Shri Kanchanlal F. Panchal,, Ahmedabad v. The ACIT, Cent.Circle-1(1),, Ahmedabad

ITSSA 122/AHD/2004 | misc
Pronouncement Date: 25-02-2011 | Result: Partly Allowed

Appeal Details

RSA Number 12220516 RSA 2004
Bench Ahmedabad
Appeal Number ITSSA 122/AHD/2004
Duration Of Justice 6 year(s) 9 month(s) 29 day(s)
Appellant Shri Kanchanlal F. Panchal,, Ahmedabad
Respondent The ACIT, Cent.Circle-1(1),, Ahmedabad
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 25-02-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted C
Tribunal Order Date 25-02-2011
Date Of Final Hearing 08-09-2010
Next Hearing Date 08-09-2010
Assessment Year misc
Appeal Filed On 26-04-2004
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD AHMEDABAD C BENCH (BEFORE S/SHRI MUKUL KUMAR SHRAWAT JUDICIAL MEMBER AND N.S. SAINI ACCOUNTANT MEMBER) IT(SS)A NO.122/AHD/2004 [BLOCK ASSTT. 1-4-1995 TO 27-9-2001] DCIT CENT.CIR.1(1) AHMEDABAD. VS. KANCHANLAL F. PANCHAL 34 PAYAL PARK SOCIETY OPP: SUNDARVAN SATELLITE AHMEDABAD. IT(SS)A NO.132/AHD/2004 [BLOCK ASSTT. 1-4-1995 TO 27-9-2001] KANCHANLAL F. PANCHAL 34 PAYAL PARK SOCIETY OPP: SUNDARVAN SATELLITE AHMEDABAD. VS. DCIT CENT.CIR.1(1) AHMEDABAD. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI SHELLY JINDAL ASSESSEE BY : SHRI S.N. SOPARKAR O R D E R PER MUKUL KUMAR SHRAWAT JUDICIAL MEMBER: THESE ARE CROSS-APPEALS ARISING FROM THE ORDER OF THE COMMISS IONER OF INCOME-TAX (APPEALS)-XI DATED 27.02.2004. BOTH THESE APPEALS HAVE BEEN CONSOLIDATED AND HEREBY DECIDED BY THIS COMMON ORDER. A. ASSESSEES APPEALS 2. AT THE OUTSET THE LEARNED AR MR. S.N.SOPARKAR HAS EXPRESSED NOT TO PRESS GROUND NOS.1 TO 3. THESE THREE GROUNDS ARE THEREFORE DISMISSED BEING NOT PRESSED. 3. GROUND NO.4 IN RESPECT OF ADDITION OF RS.15 84 311/- BEING INTE REST INCOME AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD. 3.1 THE FACTS IN BRIEF AS EMERGED FROM THE CORRE SPONDING ASSESSMENT ORDER PASSED UNDER SECTION 158BC DATED 29-9-209 WERE THAT A SEARCH UNDER SECTION 132 OF THE IT ACT TOOK PLACE ON 27-9-2001 ON NIRMA GROUP OF CASES. DURING IT(SS)A NO.122 AND 132/AHD/2004 -2- THE COURSE OF SEARCH CERTAIN EVIDENCES WERE FOUND HENCE THE ASSESSEE WAS ALSO SEARCHED. THE AO HAS ALSO NOTED THAT THE ASSESSEE BEING ONE OF THE ASSOCIATES OF SHRI AMUBHAI M. PATEL ONE OF THE MAIN PERSONS OF THE NIRMA GROUP HENCE COVERED BY THE SAID SEARCH ACTION. THE AO HAS ALSO NOTED THAT DURING THE COURSE OF SEARCH AT THE PREMISES OF THE ASSESSEE CE RTAIN DOCUMENTS WERE FOUND REGARDING SHARAFI BUSINESS WHICH WAS NOT DISCLOSED IN THE REGULAR RE TURN. IT WAS ALSO