Shri Kanjibhai Naranbhai Waghela, Surat v. The ACIT., Circle-3,, Surat

ITSSA 101/AHD/2007 | misc
Pronouncement Date: 19-03-2010 | Result: Dismissed

Appeal Details

RSA Number 10120516 RSA 2007
Assessee PAN ACJPV3287D
Bench Ahmedabad
Appeal Number ITSSA 101/AHD/2007
Duration Of Justice 2 year(s) 9 month(s) 18 day(s)
Appellant Shri Kanjibhai Naranbhai Waghela, Surat
Respondent The ACIT., Circle-3,, Surat
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 19-03-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 19-03-2010
Date Of Final Hearing 11-03-2010
Next Hearing Date 11-03-2010
Assessment Year misc
Appeal Filed On 31-05-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD (BEFORE S/SHRI BHAVNESH SAINI JM AND A. N. PAHUJA AM) IT (SS) A NO.101/AHD/2007 BLOCK A. Y.1990-91 TO 1999-2000 (UP TO 29-10-1999) KANJIBHAI NARANBHAI WAGHELA SONI ASSOCIATES 105 RESHAMWALAL MARKET RING ROAD SURAT PA NO.ACJPV 3287D VS THE A. C. I. T. CIRCLE-3 SURAT (APPELLANT) (RESPONDENT) APPELLANT BY SHRI K. P. SHAH AR RESPONDENT BY SHRI GOVIND SINGHAL DR O R D E R PER BHAVNESH SAINI: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE CIT(A)-II SURAT DATED 21- 03-2007 FOR THE ABOVE BLOCK PERIOD ON THE FOLLOWING GROUNDS: 1. THE APPEAL ORDER PASSED IN THIS CASE WAS NOT CO RRECT ON THE FACTS AS WELL AS ON LAW. A. ON FACTS 2. THE APPELLANT SUBMITS THAT HONORABLE COMMISSIONE R OF INCOME TAX (APPEALS) HAS SERIOUSLY ERRED IN SUSTAIN ING AN ADDITION OF R.2 48 000 ON ACCOUNT OF ON MONEY ALLEGEDLY PAID FOR THE PURCHASE OF FLAT PARTICULARL Y WHEN DETAILS AND SOURCE OF THE SAME WAS COMPLETELY EXPLAINED. B. ON LAW 3. THE APPELLANT SUBMITS THAT HONORABLE COMMISSIONE R OF INCOME TAX (APPEALS) WAS INCORRECT IN NOT CONSIDERI NG THE WHOLE ORDER PASSED BY ACIT CIRCLE-3 SURAT AS I LLEGAL AND INVALID BEING BASED PM IMPROPER AND INVALID ASSUMPTION OF JURISDICTION OVER THE ABOVE APPELLANT IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 2 BECAUSE THE STATUTORY MANDATORY BASIC PROVISION CONTAINED IN RELEVANT SECTION HAVE BEEN VIOLATED. MISC. 4. APPELLANT CRAVES LEAVE TO ADD ALTER OR DELETE A NY GROUND(S) EITHER BEFORE OR IN THE COURSE OF HEARING OF THE APPEAL. 2. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOT H THE PARTIES PERUSED THE FINDINGS OF THE AUTHORITIES BELOW AND C ONSIDERED THE MATERIAL ON RECORD. 3. BRIEFLY THE FACTS OF THE CASE ARE THAT IN THE C OURSE OF SEARCH OF THE PREMISES OF M/S. OHM DEVELOPERS AND M/S. OHM ORGANI ZERS EVIDENCES WERE FOUND REGARDING RECEIPT OF ON MONEY FROM VARIO US PERSONS WHO HAD BOOKED FLATS AND SHOPS AT YOGI COMPLEX RANDER ROAD SURAT. THE PARTNERS OF THE FIRM WHOSE STATEMENT WAS RECORDED O N OATH ADMITTED TO HAVE RECEIVED ON MONEY AS PER ACCOUNTS SEIZED IN TH E COURSE OF SEARCH. THE ON MONEY SO RECEIVED WAS ASSESSED IN THE HANDS OF THE FIRMS AND ADDITIONS MADE