THE ACIT, Central CIR.1(3),, Ahmedabad v. SHRI PRAKASH B.PATEL,, Ahmedabad

ITSSA 392/AHD/2003 | misc
Pronouncement Date: 14-05-2010 | Result: Partly Allowed

Appeal Details

RSA Number 39220516 RSA 2003
Assessee PAN ACTPP8953E
Bench Ahmedabad
Appeal Number ITSSA 392/AHD/2003
Duration Of Justice 6 year(s) 6 month(s) 21 day(s)
Appellant THE ACIT, Central CIR.1(3),, Ahmedabad
Respondent SHRI PRAKASH B.PATEL,, Ahmedabad
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 14-05-2010
Appeal Filed By Department
Order Result Partly Allowed
Bench Allotted A
Tribunal Order Date 14-05-2010
Date Of Final Hearing 03-05-2010
Next Hearing Date 03-05-2010
Assessment Year misc
Appeal Filed On 23-10-2003
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH A AHMEDABAD BEFORE SHRI MAHAVIR SINGH JUDICIAL MEMBER AND SHRI D. C. AGRAWAL ACCOUNTANT MEMBER IT(SS)A NO.392/AHD/2003 BLOCK PERIOD FROM:1/4/91 TO 16/11/2000 DATE OF HEARING:3.5.10 DRAFTED:3.5.10 ACIT CENTRAL CIRCLE- 1(3) AHMEDABAD V/S . SHRI PRAKASH B PATEL 13 HARISHCHANDRA PARK ANKUR ROAD NARANPURA AHMEDABAD PAN NO.ACTPP8953E (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI RAHEEV AGARWAL CIT-DR RESPONDENT BY:- NONE O R D E R PER MAHAVIR SINGH JUDICIAL MEMBER:- THIS APPEAL BY THE REVENUE IS ARISING OUT OF THE O RDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-I AHMEDABAD IN APPEAL NO. CIT [A]-I/CC.1[]/ / DATED 19-12- 2001. THE BLOCK ASSESSMENT WAS FRAMED BY THE ACIT CENTRAL CIRCLE-1(3) AHMEDABAD U/S. 158BC OF THE INCOME-TAX 1961 (HEREI NAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 29-11-2002 FOR BLOCK PERIOD 01 -04-91 TO 16-11-2000. 2. THE FIRST ISSUE IN THIS APPEAL OF REVENUE IS AGA INST THE ORDER OF CIT(A) DELETING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED DEPOSITS TREATED AS UNDISCLOSED INCOME OF THE ASSES SEE FOR THE BLOCK PERIOD BY THE ASSESSING OFFICER. 3. THE BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE T HAT SEARCH OPERATION U/S 132 OF THE ACT WAS CARRIED OUT ON GROUP CASES OF GURUKRUPA ON 16-11-2000. IN RESPONSE TO SEARCH NOTICE U/S.158BC OF THE ACT WAS ISSUED. THE ASSESSEE FILED BLOCK RETURN ON 11-10-2002 DECLARING UNDISCLOSED INCOME AT RS3 20 6 80/- DURING THE COURSE OF BLOCK IT(SS)A NO.392/AHD/2003 B.P. 1/4/91 TO 16/11/00 ACIT CC-1(3) ABD V. SH. PRAKASH B PATEL PAGE 2 ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTIC ED FROM THE SEIZED MATERIALS MARKED AS ANNEXURE-A/1 SEIZED FROM THE RESIDENCE OF THE ASSESSEE THAT THERE IS ONE DOCUMENT MENTIONING INCOME AND EXPENDITURE OF SATKA R CO-OPERATIVE HOUSING SOCIETY LTD. FROM THIS THE ASSESSEE WAS ASKED TO E XPLAIN THE DOCUMENT FOUND FROM HIS RESIDENCE AND SHOW CAUSE WAS ISSUED AS TO WHY T HE INCOME OF RS.4.70 LAKH BE NOT TREATED AS UNEXPLAINED DEPOSITS IN SATKAR CO-OP ERATIVE HOUSING SOCIETY LTD. DURING THE COURSE OF SEARCH STATEMENT OF SHRI BALD EV J PATEL WAS RECORDED AND SHRI BALDEV J PATEL WHILE Q. NO.21 AND 22 CLEARLY ADMITT ED THAT