Sh Srichand Valecha, Indore v. The DCIT 2 (1), Indore

ITSSA 43/IND/2006 | misc
Pronouncement Date: 25-11-2011 | Result: Partly Allowed

Appeal Details

RSA Number 4322716 RSA 2006
Assessee PAN SWERE5217G
Bench Indore
Appeal Number ITSSA 43/IND/2006
Duration Of Justice 5 year(s) 7 month(s) 20 day(s)
Appellant Sh Srichand Valecha, Indore
Respondent The DCIT 2 (1), Indore
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 25-11-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 25-11-2011
Date Of Final Hearing 04-05-2011
Next Hearing Date 04-05-2011
Assessment Year misc
Appeal Filed On 04-04-2006
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH J.M. AND SHRI R.C.SHARM A A.M. PAN NO. : N.A. I.T.(SS)A.NO. 43/IND/2006 BLOCK PERIOD : 01.04.1990 TO 26.09.2000 SHRI SHRICHAND VALECHA DY. CIT 31-34 LARKANA NAGAR VS CIRCLE 2(1) INDORE. INDORE. APPELLANT RESPONDENT I.T.(SS)A.NO. 53/IND/2006 BLOCK PERIOD : 01.04.1990 TO 26.09.2000 DY. CIT SHRI SHRICHAND VALECHA CIRCLE 2(1) VS 31-34 LARKANA NAGAR INDORE. INDORE. APPELLANT RESPONDENT ASSESSEE BY : SHRI M. C. MEHTA AND SHRI HITESH CHIMNANI CAS DEPARTMENT BY : SHRI ARUN DEWAN SR. DR DATE OF HEARING : 19.09.2011 DATE OF PRONOUNCEMENT : 25.11.2011 O R D E R PER R. C. SHARMA A.M. -: 2: - 2 THIS IS AN APPEAL FILED BY THE ASSESSEE AND REVENUE AGAINST THE ORDER OF CIT(A) UJJAIN DATED 31.01.200 2. FACTS IN BRIEF ARE THAT THE SEARCH AND SEIZURE OPERATION WERE COMMENCED AT THE RESIDENTIAL PREMIS ES OF SHRI NANDLAL VALECHA AND FAMILY MEMBERS OF VALECHA BROTH ERS WHO WERE RESIDING AT 33-34 LARKANA NAGAR INDORE ON 2 6.9.2000 AND WERE CONCLUDED ON 22.11.2000. DURING THE COURSE OF SEARCH APART FROM INCRIMINATING DOCUMENTS VARIOUS VALUABLES VIZ. CASH & JEWELLERY WERE FOUND OUT OF WHICH PART OF THE JEWELLERY WAS SEIZED. IN THE ASSESSMENT FRAMED U/S 158BC THE AO MADE ADDITION ON ACCOUNT OF AMOUNT (RS.) 1. UNEXPLAINED CASH 1 98 970 2. UNEXPLAINED 2 60 697 3. UNEXPLAINED 10 28 000 4. UNEXPLAINED 11 000 5. UNEXPLAINED 6 16 023 6. UNEXPLAINED 71 50 000 7. UNEXPLAINED 3 46 600 -: 3: - 3 8. UNEXPLAINED 4 20 216 9. UNEXPLAINED 30 725 10. UNEXPLAINED 36 00 000 11. INTEREST EARNED ON HUNDIES 28 12 957 12. SHARE OF HOUSE HOLD EXPENSES 2 49 417 13. UNEXPLAINED EXPENSES ON MARRIAGE 1 96 000 TOTAL UNDISCLOSED INCOME 1 69 20 605 OR ROUNDED TO 1 69 20 610 3. ADDITION MADE ON ACCOUNT OF INVESTMENT IN GOLD JEWELLERY AMOUNTING TO RS. 2 60 297/- INVESTMENT I N HUNDIES AMOUNTING TO RS. 36 LAKHS AND INTEREST THEREON AMOU NTING TO RS. 28 12 957/- ADDITION ON ACCOUNT OF INTERIOR DE CORATION MARRIAGE EXPENSES AMOUNTING TO RS. 1 96 000/- VEHI CLE EXPENSES RS. 11 000/- WAS DELETED BY THE LD. CIT(A) . HOWEVER ADDITION ON ACCOUNT OF NRI GIFTS AMOUNTING TO RS. 6 16 023/- INTERIOR DECORATION OF RS. 50 000/- HOUSE HOLD EXPE NSES OF RS. 1 63 000/- ADDITION TOWARDS HUNDIES OF RS. 30 LAKH S AND LATER OF RS. 40 LAKHS HUNDIES OF RS. 1.50 LAKHS OF SHRI SHYAMLAL ARYA AND ADDITION ON ACCOUNT OF CASH FOUND AT RS. -: 4: - 4 1 92 100/- WAS MAINTAINED BY THE LD. CIT(A). AGAINS T THIS ORDER OF LD. CIT(A) BOTH ASSESSEE AND REVENUE ARE IN APPEAL BEFORE US. FOLLOWING GROUNDS OF APPEAL HAVE BEEN TA KEN BY THE ASSESSEE AND REVENUE :- GROUNDS TAKEN BY THE ASSESSEE : 1. THE LD. CIT(A) HAS ERRED IN GIVING DIRECTIONS THAT THE NRE GIFTS ARE NOT GENUINE AND THE SAME SHOULD BE CONSIDERED IN THE REGULAR ASSESSMENT OF THE ASSESSEE. 1.1 THE LD. CIT(A) DID NOT EXAMINE THE GENUINENESS OF THE GIFT AND HAS SIMPLY RELIED ON THE ORDER OF THE AO AND GAVE A DIRECTION FOR EXAMINING THE SAME IN THE REGULAR ASSESSMENT. 1.2 SUCH A DIRECTION IS BEYOND THE POWERS OF THE LD. CIT(A) IN VIEW OF THE DECISION OF THE INDORE BENCH OF TRIBUNAL. THE POINT AGITATED BEFORE THE LD. CIT(A) WAS WHETHER THE INCOME IS TAXABLE U/S 158BC OR NOT. ONCE HAVING HELD THAT THE INCOME IS NOT TAXABLE NO FURTHER POINT COULD BE CONSIDERED. SINCE IT WAS PURELY A MATTER RELATING -: 5: - 5 TO THE UNDISCLOSED INCOME THE LD. CIT(A) HAD NO JURISDICTION TO GIVE A DIRECTION FOR CONSIDERING TH E SAME IN THE REGULAR ASSESSMENT. 1.3 SINCE ALL THE GIFTS WERE DISCLOSED IN THE REGULAR RETURNS ALONGWITH THE GIFT DEEDS AND HAVE BEEN CONFIRMED BY THE RESPECTIVE DONEES INCLUDING BANK CERTIFICATE THERE WAS NO JUSTIFICATION FOR TREATING THEM AS NOT GENUINE GIFTS. THE DIRECTION GIVEN BY THE LD. CIT(A) ARE THUS BAD IN LAW. 1.4 THE LD. CIT(A) HAS ERRED IN GIVING A DIRECTION FOR CONSIDERING THE GIFTS IN THE HANDS OF THE WIFE IS AGAIN BAD IN LAW. THE WIFE IS SEPARATELY ASSESSED AND THE GIFTS ARE SHOWN IN HER CASE. THE LD. CIT(A) HAD NO POWER TO LOOK INTO THE MERITS FOR SOME OTHER ASSESSEE. THE DIRECTION GIVEN FOR EXAMINING THE POINT IN THE HANDS OF THE WIFE IS TOTALLY BAD IN LAW AND HENCE SUCH A DIRECTION MAY PLEASE BE ANNULLED AND TREATED AS ILLEGAL. -: 6: - 6 1.5 THE DIRECTION OF THE LD. CIT(A) IN RESPECT OF GIFTS TO BE CONSIDERED IN THE REGULAR ASSESSMENT MAY BE HELD ILLEGAL AND MAY BE DIRECTED TO BE CANCELLED. 2. THE LD. CIT(A) HAS ERRED IN MAINTAINING THE ADDITIO N OF RS. 50 000/-ON ACCOUNT OF INTERIOR DECORATION FURNITURE AND LOOSE PAPERS. IT WAS PROVED BEFORE TH E LD. CIT(A) THAT THE FUNDS WERE AVAILABLE WITH THE ASSESSEE FOR MAKING INVESTMENTS AND PART OF THE AMOUNT WAS ALREADY OFFERED IN THE RETURN AND AS SUCH NO ADDITION COULD HAVE BEEN MADE ON THIS ACCOUNT. 2.1 THE ADDITION MAINTAINED BY THE LD. CIT(A) AT RS. 50 000/- ON ACCOUNT OF INTERIOR DECORATION FURNITURE AND LOOSE PAPERS MAY PLEASE BE DELETED. 3. THE LD. CIT(A) HAS ERRED IN MAINTAINING THE ADDITIO N OF RS. 1 63 000/- ON ACCOUNT OF HOUSE HOLD EXPENSES. 3.1THE ESTIMATION OF THE HOUSE HOLD EXPENSES ON THE BASIS OF A PAPER FOUND FOR FOUR MONTHS CAN NOT BE -: 7: - 7 MADE AND AS SUCH THE WHOLE ADDITION IS UNWARRANTED FOR. 3.2 IT WAS PROVED BEFORE THE CIT(A) THAT THE CASH W AS AVAILABLE ON ACCOUNT OF SALE OF GOODS OF AMBIKA FAN CY STORES AND AS SUCH HE SHOULD HAVE CONSIDERED SUCH A CASH AVAILABLE FOR THE PURPOSE OF INCURRING HOUSE H OLD EXPENSES. 3.3 THE EXPENSES ON MILK INCURRED AT THE TIME OF SAMAJ FUNCTION CANNOT BE A BASIS OF ESTIMATING THE EXPENDITURE. 