AN ACCEPTED FACT THAT THE JOTTING OR THE N OTING ON THE SEIZED MATERIAL WAS IN THE HAND-WRITING OF THE ASSESSEE. THOUGH TH E ASSESSEE HAS INITIALLY MADE A CLAIM THAT NOTINGS WERE AS PER THE DIRECTIONS OF AN ANOTHER PERSON WHO HAD EXPIRED AND NOT AVAILABLE AT THE TIME BUT THAT CLA IM OF THE ASSESSEE WAS NOT ACCEPTABLE TO THE REVENUE DEPARTMENT. THE AO HAS S UMMARISED HIS FINDING IN THE MANNER THAT THE EVIDENCES WERE RELATED TO THE A SSESSEE AND THAT THE SEIZED MATERIAL WAS WRITTEN BY THE ASSESSEE HIMSELF AND TH AT THE CALCULATION OF THE INTEREST WAS ON ACCRUAL BASIS HENCE THE INCOME BE LONGED TO THE ASSESSEE AND SINCE NOT DISCLOSED IN THE REGULAR RETURN THEREFOR E TO BE TAXED AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD. IT WAS ALSO NOTED BY THE AO THAT THE ENTRY IN THE NAME OF ONE SHRI BIPINBHAI WAS IN RESPECT OF FUNDS BORROWED HENCE THE CONSEQUENT RELIEF WAS ALSO GRANTED. THE AO HAS M ADE ANNEXURES OF THE SEIZED MATERIAL AS PART OF THE ASSESSMENT ORDER AND ON THA T BASIS WORKED OUT THE UNACCOUNTED INTEREST INCOME AT RS.15 84 311/- AND T AXED ACCORDINGLY. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHO RITY. 4. THE LEARNED CIT(A) HAS EXAMINED AT SOME LENGTH O F THE FACTS OF THE CASE AND ALSO CONSIDERED THE ARGUMENTS OF THE ASSESSEE. IN HIS OPINION THERE WERE SUFFICIENT CLINCHING EVIDENCES IN THE FORM OF SEIZE D PAPERS THROUGH WHICH UNACCOUNTED SHARAFI TRANSACTION WAS DETECTED AT THE TIME OF SEARCH. HE HAS ALSO GIVEN A FINDING THAT AS PER THE SEIZED PAP ERS THE ASSESSEE HAS CHARGED INTEREST REGULARLY ON ACCRUAL BASIS THEREFORE THE AO HAS RIGHTLY CALCULATED THE INTEREST ON ACCRUAL BASIS AND NOT ON CASH BASIS. H E HAS ALSO POINTED OUT THAT THE ASSESSEE HAS NEVER SHOWN THE INTEREST INCOME IN HIS REGULAR RETURNS OF INCOME EVEN ON CASH BASIS THEREFORE THE COMPUTATION OF IN TEREST INCOME HAD TO BE IT(SS)A NO.122 AND 132/AHD/2004 -3- MADE AS PER THE NOTING OF THE SEIZED DOCUMENTS. IT WAS ALSO POINTED OUT THAT THE RATE OF INTEREST AT 12% PER ANNUM WAS ALSO ADOP TED ON THE BASIS OF CALCULATION MADE BY THE ASSESSEE ON THE SEIZED MATE RIAL. WITH THIS FINDING THE ACTION OF THE AO WAS CONFIRMED. 4.1 WITH THIS FACTUAL BACKGROUND WE H AVE HEARD THE SUBMISSIONS OF BOTH THE SIDES. WE HAVE ALSO CAREFULLY PERUSED THE MATERIAL PLACED BEFORE US IN THE LIGHT OF THE FEW CASE LAW CITED. THE FACTS AND CIRCUMSTANCES HAVE REVEALED THAT DURING THE COURSE OF SEARCH CERTAIN HAND-WRITT EN DOCUMENTS WERE DETECTED AND ON THAT BASIS IT WAS FOUND THAT THE ASSESSEE W AS ENGAGED IN UNDISCLOSED SHARAFI BUSINESS. THE AO HAS MADE A CALCULATION