- respectively. The appellant again without admitting any of the contents of the alleged data recorded in Excel worksheets of the laptop found & seized from Saurabh Gupta, submitted that on verification of the soft data of the alleged excel sheet provided to the appellant company, it is noticed that they contained various working/noting in different manner in various excel sheets of the same amount and date. This clearly shows that there are various multiple and duplicate entries/ working/ noting of the same amount and on same date in various excel sheets of the said alleged personal laptop of Shri Saurabh Gupta. The AO on considering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only 7 parties whose total receipts were Rs. 65,65,41,094/- and total payments were only Rs. 6,41,94,456/- which tends to give a biased picture against the assessee. The ld. CIT(A) held that to arrive at the correct income of the assessee in respect of excel sheets seized from laptop of Sh. Saurabh Gupta, it is held that entries in respect of all 48 parties are required to be taken into consideration for arriving for a comprehensive picture and correct income of the assessee. The ld. CIT(A) held that in view of date wise details of receipts and payments being found recorded in the seized excel sheets, theory of peak is held to be applicable where subsequent cash receipts can possibly be explained out of cash/cheques given earlier. The ld. CIT(A) held that the total income of the assessee must be computed taking all unaccounted receipts and payments in totality, since all these unaccounted transactions are in cash, the possibility of cash being rotated cannot be ruled out. 28. In view of above facts, detailed arguments of the assessee as well as judicial decisions given above, the ld. CIT(A) held that benefit of peak is required to be given in the case of the assessee. Accordingly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eous Office and Personal Salary Payments Vinay Jain 2012-13 Nil Nil 3,34,850 Nil Nil 3,34,850 2013-14 1,22,000 Nil 30,51,097 6,76,883 Nil 38,49,980 2014-15 2,88,224 Nil 96,00,019 10,01,305 Nil 1,08,89,548 2015-16 7,36,115 Nil (-)10,32,915 18,20,779 Nil 15,23,979 2016-17 5,60,423 25,77,500 81,15,396 21,26,855 Nil 1,33,80,174 2017-18 5,38,818 2,49,60,300 1,36,53,437 15,42,475 35,00,000 4,41,95,030 2018-19 60,000 2,81,22,500 1,05,93,933 5,62,660 15,00,000 4,08,39,093 Total 23,05,580 5,56,60,300 4,43,15,817 77,30,957 50,00,000 11,50,12,654 34. We find that the ld. CIT(A) has made addition of expenditure incurred by the assessee reflected in the same excel sheets wherein the receipts and payments have been found out. The excel sheets reflect receipts, payments and expenditure. The expenditure as found in the excel sheets as determined by the Assessing Officer and allowed by the Assessing Officer is as under: S. No. Particulars Amount 1. Investment in E-24 17,00,00,000 2. Renovation of 504, common wealth games 41,88,000 3. Expenses made in Mumbai & Kolkata Office 3,73,60,136 4 Advance given to Best View Properties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Saurabh Gupta at 3031/1, Old Ranjeet Nagar, New Delhi it was annexurized as Annexure A-2. The ld. AR has drawn our attention to Pages 838 to 839 of Paper book of AY 2012-13 wherein Sh. Saurabh Gupta has filed letter dated 26.12.2019 during his assessment proceedings under sections 153A/143(3) of the Act, and clarified that the laptop was found from his in-laws and laptop was of his minor son and he took the same to office for virus removal, thereby admitting that the data therein was corrupted and unreliable. The ld. AR submitted that since Sh. Saurabh Gupta himself admitted that the said laptop was his personal laptop and data contained therein was corrupt, therefore addition made on the basis of excel sheets retrieved from personal laptop of Sh. Saurabh Gupta whose data was corrupt is bad in law and should not be sustained. The ld. AR has also drawn our attention to Pages 352 & 363 of Paper book of AY 2012-13 and vehemently argued that excel sheets on the basis of which additions was made cannot be qualified to as admissible evidence as the laptop from which the said excel sheets was found was the personal laptop of Saurabh Gupta as admitted by him and which is also evident from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that these amounts do not form the part of receipts of Rs. 157.48 Cr. or payments of Rs. 144.00 Cr. considered while determining the peak credit. The ld. CIT(A) invoked the provisions of Section 132(4A) and Section 292C of the Income Tax Act, 1961 while considering the contents of the seized material. 45. Before us, the ld. AR argued that since these transactions were also extracted from the laptop, the same ought to have been considered by the revenue authorities as part of the total receipts and payments. The ld. AR also argued that the addition has been made on ad-hoc basis and hence liable to be deleted. 46. Having gone through the facts, we find that these are the entries given by the assessee to various parties by utilizing the services of different broker as mentioned in the seized material on account of short term capital gains which do not form part of the receipts and payments mentioned above which have been already considered separately. Hence, we hold that the commission charged by the Assessing Officer is not on ad-hoc basis but taking into consideration the prevailing market trend in providing such accommodation entries. Keeping in view the facts, we hereby affir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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