SHRI DR. YOGIRAJ SHARMA, Bhopal v. THE ACIT 1(2), Bhopal

ITSSA 163/IND/2013 | 2008-2009
Pronouncement Date: 17-11-2014 | Result: Partly Allowed

Appeal Details

RSA Number 16322716 RSA 2013
Bench Indore
Appeal Number ITSSA 163/IND/2013
Duration Of Justice 1 year(s) 4 month(s) 6 day(s)
Appellant SHRI DR. YOGIRAJ SHARMA, Bhopal
Respondent THE ACIT 1(2), Bhopal
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 17-11-2014
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 17-11-2014
Assessment Year 2008-2009
Appeal Filed On 11-07-2013
Judgment Text
DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 1 IN THE INCOME TAX APPELLATE TRIBUN AL INDORE BENCH INDORE BEFORE SHRI D.T. GARASIA HONBLE JUDICIAL MEMBER AND SHRI B.C. MEENA HONBLE ACCOUNTANT MEMBER IT(SS)A NO.163/IND/2013 A.Y. 2008-09 DR. YOGIRAJ SHARMA BHOPAL PAN ALOPS-1636H ::: APPLICANT VS ASSTT.COMMR. OF INCOME TAX 1(2) BHOPAL ::: RESPONDENT APPLICANT BY SHRI B.K. NEMA RESPONDENT BY SHRI R.A. VERMA DATE OF HEARING 25.8.2015 DATE OF PRONOUNCEMENT 1 .9. 2015 O R D E R PER SHRI B.C. MEENA AM IN THIS CASE THE APPEALS OF THE ASSESSEE I.E. IT(SS) A. NOS. 159 TO 163/IND/2013 FOR THE ASSESSMENT YEARS 20 04- DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 2 05 TO 2008-09 ALONG WITH OTHER APPEALS WERE DISPOSED O F BY THE ITAT INDORE BENCH VIDE ITS ORDER DATED 17.1 1.2014. HOWEVER RECORD SHOWS THAT THE GROUND NOS. 1 TO 7 RAI SED BY THE ASSESSEE IN IT(SS)A NO. 163/IND/2013 FOR ASSESSMENT YEAR 2008-09 WERE NOT ADJUDICATED UPON BY THE HON'BLE TRIBUNAL. THE ASSESSEE SUBMITTED A MISCELLANEOUS APPLICATION ON THIS ISSUE AND AFTER HEARING BOTH THE SIDES THE MISCELLANEOUS APPLICATION WAS ALLOWE D ONLY ON THE LIMITED ISSUE TO ADJUDICATE GROUND NOS. 1 TO 7 RAISED IN IT(SS) A NO. 163/IND/2013. THESE GROUNDS R EAD AS UNDER 1. THE LEARNED ASSESSING OFFICER ERRED IN HOLDING THAT CASH FOUND IN THE COURSE OF SEARCH BELONGS TO ASSESSEE AND ASSESSEE IS LIABLE TO BE ASSESSED AT RS.1 13 00 000/- ON ACCOUNT OF CASH FOUND DURING THE COURSE OF SEARCH DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 3 2. THE LEARNED CIT(APPEALS) ERRED IN CONFIRMING THE ADDITION MADE BY ASSESSING OFFICER AT RS.1 13 00 000/- FOR UNEXPLAINED CASH. 3. THE ADDITION MADE BY ASSESSING OFFICER AT RS.1 13 00 000/- ON ACCOUNT OF CASH FOUND IN THE COURSE OF SEARCH IS UNJUSTIFIED UNWARRANTED AND BAD IN LAW. 4. THE LEARNED AUTHORITIES OUGHT TO HAVE ACCEPTED THE EXPLANATION OF ASSESSEE WITH REGARD TO CASH FOUND DURING THE COURSE OF SEARCH AND NO ADDITION AT RS.1 13 00 000/- OUGHT TO HAVE BEEN MADE. 5. THE LEARNED ASSESSING OFFICER ERRED IN HOLDING THAT SOURCE OF FOREIGN CURRENCY PURCHASED BY SHRI GAURAV SHARMA REMAINS UNEXPLAINED SO DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 4 AS TO ASSESS RS.4 50 000/- SUBSTANTIVELY AT THE HANDS OF ASSESSEE. 6. THE LEARNED CIT(APPEALS) ERRED IN HOLDING THAT SOURCE OF RS.4 50 000/- BEING VALUE OF FOREIGN CURRENCY PURCHASED BY SHRI GAURAV SHARMA REMAINS UNEXPLAINED AND IS LIABLE TO BE ASSESSED AT THE HANDS OF ASSESSEE . 