IN THE BLOCK ASSESSMENTS HAD BEEN CO NFIRMED BY THE TRIBUNAL. IN THE COURSE OF SEARCH SEIZED DOCUMENTS ANNEXURE BS-4 TO THE PANCHNAMA DATED 29-10-1999 IT WAS FOUND FROM PAGES 76 AND 77 THAT THE ASSESSEE HAD PURCHASED FLAT NO.A-804 IN YOGI CO MPLEX RANDER ROAD SURAT FOR WHICH TOTAL PAYMENT OF RS.6 21 000/ - WAS MADE TILL THE DATE OF SEARCH I.E. 29-10-1999. THE SEIZED DOCUMENT S WERE CONFIRMED BY OTHER SEIZED MATERIALS FOR RECEIPT OF THE ON MONEY BY THE DEVELOPERS. THE EXPLANATION OF THE ASSESSEE WAS CALLED FOR IN WHICH IT WAS ADMITTED VIDE REPLY DATED 26-2-2004 THAT THE ASSESSEE HAD PURCHAS ED THE ABOVE FLAT IN HIS NAME FOR RS.3 73 000/-. HOWEVER THE AO NOTED T HAT AS PER THE SEIZED DOCUMENTS THE TOTAL CONSIDERATION WAS RS.6 2 1 000/-. THE ASSESSEE WAS ISSUED SHOW CAUSE NOTICE U/S 158BD OF THE IT ACT IN REPLY TO WHICH THE ASSESSEE FILED RETURN OF INCOME AT NIL . THE ASSESSEE WAS ASKED TO CLARIFY THE INVESTMENTS MADE IN THE PROPER TY. THE AO OBSERVED IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 3 THAT THE ASSESSEE PAID A SUM OF RS.3 73 000/- THROU GH CHEQUES AND RS.2 48 000/- HAD BEEN PAID AS ON MONEY IN CASH. TH E ASSESSEE HOWEVER SUBMITTED THAT A SUM OF RS.3 73 000/- WAS PAID FROM HIS OWN FUND WHICH HAD BEEN DULY REFLECTED IN THE ACCOUNTS AND IN THE RETURN OF INCOME. THE REMAINING AMOUNT OF RS.2 48 000/- HAD B EEN PAID BY HIS FATHER WHO WAS AN AGRICULTURIST OUT OF HIS AGRICULT URAL INCOME. IT WAS EXPLAINED THAT SOURCE OF INCOME OF RS.2 48 000/- IN CASH IS THEREFORE EXPLAINED. THE AO OBSERVED THAT IN THE BALANCE SHEE T OF THE ASSESSEE AS ON 31-03-1999 A SUM OF RS.2 61 000/- HAD BEEN SHOWN ON THE ASSETS SIDE AGAINST THE NAME OF M/S. OHM ORGANIZERS. A SUM OF RS.1 00 000/- WAS SHOWN IN THE BALANCE SHEET OF ASSESSEES WIFE A S ON 31-03-1999. THE AO THEREFORE ACCEPTED RS.3 61 000/- AS EXPLAINED. THE ASSESSEE HAS HOWEVER CLAIMED TO HAVE PAID RS.3 73 000/- VIDE LE TTER DATED 26-02- 2004. THUS THERE WAS A DIFFERENCE OF RS.12 000/-. THE AO FURTHER NOTED THAT IN THE NAME OF ASSESSEES FATHER SHRI NARANBHA I GOVINDBHAI WAGHELA DID NOT APPEAR IN THE ACCOUNTS OF THE ASSES SEE I.E. BALANCE SHEET AS ON 31-03-1999. IT WOULD MEAN THAT THE AMOUNT PAI D BY HIS FATHER IS AN AFTERTHOUGHT. THE AO ALSO DID NOT ACCEPT THE AMO UNT INVESTED BY HIS WIFE IN A SUM OF RS.1 00 000/- AND ULTIMATELY AO A CCEPTED ONLY A SUM OF RS.2 61 000/- AND DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE THAT HIS FATHER HAS MADE PAYMENT IN CASH TO THE BUILDER . ADDITION OF RS.3 60 000/- WAS ACCORDINGLY MADE. THE ASSESSEE R EITERATED THE SAME SUBMISSIONS BEFORE THE LEARNED CIT(A) AND ALSO SUBM ITTED THAT INVESTMENT BY WIFE OF THE ASSESSEE IS DULY REFLECTE D IN HER BALANCE SHEET WHICH WAS FILED ALONG WITH RETURN OF INCOME AND TH AT CONTRIBUTION MADE BY HIS FATHER SHOULD ALSO HAVE BEEN ACCEPTED. THE C ONTENTION OF THE ASSESSEE WAS ACCEPTED BY THE LEARNED CIT(A) TO THE EXTENT OF RS.3 73 000/- THAT MEANS CONTRIBUTION MADE BY HIM I N A SUM OF RS.2 73 000/- PLUS RS.1 00 000/- INVESTED BY HIS WI FE. THE LEARNED CIT(A) DID NOT ACCEPT THE EXPLANATION REGARDING SOU RCE OF RS.2 48 000/- AND ACCORDINGLY ADDITION IN A SUM OF RS.2 48 000/- WAS CONFIRMED. IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 4 4. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE ASSESSEE HAS FILED AFFIDAVIT OF HIS FATHER IN WHICH IT WAS C ONFIRMED THAT HE HAS CONTRIBUTED RS.2 50 000/- FROM HIS SAVINGS OUT OF A GRICULTURAL INCOME FOR PURCHASE OF FLAT BY HIS SON I.E. THE ASSESSEE. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT SINCE THE SOURCE IS PROVED BY FATHER OF THE ASSESSEE THROUGH AFFIDAVIT THEREFORE NO ADDITION SHOULD HAVE BEEN MADE. HE HAS RELIED UPON THE DECISION OF THE HONBL E DELHI HIGH COURT IN THE CASE OF CIT VS NARESH KHATTAR (HUF) 261 ITR 664 (DEL) IN WHICH IT WAS HELD BURDEN OF PROOF IS UPON THE REVENUE TO PR OVE INVESTMENTS WHICH WERE UNEXPLAINED. STATEMENT BY THE COUNSEL OF THE ASSESSEE IN CIVIL SUIT IS NOT ENOUGH TO DISCHARGE THE BURDEN. 5. ON THE OTHER HAND THE LEARNED DR RELIED UPON TH E ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THERE IS CONTR ADICTION IN THE EXPLANATION OF THE ASSESSEE MADE AT THE INITIAL STA GE AND SUBSEQUENTLY AND THAT THE IS NO ENTRY IN THE ACCOUNTS OF THE ASS ESSEE REGARDING GIVING OF RS.2 48 000/- BY HIS FATHER. THEREFORE AO WAS J USTIFIED IN MAKING THE ADDITION AND THE LEARNED CIT(A) HAS ALSO RIGHTLY CO NFIRMED THE ADDITION. THE LEARNED DR RELIED UPON THE ORDER OF ITAT DELHI BENCH IN THE CASE OF RAGHAV BAHL VS DCIT 111 ITD 174 (DEL) IN WHICH IT W AS HELD THAT TRANSACTIONS NOT RECORDED IN THE BOOKS OF ACCOUNTS MAINTAINED IN NORMAL COURSE BEFORE THE DATE OF SEARCH IT COULD BE SAID THAT ON THE DATE OF SEARCH INCOME HAVE NOT BEEN DISCLOSED TO THE REVENU E NOR IT WAS INTENDED TO BE DISCLOSED. IT WAS TREATED AS UNDISCL OSED INCOME. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIALS AVAILABLE ON RECORD. THE DISPUTE IS LEFT ONLY WITH REGARD TO ADDITION OF RS.2 48 000/- WHICH IS CONFIRMED BY THE LEARNED CIT (A) ON ACCOUNT OF UNEXPLAINED ON MONEY PAID BY THE ASSESSEE TO THE BU ILDER. THE ASSESSEE IN HIS INITIAL REPLY ADMITTED BEFORE THE AO THAT TH E FLAT IN QUESTION HAS BEEN PURCHASED BY HIM IN HIS NAME FOR A SUM OF RS.3 73 000/-. IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 5 HOWEVER THE SEIZED MATERIAL PROVE THAT IT WAS PURC HASED FOR A SUM OF RS.6 21 000/-. THE AMOUNT OF RS.3 73 000/- ACCORDI NG TO THE ASSESSEE WAS PAID BY CHEQUE. THE BUILDERS IN THEIR STATEMENT S HAVE ADMITTED TO HAVE RECEIVED ON MONEY FROM PURCHASERS FOR SALE OF THE FLATS. THE SEIZED MATERIAL IS THEREFORE SUPPORTED BY THE STATEMENTS OF THE BUILDERS. ULTIMATELY WHEN