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TMI Blog2024 (2) TMI 332X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Ld. CIT(A) erred in deleting the penalty of Rs. 8,98,85,000/- levied by the JCIT (Central), Indore, u/s 271D on account of violating the provisions of section 269SS of the Income-tax Act, 1961. 2) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in holding that the penalty was imposed on the basis of dumb documents despite the fact that the data on the said documents was duly corroborated as per the findings in the penalty order. ITA No. 794/Ind/2019 for A.Y. 2010-11 in the matter of Penalty u/s 271D: 1) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the penalty of Rs. 54,65,000/- levied by the JCIT (Central), Indore, u/s 271D on account of violating the provisions of section 269SS of the Income-tax Act, 1961. 2) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in holding that the penalty was imposed on the basis of dumb documents despite the fact that the data on the said documents was duly corroborated as per the findings in the penalty order. ITA No. 795/Ind/2019 for A.Y. 2011-12 in the matter of Penalty u/s 271D: 1) On the facts and in the circumstances of the case, the Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deleting the penalty of Rs. 55,00,000/- levied by the JCIT (Central), Indore, u/s 271D on account of violating the provisions of section 269SS of the Income-tax Act, 1961. 2) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in holding that the penalty was imposed on the basis of dumb documents despite the fact that the data on the said documents was duly corroborated as per the findings in the penalty order. ITA No. 800/Ind/2019 for A.Y. 2009-10 in the matter of Penalty u/s 271E: 1) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the penalty of Rs. 1,64,00,000/- levied by the JCIT (Central), Indore, u/s 271E on account of violating the provisions of section 269T of the Incometax Act, 1961. 2) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in holding that the penalty was imposed on the basis of dumb documents despite the fact that the data on the said documents was duly corroborated as per the findings in the penalty order. ITA No. 801/Ind/2019 for A.Y. 2010-11 in the matter of Penalty u/s 271E: 1) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /- levied by the JCIT (Central), Indore, u/s 271E on account of violating the provisions of section 269T of the Incometax Act, 1961. 2) On the facts and in the circumstances of the case, the Ld. CIT(A) erred in holding that the penalty was imposed on the basis of dumb documents despite the fact that the data on the said documents was duly corroborated as per the findings in the penalty order. 2. Since these appeals arise from common order of lower-authorities and involve issues of common nature; they were heard together at the request of parties and are being disposed of by this common order for the sake of convenience and clarity. 3. The background facts leading to present appeals are such that the assessee is a company. A search u/s 132 of the Act was conducted in case of one "PATH Group" including assessee on 27.08.2014. Pursuant to search, the assessments of assessee were completed u/s 153A/143(3) for AY 2009- 10 to 2015-16. During search, the authorities seized a laptop from premise of assessee and took Tally data from laptop in the name of XYZ 0809-2. The search-team also seized loose papers marked as LPS-1 to 8 from the premise of one Shri G.C. Patidar, an employee of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /inferences/conclusions drawn by assessing authority. Thereafter, the revenue went in next appeals to ITAT in IT(SS)A No. 32 & 33/Ind/2021 whereupon, vide order dated 13.12.2023, the ITAT, Indore Bench dismissed revenue's appeals and thus upheld the orders of first appellate authority. Furthermore, in the present appeals also, the first appellate authority i.e. CIT(A) has deleted the penalties imposed by JCIT on the basis of very same material. Since the present appeals being contested by revenue do not have any new material or fact, the impugned orders of CIT(A) deleting the penalties are in order and must be upheld having regard to the order passed by ITAT in IT(SS)A No. 32 & 33/Ind/2021 (supra). 5. The fourth document considered by JCIT is "Page 21-24 of LPS-1" seized from office of M/s Agroh Infrastructure Developers Pvt. Ltd. This document is a basis for penalties to the extent of Rs. 3,66,25,000/- u/s 271D and Rs. 1,15,00,000/- u/s 271E in AY 2009-10 only (For the sake of clarity, these penalties are already included in overall penalties of Rs. 8,98,85,000/- u/s 271D and Rs. 1,64,00,000/- u/s 271E imposed by JCIT) in respect of cash loans taken/cash repayments alleged to hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the transactions recorded in the loose paper seized from the premises of Shri G.C. Patidar and held that the transactions to the tune of Rs.5,32,60,000/- are cash loan received by the assessee out of book for A.Y.2009-10 on which the AO has computed the interest expenses of Rs.82,03,684/-. Similarly for A.Y.2010-11 the AO taken loan of Rs.54,65,000/- and interest expenses of Rs.58,55,122/-. The details of these amounts have been given by the AO in para 11 as under: Name of Transaction Period Amount received Amount paid Loan availed by PATH FY 08-09 5,32,60,000 49,00,000 FY 09-10 54,65,000 2,55,10,000 Interest Expenses paid by PATH FY 08-09 82,03,684 FY 09-10 58,55,122 Cash transaction of PATH with directors & Relatives FY 08-09 2,85,25,021 5,52,49,940 FY 09-10 1,46,61,842 5,37,00,603 7.2 All these figures as given by the AO are based on the assumption of the AO that the transactions recorded in the loose paper against the name of these persons are cash loan taken by the assessee on interest @ 10%. There is nothing in the loose paper to show that the interest is payable annually or monthly or only at the time of repayment of loan. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure on the loose sheet on cutting and correction as signature of Shri Puneet Agrawal as under: "13.3.5 The contention of assessee is incorrect, important evidence seized from premise of Shri G.C Patidar is serial of 19 of page no.14 of LPS-1 seized from residence of Patidar it consist of signature of Shri Puneet Agrawal clearly meaning that he has approved the transactions." 7.3 This observation of the AO is contrary to the statement of Shri G.C. Patidar recorded u/s 132(4) of the Act and question no.31 and answer to the same are reproduced as page no.93 of the assessment year as under: 7.4 Thus, it is clear that Shri G.C. Patidar has stated in the statement that the signature on the loose sheet may be of Mr. NayazAhmmad from the office. Therefore, the observation of the AO is contrary to the record itself and the addition made by the AO on account of alleged payment of interest on the cash loans is only on the basis of the presumption of the AO and not on the basis of any material or evidence. The statement of Shri G.C. Patidar recorded u/s 132(4) also cannot be considered as incriminating material in the proceedings u/s 153A of the Act once the assessee has denied the tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken as 'XYZ'. The appellant has claimed not having any knowledge of company 'XYZ' which has also been stated by appellant during the course of assessment proceedings. The appellant after the search proceedings enquired from his staff member regarding the impugned printouts. Mr G.C. Patidar, who worked as an accountant usually comes to office and worked for others and uses the printer installed at the premises of the appellant, informed that he has opened this account on tally to train his junior Mr. Nilesh Tawrech and most of the figures are imaginary and few of the figures were copied from the data of appellant. The appellant in support has filed affidavit of Shri G.C. Patidar regarding the same. 4.2.3 After considering the entire factual matrix and evidence/material on record inter alia written submissions filed, I reach to conclusion that impugned additions have been made on the basis of assumption and presumption which neither sustainable on facts nor in law. The AO has reached to conclusion that few of the entries in printouts and books of appellant are matching, therefore, the same represents correct picture of books of accounts of the appellant and subs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, it is impossible for the appellant to bring Shri Nilesh Tawarech in person for examination on oath. It is pertinent to mention that no incriminating material was found during search having sole direct nexus with any of the impuged cash loan transaction. Furthermore, neither the AO call any of the person whose names were mentioned on loose paper for examination nor any person whose name were mentioned on loose paper turned out to AO and has admitted that any such transaction has taken place. Therefore, in absence of any cogent evidence having direct nexus with the impugned transactions, the said impugned papers and tally data account cannot be used against the appellant. The AO has also alleged that some of the data is accounted and some of the data is unaccounted in books of accounts, however, has failed to explain that the unaccounted data. Also, the data found from the premises of Shri G.C. Patidar was not matching with the data found from the office premises of the appellant in the seized impunged tally data. The AO has also compared data found from premises of Shri GC Patidar and impunged tally account of DM Poddar. On bare reading one could easily establish that the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... give any satisfactory reply during the statement recorded at the time of search however during the course of their assessment admitted that they have given loan to PATH. The statement of the Director wherein they admitted giving loan to PATH has not been provided nor the opportunity to cross examination was made available. It is important to mention that the buy-back of shares is duly accounted in audited books of account of appellant and the impugned loose papers were not found from premises of the appellant. Therefore, the AO is not justified in presuming buyback of shares as cash loan and interest on a loan was equally hypothetical. The statement given which has to be used against the assesse has to be confronted and opportunity to cross examine has to be provided, which squarely apply in relation to loose paper seized from the premises of Agroh where the statement was taken behind the back. 4.2.5 Another reasoning provided by the AO in support of his allegation that one BS-4 was found during the course of search which contain names of certain persons who are invitees to the party. The AO has applied all possible guess work in support of his allegation and stated that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income tax on such undisclosed income in the hands of giver of the cash loan. In none of the cases, the reciprocity which is a fundamental necessity of existence of transaction was ever proved or attempted by the department. In two cases reopened by the Department of Mr. Anil Poddar and Mr. Raghunath Poddar of which the Assessee Company has been informed, the reason to believe that cash loans were advanced by those person to assessee company was found unsupported and therefore such doubt has no legs to stand upon. Thus, in entirety the seized loose paper and tally data is dumb document/data and does not reflect any exchange of money by/to appellant. 