3.4 THE LD. CIT(A) OUGHT TO HAVE CONSIDERED THE EXPENDITURE INCURRED BY THE MEMBERS OF THE FAMILY F OR DETERMINING THE UNDISCLOSED INCOME. 3.5 THE ADDITION OF RS. 1 63 000/- ON ACCOUNT OF ESTIMATION OF HOUSE HOLD EXPENSES MAY PLEASE BE DELETED. 4.1 THE LD. CIT(A) HAS ERRED IN MAINTAINING THE ADDITION OF RS. 70 00 000/- ON ACCOUNT OF THE ALLEG ED HUNDIES OF RS. 30 00 000/- AND A LETTER FOR RS. 40 00 000/-. -: 8: - 8 4.2 IT WAS PROVED BEFORE THE LD. AO AND THE LD. CIT(A) THAT THESE HUNDIES DO NOT BELONG TO THE ASSESSEE AND ON THESE HUNDIES THE INITIALS ARE SCRIBBLED WITHOUT ANY NAMES. THUS THESE HUNDIES HAVE NO VALUE AND CANNOT BE INCLUDED AS AN UNDISCLOSED INCOME. 4.3 THE HUNDIES WERE NOT SHOWN WHILE RECORDING THE STATEMENT TO ANY PERSON OF THE FAMILY. SHRI SU RESH VALECHA CATEGORICALLY ASKED FOR VERIFYING THESE HUNDIES WHICH WERE NOT SHOWN TO HIM. 4.4 THE LETTER DOES NOT CONTAIN ANY SIGNATURE AND THE NAME OF THE ASSESSEE OR ANY FAMILY MEMBER. SUCH A LETTER HAS NO EVIDENTIAL VALUE AND CAN NOT BE TRE ATED AS VALUABLE FOR RS. 40 00 000/-. 4.5 THE TOTAL YEARLY SALES IN THIS GROUP DOES NOT EXCEED RS. 25 TO 30 LACS AND AS SUCH THE LETTER WIT HOUT ANY NAME CANNOT BE TREATED AS A GENUINE DOCUMENT. 4.6 THE ADDITION OF RS. 70 00 000/- MAY PLEASE BE DELETED. -: 9: - 9 5. THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDIT ION OF RS. 1 50 000/- ON ACCOUNT OF HUNDIES FROM SHYAMLAL ARYA. 5.1 IT WAS PROVED BEFORE THE LD. CIT(A) THAT THESE HUNDIES WERE TAKEN ON ACCOUNT OF SECURITIES FROM TH E DALAL AND AS SUCH NO ADDITION COULD HAVE BEEN MADE. 5.2 DURING THE COURSE OF THE SEARCH PROCEEDINGS THE DALAL WAS NOT EXAMINED NOR ANY ATTEMPT WAS MADE TO PROVE THAT THE ASSESSEE HAS ADVANCED ANY MONEY. 5.3 THE ADDITION OF RS. 1 50 000/- MAY PLEASE BE DELETED. 6. THE LD. CIT(A) HAS ERRED IN MAINTAINING THE ADDITION OF RS. 1 92 100/- BEING THE CASH FOUND WIT H THE ASSESSEE. 6.1 IT WAS PROVED BEFORE THE LD AO AND ALSO BEFORE THE LD. CIT(A) THAT THE CASH BELONG TO THE PARTNERS HIP FIRM WHICH WAS DISCLOSED IN THE BOOKS OF THE FIRM AND AS SUCH IT CANNOT CONSTITUTE THE UNDISCLOSED INCOME OF THE ASSESSEE. -: 10: - 10 6.2 THE ADDITION OF RS. 1 92 100/- MAY PLEASE BE DELETED. GROUNDS TAKEN BY THE REVENUE : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED :- 1. DELETED THE ADDITION OF RS. 2 60 697/- ON ACCOUN T OF UNEXPLAINED INVESTMENT IN GOLD JEWELLERY. 2. DELETED THE ADDITION OF RS. 28 12 957/- ON ACCOU NT OF INVESTMENT IN HUNDIES AND RS. 36 00 000/- ON ACCOUNT OF INTEREST EARNED THEREON. 3. REDUCE THE ADDITION OF RS. 3 70 000/- ON ACCOUNT OF INVESTMENT IN INTERIOR DECORATION TO RS. 3 46 000/- AND DELETED THE ADDITION OF RS. 4 20 216/- EXPENDITURE ON LOOSE PAPERS. 4. DELETED THE ADDITION OF RS. 1 96 000/- ON ACCOUN T OF MARRIAGE EXPENSE. 5. DELETED THE ADDITION OF RS. 11 000/- ON ACCOUNT OF VEHICLE. 6. DELETED NOT TO LEVY SURCHARGE. -: 11: - 11 7. THE ORDER OF THE CIT(A) IS THUS ERRONEOUS IN LAW AS WELL AS ON THE FACTS OF THE CASE. 8. THUS IT IS PRAYED THAT THE ORDER OF THE CIT(A) B E SET- ASIDE AND THE ORDER OF AO BE RESTORED. 4. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AN D FOUND FROM RECORD THAT THE SOURCE OF INCOME OF THE ASSESS EE IS FROM SHARE INCOME FROM FIRM AND INTEREST INCOME FROM BAN K/POST DEPOSITS AND FROM HUNDI BUSINESS. AT THE OUT-SET L D. AUTHORIZED REPRESENTATIVE PLACED ON RECORD ORDER OF I.T.A.T. IN THE CASE OF OTHER GROUP MEMBERS WHEREIN MOST OF THE GROUNDS TAKEN BY THE ASSESSEE WAS COVERED. COPY OF THE ORDE R WAS ALSO GIVEN TO LD. CIT DR. WITH REGARD TO ADDITION MADE O N ACCOUNT OF UNEXPLAINED CASH OF RS. 1 98 970/- THE LD. CIT( A) FOUND THAT IT IS REASONABLE TO CONSIDER CASH OF RS. 9850/ - AS PERTAINING TO CHILDREN AND LADY MEMBERS BEING STRI DHAN DELETED THE SAME AND UPHELD THE ADDITION OF RS. 1 9 2 100/-. THE ASSESSEE COULD NOT EXPLAIN THE AVAILABILITY OF CASH OUT OF DECLARED SOURCES. WE ACCORDINGLY CONFIRM THE ACTI ON OF THE -: 12: - 12 CIT(A) FOR RETAINING ADDITION OF RS. 1 92 100/- ON ACCOUNT OF CASH FOUND DURING SEARCH. 5. ISSUE WITH REGARD TO ADDITION OF RS. 6 16 023/- ON ACCOUNT OF NRI GIFTS HAVE BEEN DEALT BY THE ASSESSI NG OFFICER AT PAGE 11 TO 13. THIS ADDITION HAS BEEN DEALT WITH IN THE ORDER OF THE I.T.A.T. IN THE CASE OF UDHALAL VALECHA (PER SON IN SAME GROUP) VIDE ITS ORDER DATED 29 TH JUNE 2011 WHEREIN A DIRECTION HAS BEEN GIVEN FOR REOPENING THE REGULAR ASSESSMENT. FOLLOWING WAS THE PRECISE OBSERVATION AT PAGE 65 OF THE I.T.A.TS ORDER WHICH READS AS UNDER :- 37. WITH REGARD TO ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED DEPOSITS IN NRE G IFTS THE SAME HAVE BEEN EXCLUDED BY THE LD. CIT(A) IN BL OCK ASSESSMENT. HOWEVER AT THE VERY SAME TIME HE HAS GIVEN A VERY CLEAR CUT DIRECTION TO THE EFFECT THAT SUCH ADDITION CANNOT BE MADE IN THE BLOCK ASSESSMENT IN SO FAR AS NRE GIFTS SO RECEIVED HAVE ALREADY BEEN DISC LOSED IN THE REGULAR RETURN AND DIRECTED THE AO TO LOOK I NTO THE REGULAR RETURNS BY REOPENING THE SAME. AS THE ASSES SEE WAS UNABLE TO PROVE THE GENUINENESS OF THE GIFTS T HE LD. -: 13: - 13 CIT(A) HAS DIRECTED FOR REOPENING THE ASSESSMENT OF ALL THE ASSESSEES U/S 147. THE ASSESSEE IS NOW BEFORE U S AGAINST THIS DIRECTION OF THE CIT(A). IT WAS CONTEN DED BY THE LD. AUTHORIZED REPRESENTATIVE THAT THE CIT(A) H AS GOT NO POWER FOR GIVING DIRECTION FOR OTHER YEARS. HE A LSO RELIED ON THE ORDER OF THE I.T.A.T. INDORE BENCH IN THE CASE OF R. D. JAIN. ON THE OTHER HAND IT WAS ARGUE D BY THE LD. CIT DR THAT CIT(A) HAS GOT CO-TERMINUS POWE R WITH THAT OF THE AO AND HE CAN NOT ONLY DEAL WITH T HE ADDITION MADE BY THE ASSESSING OFFICER BUT CAN ALSO ENHANCE THE ASSESSMENT. IN THE SAME WAY IF HE FOUN D THAT THE ADDITION WAS NOT JUSTIFIED IN A PARTICULAR YEAR OR IN RESPECT OF A PARTICULAR ASSESSEE AFTER CONSIDER ING THE RELEVANT FACTS AND MATERIAL RECORDED THE CIT(A) CA N ISSUE NECESSARY DIRECTIONS FOR CORRECT ASSESSMENT OF INCO ME IN OTHER YEARS TO WHICH IT PERTAINED AND ALSO DIRECTIO N FOR REOPENING THE ASSESSMENTS FOR THOSE RESPECTIVE YEAR S TO WHICH THE INCOME IS REALLY PERTAINS. HE ALSO RELIED ON THE DECISION OF GUJARAT HIGH COURT IN THE CASE OF A. B. -: 14: - 14 PAREEKH 203 ITR 186 EMPHASIZING THE PROVISIONS OF EXPLANATION 3 TO SECTION 153(3). 38. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND THAT DURING THE COURSE OF APPELLATE PROCEEDINGS THE CIT(A) TRIED TO EXAMINE THE GENUINENESS OF THE GIFTS FOR WHICH HE WAS NOT SATISFIED. HOWEVER AT THE VERY SAME TIME HE FOUND THAT AMOUNT OF NRI GIFTS WERE ALREADY DISCLOSED BY THE ASSESSEE IN THE REGULAR RETURNS. THEREFORE HE DIRECTED THE AO TO REOPEN THE REGULAR ASSESSMENT AND EXAMINE THE GENUINENESS OF NRE GIFTS . WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) FOR ISSUING SUCH DIRECTIONS IN SO FAR AS THE PROVISIONS OF EXPLANATION 2 TO SECTION 153(3) CLEARLY ENVISAGES THAT IF THE APPELLATE AUTHORITY IN THE COURSE OF APPELLATE PROCEEDINGS FIND THAT ANY INCOME IS REQUIRED TO BE EXCLUDED FORM THE TOTAL INCOME OF THE ASSESSEE FOR AN ASSESSMENT YEAR BUT IS REQUIRED TO BE -: 15: - 15 CONSIDERED FOR TAXATION IN ANOTHER ASSESSMENT YEAR THE APPELLATE AUTHORITY IS FULLY EMPOWERED TO ISSUE SUCH DIRECTION AFTER RECORDING NECESSARY FINDING IN THIS BEHALF. FURTHERMORE EXPLANATION 3 ENVISAGED LEGISLATIVE INTENT THAT IF SOME INCOME IS REQUIRED TO BE EXCLUDED FROM THE HANDS OF ONE PERSON BUT SIMULTANEOUSLY IS REQUIRED TO BE CONSIDERED IN THE HANDS OF ANOTHER PERSON THE APPELLATE AUTHORITY AFTER RECORDING SUCH FINDING CAN ISSUE APPROPRIATE DIRECTION FOR CONSIDERING SUCH INCOME IN APPROPRIATE HANDS AFTER GIVING SUCH OTHER PERSON AN OPPORTUNITY OF BEING HEARD BEFORE SUCH ORDER WAS PASSED. 39. IN VIEW OF THE ABOVE DISCUSSION WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) FOR ISSUING DIRECTION FOR REOPENING THE ASSESSMENT IN WHICH THE ASSESSEE HAS INCORPORATED THE NRE GIFTS. 6. AS THE FACTS AND CIRCUMSTANCES IN THE INSTANT APPE AL IS SAME WE RESPECTFULLY FOLLOW THE DECISION OF THE TRIBUNAL IN -: 16: - 16 THE CASE OF GROUP ASSESSEES AND UPHOLD THE ACTION O F THE LD. CIT(A) FOR ISSUING DIRECTION FOR REOPENING OF THE A SSESSMENT IN WHICH THE ASSESSEE HAS INCORPORATED THE NRI GIFTS. 7. ISSUE WITH REGARD TO ADDITION ON ACCOUNT OF INVESTM ENT IN JEWELLERY AMOUNTING TO RS. 2 60 697/- HAS BEEN D EALT WITH BY THE ASSESSING OFFICER AT PAGES 5 & 6 OF HIS ORDE R AND THE SAME HAS BEEN DELETED BY THE LD. CIT(A) BY RECORDIN G FINDING AT PAGE 8. SIMILAR ISSUE HAS BEEN DEALT WITH BY THE TR IBUNAL IN ITS ORDER DATED 29 TH JUNE 2011 WHEREIN SIMILAR ADDITION HAS BEEN DELETED AFTER HAVING FOLLOWING OBSERVATIONS :- 44. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AN D FOUND FROM RECORD THAT THE AO HAS MADE ADDITION IN RESPECT OF THE JEWELLERY FOUND WITH VARIOUS FAMILY MEMBERS OF VALECHA GROUP. DESCRIPTION OF JEWELLERY IS GIVEN IN LS-4. THE LD. CIT(A) AFTER VERIFYING THE I NVENTORY OF JEWELLERY PREPARED FOUND THAT THE DESCRIPTION OF THE JEWELLERY IN THE LOOSE PAPER NOWHERE INDICATE THAT SUCH JEWELLERY WERE NEW JEWELLERY ACQUIRED BY THE FAMILY MEMBERS DURING THE BLOCK PERIOD HOWEVER MERE -: 17: - 17 REMAKING OF OLD JEWELLERY AS PER NEW DESIGN DOES NO T AMOUNT TO NEW JEWELLERY AT ALL. IT WAS FOUND AND CATEGORICALLY RECORDED BY CIT(A) THAT OVERALL JEWEL LERY FOUND WITH ALL THE FAMILY MEMBERS CONSISTING OF EIG HT MARRIED LADIES TEN UNMARRIED DAUGHTERS AND EIGHT M ALE MEMBERS WERE 5217 GMS. IN VIEW OF C.B.D.T. INSTRUCTION NO. 1916 DATED 11.5.1994 A HINDU MARRI ED LADY CAN KEEP GOLD ORNAMENTS WEIGHING 500 GMS. UNMARRIED LADIES 250 GMS. AND MALE PERSON 100 GM. CONSIDERING THE STATUS OF THE ASSESSEE FAMILY AND T HE FACTS AND CIRCUMSTANCES OF THE CASE VIS--VIS NUMBE R OF MALE AND FAMILY MEMBERS THE OVER-ALL JEWELLERY FOU ND WORKS OUT TO BE MUCH LESS THAN THE LIMITS PROVIDED BY C.B.D.T. WE THEREFORE DO NOT FIND ANY INFIRMITY I N THE ORDER OF THE CIT(A) FOR DELETING THE ADDITION MADE ON ACCOUNT OF JEWELLERY IN THE HANDS OF SURESH VALECHA NANDLAL VALECHA GANGARAM VALECHA JAMUNADAS VALECHA. 45. IN THE RESULT THE GROUND OF THE REVENUES APPEAL IN CASE OF ALL THE ASSESSEES ARE DISMISSED. -: 18: - 18 8. AS THE FACTS AND CIRCUMSTANCES IN THE INSTANT CASE UNDER CONSIDERATION ARE IN PARI MATERIA AND WHEREI N THE FINDING RECORDED BY THE LD. CIT(A) HAS NOT BEEN CON TROVERTED BY THE DEPARTMENT WE RESPECTFULLY FOLLOW THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN GROUP CASE AS DISCUSSED ABOVE AND CONFIRM THE ACTION OF THE CIT(A) FOR DELETION OF AD DITION ON ACCOUNT OF JEWELLERY OF RS. 2 60 697/-. 9. WITH REGARD TO DELETION OF ADDITION ON ACCOUNT OF INVESTMENT IN KVP AND NSC IPR AMOUNTING TO RS. 10 28 000/- WHICH HAS BEEN DELETED BY THE LD. CIT( A) BY DISCUSSING AT PAGE 9. SINCE THE REVENUE IS NOT IN A PPEAL BEFORE US AGAINST THIS DELETION WE ARE NOT GOING TO INTER FERE IN THE ORDER OF CIT(A) FOR SUCH DELETION. 10. THE AO HAS MADE ADDITION ON ACCOUNT OF INVESTMENT I N SCOOTER AMOUNTING TO RS. 11 000/- BY DISCUSSING THE ISSUE AT PAGE 8. AFTER GIVING DETAILED FINDING AT PAGE 8. AF TER GIVING DETAILED FINDING AT PAGE 23 THE CIT(A) HAS DELETED THE ADDITION NOTHING WAS POINTED OUT BEFORE US TO DEVI ATE FROM THE FINDING RECORDED BY THE LD. CIT(A) WE DO NOT SEE A NY REASON TO -: 19: - 19 INTERFERE IN THE ORDER OF THE CIT(A) IN DELETING AD DITION OF RS. 11 000/- TOWARDS INVESTMENT IN SCOOTER. 11. WITH REGARD TO ADDITION MADE ON ACCOUNT OF INTERIOR DECORATION OUT OF WHICH PART RELIEF WAS GIVEN BY TH E LD. CIT(A). SIMILAR ISSUE HAS BEEN DEALT WITH BY THE TRIBUNAL I N ITS ORDER DATED 29.6.2011 IN CASE OF OTHER GROUP MEMBERS. FOL LOWING WAS THE PRECISE OBSERVATION OF THE TRIBUNAL AT PAGE 54 WHEREIN THE ORDER OF THE CIT(A) WAS UPHELD ON THIS COUNT. ADDITION ON ACCOUNT OF INTERIOR DECORATION 27. WITH REGARD TO INTERIOR DECORATION FOUND DURING THE COURSE OF SEARCH THE ASSESSING OFFICER GOT IT VALUED BY REGISTERED VALUER. IN THE BLOCK ASSESSMENT ORDER THE ASSESSING OFFICER STATED THAT AS PER THE VALUATION REPORT THE INVESTMENT IN INTERIOR DECORATION WORKS OUT TO RS. 17 33 000/- WHICH WAS DIVIDED EQUALLY IN THE HANDS OF FIVE BROTHERS. RS. 3 46 600/- WAS ADDED IN THE HANDS OF EACH OF THE BROTHERS ON THE BASIS OF VALUATION REPORT. THE CONTENTION OF THE ASSESSEE WAS THAT THE -: 20: - 20 ITEMS LIKE SOFA CHAIRS ALMIRAH FANS ARE OLD AND PURCHASED PRIOR TO THE BLOCK PERIOD. SOME ITEMS HAVE BEEN RENEWED AND VERY FEW ITEMS HAVE BEEN ACQUIRED WHICH ARE COVERED IN THE AMOUNT SURRENDERED. IT WAS ALSO SUBMITTED THAT ALL THESE ITEMS ARE NORMALLY ACQUIRED BY THE FAMILY MEMBERS FROM DAY-TO- DAY EXPENDITURE. THE FAMILY IS QUITE OLD AND A NUMBER OF ITEMS HAVE BEEN ACCUMULATED FROM TIME TO TIME AND RECEIVED AT THE TIME OF MARRIAGES. 28. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FIND FROM RECORD THAT THE ADDITION WAS MADE ON THE BASIS OF VALUERS REPORT. THE ASSESSEE HAS DISCLOSED THE INVESTMENT IN THE INTERIOR DECORATION IN THE REGULAR BOOKS OF ACCOUNTS. THE COST OF HOME APPLIANCES PURCHASED AND DEBITED TO THE BOOKS HAS BEEN ESTIMATED AT A HIGHER -: 21: - 21 FIGURE BY THE VALUER. WE FIND THAT THE VALUER IN HIS REPORT HAS VALUED FANS TVS GEYSERS CARTONS REFRIGERATOR ETC. THESE ITEMS ARE REQUIRED BY THE FAMILY MEMBERS WHICH ARE PURCHASED BY THEM OUT OF DAY TO DAY WITHDRAWALS. WITHOUT CONSIDERING THE YEAR OF PURCHASE THE ASSESSING OFFICER HAS ADDED THE ENTIRE AMOUNT BY DISREGARDING THE DISCLOSURE OF THESE INVESTMENTS IN THE BOOKS OF ACCOUNTS. WE FIND THAT THE SAME AMOUNT HAS BEEN TAXED. 29. BY THE IMPUGNED ORDER THE LD. CIT(A) PARTLY DELETED THE ADDITION ON ACCOUNT OF INVESTMENT IN INTERIOR DECORATION TO THE EXTENT OF IMPUGNED SURRENDER BY VARIOUS ASSESSEES HOWEVER HE HAS ENHANCED THE ADDITION ON ACCOUNT OF INTERIOR DECORATION BY RS. 50 000/- IN EACH OF THE SIX ASSESSEES AMOUNTING IN TOTAL TO RS. 3 LAKHS. FOLLOWING IS THE PRECISE FINDING AND CONCLUSION OF THE CIT(A):- -: 22: - 22 THE FACTS ON RECORD THE FINDINGS GIVEN BY THE AO ON THE TWIN INTERLINKED ISSUES INVOLVED IN THE MATTER OF ADDITION OF UNEXPLAINED INVESTMENT/EXPENDITURE IN INTERIOR DECORATION AND RENOVATION OF TWO HOUSES AT LARKANA NAGAR AND 593 USHA NAGAR BASED ON IV'S REPORT AS WELL AS ADDITION MADE ON THE BASIS OF SEIZED LOOSE PAPERS ARE VERY CAREFULLY CONSIDERED IN THE LIGHT OF EXPLANATIONS OFFERED BY THE APPELLANTS. THIS FACT IS NOT DISPUTED BY THE APPELLANT THAT CERTAIN UNACCOUNTED EXPENDITURE WAS MADE ON INTERIOR DECORATION AND ACQUISITION OF HOUSE HOLD ITEMS AND FURNITURE ETC. AND SUCH UNACCOUNTED EXPENDITURE FORMS THE MAJOR PORTION OF DISCLOSURE OF UNDISCLOSED INCOME BY THE APPELLANT GROUP AT RS. 21.12 LAKHS WHICH AS PER DETAILS FURNISHED AS EXTRACTED ABOVE ALSO AMOUNTS TO RS. 15.10 LAKHS IN THE FOLLOWING HANDS :- (1) SRI UDALAL VALECHA RS.1.75 LAKHS -: 23: - 23 (2) SRI NANDLAL VALECHA RS.3.25 LAKHS (3) SRI JAMNADAS VALECHA RS.3.20 LAKHS (4) SRI GANGARAM VALECHA RS.2.25 LAKHS (5) SRI SURESH VALECHA RS.1.45 LAKHS (6) SRI SRICHAND VALECHA RS.3.20 LAKHS 7.3.1 THE FURTHER CAP ADDED BY THE APPELLANT GROUP IS THAT SUCH AMOUNT INCLUDE UNEXPLAINED EXPENDITURE ON HOUSE-HOLD EXPENSES AND OTHER EXPENSES WHICH REMAIN VAGUE. THE AO HAS FAILED TO GIVE DETAILED WORKING AS TO HOW THE GROSS AMOUNT OF RS.22 16 720/- HAS BEEN ARRIVED FROM BUNCH OF SEIZED PAPERS BEING LPS- 1 2 3 & 4 AND FURTHER HOW THE NET AMOUNT EXCLUDING AMOUNT PERTAINING TO SRI SURESH VALECHA BEING RS.1 L5 642/- I.E. RS.21 OL 078/- HAS BEEN ARRIVED AT. THE AO HAS NOT APPENDED ANY ANNEXURES TO THE ASSESSMENT ORDER TO INDICATE THE WORKING OF SUCH AMOUNT. ON THE OTHER HAND AS PER WORKING FURNISHED BY THE APPELLANT THE AMOUNT HAS BEEN ARRIVED AT RS. 1 43 369/- FOR HOUSE-HOLD GOODS/EXPENSES AND -: 24: - 24 RS. 12 23 766/- FOR OTHER EXPENSES WHICH HAS BEEN EXPLAINED TO PERTAIN TO INTERIOR DECORATION EXPENSES. 7.3.2 THUS NO CLEAR FINDING ON FACTS ARE AVAILABLE TO ARRIVE AT THE PROPER QUANTUM OF AMOUNT REQUIRED TO BE ADDED IN DIFFERENT HANDS. THE AO HAS IN ABSENCE OF PROPER DETAILS DIVIDED THE AMOUNT EQUALLY IN 1/5 TH PROPORTION FOR ADDITION BASED ON VALUATION REPORT OF INTERIOR DECORATOR (IN SHORT IVR) IN THE HANDS OF SRI UDALAL NANDLAL JAMNALAL AND SRICHAND & GANGARAM VALECHA. WHEREAS THE ADDITION BASED ON SEIZED LOOSE PAPERS OF THE NET AMOUNT EXCLUDING SRI SURESH VALECHA'S EXPENSES HAS BEEN SOUGHT TO BE DIVIDED IN FIVE HANDS AT RS.4 20 216/- EACH BUT IT APPEARS THAT THE ADDITION HAS BEEN MADE FOR UNEXPLAINED EXPENDITURE AT RS. 4 20 216/- EACH IN FOUR HANDS ONLY BEING IN THE HANDS OF -: 25: - 25 SRI SRICHAUD NARESH GANGARAM AND JAMNADAS. FURTHER THERE IS APPARENT MERIT IN THE CONTENTIONS OF THE APPELLANT THAT THE ENTIRE AMOUNT ARRIVED AT BY IVR FOR EXPENDITURE IN INTERIOR DECORATION CANNOT BE TREATED AS UNEXPLAINED AS THE PROPERTY BEING OLD SOME PART OF THE INVESTMENT/EXPENDITURE MADE WILL CERTAINLY FALL BEYOND BLOCK PERIOD ALSO. 7.3.3 AS NO CLEAR FINDINGS ON FACTS IS AVAILABLE IN ASSESSMENT ORDERS NOR THE FACTS HAVE BEEN/COULD BE FULLY BROUGHT ON RECORD BY THE APPELLANT'S SIDE IN VIEW OF THE PARTIAL DESCRIPTION ON LOOSE PAPERS IT WAS CONTEMPLATED TO REMIT THE MATTER OF SUCH TWIN/TRIPLICATE ADDITION TO THE AO FOR DECIDING THE ISSUE AFRESH WITH AN OPEN MIND AND WITH DIRECTION TO ENSURE THAT ONLY SINGLE ADDITION BASED ON EXPENSES RECORDED IN LOOSE PAPERS FOR INTERIOR DECORATION AND FURNITURE ETC. AS WELL IVR BE MADE AND NO DOUBLE/TRIPLICATE -: 26: - 26 ADDITIONS ARE MADE. BUT SUCH PREPOSITION WAS SERIOUSLY OPPOSED BY THE ARS OF THE APPELLANT CONTENDING THAT THE AO IN ROUTINE MANNER WILL BE BROADLY REPEATING THE SAME ADDITION AND SUCH AN EXERCISE WILL NOT BRING THE LITIGATION TO AN END AS APPELLANT ALSO HAD NO FURTHER EXPLANATION AND DETAILS TO OFFER AND HENCE A PROPER AND DEFINITE VIEW BE ARRIVED IN APPELLATE PROCEEDINGS ITSELF. 7.3.4 IN COURSE OF DISCUSSION THE AR PRESENT FAIRLY ENOUGH CONCEDED THAT THEY ARE AGREEABLE TO CONCEDE THAT THE ENTIRE AMOUNT DECLARED AS UNDISCLOSED INCOME AT RS.15.10 LAKHS MAY BE TREATED AS PERTAINING TO UNEXPLAINED EXPENDITURE/INVESTMENT IN INTERIOR DECORATION. IT WAS FURTHER CLARIFIED THAT THE AO PERHAPS BE ON ACCOUNT OF PAUCITY OF TIME ON ACCOUNT LACK OF CLARITY AS DIVIDED SUCH EXPENSES IN EQUAL PROPORTION IN FIVE HANDS WHEREAS THEY HAVE MADE AN ATTEMPT TO DISCLOSE THE AMOUNT BASED -: 27: - 27 ON THE NAMES MENTIONED ON SEIZED PAPERS. 