OF THE IN TEREST WHICH WAS FOUND TO BE COMPUTED BY THE ASSESSEE IN HIS OWN HAN D-WRITING. RESULTANTLY THE A.O. HAD FINALLY MADE THE TOTAL CALCULATION AS PER THE ANNEXURE-B FORMING PART OF THE ASSESSMENT ORDER. ON CAREFUL PERUSAL OF TH E SAID CALCULATION WE HAVE NOTED THAT THE PARTIES NAMES ALONG WITH INTEREST R ECEIVED OR RECEIVABLE WERE MENTIONED BY GIVING THE DETAILS OF THE PERIOD FOR W HICH THE INTEREST WAS COMPUTED. AS FAR AS THE REVENUE DEPARTMENT IS CONCERNED THAT EVIDENCE WAS ENOUGH TO ASSESS THE UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE. MOREOVER THE ASSESSEE HAS ACCEPTED THAT NOTING WER E IN HIS OWN HAND-WRITING. FROM THE SIDE OF THE REVENUE AN ATTEMPT WAS MADE TO VERIFY THE CORRECTNESS OF THE CALCULATION AND FOR THAT PURPOSE THE ASSESSEE W AS ASKED EITHER TO PRODUCE THOSE PARTIES OR TO FURNISH THEIR ADDRESSES. HOWEV ER NO SUCH INFORMATION WAS SUPPLIED BY THE ASSESSEE TO THE REVENUE DEPARTMENT. IN THE ABSENCE OF SUCH INFORMATION THE AO HAD CONFINED HIS ASSESSMENT ON THE BASIS OF THE CALCULATION ALREADY NOTED BY THE ASSESSEE HIMSELF. IT WAS ON T HE PART OF THE ASSESSEE TO DISCHARGE HIS ONUS TO DEMONSTRATE THAT THE INTEREST INCOME WAS TAXED ON CASH BASIS AND NOT ON ACCRUAL BASIS. BUT THIS FACT CAN ALSO NOT BE DENIED THAT FOR THESE SOURCES OF INCOME I.E. SHARAFI BUSINESS NO DISCLOSURE WAS EVER MADE IN THE PAST. THEREFORE DUE TO THIS REASON IT CANNOT BE HELD THAT THE ASSESSEE HAD OPTED FOR A PARTICULAR METHOD OF ACCOUNTING FOR THE CALCULATION OF THE INTEREST INCOME WHICH WAS DISCLOSED OR ACCEPTED IN THE PAST. IT IS NOT THE CASE WHERE IT(SS)A NO.122 AND 132/AHD/2004 -4- THE IMPUGNED ADDITION WAS MADE MERELY ON CERTAIN PR OBABILITIES OR PRESUMPTIONS. THE AO HAS FOUND THE CALCULATION ON THE SEIZED MATERIAL ONLY. THEREFORE THE ARGUMENT OF THE ASSESSEE THAT THE CA LCULATION OF INTEREST SHOULD HAVE BEEN BASED UPON THE CASH BASIS HAS NO FORCE. THERE WAS ANOTHER ASPECT OF THE ARGUMENTS WHICH WAS IN RESPECT OF THE CALCULAT ION OF INTEREST ON ACCRUAL BASIS UPTO THE PERIOD OF SEARCH I.E. 27-9-2001. TH E AO HAS MENTIONED THE NAMES OF THE PARTIES ALONG WITH THE OUTSTANDING BAL ANCES AND THEN APPLIED THE RATE OF INTEREST AT 12% PER ANNUM FOR THE REMAINING PERIOD UPTO THE DATE OF SEARCH. ONCE IT WAS AN ADMITTED FACTUAL POSITION THAT THE ASSESSEE HAS COMPUTED THE INTEREST ON ACCRUAL BASIS AS PER THE SEIZED DOCUMENTS THEREFORE WE FIND NO MISTAKE ON THE APART OF THE AO TO COMPUT E THE INTEREST ON ACCRUAL BASIS FOR THE REMAINING PERIOD COMPLETED ON THE DAT E OF SEARCH. WITH THIS REMARKS WE HEREBY CONFIRM THE FINDINGS OF THE AUTH ORITIES BELOW AND DISMISS THIS GROUND OF THE ASSESSEE. 