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TMI Blog2024 (11) TMI 428X X X X Extracts X X X X X X X X Extracts X X X X ..... ereafter under section 131(1) we observe that recently in the case of Harjiv [ 2016 (3) TMI 329 - DELHI HIGH COURT] as no evidentiary value and hence cannot be termed as incriminating material. Similar view has been reiterated in the case of Best Infrastructure [ 2017 (8) TMI 250 - DELHI HIGH COURT] Therefore, merely because the drivers not available at the time of assessment no addition is permissible in this case, in absence of any corroborating material. It is not the case of the revenue that there was any material showing that these expenses were either bogus or not incurred for the purpose of business, or there was some material which would prove that the invoices of these vouchers were fake. Additions sustained by the CIT(A) that 60% of the hypothetical surrender is not tenable in law. Hence, we delete all these additions sustained by CIT(A). Appeals filed by the assessee are allowed. - Ms. Padmavathy S, Accountant Member And Shri Prakash Chand Yadav, Judicial Member For the Appellant : Sri. V. Srinivasan, Advocate For the Respondent : Ms. Neha Sahay, JCIT-DR ORDER PER BENCH : This is a bunch of six appeals arising out of the common order of the learned Commissioner of Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee that these expenses were duly recorded in the books of account and were properly supported by vouchers. 6. Aggrieved with the order of the A.O, the assessee filed appeal before the CIT(A) and assailed the order of the A.O. Before CIT(A) the assessee interalia contended that no material during the course of search, corroborating the surrender made, has been found on the basis of which it can be said that the expenses incurred by assessee were bogus. The assessee also asked relief for the additional amount offered by him in the return of Income, on the ground that since no material has been unearthed during search, no addition is sustainable for the years which were not pending on the date of search. The Ld CIT(A) discarded the submissions of the assessee vis- - vis relief sought in respect of additional income offered by observing that though there was no material for the additions made yet there was some other material which has given jurisdiction to the AO to examine the matters a fresh. It is pertinent to observe here that the Ld AR of the assessee has also accepted that there was some material relatable to all years. 7. The CIT(A) partly affirmed the order of the A.O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this orders elsewhere. However, the assessee has not obliged that surrender and has only offered Rs. 50 lakh as additional income, while filing the return of income in response to the notices u/s.153A of the Act. The relevant questions recorded by the search team is reproduced hereunder:- 28. During the course of search proceedings at office premises of M/s.SRS Travels and its other concerns at Lakshmi Complex and No.321/3, Kalasipalya, the expenditures incurred were examined. It is observed that some of the expenditures incurred were not backed with proper documentary vouchers. In absence of the same what do you have to say? Ans: It is stated to me that the expenses are not properly backed by proper vouchers. I would like to reiterate that all the expenditures claimed are backed by proper vouchers. However, at this point of time in order to have closure of proceedings without litigation, I am voluntarily agreeing to offer a sum of Rs. 13,00,00,000 as my additional income over and above the regular income with respect to lacuna stated as per below table:- AY 2012-2013 1,00,00,000 AY 2013-2014 2,00,00,000 AY 2014-2015 2,00,00,000 AY 2015-2016 2,50,00,000 AY 2016-2017 2,50,00,000 A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. 5. Having regard to the definition of 'net wealth', we may refer to the definition of 'asset and find out as to whether under the said provision, as it stood in 1993-94, the building let out to a tenant for commercial purposes could be treated to be an asset taxable under s. 3 of the WT Act. A plain reading of s. 2(ea) indicates that only a guesthouse and/or residential building (including a farm-house situated within 25 kms of the local limits of any municipality) are assets. However, an exception was carved out in respect of house meant exclusively for residential purposes and those allotted by a company to an employee or an officer or director subject to the conditions laid down therein or used for business purposes forming part of stock-in-trade. If this definition is interpreted in the manner on the principle settled by law then it is very difficult to bring within the definition a building used for commercial purpose by the tenant on being let out. Character of the building is the determining factor under the existing provision for making it an asset. Guest-house, residential buildings including farm-houses were made taxable. But commercial building was not ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further clarified at p. 156 of 133 CTR (St)/p. 282 of 220 ITR (St), we do not think we need to explain or add anything to it except quoting it : The term 'assets', on which tax is to be levied, is defined in cl. (ea) of s. 2. This definition includes any guesthouse and any residential house (including a farm-house situated within 25 Kms of the local limits of any municipality) for levy of tax, except the exclusions made in items (1) and (2) of sub-cl. (i) of this clause. If residential houses have been taken as assets, there seems to be no reason why commercial properties, other that those used by the assessee wholly and exclusively in his business or profession, should also be not taken as assets. It is, therefore, proposed to tax commercial buildings, which are not used by the assessee in his business or profession, other than the business of letting out of properties. 9. However, we are not called upon to decide the meaning of the phrase 'other than the business of letting out of properties', therefore, we do not make any observation with regard thereto and keep it open to decision on an appropriate time and issue. However, this explanation clearly indicates that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edings. We also refer to the judgment of the Hon ble Supreme Court in the case of CIT v. V.M.R.P.Firm Limited reported in 56 ITR 67, wherein the Larger Bench of the Hon ble Supreme Court has held that the the doctrine of approbate and reprobate is only a species of estoppel; it applies only to the conduct of parties. As in the case of estoppel, it cannot operate against the provision of a statute. If a particular income is not taxable under the IT Act, it cannot be taxed on the basis of estoppel or any other equitable doctrine. Equity is out of place in tax law; a particular income is either exigible to tax under the taxing statute or it is not. If it is not, the ITO has no power to impose tax on the said income ( emphasis supplied ) . We also observed that the statement on standalone basis would not be sufficient to sustain the addition particularly in search matters because as observed by the Hon ble Supreme Court in the case of Manish Maheswari case reported in 289 ITR 341 (SC) that a search is a serious invasion in the privacy of a citizen so after such invasion the department further cannot ask an assessee to prove against himself. Further, the Hon ble Delhi High Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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