7.3.5 THE AR AND THE APPELLANT PRESENT EMPHASIZED IN COURSE OF DISCUSSION IN CONTINUATION WITH THE SUBMISSION MADE IN THE CASE OF SRI UDHALAL VALECHA AND OTHER CONNECTED CASES BY REFERRING TO COMMON WRITTEN SUBMISSION FILED IN GROUP CASES DTD. 11.09.03 AND 20.02.04 IN PARA-11.1 (RELEVANT PORTION EXTRACTED HERE-IN-ABOVE) THAT APART FROM THE UNDISCLOSED INCOME ADMITTED IN THE HANDS OF VARIOUS MEMBERS OF T HE GROUP FOR INTERIOR DECORATION AND RENOVATION ETC. AT RS.15.10 LAKHS FUNDS WERE AVAILABLE FOR MAKING SUCH INVESTMENT OUT OF WITHDRAWALS FROM UNEXPLAINED DEPOSITS WITH BANK ACCOUNT WITH OBC AGGREGATING NEARLY RS. 2.00 LAKHS BY SRI SURESH VALECHA. SO ALSO THE APPELLANTS HAD FURTHER FUNDS AVAILABLE FROM UNRECORDED SALES AS FOUND IN THE CASE OF M/S. AMBIKA FANCY STORES AT RS.5.33 LAKHS BESIDES INCOME -: 28: - 28 DISCLOSED FROM UNACCOUNTED TRANSACTIONS IN THE CASE OF ANOTHER CONCERN OF THE GROUP M/S. AMBIKA TRADERS AT RS.2.50 LAKHS. THUS BROADLY THE APPELLANT GROUP HAD FUNDS AVAILABLE FOR EXPLAINING UNACCOUNTED EXPENDITURE TO THE EXTENT OF RS. 24.50 LAKHS. 7.3.6 CONTINUING FURTHER IT WAS EXPLAINED THAT THE DEPARTMENT HAD OBTAINED TWO VALUATION REPORTS ABOUT INTERIOR DECORATION FROM THE VALUER SRI KIRAN SINDE ACCORDING TO WHICH THE AMOUNT SPENT ON INTERIOR DECORATION ETC. WAS ARRIVED AT RS. 17.33 LAKHS FOR 33-34 LARKANA NAGAR AND RS. 2 93 OOO/- FOR HOUSE AT 593 USHA NAGAR EXTN. THUS ACCORDING TO INTERIOR VALUATION REPORTS ALSO THE TOTAL EXPENDITURE IN INTERIOR DECORATION ETC. WAS ARRIVED AT RS. 20.26 LAKHS. WHILE THE AO HAS MADE ADDITION FOR UNEXPLAINED EXPENDITURE BASED ON THESE REPORTS SEPARATELY AT RS. 20.26 LAKHS AND TOP OF IT HE HAS MADE ADDITION OF RS. 21 OL 078/- IN THE -: 29: - 29 HANDS OF FIVE MEMBERS OF THE SEARCH GROUP AND STILL ON TOP OF IT ANOTHER AMOUNT OF RS.22.31 LAKHS (APPROX.) HAS BEEN ADDED IN THE HANDS OF THE APPELLANT SRI SURESH VALECHA BASED ON SUCH LOOSE PAPERS. THUS IT WAS EMPHASIZED THAT AS AGAINST A MAXIMUM ADDITION BASED ON INTERIOR VALUATION REPORTS AT RS. 20.26 LAKHS THE AO HAS MADE ADDITION AT NEARLY THREE TIMES OF SUCH AMOUNT IN DIFFERENT CASES OF THE GROUP. 7.4 THE CONTENTIONS OF THE APPELLANT ARE VERY CAREFULLY EXAMINED. THERE IS DEFINITE SUBSTANCE IN THE CONTENTIONS OF THE APPELLANT TO THE EXTENT THAT THE AO HAS MADE AT LEAST DOUBLE ADDITION FOR THE SAME EXPENDITURE BASED ON INTERIOR VALUATION REPORT (IVR) AND THEN ON THE BASIS OF NOTINGS ABOUT SUCH EXPENDITURE IN THE LOOSE' PAPERS FOUND. NO DETAILED WORKING ARE GIVEN BY THE AO EITHER IN THE ASSESSMENT ORDER OR BY WAY OF ANNEXURE HOW THE VARIOUS AMOUNTS AS -: 30: - 30 ADDED AS PER DIFFERENT PARAS OF ASSESSMENT ORDER BEING 9(A) TO 9(F) HAVE BEEN ARRIVED AT. THE COPY OF ASSESSMENT ORDER IN THE CASE OF M/S. AMBIKA FANCY STORE HAS BEEN EXAMINED AND IT IS SEEN THAT THE AO HAS ADDED AN AMOUNT AT RS. 5 33 3661- FOR DIFFERENCE IN STOCK FOUND IN COURSE OF SURVEY U/S. 133A AND HE HAS MADE SEPARATE ADDITION FOR UNRECORDED PURCHASES AS PER LOOSE PAPERS AT RS. 42 565/- ARID RS. 2 296/-. M/S. AMBIKA FANCY STORE HAS APPENDED A NOTE TO THE TRADING ACCOUNT THAT STOCK AS PER BOOKS CAME TO APPROXIMATELY RS. 14 61 310/- AND THE STOCK WAS FOUND LESS BY THE DEPARTMENT DURING THE COURSE OF SURVEY AT RS. 8 05 206/- AND IT IS FURTHER STATED THAT SUCH DEFICIT IS ON ACCOUNT OF OLD STOCK CLEARED AT APPROXIMATELY COST PRICE AND SUCH. AMOUNT WAS UTILIZED BY THE PARTNERS FOR THE COLOURING AND INTERIOR OF THE RESIDENTIAL HOUSE AND SUCH STOCK WAS REDUCED IN THE BOOKS BY DEBIT TO PARTNERS -: 31: - 31 AND SINCE SUCH GOODS WERE SOLD AT COST NO PROFIT WAS ACCOUNTED FOR ON SUCH SALES. 7.4.1 THE CONTENTION IN RESPECT OF THE AVAILABILITY OF FUNDS FROM WITHDRAWAL FROM UNACCOUNTED DEPOSITS IN BANK ACCOUNT WITH OBC SUDAMA NAGAR BR. BY THE APPELLANTS ARE EXAMINED WITH REFERENCE TO COPY OF SUCH BANK ACCOUNT FURNISHED BY THE APPELLANT. IT IS SEEN THAT THE MAJOR AMOUNTS HAVE BEEN WITHDRAWN BY WAY OF CLEARING. ONE MAJOR AMOUNT BEING RS. 96 000/- DEBITED IN BANK ACCOUNT ON 9.3.01 WHICH IS SUCCEEDED BY A CASH DEPOSIT OF RS. 95 000/- ON 3.3.01. NO DIRECT DEFINITE AND CREDIBLE DETAILS AND EVIDENCES HAVE BEEN BROUGHT ON RECORD TO ESTABLISH THAT SUCH WITHDRAWALS WERE UTILIZED FOR THE PURPOSE OF MEETING EXPENDITURE ON INTERIOR DECORATION AND RENOVATION OF HOUSES ETC. ONLY AND WERE NOT UTILIZED OTHERWISE. HENCE IN ABSENCE OF CORROBORATIVE EVIDENCES SUCH SELF-SERVING -: 32: - 32 STATEMENT OF THE APPELLANT CANNOT BE ACCEPTED AND NO CREDIT FOR AVAILABILITY OF SUCH FUNDS SHALL BE CONSIDERED AGAINST ADDITION FOR UNEXPLAINED EXPENDITURE ON INTERIOR DECORATION AND RENOVATION ETC. 7.4.2 COMING TO THE UNDISCLOSED INCOME OFFERED IN THE HANDS OF M/S. AMBIKA TRADERS AT RS.2.50 LAKHS IT IS SEEN THAT THERE IS NO CLEAR CUT MENTION IN THE RETURN OF INCOME FILED THAT SUCH AMOUNT WAS UTILIZED IN A PARTICULAR FASHION NOR THERE ARE ANY FINDINGS TO THIS EFFECT IN THE ASSESSMENT ORDER. IN ABSENCE OF ANY CLEAR ADMISSION OR DETAILS AND EVIDENCES TO SUPPORT THE CONTENTION THAT SUCH AMOUNT WAS UTILIZED TOWARDS EXPENDITURE ON INTERIOR DECORATION ETC. THE APPELLANT'S CONTENTION MERELY ON THE BASIS OF STATEMENT WITHOUT ANY CORROBORATIVE EVIDENCES AND DETAILS CANNOT BE ACCEPTED. 