THE ASSESSEE WAS CONFRONTED WITH T HE SEIZED MATERIAL HE HAS CHANGED HIS VERSION AND EXPLAINED THAT REMAI NING AMOUNT OF RS.2 48 000/- HAS BEEN PAID BY HIM OUT OF RS.2 50 0 00/- CONTRIBUTED BY HIS FATHER. THE AFFIDAVIT OF FATHER OF THE ASSESSEE WAS FILED WHICH REMAINED UN-SUBSTANTIATED THROUGH ANY MATERIAL OR E VIDENCE. THE AFFIDAVIT THUS DOES NOT SUPPORT THE CLAIM OF THE AS SESSEE. RATHER THE AFFIDAVIT OF THE FATHER OF THE ASSESSEE FILED LATER ON PROVE THAT IT WAS FILED MOTIVATEDLY AFTER THOUGHT BECAUSE THE ASSESSEE INIT IALLY DENIED PAYMENT OF ON MONEY OF RS.2 48 000/- IN CASH BUT LATER ON H AS ADMITTED TO HAVE PAID ON MONEY IN CASH AFTER RECEIPT OF THE AMOUNT F ROM HIS FATHER. THE CONTRADICTION IN THE EXPLANATION OF THE ASSESSEE AL SO SUPPORTS THE FINDINGS OF THE AUTHORITIES BELOW THAT HE ASSESSEE MOTIVATEDLY FILED FALSE AFFIDAVIT OF HIS FATHER IN SUPPORT OF PAYMENT OF ON MONEY. NO EVIDENCE WAS FILED REGARDING EARNING OF ANY AGRICULTURAL INC OME BY THE FATHER OF THE ASSESSEE AND AFFIDAVIT WAS ALSO NOT ATTESTED. T HE LEARNED COUNSEL FOR THE ASSESSEE ALSO FILED COPY OF THE AFFIDAVIT BEFOR E US WHICH SUPPORTS THE FINDINGS OF THE AUTHORITIES BELOW THAT AFFIDAVIT WA S NOT ATTESTED AS REQUIRED UNDER THE LAW. THE AFFIDAVIT WHICH IS NOT ATTESTED AS PER REQUIREMENT OF LAW CANNOT BE CONSIDERED AS AN EVIDE NCE FOR ANY PURPOSE. IT THEREFORE STANDS PROVED ON RECORD THAT THE ASS ESSEE FAILED TO EXPLAIN PAYMENT OF ON MONEY OF RS.2 48 000/- TO THE BUILDER S BEING INVESTMENTS IN THE FLAT. THEREFORE AUTHORITIES BELOW WERE JUST IFIED IN HOLDING THAT THE ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE OF INVEST MENT IN THE FLAT IN A SUM OF RS.2 48 000/-. CONSIDERING THE FACTS AND CIR CUMSTANCES NOTED ABOVE AND THE FACTS THAT NO ENTRY IS ALSO RECORDED IN THE ACCOUNT OF THE ASSESSEE IN RESPECT OF THE AMOUNT CONTRIBUTED BY AS SESSEES FATHER WE DO IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 6 NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE OR DERS OF THE AUTHORITIES BELOW. WE CONFIRM THE ADDITION OF RS.2 48 000/- THE REFORE THE APPEAL OF THE ASSESSEE ON MERIT IS DISMISSED. 7. THE OTHER GROUND IS REGARDING JURISDICTION OF TH E AO. THE ASSESSEE SUBMITTED BEFORE THE LEARNED CIT(A) THAT HE IS ASSE SSED REGULARLY TO TAX IN RANGE 7. THEREFORE ACIT CIRCLE -3 SURAT DO NO T HAVE JURISDICTION OVER HIS CASE. THE LEARNED CIT(A) NOTED THAT AFTER SEARC H ALL THE CASES WERE CENTRALIZED WITH ACIT CIRCLE-3 SURAT THEREFORE THE CASE OF THE ASSESSEE WAS TAKEN UP BY THE SAME AO. OBJECTION OF THE ASSES SEE WAS ACCORDINGLY REJECTED. THE LEARNED COUNSEL FOR THE ASSESSEE DID NOT ARGUE ON THIS ISSUE. WE THEREFORE DO NOT FIND ANY JUSTIFICATIO N TO INTERFERE WITH THE ORDER OF THE LEARNED CIT(A). WE CONFIRM HIS FINDING S AND DISMISS THIS GROUND OF APPEAL OF THE ASSESSEE ALSO. 8. THE LEARNED COUNSEL