5. GROUND NO.5 IS IN RESPECT OF AN ADDITION OF RS.48 355/- WHICH W AS TAXED AS UNDISCLOSED INTEREST INCOME. A DOCUMENT W AS FOUND FROM THE PREMISES OF THE ASSESSEE MARKED AS ANNEXURE-S/18. WHEN THE SAID DOCUMENT WAS CONFRONTED TO THE ASSESSEE THE ASSESSEE HAS EX PRESSED HIS INABILITY TO EXPLAIN THE CONTENTS BECAUSE THE ALLEGED NOTINGS WE RE NOT IN HIS HAND-WRITING. THE AO HAS THUS HELD THAT SINCE THE ASSESSEE HAS NO T DISCHARGED HIS PRIMARY ONUS TO EXPLAIN THE CONTENTS OF THE SAID DOCUMENTS THEREFORE THE FIGURE MENTIONED IN THAT DOCUMENT OF RS.48 355/- WAS HELD AS UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE. 6. WHEN THE MATTER WAS CARRIED BEFORE THE FIRST APP ELLATE AUTHORITY THE ACTION OF THE AO WAS CONFIRMED PRIMARILY ON THE GRO UND THAT THE PRESUMPTION AS PRESCRIBED UNDER SECTION 132 (4A) IS THAT THE SE IZED DOCUMENTS BELONGS TO THE PERSON FROM WHOSE POSSESSION IT WAS DETECTED. IT(SS)A NO.122 AND 132/AHD/2004 -5- 7. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE ORD ERS OF THE AUTHORITIES BELOW. AS WE HAVE SEEN IN THE ABOVE PARAGRAPHS THA T THE DOCUMENTS PERTAINING TO THE SHARAFI BUSINESS WERE WRITTEN BY THE ASSESSEE HIMSELF. AS AGAINST THAT THERE IS NO DENIAL OF THIS FACT THAT ANNEXURE-S/18 WAS NOT IN THE HAND-WRITING OF THE ASSESSEE. FURTHER THERE WAS NO CONNECTED OR C ORROBORATIVE EVIDENCE TO EXACTLY DEMONSTRATE EVEN THE NATURE OF THE DOCUMENT S. IN THIS REGARD THE ASSESSEE HAS EXPLAINED THAT THE DOCUMENTS DID NOT B ELONG TO HIM AND THE ASSESSEE COULD NOT EXPLAIN THE CONTENTS HAVING NOT WRITTEN BY HIM AND THAT THE POSSIBILITY IS THAT THE DOCUMENTS WAS MERELY A BALD DOCUMENT UNCONNECTED WITH THE ASSESSEE. IN THIS REGARD A FEW CASE LAWS HAVE ALSO BEEN REFERRED HOWEVER KEEPING BREVITY IN MIND WE ARE ALSO OF THE VIEW TH AT CONSIDERING THE OVERALL CIRCUMSTANCES OF THE CASE AND THE NATURE OF WORKING CARRIED OUT BY THE ASSESSEE THERE WAS NO POSSIBILITY OF HOLDING THAT THE AMOUNT MENTIONED IN THAT PAPER WAS UNACCOUNTED INCOME WHICH HAD ACTUALLY BEEN EARNED B Y THE ASSESSEE SO AS TO TAX AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD. WE THEREFORE HOLD THAT THE ASSESSEE IS ENTITLED FOR RELIEF IN RESPECT OF THE S AID ADDITION. WE DIRECT ACCORDINGLY. THIS GROUND IS ALLOWED. 