7. THE LEARNED AUTHORITIES OUGHT TO HAVE ACCEPTED THE SOURCE OF ACQUISITION OF FOREIGN CURRENCY AS EXPLAINED BY SHRI GAURAV SHARMA AND NO ADDITION AT RS.4 50 000/- OUGHT TO HAVE BEEN MADE AT THE HANDS OF ASSESSEE. 2. IN GROUND NOS. 1 TO 4 THE ISSUE INVOLVED IS REG ARDING ASSESSMENT OF CASH FOUND AT THE TIME OF SEARCH AT RS.1 13 00 000/-. DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 5 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS CASH WAS FOUND AT THE PREMISES A-70 SHAKTI NAGAR BHOPAL. THIS HOUSE BELONGS TO SHRI GAURAV SHARMA SON OF THE ASSESSEE. SHRI GAURAV SHARMA INHERITED THE HOUSE O N THE DEATH OF HIS GRAND-MOTHER RAM DULARI SHARMA ON 31.3.2000. SHRI GAURAV SHARMA ADMITTED IN HIS STATEMENT THAT THE CASH FOUND BELONGS TO HIM ONLY. THE ITAT IN THE CASE OF ASHOK NANDA VIDE ITS ORDER DATED 31.10.2014 FOR THE ASSESSMENT YEAR 2008-09 IN ITA NO. 375/IND/2012 H AS HELD THAT THIS CASH SO FOUND CANNOT BE PRESUMED TO BE BELONGING TO DR. YOGIRAJ SHARMA. LD. AR DREW OUR ATTE NTION TO PARAS 6.2. TO 6.4 AT PAGES 60 TO 62 OF THE ITAT ORDE R. IT WAS ALSO SUBMITTED BEFORE US THAT THE ASSESSEE WAS A STAT E GOVERNMENT EMPLOYEE AND THE STATE GOVERNMENT HAS ALLOTTED A HOUSE NO. D2-104/9 SHIVAJI NAGAR AND DURING THE RELEVANT PERIOD IT WAS OCCUPIED BY THE ASSESSEE AND HE DREW OUR ATTENTION TO THE ORDER OF THE ITAT PARA 66 AT PAGE DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 6 77 THAT THE ASSESSEE WAS RESIDING IN THE GOVERNMENT ACCOMMODATION. 4. WE HAVE HEARD BOTH THE SIDES. ITAT VIDE ITS ORDER DATED 31.10.2014 IN ITA NOS. 371 TO 375/IND/2013 AND 383 & 385/IND/2013 IN THE CASE OF ASHOK NANDA HAS DECIDED THE ISSUE AS UNDER :- 6.2 WE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME ALONGWITH THE ORDER OF THE TAX AUTHORITIES BELOW. WE NOTED THAT THE SUM OF RS.1 21 80 000/- HAS DULY BEEN SHOWN BY THE ASSESSEE IN HIS RETURN FILED FOR AFORESAID ASSESSMENT YEAR IN CONSEQUENCES OF THE SEARCH AND PAID THE TAXES THEREON. THE RETURN WAS FILED BY THE ASSESSEE ON 31.010.2008 AT AN INCOME OF RS.1 78 26 510/- WITHIN THE DUE DATE OF FILING THE RETURN. THIS IS A FACT THAT THE ASSESSEE HAS ENTERED INTO AN AGREEMENT FOR DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 7 PURCHASE OF LAND WITH GAURAV SHARMA S/O DR. YOGIRAJ SHARMA. THE AGREEMENT IS DT. 30.8.2007 WHICH IS DULY NOTARIZED. THE ASSESSEE AS WELL AS GAURAV SHARMA HAVE DULY SIGNED THE AGREEMENT. THE ASSESSEE HIMSELF HAS WRITTEN LETTER TO ADIT BHOPAL ON 19.11.2007 ABOUT THE AGREEMENT BEING ENTERED INTO ON 30.8.2007 FOR THE PURCHASE OF THE PROPERTY AND ALSO THE FACT THAT THE ASSESSEE HAS GIVEN ADVANCE OF RS.1 21 80 000/- TO GAURAV SHARMA. THE AGREEMENT IS DT. 30.8.2007 I.E. EXECUTED MUCH PRIOR TO SEARCH AND WAS NOT FOUND DURING THE COURSE OF THE SEARCH. ON THE BASIS THAT THE AGREEMENT WAS NOT FOUND DURING THE COURSE OF THE SEARCH AND NEITHER THE ASSESSEE NOR GAURAV SHARMA STATED DURING THE COURSE OF THE SEARCH ABOUT THE