7.4.3 FINALLY TO SUM UP THE APPELLANT GROUP -: 33: - 33 AS A WHOLE HAS OWNED UP UNDISCLOSED\ INVESTMENT IN INTERIOR DECORATION AND RENOVATION ETC. AT RS. 15.10 LAKHS IN THE HANDS OF SIX INDIVIDUALS AS DISCUSSED ABOVE AND FURTHER AMOUNT OF RS. L 87 000/- HAS BEEN OFFERED IN THE HANDS OF APPELLANT SRI SURESH VALECHA FOR EXPENSES BASED ON LOOSE PAPERS ETC. AS PER DISCUSSION IT WAS MADE CLEAR TO THE AR PRESENT AND SRI SURESH VALECHA AND AGREED BY THEM THAT NO CREDIT AGAINST ANY PART OF SUCH DISCLOSURE COULD BE ENTERTAINED FOR ADDITION OF ANY UNDISCLOSED EXPENDITURE UNDER THE HEAD HOUSE-HOLD EXPENSES. THUS ADMITTED UNDISCLOSED EXPENDITURE ON THIS HEAD AMOUNTS TO RS. 15.10 + RS. 1.87 LAKHS OR SAY RS. 16.97 LAKHS. FURTHER THE APPELLANTS CANNOT BE DENIED THE BENEFIT OF AVAILABILITY OF CASH FROM UNRECORDED SALES TRANSACTIONS IN THE CASE OF M/S. AMBIKA FANCY STORE AS IT HAS BEEN CATEGORICALLY STATED -: 34: - 34 BY WAY OF NOTE TO THE TRADING ACCOUNT AND THE SAME IS CORROBORATED BY CORRESPONDING DEBIT ENTRIES TO PARTNERS ACCOUNT AGGREGATING RS. 6 46 104/-. EVEN IF THE AO'S FINDINGS ARE TAKEN INTO CONSIDERATION THE DIFFERENCE IN STOCK HAS BEEN WORKED OUT AT RS. 5 33 366/- AND ADDITION HAS BEEN MADE FOR UNRECORDED PURCHASES AT RS. 42 565/- AND RS. 25 296/- I.E. AGGREGATING RS. 67 761/-. THUS EVEN CONSIDERING THE AO'S FINDINGS THE AVAILABILITY OF SUCH FUNDS TO THE EXTENT OF RS. 4.66 LAKHS (APPROX.) CANNOT BE DENIED TO THE APPELLANT AND THUS THE AVAILABLE FUNDS IN THE HANDS OF THE VARIOUS MEMBERS OF THE GROUPS COMES TO RS. 21.63 LAKHS. 7.4.4 NOW IT IS SEEN THAT THE AO HAS MADE ADDITION FOR EXPENSES INCURRED ON INTERIOR DECORATION RENOVATION OF HOUSE AND ACQUISITION OF HOUSE-HOLD FURNITURE AND ELECTRONICS GOODS ETC. AT RS. 17.33 LAKHS BASED ON IVR'S REPORT IN FIVE CASES AND HAS ADDED FURTHER AMOUNT OF -: 35: - 35 RS.21.01 LAKHS BASED ON DESCRIPTION OF EXPENSES ON SIMILAR NATURE IN FIVE CASES OF THE GROUP EXCLUDING THE CASE OF SRI SURESH VALECHA. THE AO HAS FURTHER MADE ADDITION FOR ACQUISITION OF HOUSE-HOLD GOODS AT RS.2.69 LAKHS IN THE CASE OF SRI SURESH VALECHA BESIDES ADDITION OF RS.2.93 LAKHS ON A SEPARATE INTERIOR VALUER'S REPORT PERTAINING TO USHA NAGAR BUILDING AND FURTHER AMOUNT OF RS.20.31 LAKHS IS ADDED BASED ON NOTINGS FOUND ON LOOSE PAPERS CONCERNING EXPENSES OF INTERIOR DECORATION RENOVATION OF HOUSE AND ACQUISITION OF FURNITURE AND OTHER ELECTRONIC GOODS ETC. THE TOTAL AMOUNT ADDED THUS COMES TO RS. 64.02 LAKHS. 7.5 IN VIEW OF THE AFORESAID DISCUSSION THERE IS SUFFICIENT MERIT IN THE APPELLANT'S CONTENTION THAT THE APPROACH ADOPTED BY THE AO HAS RESULTED IN MORE THAN DOUBLE ADDITION ON THE SAME SCORE BUT THERE IS NO MERIT IN CONTENTIONS -: 36: - 36 THAT SUCH ADDITION BE CONFINED TO AMOUNT ARRIVED IN IVR'S REPORTS AS SUCH REPORTS DO NOT COVER ALL EXPENSES RECORDED IN SEIZED LOOSE PAPERS. 7.5.1 IN THIS BACK DROP IT IS AGAIN REITERATED THAT THE UNDISCLOSED INCOME ADMITTED PERTAINING TO SUCH ACCOUNTED EXPENSES IN THE HANDS OF SIX PERSONS AS AFORESAID' INCLUDING THE AMOUNT OF RS. 1.87 LAKHS IN THE CASE OF SRI SURESH VALECHA COMES TO RS. 16.97 LAKHS. IT WAS ALSO EMPHASIZED THAT EXPENDITURE TO THE TUNE OF RS. 88 OOO/-(APPROX.) HAS BEEN DISCLOSED IN THE BALANCE-SHEET OF SRI SURESH VALECHA AND HIS WIFE SMT. LEENA VALECHA. FURTHER IT HAS BEEN HELD THAT AN AMOUNT OF RS. 4.66 LAKHS IS TO BE TREATED AS AVAILABLE IN THE HANDS OF THE APPELLANT GROUP FOR MEETING SUCH UNACCOUNTED EXPENSES OUT OF THE STOCK/GOODS SOLD FROM M/S. AMBICA FANCY STORES. THUS THE -: 37: - 37 OVERALL FUNDS AVAILABLE COMES TO RS. 22.50 LAKHS. 7.5.2 AS HAS BEEN HELD ABOVE AN ELEMENT OF ESTIMATION HAS TO BE NECESSARILY INVOLVED EVEN IN ARRIVING AT QUANTUM OF UNDISCLOSED INVESTMENT/EXPENDITURE ON SUCH HEADS. FURTHER ONE ALTERNATIVE IS TO APPORTION SUCH ESTIMATED AMOUNT IN EQUAL AMOUNTS IN THE HANDS OF THE FAMILY HEADS AND FOR CONCERNED PERSONS. BUT THE APPELLANT GROUP HAS DISCLOSED VARYING AMOUNTS AS NOTED ABOVE IN SIX DIFFERENT HEADS AGGREGATING AS NOTED ABOVE AT RS. 16.97 LAKHS. 7.5.3 ON OVERALL CONSIDERATION AND GIVING WEIGHTAGE TO THE APPELLANT'S CONTENTION THAT THE AO'S APPROACH HAS BEEN RESULTED IN MORE THAN DOUBLE. IT IS DIRECTED THAT FURTHER ADDITION OF RS.50 OOO/- EACH IN THE HANDS OF SRI UDHALAL VALECHA SRI NANDLAL VALECHA SRI JAMNALAL / -: 38: - 38 VALECHA SRI GANGARAM VALECHA SRI SURESH VALECHA & SRI SHRICHAND VALECHA WOULD BE JUSTIFIED AND PROPER TO MEET THE ENDS OF JUSTICE IN ABSENCE OF PROPER AND RELIABLE BASIS MADE AVAILABLE. BY EITHER AO OR THE APPELLANTS AND ACCORDINGLY THE AO IS DIRECTED TO RESTRICT SUCH ADDITION IN THE CASE OF SIX CASES OF THE GROUP BASED ON THESE FINDINGS AND AMOUNT DISCLOSED BY THE APPELLANT IN THIS BEHALF AS UNDER FOR ADDITION BASED ON INTERIOR VALUER'S REPORT AS WELL ACQUISITION OF HOUSE-HOLD GOODS AND ADDITION MADE ON LOOSE PAPERS EXCLUDING OF COURSE ADDITION HOUSE-HOLD EXPENSES WHICH HAVE BEEN DECIDED SEPARATELY. AMOUNT AS ADMITTED TO BE SPENT FURTHER ADDITION TO BE MADE TOTAL (1) SRI UDHALAL VALECHA 1 75 000 50 000 2 25 000 (2) SRI NANDLAL 3 25 000 50 000 3 75 000 -: 39: - 39 VALECHA (3) SRI JAMNALAL VALECHA 3 20 000 50 000 3 70 000 (4) SRI GANGARAM VALECHA 2 25 000 50 000 2 75 000 (5) SRI SURESH VALECHA 3 32 000 50 000 3 82 000 (6) SRI SHRICHAND VALECHA 3 20 000 50 000 3 70.000 TOTAL 16 97 000 3 00 000 18 97 000 30. IT IS QUITE CLEAR FROM THE ORDER OF THE CIT(A) THAT HE HAS CONSIDERED THE VALUATION REPORT IN RESPECT OF EXPENDITURE INCURRED BY THE ASSESSEE ON ACCOUNT OF INTERIOR DECORATION AND ALSO NOTINGS IN THE LOOSE SLIPS FOUND DURING THE COURSE OF SEARCH AND AFTER CONSIDERING THE DOUBLE ADDITION MADE BY THE ASSESSING OFFICER ON DIFFERENT OCCASIONS BY REFERRING TO THE LOOSE PAPERS AND ALSO DVOS REPORT THE LD. CIT(A) HAS REASONABLY RESTRICTED THE TOTAL ADDITION ON ACCOUNT OF INTERIOR DECORATION AT RS. 18.97 LAKHS OUT OF WHICH RS. 16.97 LAKHS WERE -: 40: - 40 ALREADY ADMITTED BY THE ASSESSEE. AFTER MAKING FURTHER ADDITION OF RS. 50 000/- IN THE HANDS OF EACH OF THE FAMILY MEMBERS AMOUNTING IN TOTAL TO RS. 3 LAKHS THE LD. CIT(A) HAS REASONABLY UPHELD THE ADDITION ON ACCOUNT OF INTERIOR DECORATION. NOTHING WAS POINTED OUT BY THE LD. SENIOR A.R.NOR BY THE CIT DR TO CONTROVERT THE FINDING RECORDED BY THE LD. CIT(A) WITH RESPECT TO OBSERVATION ON ACCOUNT OF DVOS REPORT VIS--VIS LOOSE PAPERS FOUND DURING COURSE OF SEARCH INDICATING INVESTMENT AND ALSO AMOUNT SURRENDERED BY THE VARIOUS ASSESSEES ON ACCOUNT OF INTERIOR DECORATION. ACCORDINGLY WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A). 31. IN THE RESULT GROUND TAKEN BY THE REVENUE AND ASSESSEE BOTH WITH RESPECT TO ADDITION/DELETION IN INVESTMENT IN INTERIOR DECORATION AND RENOVATION OF HOUSE AT -: 41: - 41 LARKANA NAGAR AND USHA NAGAR ARE DISMISSED. 