8. GROUND NO.6 IS IN RESPECT OF AN ADDITION OF RS.93 970/- WHICH WAS BASED UPON THE ABOVE CERTAIN JOTTINGS ON THE SEIZED MATERIAL. IT WAS NOTED BY THE AO THAT THERE WAS CERTAIN CALCULATION OF INTERE ST FOR A PARTICULAR PERIOD AS PER PAGE NO.145 OF THE SEIZED DOCUMENT. IN THIS RE GARD THE EXPLANATION OF THE ASSESSEE WAS THAT THE PAPER DID NOT BELONG TO HIM A ND THE SAME WAS NOT IN HIS OWN HAND-WRITING. HOWEVER THE AO HAS HELD THAT TH E INTEREST WAS CALCULATED FOR THE PERIOD MENTIONED THEREIN AND CALCULATED THE AMOUNT AT RS.2 05 970/-. HOWEVER HE HAS ALSO EXTRAPOLATED THE INTEREST UPTO 27-9-2001 BY ADDING AN AD HOC FIGURE OF RS.2 LAKHS. WITH THE RESULT THE TOTAL ADDITION OF RS.4 05 970/- WAS TAXED AS UNDISCLOSED INCOME IN THE HANDS OF THE ASSESSEE. 9. THE ISSUE WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY. WHILE EXAMINING THE DETAILS OF INTEREST THE LEARNED CIT( A) HAS NOTED THAT CERTAIN IT(SS)A NO.122 AND 132/AHD/2004 -6- ENTRIES WERE NOT IN RESPECT OF INCOMING BUT IN RESP ECT OF OUTGOING IN THE NATURE OF SALARY OVERTIME MEDICINES ETC. BY GIVING THE RELIEF ON THESE ENTRIES THE LEARNED CIT(A) HAS CONFIRMED THE ADDITION ONLY TO T HE EXTENT OF RS.93 970/- AS PER THE FOLLOWING OBSERVATIONS: ... I HAVE CAREFULLY GONE THROUGH THE COPY OF THE SEIZED DOCUMENT PAGE 145 OF ANNEXURE S18 AND IT IS FOUND THAT THE S EIZED DOCUMENT DOES NOT BEAR ANYONES NAME. DETAILS OF EXPENSES FROM 2 8.8.1988 TO 31.8.1997 ARE GIVEN. AT THE END OF THE PAGE THE TO TAL OF RS.3 65 061/- IS WRITTEN AND NARRATION WRITTEN IS KUL APYA PAGAR O VERTIME MEDICINES BONUS (TOTAL PAID FOR SALARY OVERTIME MEDICINES BONUS). ONLY LAST THREE ENTRIES OF RS.326 399/- RS.30 957/- AND RS.3 6 614/- PERTAIN TO THE BLOCK PERIOD. THE PLAIN READING OF THIS SEIZED DO CUMENT CLEARLY SHOWS THAT THE DETAILS OF EXPENSES ARE GIVEN. IT DOE SNO T SUGGEST THAT THE INTEREST HAS BEEN RECEIVED BY THE APPELLANT. RATHE R IT IS VERY CLEAR THAT THESE ARE THE DETAILS OF UNACCOUNTED EXPENSES I.E. SALARY OVERTIME MEDICINES AND BONUS. THEREFORE THE AO IS NOT JUST IFIED IN TREATING IT AS INTEREST INCOME WITHOUT ANY BASIS AND WITHOUT WRITI NG ANY REASON FOR PRESUMING SO. I AM OF THE VIEW THAT THE ADDITION SH OULD HAVE BEEN MADE ONLY TO THE EXTENT OF RS.93 970/- (RS.26 300 + 30 9 57 + 36 614). IN VIEW OF THE ABOVE DISCUSSION THE ADDITION ON THE BASIS OF SEIZED DOCUMENT S18 (PAGE NO.145) IS CONFIRMED TO THE EX TENT OF RS.93 970/- AS UNACCOUNTED EXPENDITURE ON SALARY OVERTIME MED ICINES AND BONUS. THE AO IS DIRECTED ACCORDINGLY. 