M/s. Mulk Raj Ramesh Kumar, Delhi v. ACIT, New Delhi

ITA 1231/DEL/2010 | 2001-2002
Pronouncement Date: 15-07-2011 | Result: Partly Allowed

Appeal Details

RSA Number 123120114 RSA 2010
Assessee PAN AAIFM4058D
Bench Delhi
Appeal Number ITA 1231/DEL/2010
Duration Of Justice 1 year(s) 3 month(s) 27 day(s)
Appellant M/s. Mulk Raj Ramesh Kumar, Delhi
Respondent ACIT, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 15-07-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted E
Tribunal Order Date 15-07-2011
Date Of Final Hearing 08-07-2011
Next Hearing Date 08-07-2011
Assessment Year 2001-2002
Appeal Filed On 19-03-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `E: NEW DELHI BEFORE SHRI C.L.SETHI JUDICIAL MEMBER AND SHRI SHAMIM YAHYA ACCOUNTANT MEMBER I.T. A. NO.1231/DEL/2010 ASSESSMENT YEAR : 2001-02 M/S. MULK RAJ RAMESH KUMAR ASSTT. COMMISSIONER OF INCOME-TAX A-100 GROUND FLOOR VS. CIRCLE 20(1) NEW DELHI. GUJRAWALAN TOWN DELHI. PAN: AAIFM4058D (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI B.L. GUPTA ITP. RESPONDENT BY: SHRI RAJ TANDON CIT-DR. O R D E R PER C.L. SETHI JUDICIAL MEMBER: THE ASSESSEE IS IN APPEAL AGAINST THE ORDER DATED 8 .02.2010 PASSED BY THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) IN THE MATTER OF AN ASSESSMENT MADE BY THE ASSESSING OFFICER UNDER SEC. 153(C)/143(3) OF THE INCOME-TAX ACT 1961 (THE ACT) FOR THE ASSESSMENT Y EAR 2001-02. 2 2. THE ASSESSEE HAS TAKEN VARIOUS GROUNDS VIDE ORIG INAL GROUNDS OF APPEAL AS WELL AS REVISED GROUNDS OF APPEAL FILED B EFORE US. HOWEVER IN THE COURSE OF HEARING OF THIS APPEAL THE LEARNED AUTHO RIZED REPRESENTATIVE OF THE ASSESSEE SHRI B.L. GUPTA ITP HAS CATEGORICALLY AND EMPHATICALLY SUBMITTED THAT VARIOUS GROUNDS OF APPEAL RAISED BY THE ASSESSEE VIDE ORIGINAL GROUNDS AS WELL AS ADDITIONAL GROUNDS ARE NOT BEING PRESSED EXCEPT A GROUND THAT THE ADDITION OF RS.25 72 250/- MADE BY THE AO AND FURTHER CONFIRMED BY THE LEARNED CIT(A) IN THE PRESENT ASSESSMENT YEAR I S UNJUSTIFIED INASMUCH AS THE TRANSACTION ON THE BASIS OF WHICH THIS ADDIT ION HAS BEEN MADE IS RELATED TO THE PERIOD RELEVANT TO THE ASSESSMENT YE AR 2005-06. THE LEARNED AR FOR THE ASSESSEE HAS ALSO DISPUTED THE CORRECTNE SS OF THE AMOUNT OF RS.25 72 250/-. 3. IN THE LIGHT OF THE SUBMISSION OF THE AUTHORIZED REPRESENTATIVE WE THEREFORE PROCEED TO DECIDE AS TO WHETHER A CORREC T AMOUNT OF ADDITION WILL BE RS.25 72 250/- OR WHETHER IT IS ASSESSABLE IN TH E ASSESSMENT YEAR 2001- 02 OR ASSESSMENT YEAR 2005-06. 