12. AS THE FACTS AND CIRCUMSTANCES IN THE INSTANT APP EALS IS SAME WE RESPECTFULLY FOLLOW THE DECISION OF TRI BUNAL AS DISCUSSED ABOVE AND UPHOLD THE ACTION OF THE CIT(A) ON ACCOUNT OF ADDITION SUSTAINED BY HIM FOR INTERIOR D ECORATION AND RENOVATION WORK. 13. AS THE ADDITION ON ACCOUNT OF LOOSE PAPERS AMOUNTIN G TO RS. 4 20 216/- WAS ALREADY DISCUSSED BY THE LD. CIT(A) WHILE DEALING WITH THE ISSUE OF EXPENDITURE IN INTE RIOR DECORATION. THE ACTION OF THE CIT(A) IN THIS REGARD IS UPHELD AS DISCUSSED HEREINABOVE. 14. ADDITION ON ACCOUNT OF INVESTMENT IN HUNDIES AMOUNTING TO RS. 23 10 000/- IN CASE OF ASSESSEE AN D RS. 12 90 000/- IN CASE OF WIFE OF ASSESSEE SMT. ASHA. THIS ADDITION HAS BEEN DELETED BY THE LD. CIT(A) BY FOLL OWING THE DECISION IN CASE OF UDHALAL VALECHA. THE TRIBUNAL H AVE ALSO DEALT WITH THE ISSUE AND UPHELD THE ACTION OF CIT(A ) AFTER HAVING THE FOLLOWING OBSERVATIONS :- -: 42: - 42 25. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULL Y GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FIND FROM RECORD THAT THE HUNDIES FOUND DURING THE COURSE OF SEARCH WERE DISCLOSED TO THE DEPARTMENT IN THE REGULAR RETURNS FILED WITH IT FO R ALL THE ASSESSMENT YEARS UNDER CONSIDERATION COMPRISING IN THE BLOCK PERIOD. THE ASSESSEE HAS ALSO FURNISHED DETAILS OF HUNDIES ADVANCED DURING THE BLOCK PERIOD TO VERIFY THE FACTUAL POSITION. THE LEARNED COMMISSIONER OF INCOMETAX (APPEALS) HAS ALSO CALLED FOR A REMAND REPORT. AFTER CONSIDERING THE REMAND REPORT THE LEARNED COMMISSIONER OF INCOMETAX (APPEALS) RECORDED A FINDING TO THE EFFEC T THAT SINCE ALL THE HUNDIES AND INTEREST THEREON WER E DULY DISCLOSED IN THE REGULAR RETURNS FILED WITH TH E DEPARTMENT NO ADDITION UNDER THESE HEADS IS CALLED FOR IN THE BLOCK ASSESSMENT. THE ASSESSEE AND HIS WIFE WERE ALSO FOUND TO BE REGULARLY ASSESSED SEPARATELY. A CATEGORICALLY FINDING HAS BEEN RECORDED BY THE LEARNED COMMISSIONER OF -: 43: - 43 INCOMETAX (APPEALS) TO THE EFFECT THAT THE ASSESSIN G OFFICER IN THE COURSE OF APPELLATE PROCEEDINGS HAS TOTALLY FAILED TO COME UP WITH ANY BASIS OR EXPLANATION TO SUPPORT HIS CONCLUSION THAT HUNDIES FOUND DURING THE COURSE OF SEARCH WERE NOT DISCLOSED TO THE DEPARTMENT. THE PRINT OUT TAKEN FROM THE COMPUTER HARD DISC IN THE POSSESSION OF THE DEPARTMENT WITH RESPECT TO THESE HUNDIES CLEARLY SUPPORTS THE ASSESSEES CONTENTION THAT ALL SUCH INVESTMENTS WERE DULY DISCLOSED IN THE RETURN FILED. THIS FINDING OF THE LEARNED COMMISSIONER OF INCOMETAX (APPEALS) HAS NOT BEEN CONTROVERTED BY THE DEPARTMENT. WE THEREFORE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LEARNED COMMISSIONER OF INCOMETAX (APPEALS) IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF HUNDIES AND INTEREST THEREON AND CONFIRM THE SAME. 26. THE NEXT GRIEVANCE OF THE REVENUE RELATES TO DELETION OF ADDITION TOWARDS INTERIOR DECORATION AS -: 44: - 44 FOUND IN THE LOOSE PAPERS AMOUNTING TO RS.1 21 600/-. 15. AS THE FACTS AND CIRCUMSTANCES ARE SAME RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNA L AS DISCUSSED ABOVE WE UPHOLD THE ACTION OF THE CIT(A) FOR DELETING ADDITION ON ACCOUNT OF INVESTMENT IN HUNDI ES. WE ALSO UPHOLD THE ACTION OF CIT(A) WITH REGARD TO INTEREST ON THESE HUNDIES. 16. THE ADDITION MADE ON ACCOUNT OF HOUSE HOLD EXPENSES AMOUNTING TO RS. 2 44 417/- HAS BEEN DISCUSSED BY T HE ASSESSING OFFICER AT PAGES 19 & 20 OF HIS ORDER. AF TER HAVING DETAILED DISCUSSION THE LD. CIT(A) RESTRICTED THE ADDITION AT RS. 1.63 LAKHS AND RELIEF WAS ALLOWED TO THE TUNE OF RS . 86 417/- AS PER THE ORDER OF UDHALAL VALECHA. THE TRIBUNAL H AS UPHELD THIS ISSUE IN THE CASE OF UDHALAL VALECHA AFTER HAV ING FOLLOWING OBSERVATIONS :- 32. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND THAT NO INCRIMINATING PAPER WAS FOUND ABOUT -: 45: - 45 INCURRING OF EXPENDITURE EXCEPT ONE BUNCH OF PAPERS AS INDICATED IN THE PAPER BOOK AT PAGES 14-21 FILED BEFORE THE CIT(A). THE LD. CIT(A) HAS DULY CONSIDERED THE ENTRIES OF THESE PAPERS AND FOUND THAT SOME OF THESE EXPENSES ARE ALREADY DEBITED IN THE BOOKS. MILK EXPENDITURE DEBITED AT RS. 64 480/- BECAUSE OF THE VOUCHER BELONGING TO PAYMENT OF MILK FOR THE ISSYOG ORGANIZATION OF PATNA OF WHICH ONE OF THE ASSESSEES SHRI SURESH VALECHA IS A MEMBER. THE SAID PAYMENT WAS FOR FUNCTION HELD AT INDORE IN JULY 2000 FOR THE EXPENSES ON ACCOUNT OF MILK WHICH WAS CONTRIBUTED BY THE ASSESSEE FAMILY AS HAVING BEEN COLLECTED FROM SAMAJ PEOPLE. THE ASSESSEE HAS ALSO SUBMITTED THE PAPER CUTTING OF SUCH FUNCTION BEFORE THE LOWER AUTHORITIES. AFTER CONSIDERING THE VARIOUS HOUSE HOLD EXPENSES WHICH ARE LIKELY TO BE INCURRED THE CIT(A) HAS REASONABLY RESTRICTED THE ADDITION TO THE -: 46: - 46 EXTENT OF RS. 1 63 000/- IN THE HANDS OF EACH OF THE ASSESSEE. AGAINST THE PART DELETION OF ADDITION THE REVENUE IS NOT IN APPEAL BEFORE US FURTHERMORE THE LD. AUTHORIZED REPRESENTATIVE COULD NOT POINT OUT ANY FAULT IN THE ORDER OF LD. CIT(A) FOR RESTRICTING THE ADDITION TO THE EXTENT OF RS. 1 63 000/-. ACCORDINGLY WE CONFIRM THE ACTION OF CIT(A) WITH REGARD TO HOUSE HOLD EXPENSES. 33. IN THE RESULT THE GROUND TAKEN BY ALL THE ASSESSEES IN RESPECT OF ADDITION FOR HOUSE HOLD EXPENDITURE IS HEREBY DISMISSED. 17. RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNA L WE UPHOLD THE ACTION OF THE LD. CIT(A) IN THIS REGARD. 18. IN THE RESULT THIS GROUND OF THE ASSESSEE IS DISM ISSED. 19. ADDITION MADE ON ACCOUNT OF MARRIAGE EXPENSES OF DAUGHTER AMOUNTING TO RS. 1 96 000/- HAS BEEN DELET ED BY THE LD. CIT(A) AFTER HAVING DETAILED DISCUSSED AT PAGES 21 TO 23. SIMILAR ISSUE HAS BEEN DEALT WITH BY THE TRIBUNAL I N CASE OF -: 47: - 47 GROUP ASSESSEES AND THE ACTION OF CIT(A) FOR DELETI NG THE ADDITION HAS BEEN CONFIRMED BY THE TRIBUNAL AFTER H AVING FOLLOWING OBSERVATIONS :- 59. ADDITION MADE ON ACCOUNT OF MARRIAGE EXPENSES IN THE HANDS OF NANDLAL VALECHA GANGARAM VALECHA AND JAMNADAS VALECHA WERE DELETED BY THE LD. CIT(A) BY RECORDING A FINDING TO THE EFFECT THAT NO EVIDEN CE WERE FOUND PERTAINING TO INCURRING OF SUCH EXPENDITURE IN SEARCH AND SEIZURE OPERATION AND ADMISSION OF SUCH EXPENSES THE ADDITION COULD NOT BE SUSTAINED BEYOND THE SCOPE OF UNDISCLOSED INCOME AS DEFINED U/S 158B(B) OF THE INCOME-TAX ACT 1961. 