10. AFTER HEARING SUBMISSIONS OF BOTH SIDES AND CAR EFUL EXAMINATION OF THE EVIDENCES PLACED BEFORE US WE ARE OF THE VIEW THAT ONCE THE ASSESSEE HAS DENIED THE WRITING AND THE DOCUMENTS COULD NOT BE L INKED WITH THE SHARAFI BUSINESS OF THE ASSESSEE WHICH WAS DETECTED DURING THE COURSE OF SEARCH THEN IT WAS DIFFICULT TO PRESUME THAT THE IMPUGNED DOCUM ENT HAS REFLECTED THE UNDISCLOSED INTEREST INCOME OF THE ASSESSEE. RATHE R THE CIT(A) HAS ALSO QUOTED THAT THE AO HAS RIGHTLY PRESUMED THAT THE ENTRIES BELONGED TO THE APPELLANT. MEANING THEREBY THE REVENUE AUTHORITIE S HAVE PROCEEDED ON THE PRESUMPTION THAT THE ENTRIES ARE BELONGED TO THE AS SESSEE. BUT THE FACT REMAINED UNDISPUTED THAT THERE WAS NO CORROBORATIVE EVIDENCE THROUGH WHICH IT COULD BE DEMONSTRATED THAT THE ENTRIES THEREIN WERE UNACCOUNTED INTEREST IT(SS)A NO.122 AND 132/AHD/2004 -7- INCOME OF THE ASSESSEE. WE FIND NO JUSTIFIABLE REA SON FOR SUCH PRESUMPTION CONSIDERING THE FEW CASES CITED AND ALSO THE TOTALI TY OF THE CIRCUMSTANCES OF THE CASE. WITH THE RESULT WE HEREBY REVERSE THE FIND INGS OF THE AUTHORITIES BELOW AND ALLOW THIS GROUND OF THE ASSESSEE. 11. REST OF THE GROUNDS BEARING NO.7 8 9 AND 10 A RE GENERAL IN NATURE AND NOT CONTESTED BEFORE US THEREFORE NEED NO ADJUDIC ATION HENCE DISMISSED. REVENUES APPEAL: 12. THE FIRST GROUND OF THE REVENUES APPEAL READS AS UNDER: 1. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIR ECTING TO DELETE THE ADDITION OF RS.59 675/- MADE ON ACCOUNT OF UNDI SCLOSED RENT RECEIPT. 13. THE BREAK UP WAS SUBMITTED IN RESPECT OF UNDISC LOSED RENT RECEIPTS AND THE RENTAL INCOME WAS OFFERED OF RS.2 39 550/-. THA T WORKING WAS NOT ACCEPTED BY THE AO AND FURTHER ADDED THE AMOUNTS I.E. RS.30 800/- AND RS.28 875/- TOTALING TO RS.59 675/- AS UNDISCLOSED RENT RECEIPT S RESPECTIVELY FOR THE A.Y.1998-99 AND 1999-2000. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY. 14. BEFORE THE LEARNED CIT(A) IT WAS CONTESTED THA T THE AO HAS MERELY ESTIMATED THE RENTAL INCOME FOR THE RESPECTIVE TWO YEARS . IT WAS ALSO ARGUED THAT AS FAR AS THE QUESTION OF ASSESSMENT UNDER CHA PTER-XIVB IS CONCERNED THE ONLY UNDISCLOSED INCOME WHICH WAS DETECTED OR AN IN CRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH SHOULD BE ASSESS ED. HOWEVER THE AO HAS MERELY PRESUMED THAT THE RENTAL INCOME WAS EARNED F OR THESE TWO YEARS. THE LEARNED CIT(A) HAS EXAMINED THE FACTS IN DETAIL AS WELL AS THE SEIZED DOCUMENTS WHICH WAS SUBJECT MATTER OF CONTROVERSY. AFTER EXAMINING THE CONTENTS OF THE SEIZED MATERIAL AS WELL AS THE AMOU NT OF RENT NOTED THEREIN HE HAS ARRIVED AT A CONCLUSION THAT THE ACTION OF THE AO WAS NOT SUPPORTED BY ANY EVIDENCE. RATHER A CLEAR FINDING WAS GIVEN BY THE LEARNED CIT(A) THAT THE AO IT(SS)A NO.122 AND 132/AHD/2004 -8- HAS ONLY ESTIMATED THE RENTAL INCOME. WITH THE RES ULT THE IMPUGNED ADDITION WAS DELETED. 