4. IN THIS CASE IN PURSUANCE TO THE SEARCH AND SEI ZURE OPERATION U/S 132 OF THE ACT CONDUCTED ON 15.12.2004 IN THE CASE OF S HRI BRIJ MOHAN GUPTA AND IN THE LIGHT OF THE INFORMATIONS/DOCUMENTS SUPP LIED BY THE DCIT CENTRAL CIRCLE-19 NEW DELHI AND IN THE LIGHT OF TH E SATISFACTION NOTE OF 3 DCIT CENTRAL CIRLCE-19 NEW DELHI PROCEEDINGS U/S 153C OF THE ACT WERE INITIATED AGAINST THE ASSESSEE BY ISSUING THE NOTIC E U/S 153(C) OF THE ACT. THEREAFTER THE ASSESSMENT WAS COMPLETED U/S 153(C) ON 13.12.2008 WHEREIN ADDITION OF RS.25 72 250/- WAS MADE ON ACCOUNT OF U NEXPLAINED MONEY OR TRANSACTION REVEALED FROM THE VARIOUS DOCUMENTS SEI ZED DURING THE SEARCH AND SEIZURE PROCEEDINGS. IT WAS NOTED BY THE AO THA T THE ASSESSEE WAS INVOLVED IN CASH TRANSACTIONS WITH/OR THROUGH SHRI BRIJ MOHAN GUPTA GROUP A SUM OF RS.25 00 000/- SHOWN AS CASH PAYMENT WAS A DDED AS INCOME OF THE ASSESSEE U/S 69A OF THE ACT ALONG WITH THE INTEREST INCOME OF RS.70 000/- AND UNEXPLAINED EXPENSES TOWARDS BROKERAGE AND COMM ISSION AMOUNTING TO RS.2 500/-. 5. ON AN APPEAL THE LEARNED CIT(A) CONFIRMED THE A DDITION. 6. HENCE THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 7. WE HAVE HEARD BOTH THE PARTIES AND CAREFULLY PER USED THE ORDERS OF THE AUTHORITIES BELOW. IN THIS CASE A SEARCH AND SEIZ URE OPERATION U/S 132 OF THE ACT WAS CONDUCTED ON 15.12.2004 IN THE CASE OF BRIJ MOHAN GUPTA DURING THE COURSE OF WHICH VARIOUS INCRIMINATING DOCUMENT S DIARIES/LOOSE PAPERS WERE FOUND AND SEIZED. STATEMENTS ON OATH OF SHRI BRIJ MOHAN GUPTA HIS SON SHRI RAJIV GUPTA AND ACCOUNTANT SHRI RAM AVTAR SINGHAL WERE RECORDED DURING THE COURSE OF SEARCH AS WELL AS POST SEARCH PROCEEDINGS. FROM THE 4 INFORMATIONS DOCUMENTS AND STATEMENTS COLLECTED DU RING THE COURSE OF THE SEARCH IT WAS NOTED BY THE DEPARTMENT THAT SHRI BR IJ MOHAN GUPTA GROUP WAS ENGAGED IN MONEY LENDING BUSINESS/HUNDI BUSINES S/UNACCOUNTED CASH LOAN TRANSACTIONS WHEREIN MONEY WAS ARRANGED FROM V ARIOUS PARTIES AND ADVANCED TO THE OTHER PARTIES AND THIS GROUP HAD A CTED AS A MEDIATOR/BROKER IN SUCH FINANCIAL TRANSACTIONS. AMONGST VARIOUS PAP ERS COPIES OF HUNDIES WERE ALSO SEIZED. THE ASSESSEE AND HIS SON HAD EXP LAINED THE COMPLETE MODUS OPERANDI OF THEIR HUNDI BUSINESS/UNACCOUNTED CASH LOAN TRANSACTIONS. ON THE BASIS OF SEIZED MATERIAL AND INFORMATION A SATISFACTION NOTE WAS RECORDED BY THE AO OF SHRI BRIJ MOHAN GUPTA THAT TH E ASSESSEE HAD PAID CASH THROUGH BRIJ MOHAN GUPTA & GROUP. IT WAS NOTE D BY THE AO THAT THE ASSESSEE HAD GIVEN CASH OF RS.25 00 000/- TO SHRI B RIJ MOHAN GUPTA IN DECEMBER 2000. IN THE COURSE OF APPELLATE PROCEED INGS A REMAND REPORT FROM THE ASSESSING