4.2.6 This is settled legal position that any 'dumb document' cannot be used as an evidence to draw an adverse inference against the assessee. Case laws supporting this proposition are as under:- ACIT Vs. Satyapal Wassan (2007) 295 ITR (AT) 352 (Jabalpur) Held that: "the crux of these decisions is that a document found during the course of search must be a speaking one and without any second interpretation, must reflect all the details about the transactions of the assessee in the relevant assessment year. Any gap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the pages found from the possession of the assessee are placed in the paper book and after going through these papers, we find that these are simply deaf and dumb documents and they cannot be considered for making any addition. This is a settled principle of law that any document or entry recorded in those documents should be corroborated with positive evidence. Here in the present case nothing has been corroborated or proved that assessee was dealing in money lending business." Mohan Foods Ltd Vs. DCIT (2010) 123 ITD 590 (Del) - Held that-although the contents of the relevant seized documents show that the amounts mentioned therein relate to some expenditure, in the absence of any other evidence found during the course of search or brought on record by the AO to show that the said expenditure was actually incurred by the assessee, the same cannot be added to the undisclosed income of the assessee by invoking the provisions of s. 69C- Assessee explained that the said entries represented estimates made by its employees in respect of proposed expenditure-There is no evidence on record to rebut/controvert the said explanation- Additions not sustainable CIT Vs. S M Agarwal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis of figures on a small piece of paper in respect of purchase of Plot No. B-4, Govind Marg, Jaipur was made by the AO. This plot B-4, Govind Marg, Jaipur, has been purchased jointly by Dr.Tomar, Dr. Mrs. Tomar and B.S. Tomar, HUF. Held that no addition on account of entries on a piece of paperwhich is claimed to have been found at the time of search, can be made treating the figures as investment for purchase of plot No. B-4, Govind Marg, Jaipur in the hands of Dr.Tomar, Dr. Mrs. Tomar and B.S. Tomar HUF." NK Malhan Vs. DCIT (2004) 91 TTJ (Del) 938 - Held that - "We have perused the aforesaid explanation and the seized document placed at assessee's paper book-l pp. 48 and 50. The document does not state of any date or the year against the entries written therein. It does not show whether the assessee has made or received any payment. It also cannot be deciphered from the said documents that the entries therein pertain to the block period. The AO also did not bring on record any material to show that any investment has been made by the assessee in any chit fund company or otherwise. The document found and seized might raise strong suspicion, but it could not be hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he kind of materials which have been placed on record, this Court in V.C. Shukla's case (supra) has dealt with the matter though at the stage of discharge when investigation had been completed but same is relevant for the purpose of decision of this case also. This Court has considered the entries in Jain Hawala diaries, note books and file containing loose sheets of papers not in the form of "Books of Accounts" and has held that such entries in loose papers/sheets are irrelevant and not admissible under Section 34 of the Evidence Act, and that only where the entries are in the books of accounts regularly kept, depending on the nature of occupation, that those are admissible 17. It has further been laid down in V.C. Shukla (Supra) as to the value of entries in the books of account, that such statement shall not alone be sufficient evidence to charge any person with liability, even if they are relevant and admissible, 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. 18. This Court has further laid down in V.C. Shukla (Supra) that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s are relevant whenever they refer to a matter in which the Court has to enquire was subject to the salient proviso that such entries shall not alone be sufficient evidence to charge any person with liability. It is not, therefore, enough merely to prove that the books have been regularly kept in the course of business and the entries therein are correct. It is further incumbent upon the person relying upon those entries to prove that they were in accordance with facts." 20. It is apparent from the aforesaid discussion that loose sheets of papers are wholly irrelevant as evidence being not admissible under Section 34 so as to constitute evidence with respect to the transactions mentioned therein being of no evidentiary value. The entire prosecution based upon such entries which led to the investigation was quashed by this Court. 