15. ON HEARING THE SUBMISSIONS OF BOTH THE SIDES AS WELL AS CAREFUL EXAMINATION OF THE MATERIAL PLACED BEFORE US WE AR E ALSO OF THE VIEW THAT ONCE THE AO HAS TAXED REST OF THE FIGURES OF THE RENT ST RICTLY ON THE BASIS OF SUCH INCRIMINATING MATERIAL AND HAS ACCEPTED THE FIGURE OF THE RENT FOR THE REST OF THE YEARS THEN THERE WAS NO SCOPE OF FURTHER ESTIMATIO N OR PRESUMPTION. FURTHER THIS ARGUMENT OF THE LEARNED AR ALSO HAD SUFFICIENT FORCE THAT THE RENTAL INCOME WAS HELD AS UNDISCLOSED INCOME ON THE RECEIP T BASIS AS FOUND NOTED IN THE DOCUMENT . THEREFORE THERE WAS NO REASON TO CHANGE THE SAI D METHOD AND PRESUMED THAT THE RENTAL INCOME HAD ACCRUED FOR THE SAID TWO YEARS. THUS OVERALL CIRCUMSTANCES DEMONSTRATE TO CONFIRM THE FA CTUAL OF THE LEARNED CIT(A). RESULTANTLY THIS GROUND OF THE REVENUE IS DISMISSED. 16. GROUND NO.2 OF THE REVENUES APPEAL READS AS UNDER: 2. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING TO DELETE THE ADDITION OF RS.2 45 000/- MADE ON ACCOUNT OF AD VANCE GIVEN BY THE ASSESSEE OUT OF HIS UNDISCLOSED INCOME. 17. ON THE BASIS OF THE SEIZED MATERIAL MARKED AS ANNEXURE-3/1 WHEREIN THE DETAILS OF THE RENTAL INCOME WERE NOTED IN ASSE SSEES OWN HAND-WRITING AT THE BOTTOM THERE WERE CERTAIN NOTING ABOUT FEW FIG URES AND THE ASSESSEE WAS ASKED TO EXPLAIN THE NATURE OF THIS JOTTING. THE E XPLANATION OF THE ASSESSEE WAS THAT THOSE FIGURES WERE NOTHING BUT PART OF THE WOR KING OF THE RENTAL INCOME ALREADY DISCLOSED AT RS.2 39 550/- IN THE BLOCK RET URN. THEREFORE IT WAS ARGUED THAT SINCE THE SAID CONTENTS HAVE ALREADY BEEN INCL UDED IN THE RENTAL RECEIPTS THEREFORE THE SAID AMOUNT SHOULD BE TREATED AS THE AMOUNTS OUT OF THE RENTAL INCOME DISCLOSED BY THE ASSESSEE IN THE BLOCK RETUR N. THE AO WAS NOT CONVINCED AND TAXED THE ENTIRE AMOUNT. IT(SS)A NO.122 AND 132/AHD/2004 -9- 18. BEFORE THE FIRST APPELLATE AUTHORITY IT IS FUR THER ELABORATED THAT THE RENT FIGURES MENTIONED PERTAINED TO THE RENT FOR PARTICU LAR PERIODS WHICH HAD ALREADY BEEN OFFERED. THE LEARNED CIT(A) HAS GIVEN A FINDI NG THAT THE IMPUGNED JOTTING WERE NOTED ON THE SAME ANNEXURES ON WHICH T HE DETAILS OF THE RENTS HAVE ALREADY BEEN CONSIDERED. THE MENTION OF THE WORD APYA (GIVEN) WAS FOUND WRITTEN AND THE EXPLANATION WAS THAT THOSE WERE PAY MENTS WHICH WERE RECEIVED FROM THE TENANTS. CONSIDERING THAT FACT THE LEARN ED CIT(A) HELD THAT THERE WAS A BASIS TO CHARGE THOSE RENTS AS PART OF THE RENTAL INCOME IN RESPECT OF A PROPERTY IDENTIFIED AS RADHESHAY APARTMENT NEHRU NAGAR CIRC LE. WITH THIS FINDING THE ADDITION WAS DELETED. 