OFFICER WAS CALLED FOR. IN THE REMAND REPORT THE AO STATED THAT ADDITION OF RS.25 00 000/- WAS MADE ONL Y ON THE BASIS OF STATEMENT OF SHRI BRIJ MOHAN GUPTA SHRI RAJIV GUPT A AND SHRI RAM AVTAR SINGHAL. THE STATEMENTS ARE CORROBORATED BY THE DO CUMENTS FOUND AND SEIZED DURING THE SEARCH. IT WAS FURTHER STATED BY THE AO THAT THE ASSESSEES LINK WITH SHRI BRIJ MOHAN GUPTA AND OTHERS IS PROVE D FROM THE SEIZURE OF COPIES OF LETTER PADS OF M/S. MULAK RAJ RAMESH KUMA R WHICH WERE FOUND 5 AND SEIZED WHERE CERTAIN TRANSACTIONS WERE MENTION ED. THE AO FURTHER STATED THAT THE THESE PAPERS MAY NOT BE IN THE NATU RE OF HUNDI ITSELF BUT IN THE LIGHT OF THE SEIZED MATERIAL IT WAS CLEARLY PROVED THAT THE ASSESSEE WAS HAVING HUNDI OF RS.25 LAKH AND HAD EARNED INTEREST INCOME OF RS.70 000/-. THE PHOTO COPY OF RELEVANT MATERIAL ON REPORT OF DC IT WAS ALSO FORWARDED THEREWITH. PAPERS SEIZED DURING THE COURSE OF SEAR CH WERE EXAMINED BY THE LEARNED CIT(A). THE LEARNED CIT(A) STATED THAT THE AMOUNT IN LACS WAS DISGUISED AS BAGS AND THE INTEREST AMOUNT IN THE DISGUISE OF RENT WAS MENTIONED AS 0.80 PAISA PER BAG PER MONTH. THE L EARNED CIT(A) HAS SUMMARIZED THE WRITINGS ON THESE PAPERS AS UNDER:- SERIAL NO. BAGS DATE 1. 350 23-11-2004 2. 350 23.11.2004 3. 450 25-11-2004 4. 450 25-11-2004 5. 500 25-11-2004 6. 500 25-11-2004 8. THE CIT(A) FURTHER STATED THAT IN THE LIGHT OF T HESE WRITINGS ON LETTER- HEADS OF M/S. MULAK RAJ RAMESH KUMAR THE TOTAL OF THE ABOVE TRANSACTIONS COMES TO RS.26 LAKH BUT THE AO HAS TAKEN RS.25 00 0 00/- ONLY AS UNEXPLAINED INVESTMENT. IN THE LIGHT OF THESE FACT S NARRATED BY THE LEARNED CIT(A) IN HIS ORDER AND THE REASONS GIVEN THE LEAR NED CIT(A) CONFIRMED THE ADDITIONS OF RS.25 00 000/- RS.70 000/- AND RS.2 5 00/- MADE BY THE AO. 6 FROM THE DETAILS OF ENTRY MENTIONED IN THE LETTER-H EAD OF THE ASSESSEE IT IS SENT HAT THE TRANSACTIONS ARE RELATED TO THE PERIOD FROM 23-11-2004 TO 25-11- 2004. HOWEVER THIS ADDITION HAS BEEN MADE BY THE AO IN THE ASSESSMENT YEAR 2001-02. IT IS NOT CLEAR AS TO ON WHAT BASIS THE AMOUNT OF RS.25 00 000/- RELATING TO THE PERIOD RELEVANT TO T HE ASSESSMENT YEAR 2001- 02 HAS BEEN WORKED OUT. THE LEARNED AUTHORIZED REP RESENTATIVE FOR THE ASSESSEE HAS SUBMITTED THAT ENTRIES IN THE PAPER SE IZED ARE TAKEN TWICE AND ON THE BASIS OF THESE ENTRIES THE REAL TRANSACTION WO ULD BE ONLY OF RS.13 00 000/- WHICH AMOUNT HAS ALREADY BEEN ADDED IN THE ASSESSMENT YEAR 2005-06. IT WAS THUS SUBMITTED BY THE LEARN ED AR FOR THE ASSESSEE THAT ONLY THE AMOUNT OF RS.13 00 000/- ON THE BASIS OF THESE ENTRIES ON THE SEIZED