FOR THE ASSESSEE ALSO RELIED UPON THE ORDER OF THE ITAT AHMEDABAD BENCH DATED 07-11-2008 IN MA NO. 115/AHD/2008 AND IT(SS)A NO.80/AHD/2007 IN THE NAME OF SHRI RAM ESH AMBALAL WAGHELA VS ACIT SURAT. HE HAS SUBMITTED THAT IT WA S A CASE OF OTHER BUYER IN WHICH THE TRIBUNAL HAS HELD THAT THE BLOCK ASSESSMENT ORDER IS BARRED BY LIMITATION. HE HAS THEREFORE PRAYED THA T THE ORDER IN THE CASE OF THE ASSESSEE ALSO MAY BE QUASHED. THE LEARNED DR OBJECTED TO THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSESSEE ON THE GROUND THAT NO SPECIFIC GROUND IS TAKEN IN THIS REGARD BY THE A SSESSEE. THE LEARNED DR SUBMITTED THAT IN THE CASE OF SHRI RAMESH AMBALA L WAGHELA SPECIFIC GROUND WAS TAKEN BEFORE THE TRIBUNAL THAT THE LEAR NED CIT(A) ERRED IN CONFIRMING THE ACTION OF THE AO IN TAKING ACTION U/ S 158BD OF THE IT ACT AFTER LAPSE OF ABOUT 5 YEARS. THE LEARNED DR SUBMI TTED THAT SINCE THE ASSESSEE HAS NOT RAISED THIS GROUND EITHER BEFORE T HE AO OR BEFORE THE LEANED CIT(A) AND NO SPECIFIC GROUND IS TAKEN IN TH E GROUNDS OF APPEAL IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 7 BEFORE THE TRIBUNAL THEREFORE SUBMISSION OF THE L EARNED COUNSEL FOR THE ASSESSEE MAY NOT BE ENTERTAINED WHICH ALSO REQUIRES VERIFICATION OF FACTS. 9. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PARTIE S AND DO NOT FIND ANY JUSTIFICATION TO CONSIDER THE SUBMISSIONS OF TH E LEARNED COUNSEL FOR THE ASSESSEE. WE MAY ALSO NOTE HERE THAT WHEN THE L EARNED DR OBJECTED TO THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE A SSESSEE THE LEARNED COUNSEL FOR THE ASSESSEE TRIED TO RAISE ADDITIONAL GROUND OF APPEAL WHICH ALSO CANNOT BE CONSIDERED AFTER OBJECTION TAKEN BY THE LEARNED DR AND AFTER CONCLUSION OF HEARING ON THIS ISSUE. IN THIS CASE THIS G ROUND IS NOT RAISED EITHER BEFORE THE AO OR BEFORE THE LEARNED C IT(A) AND NO SUCH GROUND IS TAKEN BEFORE THE TRIBUNAL. HONBLE M. P. HIGH COURT IN THE CASE OF CIT VS TOLARAM HASSOMAL 298 ITR 22 HELD THAT W HEN TRIBUNAL PERMITTED ADDITIONAL GROUND TO BE RAISED FOR FIRST TIME TRIBUNAL SHOULD REMAND CASE TO CIT(A). HOWEVER THE PRESENT CASE IS WORST ON FACTS BECAUSE OF ABOVE FINDINGS AND THAT ASSESSEE DID NOT TAKE ANY STEP TO RAISE ADDITIONAL GROUND OF APPEAL. WE ARE OF THE VI EW THAT THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE CANNOT BE E NTERTAINED AT THIS STAGE. WE ACCORDINGLY REJECT THE SUBMISSIONS OF TH E LEARNED COUNSEL FOR THE ASSESSEE. 10. AS A RESULT APPEAL OF THE ASSESSEE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 19-03-2010. S/- SD/- (A. N. PAHUJA) ACCOUNTANT MEMBER (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 19- 03-2010 LAKSHMIKANT/- IT(SS)A NO.101/AHD/2007 KANJIBHAI NARANBHAI WAGHELA 8 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR ITAT AHMEDABAD 6. GUARD FILE BY ORDER D Y. REGISTRAR ITAT AHMEDABAD