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TMI Blog2004 (6) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... e proceeds of goods sold on behalf of grape farmers and agriculturists of Nasik and the assessee had deputed Shri Nadimul Haque to remit the same to the concerned parties. However, the assessee's version was not believed under s. 132(5) of the IT Act and the cash in question was treated to be the undisclosed income of the assessee. The assessee in compliance to the notice under s. 142(1) of the IT Act filed return of income at Rs. 37,200 showing income from business of dealing in grapes and commission agency and dealing in vegetables. It was explained by the assessee during the course of assessment proceedings that the cash belonged to the agriculturists and grape farmers based at Nasik as under: Names Amount Rs. (i) M/s Uttam Vithal Rao Niphade 62,000 (ii) Suresh Pandit Dhonse 45,000 (iii) Gopi Nath Laxmi Pawar 30,000 (iv) Balkrishna Mahadeo 21,000 (v) M/s Sadashiv Gobhaji Thakre 10,000 (vi) Bajirao Dada Dhomse 6,000 (vii) Sekh Noor Sekh Chand Shivade 6,000 Total 1,80,000 4. The IT authorities recorded the statements of assessee and his employee Shri N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e carefully considered the arguments of the appellant as well as the reasons given by the AO for rejecting the appellant's explanation regarding the source of cash of Rs. 1,80,000. The appellant's case is that the amount of Rs. 1,80,000 was the sale proceeds of grapes of various growers at Nasik, which of course was disbelieved by the AO, who held it to be the unexplained money of the appellant. It is significant to note that the appellant's stand is corroborated by the statement of Shri Nadimul Haque made before the GRP immediately after the seizure of cash and this statement was also corroborated by the letters accompanying the cash of Rs. 1,80,000 and recovered along with it. Apart from that, the growers concerned came all the way from Nasik and were examined on oath either in proceedings under s. 132(5) of the Act or in regular assessment proceedings. Thus, all the independent evidence corroborates the stand of the appellant and I find no reason not to accept the statement as correct. The learned AO has, however, not accepted the contention of the appellant giving a number of arguments. The arguments, in my opinion, cannot be a substitute for factual and contemporaneous evidenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to support his contentions. 8. We have considered the rival submissions and material available on record and the details submitted in the paper book. 9. It is an admitted fact that cash was seized from Nadimul Haque by the railway police. The relevant report of the railway police is reproduced in the assessment order in which itself it is mentioned by the police that on seeing the police Nadimul Haque was found to be perturbed and, as such, on suspicion he was stopped for enquiry and during his interrogation Nadimul Haque explained that he was carrying cash in the bag which belonged to the assessee which was to be delivered at Nasik to M/s Uttam Bitthal Rao. He also explained that since bank draft could not be prepared, therefore, he was carrying the cash on behalf of the assessee for delivery at Nasik. The police took it as evasion of sales-tax and income-tax and, as such, seized the same. On the basis of these facts, the cash was handed over to the IT authorities upon which necessary proceedings were conducted. 10. Before dealing with the powers of police to seize the cash in question, we would like to record certain reasons for upholding the findings of the CIT(A). Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rapes is proved from Nasik to Gorakhpur. It is the duty of the assessee to take delivery of grapes for sale on commission basis. Assessee never claimed it to be purchase. Therefore, assessee is not supposed to maintain any purchase voucher for the same. Assessee had mentioned bill number, vehicle number and amount of sale proceeds along with the commission in his accounts though the same may not be regular books of account. Therefore, it could prove that the assessee had been receiving goods for sale on commission basis. Therefore, these reasons are not sufficient to uphold the findings of the AO. Learned Departmental Representative also argued that the details mentioned in the seized papers by the police are not explained. However, on going through the contents of the letter, it is revealed that the details are recorded in the letter-head of the assessee in which briefly it was mentioned that 180 is sent and it is also stated that since draft could not be prepared, therefore, cash is being sent. Even if it is recorded in number but it was letter-head of the assessee and at least would explain that cash was sent for delivery at Nasik. The case of the assessee had been that cash was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also challenged the jurisdiction of the police to seize the cash. Therefore, it being an important issue is decided by us. 12. Sec. 102 of Code of Criminal Procedure provides the power to the police officer to seize certain properties and sub-s. (1) provides that any police officer may seize any property which may be alleged or suspected to have been stolen or which may be found under circumstances which create suspicion of the commission of any offence. Therefore, power is given to the police under Cr.P.C. to seize any property if it is suspected to have been stolen or if it creates suspicion of the commission of any offence. It is the discretion vested in police to seize the property in appropriate cases. Therefore, police should have exercised the discretion in lawful manner as it would curtail the right of the party. It is not the case of anybody that the cash was stolen. It is also not clear from the assessment order in which report of the police is incorporated as to in what way Nadimul Haque was suspected of commission of any offence. However, to the contrary, it is mentioned in the police report that the amount might be from evasion of sales-tax and income-tax. Nadimul H ..... 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