PAPER IS ASSESSABLE IN THE ASSESSMENT YEAR 2 005-06 AND NOT IN THE ASSESSMENT YEAR 2001-02 WHICH IS UNDER CONSIDERATI ON. HE FURTHER POINTED OUT THAT ALL THE SEIZED PAPERS IN ORIGINAL WERE REL EASED BY THE DEPARTMENT AFTER ACCEPTING THE CHEQUE OF RS.13 00 000/- ONLY I N LIEU THEREOF. HE THEREFORE SUBMITTED THAT THE DEPARTMENT HAS ITSELF ACCEPTED THAT THESE SEIZED PAPERS ARE WITH REGARD TO THE TRANSACTION OF RS.13 00 000/- AND NOT RS.26 00 000/- OR RS.25 00 000/-. 9. IN THE LIGHT OF THE FACTS AS DISCUSSED ABOVE AND THE STATEMENT OF THE ASSESSEE WE FIND IT APPROPRIATE TO RESTORE THIS IS SUE BACK TO THE FILE OF THE 7 ASSESSING OFFICER FOR HIS FINAL ADJUDICATION. THE ASSESSING OFFICER SHALL DETERMINED AS TO WHETHER THE ADDITION OF RS.25 00 0 00/- HAS BEEN MADE ON THE BASIS OF THE SEIZED DOCUMENTS THE SUMMARY OF W HICH HAS BEEN NARRATED BY THE LEARNED CIT(A) IN HIS ORDER OR ON THE BASIS OF SOME OTHER INDEPENDENT MATERIAL PERTAINING TO THE ASSESSMENT YEAR 2001-02. THE AO SHALL ALSO DETERMINE AS TO WHETHER ANY ADDITION ON THE BASIS O F SEIZED MATERIAL IN THE NATURE OF SOME WRITING ON THE LETTER-HEAD OF THE AS SESSEE IS ASSESSABLE IN THE ASSESSMENT YEAR 2001-02 OR 2005-06. THE AO SHALL A LSO QUANTIFY THE AMOUNT OF ADDITION ON THE BASIS OF SEIZED MATERIAL OR INFORMATION OR STATEMENTS COLLECTED DURING THE COURSE OF SEARCH OR POST-SEARCH PROCEEDINGS. THE AO SHALL PROVIDE NECESSARY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE WHILE DETERMINING THE QUESTION AS TO WHETHER THE AD DITION IS CALLED FOR IN THE ASSESSMENT YEAR 2001-02 OR IN ASSESSMENT YEAR 2005- 06 AND THAT TO WHAT EXTENT OF AMOUNT OR WHETHER ANY SEPARATE ADDITION O F RS.25 00 000/- WITHOUT BASED ON THE SEIZED MATERIAL DATED 23.11.2004 TO 25 .11.2004 BEING WRITINGS ON LETTER-HEAD OF THE ASSESSEE IS STILL CALLED FOR IN THE A.Y. 2001-02. 10. VARIOUS OTHER GROUNDS REGARDING NOT PROVIDING O PPORTUNITY TO CROSS EXAMINE THE PERSONS WHOSE STATEMENTS WERE RECORDED AND FURNISHING COPIES OF STATEMENT TO THE ASSESSEE AND DENIAL OF RULES OF NATURAL JUSTICE HAVE NOT 8 BEEN PRESSED BY THE LEARNED AR FOR THE ASSESSEE AND THEREFORE THESE ISSUES RAISED BY THE ASSESSEE IN THE GROUNDS OF APPEAL ARE REJECTED. 11. IN THE RESULT THIS APPEAL FILED BY THE ASSESSE E IS TREATED TO BE PARTLY ALLOWED FOR A STATISTICAL PURPOSE IN THE MANNER AS INDICATED ABOVE. 12. THIS DECISION IS PRONOUNCED IN THE OPEN COURT O N 15 TH JULY 2011. SD/- SD/- (SHAMIM YAHYA) (C.L. SETHI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 15 TH JULY 2011. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR ITAT.