THIS FILE ANNEXURE-A/1 PAGES NO.1 AND 2 PERTAINS TO ASSESSEE AND EXPLAINED THE AMOUNT WRITTEN ON THE CREDIT AND DEBIT SIDE. AS THE ASSESSEE COULD NOT E XPLAIN IN SPITE OF REPEATEDLY ASKED THE ASSESSING OFFICER MADE ADDITION BY GIVIN G FOLLOWING FINDING IN PARA-1.3 OF HIS BLOCK ASSESSMENT ORDER:- 1.3 THIS ATTITUDE OF THE ASSESSEE ALONG WITH THE F ACT THAT NO SATISFACTORY EXPLANATION/CLARIFICATION IS OFFERED BY THE ASSESSE E REGARDING THE DEPOSITS OF RS.4 70 000 IN THE SATKAR HOUSING SOCIETY INSPITE OF BEING GIVEN SEVERAL OPPORTUNITIES AND ALSO KEEPING IN MIND THE STATEMEN T OF THE FATHER OF THE ASSESSEE AT THE TIME OF SEARCH ITSELF THAT SHRI PRA KASH B PATEL HAD DEPOSITS WITH THE SATKAR HOUSING SOCIETY LEAVES ME WITH NO OPTION BUT TO MAKE ADDITION OF RS.4 70 000 AS BEING DEPOSITS OUT OF UN DISCLOSED INCOME OF THE A. THE ADDITION OF RS.4 70 000 IS ACCORDINGLY MADE. 4. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE CIT( A). THE CIT(A) DELETED THE ADDITION AFTER CONSIDERING THE SUBMISSION OF THE AS SESSEE BY GIVING FOLLOWING FINDINGS IN PAGE-10 & 11 OF HIS APPELLATE ORDER:- I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS MADE B Y THE LD. AUTHORIZED REPRESENTATIVE AND I HAVE ALSO PERUSED COPY OF THE SEIZED DOCUMENTS. THE DOCUMENT SHOWS THAT MOST OPPOSITE THE ENTRY OF DEPO SIT OF RS.4 70 000/- THERE IS A DEBIT ENTRY OF RS.7 90 000 IN APPELLANT S NAME WHICH GOES TO SHOW THAT IN FACT THE AMOUNT OF DEPOSIT IS MUCH LESS THA N THE AMOUNT RECEIVED FROM THE SAID SOCIETY. IT HAS BEEN CONSISTENTLY HELD IN VARIOUS JUDICIAL PRONOUNCEMENTS THAT SEIZED DOCUMENTS SHOULD BE READ AS A WHOLE AND IT IS NOT PERMISSIBLE TO ACCEPT ONLY PART OF IT AS TRUE A ND IGNORE THE REST. IF THE SEIZED DOCUMENT IS READ IN TOTALITY IT IS SEEN THA T AMOUNT OF DEBIT ENTRY IS MUCH HIGHER THAN THE ALLEGED DEPOSIT. IN THE CIRCUM STANCES IT WAS NOT PROPER TO DRAW SUCH AN INFERENCE AGAINST THE APPELLANT WH EN THE CONTENTS OF SEIZED DOCUMENTS WERE WELL WITHIN THE KNOWLEDGE OF ASSESSI NG OFFICER. HENCE ADDITION OF RS.4 70 000/- IS DELETED. 5. BEFORE US DESPITE SERVICE THE ASSESSEE WAS NOT PRESENT BUT FILED PAPER BOOK. THE LD. CIT-DR SHRI RAJEEV AGARWAL SPECIFIC ALLY REFERRED TO PAGE NO.7 OF THE ASSESSEES PAPER BOOK WHERE DEPOSIT OF ASSESSEE AM OUNTING TO RS.4.70 LAKH IS IT(SS)A NO.392/AHD/2003 B.P. 1/4/91 TO 16/11/00 ACIT CC-1(3) ABD V. SH. PRAKASH B PATEL PAGE 3 NOTED ON THIS SEIZED PAPER ANNEXURE-A/1 PAGE-2. HE STATED THAT BEFORE THE AO NOTHING WAS PRODUCED BUT CIT(A) WITHOUT PROVIDING O PPORTUNITY TO THE ASSESSING OFFICER DELETED THE ADDITION ONLY ON THE BASIS THAT JUST OPPOSITE THE ENTRY OF DEPOSIT OF AN AMOUNT OF RS.4.70 LAKH THERE IS A DEBIT ENTRIES IN THE NAME OF THE ASSESSEE FOR AN AMOUNT OF RS.7 90 LAKHS. HE STATED THAT THIS DO ES NOT EXPLAIN THE DEPOSIT ENTRY. ACCORDINGLY HE URGED THE BENCH TO PROVIDE OPPORTUN ITY TO THE ASSESSING OFFICER TO CONSIDER THIS AND DECIDE THE ISSUE ACCORDINGLY. 