60. NOTHING WAS BROUGHT TO OUR NOTICE BY THE LD. SENIO R D.R. SO AS TO PERSUADE US TO DEVIATE FROM THE FINDI NGS RECORDED BY THE LD. CIT(A). WE ACCORDINGLY DO NOT FIND ANY REASON TO INTERFERE IN THE FINDING OF THE CIT(A) FOR DELETING THE ADDITION MADE BY THE ASSESSING OFFICER BY ESTIMATING EXPENSES ON MARRIAG E OF THE DAUGHTERS WHERE NO INCRIMINATING DOCUMENTS WERE FOUND DURING SEARCH TO INDICATE THAT THE -: 48: - 48 ASSESSEE HAD ACTUALLY SPENT ANY MONEY ON SUCH MARRIAGES. FURTHER THE MARRIAGE WAS SOLEMNIZED IN DIFFERENT YEARS. IN ADDITION TO THE WITHDRAWALS TH ERE WAS SUFFICIENT FUND FOR EXPLAINING THE EXPENSES IF ANY INCURRED ON SUCH MARRIAGES. ACCORDINGLY GROUND RAISED BY REVENUE WITH REGARD TO DELETION OF ADDITI ON ON ACCOUNT OF MARRIAGE EXPENSES IN RESPECT OF ALL T HE ASSESSEES ARE HEREBY DISMISSED. 20. AS THE FACTS AND CIRCUMSTANCES IN THE CASE OF THE ASSESSEE ARE PARI MATERIA AS DISCUSSED BY THE TRIB UNAL AT PAGE 59 AND 60 OF HIS ORDER AT PAGE NOS. 89 & 90. R ESPECTFULLY FOLLOWING THE SAME REASONING WE CONFIRM THE ACTION OF CIT(A) FOR DELETING THE ADDITION MADE ON ACCOUNT OF MARRIA GE EXPENSES. 21. THE ISSUE WITH REGARD TO LEVYING OF SURCHARGE HAS BEEN DECIDED BY THE TRIBUNAL AGAINST THE ASSESSEE BY REV ERSING THE ORDER OF CIT(A). FOLLOWING WAS THE PRECISE OBSERVAT ION OF THE TRIBUNAL AT PAGE 62 :- -: 49: - 49 35.IN ALL THE YEARS UNDER CONSIDERATION THE REVENUE IS ALSO AGGRIEVED FOR DELETION OF SURCHARGE LEVIED BY THE ASSESSING OFFICER IN RESPECT OF ALL THE ASSESSEES. THE ISSUE FOR LEVY OF SURCHARGE IN CASE OF BLOCK ASSESSMENT IS SQUARELY COVERED BY THE ORDER OF THE HON'BLE SUPREME COURT IN THE CASE OF SURESH GUPTA 297 ITR 222. ACCORDINGLY WE REVERSE THE ORDER OF CIT(A) ON THIS GROUND AND CONFIRM THE ACTION OF THE AO FOR LEVY OF SURCHARGE IN RESPECT OF TAXES TO BE COMPUTED AFTER GIVING APPEAL EFFECT IN THE AMOUNT OF INCOME TAX SO COMPUTED. WE DIRECT ACCORDINGLY. 22. RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL WE REVERSE THE ACTION OF THE CIT(A) FOR NOT LEVYING TH E SURCHARGE. 23. IN THE RESULT THIS GROUND OF REVENUES APPEAL IS ALLOWED. 24. ADDITION ON ACCOUNT OF HUNDIES OF RS. 30 LAKHS AND LETTER OF RS. 40 LAKHS WAS UPHELD BY THE LD. CIT(A) BY -: 50: - 50 DISCUSSING AT PAGE NOS. 11 TO 21 OF HIS APPELLATE O RDER. THE CONTENTION OF LD. AUTHORIZED REPRESENTATIVE WAS THA T THE ASSESSEE HAS RIGHT FROM THE BEGINNING DENIED THE OW NERSHIP OF THESE PAPERS AND THE SAME WAS REPEATED IN THE RETUR NS SO FILED. THE SAME WAS AGAIN SUBMITTED THROUGH AN AFFI DAVIT SWORN BY ALL THE EIGHT MEMBERS OF THE GROUP ON 5.3. 2002. THE DENIAL OF THESE DOCUMENTS WAS AGAIN REPEATED THROUG H STATEMENT OF SHRI SURESH VALECHA RECORDED BY THE AS SESSING OFFICER ON 31.3.2001. 25. ON THE OTHER HAND THE LD. CIT DR RELIED ON THE FINDINGS RECORDED BY THE LOWER AUTHORITIES AND SUBM ITTED THAT THE ASSESSEE HAS EVEN SIGNED AT THE BACK OF THE PRO MISSORY NOTE THEREBY ACCEPTING THEIR CONTENTS DURING COUR SE OF SEARCH. 26. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE FINDINGS RECORDED BY THE LOWER AUTHORITIES AS WELL AS COPY OF THE PROMISSORY NOTE SO FOUND AT THE BUSINESS PREMISES WHICH ARE PLACED IN THE PAPER BOOK. WE FOUND THAT THESE PROMISSORY NOTES AS WELL AS LETTER ARE DUMB DOCUMENTS IN SO FAR AS THEY DO NOT REFLECT EVEN THE NAME AND -: 51: - 51 ADDRESS OF THE LENDER AND BORROWER. IF THE ASSESSEE HAD ACTUALLY ADVANCED SOME AMOUNT THE NAME OF SUCH BOR ROWER SHOULD APPEAR ON SUCH PROMISSORY NOTE ALONGWITH HIS ADDRESS. EVEN THE DEPARTMENT AFTER MAKING DETAILED INQUIRY C OULD NOT FIND OUT ANY OF SUCH BORROWER WHO HAS TAKEN MONEY F ROM THE ASSESSEE AS STATED ON THE PROMISSORY NOTE. THE SCAL E OF ASSESSEES BUSINESS AND ALSO ALL THE ASSETS SO FOUN D DURING COURSE OF SEARCH DO NOT JUSTIFY ANY MONEYLENDING BE ING CARRIED OUT OUTSIDE THE BOOKS OF ACCOUNT. EVEN THE AMOUNT S O MENTIONED ON THESE PROMISSORY NOTES WERE SO EXORBIT ANT AMOUNT WHICH EVEN DO NOT RESEMBLE AND COHERENCE WI TH THE ADVANCES GIVEN BY THE ASSESSEE DURING THE WHOLE OF THE BLOCK PERIOD. DURING THE COURSE OF SEARCH WHEN THE ASSE SSEE WAS BEING ASKED TO SIGN THOUSANDS OF DOCUMENTS IT IS P OSSIBLE THAT THE ASSESSEE WITHOUT SEEING THE CONTENTS OF TH E DOCUMENTS HAD SIGNED AT THE BACK OF THESE DOCUMENTS . NOT ONLY BEFORE AO BUT ALSO BEFORE THE CIT(A) THE ASSE SSEE HAS CLEARLY STATED THAT DEPARTMENT HAS LIBERTY TO RECOV ER ANY AMOUNT OF THESE PROMISSORY NOTES AND TO KEEP THE SA ME WITH THE DEPARTMENT AS THE ASSESSEE HAD NOTHING TO DO WI TH SUCH -: 52: - 52 PAPERS. NONE OF THESE PROMISSORY NOTES MATCHES WITH OTHER 520 HUNDIES FOUND AT ASSESSEES PREMISES WHICH WER E ADVANCED THROUGH CHEQUES AND ALL THE INTEREST HAD B EEN DULY ACCOUNTED FOR AND REFLECTED IN THE RETURN SO FILED. IN THE NORMAL COURSE ALL THE HUNDI ADVANCE WAS GIVEN THRO UGH ACCOUNT PAYEE CHEQUES AND THESE HUNDIES DULY CONTAI NED CHEQUES NOS. NAMES AND ADDRESS OF THE LENDER AND B ORROWER. WHETHER THEY WERE FRESH HUNDIES OR RENEWALS THE HU NDI SO FOUND AND ADDED BY THE LOWER AUTHORITIES DID NOT CO NTAIN ANY OF THESE DETAILS. 27. IN VIEW OF THE ABOVE DISCUSSION WE DO NOT FIND AN Y MERIT IN THE ACTION OF LOWER AUTHORITIES FOR MAKING ADDITION IN RESPECT OF THESE HUNDIES. 28. WITH REGARD TO THE ADDITION ON ACCOUNT OF THREE HUNDIES OF RS. 50 000/- EACH WE DO NOT FIND ANY RE ASON TO INTERFERE IN THE FINDINGS RECORDED BY THE LD. CIT(A ) AT PAGE 14 OF HIS ORDER HAVING READ WITH THE STATEMENT OF SHRI SURESH VALECHA. ACCORDINGLY WE CONFIRM THE ADDITION OF RS . 1.50 LAKHS IN RESPECT OF THESE HUNDIES. -: 53: - 53 29. IN THE RESULT BOTH THE APPEALS OF THE ASSESSEE AS WELL AS REVENUE ARE ALLOWED IN PART IN TERMS INDICATED A BOVE. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 25 TH NOVEMBER 2011. SD/- SD/- (JOGINDER SINGH) ( R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 25 TH NOVEMBER 2011. CPU* 1724