AGREEMENT THE REVENUE DID NOT ACCEPT THE AGREEMENT AND THE FACT THAT THE ASSESSEE HAS DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 8 PAID A SUM OF RS.1 21 80 000/- TO GAURAV SHARMA. THE AGREEMENT IS DULY SIGNED BY NOT ONLY GAURAV SHARMA BUT ALSO BY THE ASSESSEE. GAURAV SHARMA IS BEING ASSESSED TO TAX SEPARATELY AND WAS STAYING SEPARATELY WHILE HIS FATHER DR. YOGIRAJ SHARMA WAS ALLOTTED GOVERNMENT ACCOMMODATION. THERE IS NO EVIDENCE BEING BROUGHT ON RECORD THAT THE SAID MONEY BELONGED TO DR. YOGIRAJ SHARMA. IT IS ALSO A FACT THAT THE IMPUGNED PROPERTY FOR THE PURCHASE OF WHICH THE AGREEMENT HAD BEEN ENTERED INTO BETWEEN GAURAV SHARMA AND THE ASSESSEE BELONGED TO GAURAV SHARMA. IT IS NOT A CASE THAT GAURAV SHARMA DID NOT OWN THE PROPERTY WHICH HE DISPOSED OFF. ONCE THE ASSESSEE HAS ACCEPTED THAT HE HAS ENTERED INTO AN AGREEMENT WITH GAURAV SHARMA THE AGREEMENT IS DULY SIGNED BY DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 9 GAURAV SHARMA AS WELL AS BY THE ASSESSEE THE ASSESSEE HAS ALSO FILED RETURN SHOWING THE SAID MONEY AS HIS INCOME THE SAID INCOME IN OUR OPINION CANNOT BE ASSESSED PROTECTIVELY IN THE HANDS OF THE ASSESSEE MERELY ON THE BASIS THAT THE AGREEMENT WAS NOT FOUND DURING THE COURSE OF SEARCH. THE ASSESSEE HAD ALREADY DURING THE COURSE OF SEARCH ACCEPTED THAT HE HAD EARNED UNDISCLOSED INCOME FROM TRANSACTIONS WITH CHHATISGARH PHARMACEUTICALS NETAM INDUSTRIES AND NEPTUNE REMEDIS. WE HAVE ALSO SUSTAINED ADDITION IN THIS REGARD IN PRECEDING PARAGRAPH. THE REVENUE EVEN ACCEPTED THAT THE ASSESSEE DERIVED INCOME FROM THESE CONCERNS EVEN TREATED THESE CONCERNS TO BE BENAMI TO WHICH WE DID NOT AGREE. THIS ITSELF PROVES THE SOURCE OF INCOME AND DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 10 ASSESSEE COULD HAVE EARNED THE INCOME TO MAKE PAYMENT TO GAURAV SHARMA. 6.3 THERE HAD BEEN A SEARCH IN THE CASE OF DR. YOGIRAJ SHARMA BUT NO EVIDENCE WAS BROUGHT ON RECORD OR FOUND WHICH MAY PROVE THE SOURCE FROM WHICH GAURAV SHARMA GOT THE CASH TO THE EXTENT IT WAS FOUND AT HIS RESIDENCE. MERELY THAT THE FATHER OF GAURAV SHARMA IS A GOVERNMENT EMPLOYEE IT CANNOT BE PRESUMED THAT THE MONEY WOULD HAVE BEEN PROCURED BY THE FATHER AND GIVEN TO THE SON BY ILLEGAL MEANS. IT IS APPARENT FROM THE ORDER OF THE A.O. AS WELL AS THAT OF THE CIT(A) THAT THEY REJECTED THE AGREEMENT ENTERED INTO BETWEEN THE ASSESSEE AND GAURAV SHARMA MERELY ON THE BASIS THAT HE FATHER OF GAURAV SHARMA I.E. DR. YOGIRAJ SHARMA IS A GOVERNMENT EMPLOYEE AND THE CONSEQUENCE OF DISCOVERY OF DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 11 UNDISCLOSED INCOME IN HIS HANDS ARE NOT LIMITED TO THE TAX BURDEN THEREON BUT CONSTITUTE VIOLATION OF GOVERNMENT SERVICE RULES. IT IS ALSO A FACT THAT GAURAV SHARMA IS ENGAGED IN BUSINESS AND EARNING BUSINESS INCOME MUCH PRIOR TO SEARCH. THERE HAD BEEN SEARCH IN THE CASE OF DR. YOGIRAJ SHARMA BUT NOT SUCH EVIDENCE WAS FOUND OR BROUGHT ON RECORD BY THE A.O. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IN THE CASE OF DR. YOGIRAJ SHARMA THAT HE HAS EARNED INCOME BY ILLEGAL OR UNLAWFUL MEANS. MERELY BECAUSE DR. YOGIRAJ SHARMA IS A GOVERNMENT SERVANT AND HIS SON IS CARRYING ON BUSINESS AND CASH WAS FOUND FROM FAMILY OF DR. YOGIRAJ SHARMA ESPECIALLY WHEN THE GOVERNMENT SERVANT HAS BEEN ALLOTTED AND PUTTING UP IN SEPARATE GOVERNMENT ACCOMMODATION IT CANNOT BE PRESUMED THAT THE DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 12 CASH SO FOUND BELONGED TO DR. YOGIRAJ SHARMA AND ON THAT BASIS THE CASH SURRENDERED BY THE ASSESSEE CANNOT BE CARVED OUT OF HIS INCOME AND ADDED SUBSTANTIVELY IN THE HANDS OF DR. YOGIRAJ SHARMA. OUR AFORESAID VIEW IS DULY SUPPORTED BY THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF DSP CHENNAI VS. K. INBASAGARAN 1 HON'BLE SUPREME COURT (2006) 420 IN WHICH AT PG. 430 IT WAS HELD AS UNDER :- SINCE THE CRUCIAL QUESTION IN THIS CASE WAS OF POSSESSION AND THE PREMISES IN QUESTION WERE JOINTLY SHARES BY THE WIFE AND THE HUSBAND AND THE WIFE HAVING ACCEPTED THE ENTIRE RECOVERY AT HER HAND IT WILL NOT BE PROPER TO HOLD THE HUSBAND GUILTY. 6.4 THERE IS NO RELATIONSHIP BETWEEN GAURAV SHARMA AND ASHOK NANDA. NO PERSON WOULD LIKE TO DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 13 PAY TAXES ON THE INCOME UNTIL AND UNLESS THE INCOME BELONGS TO HIM. IT IS A SETTLED LAW THAT SUSPICION HOWSOEVER STRONG IT MAY BE IT CANNOT TAKE THE PLAC E OF ACTUALITY. IN OUR OPINION APPARENT IS REAL. ON CE THE ASSESSEE HAS SURRENDERED THE SUM OF RS.1 21 80 000/- THE ONUS LIES ON THE REVENUE TO PROVE THAT THIS MONEY DOES NOT BELONG TO THE ASSESSEE AND ASSESSEE IS THE BENAMI OF GAURAV SHARMA. WE DO NOT FIND THAT THE ONUS AS LIES ON THE DEPARTMENT HAS BEEN DISCHARGED BY THE DEPARTMENT EXCEPT RELYING ON THE PROBABILITIES. WE THEREFORE SET ASIDE THE ORDER OF CIT(A) ON THIS ISSUE AND DIRECT THE A.O. TO ADMIT THE SUM OF RS.1 21 80 000/- SUBSTANTIVELY AS THE INCOME OF THE ASSESSEE. THUS THIS GROUND STANDS ALLOWED TO THAT EXTENT. 5. THUS ITAT HAS DECIDED TO TAX THE CASH SEIZED SUBSTANTIVELY IN THE HANDS OF SHRI ASHOK NANDA. IN VIE W OF DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 14 THESE FINDINGS RECORDED BY THE TRIBUNAL ABOVE WE FI ND NO REASON IN SUSTAINING THE ADDITION SUBSTANTIVELY IN TH E HANDS OF THE ASSESSEE. THEREFORE WE ALLOW THESE GROUN DS OF THE ASSESSEE. 6. IN GROUND NOS. 5 TO 7 THE ISSUE IS REGARDING ADDIT ION OF RS.4 50 000/- ON THE BASIS OF FOREIGN CURRENCY FOUND AT THE TIME OF SEARCH. ON THIS ISSUE ALSO THE LEARNED AR D REW OUR ATTENTION TO THE DECISION OF THE ITAT INDORE BENCH IN THE CASE OF GAURAV SHARMA; ITA NO. 77/IND/2013 FOR THE ASSESSMENT YEAR 2008-09 WHILE ADJUDICATING GROUND NOS. 1 2 AND 3 OF GAURAV SHARMA IN PARA 38 IT WAS CONCLUDED THAT FOREIGN CURRENCY VALUED AT RS. 4 50 000/- FOUND DURING THE COURSE OF SEARCH IS LIABLE TO BE ASSESSED I N THE HANDS OF GAURAV SHARMA WHERE THE ASSESSING OFFICER MADE THE PROTECTIVE ASSESSMENT. HE PLEADED THAT THUS THE SUBSTANTIVE ADDITION HAS BEEN