4.2.7 Further, in numerous other case laws courts have consistently upheld the view that no addition and penalty could be imposed in the hands of the assessee on the basis of the dumb loose papers seized during search, absence of any corroborative material to show undisclosed cash loa given/taken by the appellant. Some of the case laws are as under:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue filed appeal against the order of ITAT - HELD - In the case of Common Cause (A Registered Society) v. Union of India, (2017) 30 ITJ 197 (SC). the Supreme Court held that incriminating materials in form of random sheets, loose papers, computer prints, hard disk and pen drive etc. and has held that that are inadmissible in evidence, as they are in the form of loose papers In the present case also entries found during search and seizure which are on loose papers are being made the basis to add income of respondent-appellant -ln the light of the Supreme Court judgments, no case for interference is made out with the order passed by ITAT - Moreover no substantial question of law arise in the present appeal is dismissed" It is settled legal position that onus of proof is on the person who makes any allegation and not on the person who has to defend. As per legal maxim "affairmanti non neganti incumbit probation" means burden of proof lies upon him who affirms and not upon him who denies. Similarly as per doctrine of common law "incumbit probation qui digit non qui negat" i.e. burden lies upon one who alleges and not upon one who deny the existence of the fact. The AO has failed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ared nor there was opportunity given to cross examine the person from whom it is alleged that Appellant has taken loan in cash. Further, the theory of huge cash loan being taken by Appellant, which has been built upon the loose sheet and laptop, a presumption u/s. 132 (4A) was available in the statute book but it has been duly rebutted by the Appellant with cogent and germane explanations, which cannot be disbelieved. Hon. ITAT Indore Bench in the case of Dr.Yogiraj Sharma Vs. asstt CIT (2015) 25 ITJ 105 (Indore Tribunal); [2016] 69 taxmann.com 366 (Indore - Trib.)/[2015] 169 TTJ 547 (Indore - Trib.) categorically held that department has to bring cogent evidence to prove that transaction has actually taken place and inference cannot take the place of actuality. The relevant para is reproduced as under, "In this case also we noted that the revenue authorities tried to corelate these figures with the various supplies made to M.P Health Dept. but AO did not call any of the parties or if called for has not brought statement of any of the parties, if recorded, on record to prove whether these parties have paid any commission to the Assessee. Even no information was supplied or given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This is also clearly explicit from clause (iii) of the explanation to Section 269SS of the Act which defines loan or deposit to mean "loan or deposit of money". The liability recorded in the books of accounts by way of journal entries, i.e. crediting the account of a party to whom monies are payable or debiting the account of a party from whom monies are receivable in the books of accounts, is clearly outside the ambit of the provision of Section 269SS of the Act, because passing such entries does not involve acceptance of any loan or deposit of money. In the present case, admittedly no money was transacted other than through banking channels. M/s PACL India Ltd. made certain payments through banking channels to land owners. This payment made on behalf of the assessee was recorded by the assessee in its books by crediting the account of M/s PACL India Ltd. In view of this admitted position, no infringement of Section 269SS of the Act is made out. In the present case, the entries during the course of training in a dummy Company XYZ found in one Laptop and some loose sheets found at the premises of G.C. Patidar are the sole basis. Neither there is any payment or receipt of money ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered opinion, the authority failed to do. Therefore, Loan or Deposit of Money actually taken by appellant is to be established by independent and direct evidence and not with the help of Laptop data or jottings. The Burden is heavy on the person who allege, once the initial presumption is rebutted with sound explanations." 7.5 The CIT(A) has considered the tally account as dummy one created for training purpose incorporating the data from different sources including that of assessee and therefore, the Tally account found in the laptop as well as loose paper were held to be having no evidentiary value being dump documents. The CIT(A) has also given more emphasize on the retraction of the statement by Shri G.C. Patidar by filing the affidavit and non-consideration of the same by the AO or examination of the said affidavit as well as Shri G.C. Patidar to ascertain the correct facts is a serious laps on the part of the AO while making addition. Despite the fact that the affidavit has been duly considered by the CIT(A) there is no rebuttal on the part of the AO. The AO has not even raised any question about the said affidavit in the grounds of appeal before us. Therefore, in absen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... That has not been done. The language employed under Section 131 of the Act empowers the Assessing Officer to ensure the attendance of any person. When the statement of Mohd. Rashid was used against the assessee and an affidavit was filed controverting the same, we are disposed to think, it was obligatory on the part of the Assessing Officer to allow the prayer for cross-examination. That would have been in the fitness of things and in compliance with the principles of natural justice. 