6. WE HAVE HEARD THE LD. CIT-DR AND GONE THROUGH TH E SEIZED PAPER ANNEXURE- A/1 PAGE-2 AND NOTED THAT THERE IS ENTRY OF DEPOSIT OF RS.4.70 LAKH AND THERE IS A DEBIT ENTRY OF RS.7.90 LAKH IN THE ASSESSEES NAME ON THIS SAME PAPER. NOW THIS EXPLAIN THAT THE AMOUNT IS WITHDRAWN BY THE ASSESSE E BUT HOW THE CREDIT ENTRY WILL BE EXPLAINED THIS IS TO BE EXPLAINED BY THE ASSESSEE BEFORE ASSESSING OFFICER AS THIS EXPLANATION WAS NOT FILED BEFORE THE ASSESSING OFFI CER AND FILED FOR THE FIRST TIME BEFORE THE CIT(A). THE AO REQUIRES OPPORTUNITY. ACC ORDINGLY WE SET ASIDE THIS ISSUE TO THE FILE OF ASSESSING OFFICER TO RE-DECIDE THIS ISSUE AFTER HEARING THE ASSESSEE AND CONSIDERING THE EXPLANATION SUBMITTED BEFORE THE CI T(A). THIS ISSUE OF THE REVENUES APPEAL IS SET ASIDE TO THE FILE OF THE AS SESSING OFFICER AND ALLOWED FOR STATISTICAL PURPOSES. 7. THE NEXT ISSUE IN THIS APPEAL OF THE REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE ADDITION OF RS.7.92 LAKH MADE BY THE A SSESSING OFFICER ON ACCOUNT OF UNEXPLAINED INVESTMENT AS UNDISCLOSED OF THE BLOCK PERIOD. 8. WE HAVE HEARD LD. CIT-DR AND FIND THAT ASSESSING OFFICER DURING THE COURSE OF BLOCK ASSESSMENT PROCEEDINGS NOTICED FROM THE SE IZED MATERIALS THAT THE ASSESSEE HAS MADE INVESTMENT OF RS.8 LAKH IN SAMARP AN TOWER BUT DISCLOSED AT RS.8 000/- ONLY AS PER ANNEXURE-A/1 SEIZED FROM THE RESIDENCE OF ASSESSEE. ASSESSEE REPLIED BEFORE ASSESSING OFFICER THAT HE H AS MADE INVESTMENT AS UNDER:- 1. RS.514800 DT.28.03.98 CH.NO.506783 2. RS.100000 DT.12.02.99 CH. NO.104548 SHOP 1. RS.2000 DT.26.03.98 CASH IT(SS)A NO.392/AHD/2003 B.P. 1/4/91 TO 16/11/00 ACIT CC-1(3) ABD V. SH. PRAKASH B PATEL PAGE 4 2. RS.3000 DT.04.01.99 CH.NO.104547 3. RS.3000 DT.05.03.99 CH.NO.104550 THE ASSESSEE SUBMITTED COPY OF ACCOUNT AND BANK STA TEMENT TO VERIFY THESE DETAILS. THE ASSESSING OFFICER WAS NOT CONVINCED AND HE ACCO RDINGLY NOTED THAT THE AMOUNTS ARE IN CODED FORM I.E. 8 000 FOR 8 LAKH AND THE DI FFERENCE WAS ADDED AS UNDISCLOSED INCOME OF THE ASSESSEE AT RS.7 9 LAKH. AGGRIEVED A SSESSEE PREFERRED APPEAL BEFORE CIT(A). THE CIT(A) ALLOWED THE CLAIM OF THE ASSESSE E AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE IN PAGE-16 & 17 OF HIS APPELLATE ORDER AS UNDER:- I HAVE CAREFULLY CONSIDERED THE ABOVE AND I HAVE ALSO GONE THROUGH THE RELEVANT SEIZED DOCUMENTS. I FIND THAT ENTRIES RELA TED TO APPELLANT ARE NOTED ON A SEPARATE PAGE AND HE DETAILS OF PAYMENTS NOTED AR E AS UNDER:- 2000 26/03/98 3000 4/1/99 DUKAN 3000 5/3/99 -DO- IT IS ALSO SEEN THAT TO THE APPELLANT SPECIFICALLY RECEIPTS OF RS.2000/- & RS.3000/- (AT TWO OCCASIONS) WERE ISSUED. IT IS ALS O SEEN THAT PAYMENTS ON 4/1/99 AND 5/3/99 ARE BY WAY OF ACCOUNT PAYEE CHEQU ES AND ON THE RECEIPTS ISSUED CHEQUES NUMBERS ARE CLEARLY WRITTEN. SIMILAR LY AMOUNT IN WORDS AND FIGURES ARE ALSO WRITTEN ON ALL THESE RECEIPTS. IT IS ALSO SEEN THAT THESE PAYMENTS ARE IN RESPECT OF A SHOP AND NOT A FLAT IN RESPECT OF WHICH THE AMOUNT