UPHELD IN THE CASE OF GAUR AV SHARMA. THEREFORE NO ADDITION CAN BE MADE IN THE CASE OF DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 15 THE ASSESSEE. HE ALSO SUBMITTED THAT IN PARA 38 OF THE ORDER OF THE TRIBUNAL IN THE CASE OF GAURAV SHARMA IT HAS BEEN MENTIONED THAT NO ADDITION CAN BE MADE IN THE HANDS OF THE ASSESSEE. THE ADDITION WAS FINALLY CONFIRMED ON SUBSTANTIVE BASIS IN THE HANDS OF GAURAV SHARMA BY THE HON'BLE ITAT INDORE BENCH INDORE WITH THE FOLLOW ING FINDINGS :- 38. WE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME ALONGWITH THE ORDER OF THE TAX AUTHORITIES BELOW. WE NOTED THAT THE ASSESSEE WAS HAVING INDEPENDENT SOURCE OF INCOME. ASSESSEE HAS ALSO WENT FOR ABOUT 6 MONTHS FOR STUDY IN FOREIGN COUNTRY. THE BILLS FOR THE PURCHASE OF FOREIGN CURRENCY ARE IN THE NAME OF THE ASSESSEE AND NOT IN THE NAME OF ASSESSEES FATHER. THE HOUSE FROM WHERE THE BILLS WERE PURCHASED IS ALSO IN THE NAME OF THE DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 16 ASSESSEE AND NOT IN THE NAME OF DR. YOGIRAJ SHARMA ASSESSEES FATHER. BOTH THE AUTHORITIES BELOW TREATED IT TO BE THE INCOME OF DR. YOGIRAJ SHARMA UNDER THE INFLUENCE THAT DR. YOGIRAJ SHARMA BEING A GOVERNMENT SERVANT WOULD HAVE RECEIVED ILLEGAL GRATIFICATION WITHOUT BRINGING ANY EVIDENCE IN THIS REGARD. THIS IS A CASE WHERE THE FOREIGN CURRENCY HAS NOT BEEN RECEIVED BY DR. YOGIRAJ SHARMA FROM ANY PARTY. IT IS A CASE WHERE THE FOREIGN CURRENCY HAS NOT BEEN RECEIVED BY DR. YOGIRAJ SHARMA FROM ANY PARTY. IT IS A CASE WHERE FOREIGN CURRENCY HAS BEEN PURCHASED BY THE ASSESSEE AND THE BILLS TO THAT EXTENT WERE FOUND. IT IS A SETTLED LAW THAT NO ADDITION CAN BE MADE MERELY ON THE BASIS OF SUSPICION HOWSOEVER STRONG IT MAY BE. NO STATEMENT EVIDENCE OR COGENT MATERIAL HAS BEEN DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 17 BROUGHT ON RECORD BY THE A.O. BY WAY OF RECORDING THE STATEMENT OF THE PARTIES WHICH WOULD HAVE CONFIRMED THAT THEY HAVE GIVEN THE FOREIGN CURRENCY TO DR. YOGIRAJ SHARMA. IN OUR OPINION NO ADDITION IN THIS REGARD CAN BE MADE IN THE HANDS OF DR. YOGIRAJ SHARMA. THE EXPLANATION GIVEN BY THE ASSESSEE IN OUR OPINION IS NOT A PLAUSIBLE ONE AS THE ASSESSEE HAS NOT GIVEN ANY EVIDENCE THAT THE BILLS FOR THE PURCHASE OF THE FOREIGN CURRENCY IS SUBSEQUENT TO THE DATE OF RECEIPT OF THE CASH ADVANCED FROM SHRI ASHOK NANDA AGAINST THE SALE OF THE AGRICULTURAL LAND. WE ACCORDINGLY CONFIRM THE ADDITION SUBSTANTIVELY IN THE HANDS OF THE ASSESSEE. DR. YOGIRAJ SHARMA ITA NO. 163/IND/2013 18 7. WE HAVE HEARD BOTH THE SIDES. SINCE THE ITAT HAS ALREADY DECIDED THE ISSUE IN THE CASE OF GAURAV SHARMA AND THE SUBSTANTIVE ADDITION HAS BEEN MADE IN HIS HANDS THEREFORE ON THE SAME FINDINGS THESE GROUNDS OF APP EAL IN THE ASSESSEES CASE ARE ALLOWED. 8. IN THE RESULT THE APPEAL OF THE ASSESSEE STANDS ALLO WED. PRONOUNCED IN OPEN COURT ON IST SEPTEMBER 2015 SD/- SD/- (D.T. GARASIA) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER IST SEPTEMBER 2015 DN/-