21. In view of the aforesaid we answer the reference holding that as the Assessing Officer had not summoned Mohd. Rashid, the proprietor of M/s. Rashid and Co., Jabalpur, in spite of the request made under Section 131 of the Act, the evidence of the said Mohd. Rashid could not have been used against the assessee and in the absence of affording a reasonable opportunity of being heard by summoning the said witness the assessment order is vitiated and cannot be saved as the addition has been made on the foundation of his deposition." 7.7 Thus, statement and witness cannot be used against the assessee without affording reasonable a opportunity of being heard as well as giving the assessee an opportu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity to the petitioners when they demanded of cross examining the persons who gave the statement. When the department has taken a stand that there are two groups which were searched by a single warrant and that the companies of one group should not be given to another, as rightly pointed out by the learned counsel for the petitioners, the assessing officer should not have discussed the statement of the other group for framing the assessment of the petitioners. This completely vitiates the entire assessment proceedings." 7.8 The Hon'ble Jurisdictional High Court has reiterated its view in case Prestige Foods vs. CIT 20 ITJ 1 had held in para 6 as under: "6. Re questions No.1 and 2:- On going through the order passed by the CIT(A) and the Tribunal, we find that the CIT(A) has recorded the finding against the Assessee on the basis of the survey report of the Insurance Company. The said survey report was received by the Assessing Officer behind the back of the Assessee. No opportunity was ever given by the CIT(A) to the Assessee to dispute the correctness of the said survey report which formed the basis of recording of findings against the Assessee. We find that even copy of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... report should have been disclosed to the Assessee and the Assessee should have been provided opportunity to explain and object the findings recorded in it before forming any opinion adverse to it. In this view of the matter the question No.2 is decided in favour of the Assessee by holding that the finding that the expenditure of Rs. 16,47,766/- is capital in nature is vitiated as it is based upon the material not disclosed to the Assessee. Having regard to this opinion about question No.2, we do not feel it necessary to answer question No.1." 7.9 Therefore, it is settled preposition of law that if any evidence or statement is made the basis of the assessment order without allowing the assesse to cross examine the witness or to rebut the evidence then it would amount to violation of principle of natural justice as held by the Hon'ble Supreme Court in case of Andaman Timber Industries vs. Commissioner of Central Excise (supra) in para 6 & 7 as under: "6. According to us, not allowing the assessee to cross-examine the witnesses by the Adjudicating Authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the assessee has right to be confronted with the information being used against the assessee. The AO has used the loose paper seized from the premises of Shri G.C. Patidar as well as the statement of Shri G.C. Patidar without giving an opportunity to assessee to cross examine or to substantiate its claim based on the affidavit filed by Shri G.C. Patidar. Accordingly, we are of the considered view that there is a violation of principle of natural justice, so far as the addition is made by the AO on account of alleged unaccounted payment of interest on the basis of the statement of Shri G.C. Patidar and consequently, it renders the assessment order nullity as much as the additions are made by the AO purely on the basis of the statement of Shri G.C. Patidar and loose papers seized from the possession of Shri G.C. Patidar. Further when the assessee has denied the alleged transactions of taking any loan or payment of any interest on the same then it was incumbent on the AO to conduct a further inquiry by examining the person concerns from who alleged loans are stated to be taken. The AO has not even verified stands of those parties about confirming the transactions of the alleged loa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 008-09 relevant to AY 2009-10 but concluded the same to be a transaction of cash-loan taken by assessee from AIDPL. The Ld. AO also observed that the assessee must have paid an interest of Rs. 14,83,394/- on the aforesaid transactions to AIDPL out of undisclosed sources. When the Ld. AO confronted the assessee in the matter, the assessee submitted that the impugned loose paper was seized from AIDPL in an independent search proceeding conducted upon AIDPL and not from assessee. Hence any presumption u/s 292C should be taken against AIDPL, not against assessee. However, the Ld. AO did not accept the submissions of assessee and made an addition of Rs. 14,83,394/- on account of cash-payment of interest from undisclosed sources in AY 2009-10 vide Para No. 13.4 to 13.4.10 of the assessment-order. 