MIGHT HAVE BEEN WRITTEN IN CODED FORM. IT IS APPARENT FROM THE CHEQUES PAYMENTS OF IDENTICAL AMOUNTS THAT FIGURES WRITTEN IN RESPECT OF THE APPELLANT ARE ACTUAL OTHERWISE IF IT IS PRESUMED TH AT PAYMENT WAS MADE BOTH BY CHEQUES AND CASH THEN FOR RS.3 00 000/- THE EN TRY SHOULD HAVE BEEN 30 FOR CHEQUES AND 2970 FOR CASH RESPECTIVELY. HOWEVER THE ENTRY NOTED IS ONLY 3000/- WHICH IS IDENTICAL TO THE AMOUNT OF CHEQUES. HENCE I FIND NO JUSTIFICATION FOR THIS ADDITION AND THE SAME IS DELETED. 9. WE FIND FROM THE ABOVE THAT THE ASSESSEE HAS PRO DUCED THE BANK PASS BOOK AND PAYMENTS ARE MADE BY CHEQUES. THE ASSESSEE HAS EXPLAINED THE INVESTMENT IN FLAT AND SHOP BY SUBMITTING THE COPY OF ACCOUNT AND POINTING OUT THE CHEQUES ISSUED FROM BANK STATEMENTS NOTED ABOVE. THE ASSESSEE HAS MADE ENTIRE PAYMENTS BY CHEQUE. WE FIND NO INFIRMITY IN THE EXPLANATION OF THE ASSESSEE AND ACCORDINGLY WE CONFIRM THE ORDER OF CIT(A). THIS ISSUE OF THE REVE NUES APPEAL IS DISMISSED. 10. THE NEXT ISSUE IN THIS APPEAL OF REVENUE IS AGA INST THE ORDER OF CIT(A) DELETING THE ADDITION MADE BY ASSESSING OFFICER ONL Y ON ONE PREMISE THAT THE ASSESSEE HAS NOT FILED RETURN OF INCOME FOR ASSESSM ENT YEAR 2000-01 BY DUE THE DATE AS PRESCRIBED U/S.139(1) OF THE ACT. IT(SS)A NO.392/AHD/2003 B.P. 1/4/91 TO 16/11/00 ACIT CC-1(3) ABD V. SH. PRAKASH B PATEL PAGE 5 11. AFTER HEARING THE LD. CIT-DR AND GOING THROUGH THE CASE RECORDS WE FIND THAT THE RETURN OF INCOME FOR ASSESSMENT YEAR 2000-01 WA S FILED ON 16-11-2000 THE DATE OF SEARCH BUT AFTER THE COMMENCEMENT OF SEARCH ON 1 6-11-2000. ACCORDINGLY ASSESSING OFFICER TREATED THE ENTIRE INCOME OF THE RELEVANT ASSESSMENT YEAR AMOUNTING TO RS.2 22 697/- AS UNDISCLOSED INCOME IN VIEW OF THE PROVISION OF SECTION 158BB OF THE ACT. WE FIND THAT THE ASSESSEES INCO MES FOR ASSESSMENT YEAR ARE AS UNDER:- BUSINESS INCOME RS.139940/- CAPITAL GAIN RS. 83340/- OTHER SOURCES RS. 5446/- IT WAS THE CONTENTION OF THE ASSESSEE BEFORE THE LO WER AUTHORITIES THAT THE ASSESSEE PAID ADVANCE TAX OF RS.15 000/- AND HIS SELF-ASSESS MENT TAX OF RS.3 678/-BEFORE COMMENCEMENT OF SEARCH. WE FIND THAT CIT(A) HAS ONL Y DIRECTED THE ASSESSING OFFICER TO VERIFY THE FACTUM OF PAYMENT OF ADVANCE TAX SELF-ASSESSMENT TAX AND CORRESPONDING INCOME SHOULD NOT BE TREATED AS UNDIS CLOSED INCOME. WE FIND NO INFIRMITY IN THE DIRECTION OF CIT(A) AND ASSESSING OFFICER WILL VERIFY THIS FACT IN TERMS OF THE DIRECTION OF CIT(A). ACCORDINGLY THIS ISSUE OF THE REVENUES APPEAL IS DISMISSED. 12. IN THE RESULT REVENUES APPEAL IS PARTLY ALLOWED F OR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 14/05/2010 SD/- SD/- (D.C.AGRAWAL) (MAHAVI R SINGH) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) AHMEDABAD DATED : 14/05/2010 *DKP COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-I AHMEDABAD 4. THE CIT CONCERNS. 5. THE DR ITAT AHMEDABAD 6. GUARD FILE. BY ORDER /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT AHMEDABAD