19. EVEN BEFORE US THE REVENUE HAS NOT DEMONSTRATE D THAT WHY THESE AMOUNTS SHOULD ALSO NOT BE TREATED AS PART OF THE R ENT RECEIPTS ALREADY DISCLOSED AND TAXED AS UNDISCLOSED INCOME IN THE NATURE OF RE NTAL INCOME. UNDISPUTEDLY THOSE JOTTINGS NOW IN QUESTION BEFORE US WERE FOU ND WRITTEN ON THE SAME PAPER ON WHICH THE ASSESSEE HAD NOTED IN HIS OWN HAND-WRI TING THE RENT RECEIVED BY HIM. THUS CONSIDERING THE TOTALITY OF THE FACTS O F THE CASE WE HEREBY UPHOLD THE FINDINGS ON FACTS OF LEARNED CIT(A) AND DISMISS THIS GROUND OF THE REVENUE. 20. GROUND NO.3 READS AS UNDER: 3. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIR ECTING TO RESTRICT THE ADDITION OF RS.4 05 970/- MADE ON ACCOUNT OF UN DISCLOSED INTEREST INCOME TO RS.93 970/-. 21. THE AO REFERRED CERTAIN NOTING WHICH WERE FOUND AT PAGE NO.145 OF THE DOCUMENTS. THOSE NOTINGS WERE AT THE BACK SIDE OF THE SAID DOCUMENT AND IT WAS TREATED BY THE AO AS THE CALCULATION OF THE INT EREST FOR THE PERIOD FROM 28.8.88 TO 31.8.97. THE STRONG CONTENTION OF THE A SSESSEE WAS THAT THE SAID PAPER DID NOT BELONG TO HIM AND WAS NOT IN HIS HAND -WRITING. THE AO WAS NOT CONVINCED AND CALCULATED THE FIGURE ON THE BASIS OF THE PERIOD MENTIONED AT RS.2 05 970/- AND FURTHER EXTRAPOLATED THE INTEREST UPTO 27-9-2001 AT RS.2 LAKHS THUS THE TOTAL ADDITION OF RS.4 05 970/- WAS MADE. IT(SS)A NO.122 AND 132/AHD/2004 -10- 22. WE HAVE ALREADY CONSIDERED THE IMPUGNED ADDITIO N WHILE DECIDING THE GROUND NO.6 IN THE ASSESSEES APPEAL (SUPRA). WE H AVE TAKEN A VIEW THAT THERE WAS NO JUSTIFIABLE REASON TO ALLOW PART RELIEF AND THEREFORE THE TOTAL ADDITION WAS DIRECTED TO BE DELETED. IN THE LIGHT OF THE SA ID OBSERVATIONS WE FIND NO FORCE IN THIS GROUND OF THE REVENUE AND HEREBY DISM ISS. 23. IN RESULT APPEAL OF THE ASSESSEE IS PARTLY AL LOWED AND THE REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 25 TH FEBRUARY 2011. SD/- SD/- (N.S. SAINI) ACCOUNTANT MEMBER (MUKUL KR. SHRAWAT) JUDICIAL MEMBER PLACE : AHMEDABAD DATE : 25-02-2011 COPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR ITAT. BY ORDER DR/AR ITAT AHMEDABAD 1. DATE OF DICTATION : 22-02-2011 & 24-02-2011 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER : 23-02-2011 & 25-02-2011 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P.S./P.S : 25-02-2011 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT. : 25-02-2011 5. DATE ON WHICH FAIR ORDER PLACED BEFORE OTHER MEMBER : 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P.S./P.S : 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK. : 25-02-2011 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER. : 10. DATE OF DESPATCH OF THE ORDER :