22. During first-appeal, the assessee made a detailed submission to Ld. CIT(A). After considering submission of assessee, the Ld. CIT(A) deleted this addition. The relevant paragraphs of the CIT(A)'s observation are extracted below: "4.2.4 Further, the AO on the basis of one loose sheet which is page No. 21 of LPS -1 and reproduced at page 100 of the Order and on the basis of page No. 23 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om premises of appellant. In the instant case the loose papers were found and seized from the premises of AIDPL (third party). Hon'ble Delhi Tribunal in the case of Trilok Chand Chaudhary (2019) 33 NYPTTJ 610 (Del-Trib) dt.20-8-19 has held as under:- 5.4 ...it is evident that the material relied upon for making addition was not found from the premises of the assessee. 5.5 We also find that during relevant period, i.e., FY14-15, for using any material found from the premises of the third party during the course of the search in assessment proceeding of the assessee, the AO of the third party was required to record satisfaction as the material belong to the assessee in terms of sec153C and then was required to proceed as per the sec153C. In the instant case, it is evident that addition in dispute has been made in the assessment completed u/s153A. The assessee raised this issue before the ld CIT(A), however, the ld CIT(A) rejected the arguments of the assessee observing as under: "6.3 Another argument of the appellant, if understood correctly, is that in reference to the document u/c, the AO ought to have initiated proceedings u/s153C and that in no case this can be consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of Hon'ble jurisdictional HC, it is evident that completed assessment can be interfered with by the AO on the basis of any incriminating material unearthed during the course of search. If in relation to any AY no incriminating material is found, no addition or disallowance can be made in relation to that year in exercise of power u/s153A. Obviously, the reference to the incriminating material in the above decisions of Hon'ble Jurisdictional HC is in regard to incriminating material found as a result of search of the assessee's premises and not of any other assessee. The legislature has provided sec153C by invoking the same the Revenue can utilise the incriminating material found in the case of search of any other person to the different assessee. Sec153C is reproduced below for ready reference:* 15. Thus, when during the course of search of an assessee any books, document or money, bullion, jewellery etc. is found which relates to a person other than the person searched, then the AO of the person searched shall hand over such books of account, documents, or valuables to the AO of such other person and thereafter, the AO of such other person can proceed against such other per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anation, has got recourse to proceed on such other person (i.e., the person to whom the said documents actually belong to) in terms of sec153C by recording satisfaction to that effect by way of transfer of those materials to the AO assessing the such other person. This is the mandate provided in sec153C. In the instant case, if at all, the seized documents referred to in CG/1 to 11 and CG/HD/1 is stated to be belonging to assessee herein, then the only legal recourse available to the deptt is to proceed on the assessee herein in terms of sec153C. In this regard, we would like to place reliance on Pinaki Misra & Sangeeta Misra (2017) (Del HC) dt.3-3- 17, wherein it was held that, no addition could be made on the basis of evidence gathered from extraneous source and on the basis of statement or document received subsequent to search. Hence, we hold that the said materials cannot be used in sec153A against the assessee. This opinion is given without going into the merits and veracity of the said seized documents implicating the assessee herein." In view of the above, it is clear that the impunged loose papers and documents were found from third party premises and therefore, pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be considered or analyed in present appeals, we adopt the same reasoning and same view as taken by ITAT in IT(SS)A No. 32 & 33/Ind/2021 (supra) and IT(SS)A No. 32 to 34/Ind/2021 (supra). Accordingly, we hold that the orders passed by CIT(A) in present appeals deleting the penalties are in order and do not require any interference from our side. 10. We would also like to emphasize one more point noted by Ld. CIT(A) on Page No. 74-75 of order which reads thus: "From the above, it is crystal clear that to bring into the effect of penalty provision us 271D or 271E, it has to be established with independent evidence and not merely corroborative evidence (i.e. book entries) that Assessee has actually committed the default contemplated in section 269SS or 269T i.e. it has taken loan in cash or it has repaid the loan in cash exceeding Rs. 20,000. The explanation below 269SS defines the "Loans or deposits MEANS Loans or deposits of money. The use of word "Means" by legislature in the Explanation below Section 269SS or 269T is with a purpose and it is to restrict the meaning to only Loan of "Money". The use of Word "Means" indicates that definition is hard and fast and no other meaning c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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