The ACIT, 3(1), v. Shri Sanjay Mehta,

PAGE 1 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH : INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI V.K. GUPTA ACCOUNTANT MEMBER PAN NO. : AABCM1098E I.T(SS).A.NO.55/IND/2007 BLOCK PERIOD : 1.4.1995 TO 27.2.2002 ACIT M/S. MINAL BUILDERS PVT.LTD. 3(1) VS 21 ZONE II M.P. NAGAR BHOPAL BHOPAL. APPELLANT RESPONDENT C.O.NO.70/IND/2008 (ARISING OUT OF I.T(SS).A.NO.55/IND/2007) BLOCK PERIOD : 1.4.1995 TO 27.2.2002 M/S. MINAL BUILDERS PVT.LTD. ACIT 21 ZONE II M.P. NAGAR VS 3(1) BHOPAL. BHOPAL CROSS OBJECTOR RESPONDENT PAN NO. : N.A. I.T(SS).A.NO.85/IND/2006 BLOCK PERIOD : 1.4.1995 TO 27.2.2002 ACIT SMT.SANDHYA SAHLOT M/S. RAJ HOMES PVT.LTD. 3(1) VS 21 ZONE II M.P. NAGAR BHOPAL BHOPAL. APPELLANT RESPONDENT C.O.NO.89/IND/2006 (ARISING OUT OF I.T(SS).A.NO.85/IND/2006) BLOCK PERIOD : 1.4.1995 TO 27.2.2002 PAGE 2 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS SMT.SANDHYA SAHLOT M/S. RAJ HOMES PVT.LTD. ACIT 21 ZONE II M.P. NAGAR VS 3(1) BHOPAL. BHOPAL CROSS OBJECTOR RESPONDENT I.T(SS).A.NO.86/IND/2006 BLOCK PERIOD : 1.4.1995 TO 27.2.2002 ACIT SHRI ARUN SAHLOT M/S. RAJ HOMES PVT.LTD. 3(1) VS 21 ZONE II M.P. NAGAR BHOPAL BHOPAL. APPELLANT RESPONDENT C.O.NO.90/IND/2006 (ARISING OUT OF I.T(SS).A.NO.86/IND/2006) BLOCK PERIOD : 1.4.1995 TO 27.2.2002 SHRI ARUN SAHLOT M/S. RAJ HOMES PVT.LTD. ACIT 21 ZONE II M.P. NAGAR VS 3(1) BHOPAL. BHOPAL CROSS OBJECTOR RESPONDENT I.T(SS).A.NO.87/IND/2006 BLOCK PERIOD : 1.4.1995 TO 27.2.2002 ACIT SHRI HITESH MEHTA M/S. RAJ HOMES PVT.LTD. 3(1) VS 21 ZONE II M.P. NAGAR BHOPAL BHOPAL. APPELLANT RESPONDENT C.O.NO.91/IND/2006 PAGE 3 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS (ARISING OUT OF I.T(SS).A.NO.87/IND/2006) BLOCK PERIOD : 1.4.1995 TO 27.2.2002 SHRI HITESH MEHTA M/S. RAJ HOMES PVT.LTD. ACIT 21 ZONE II M.P. NAGAR VS 3(1) BHOPAL. BHOPAL CROSS OBJECTOR RESPONDENT I.T(SS).A.NO.88/IND/2006 BLOCK PERIOD : 1.4.1995 TO 27.2.2002 ACIT SHRI SANDEEP MEHTA M/S. RAJ HOMES PVT.LTD. 3(1) VS 21 ZONE II M.P. NAGAR BHOPAL BHOPAL. APPELLANT RESPONDENT C.O.NO.92/IND/2006 (ARISING OUT OF I.T(SS).A.NO.88/IND/2006) BLOCK PERIOD : 1.4.1995 TO 27.2.2002 SHRI SANDEEP MEHTA M/S. RAJ HOMES PVT.LTD. ACIT 21 ZONE II M.P. NAGAR VS 3(1) BHOPAL. BHOPAL CROSS OBJECTOR RESPONDENT I.T(SS).A.NO.89/IND/2006 BLOCK PERIOD : 1.4.1995 TO 27.2.2002 ACIT SHRI SANJAY MEHTA M/S. RAJ HOMES PVT.LTD. 3(1) VS 21 ZONE II M.P. NAGAR BHOPAL BHOPAL. APPELLANT RESPONDENT C.O.NO.93/IND/2006 PAGE 4 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS (ARISING OUT OF I.T(SS).A.NO.89/IND/2006) BLOCK PERIOD : 1.4.1995 TO 27.2.2002 SHRI SANJAY MEHTA M/S. RAJ HOMES PVT.LTD. ACIT 21 ZONE II M.P. NAGAR VS 3(1) BHOPAL. BHOPAL CROSS OBJECTOR RESPONDENT DEPARTMENT BY : SHRI K.K.SINGH CIT DR ASSESSEE BY : SHRI YASHWANT SHARMA C. A. DATE OF HEARING : 22.04.2010 O R D E R PER BENCH THESE APPEALS BY THE REVENUE AND CROSS OBJECTIONS BY THE ASSESSEE ARE IN RESPECT OF CONNECTED ASSESSEES AND INVOLVE C OMMON ISSUES HENCE THESE WERE HEARD TOGETHER AND THESE ARE BEING DISPO SED OF THROUGH THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. WE HAVE HEARD BOTH THE PARTIES AND HAVE ALSO PERUSE D THE MATERIAL AVAILABLE ON RECORD. 3. FIRST WE SHALL TAKE UP THE ASSESSEES CROSS OBJECT ION NO.70/IND/2008. 4. THE LEARNED COUNSEL SUBMITTED THAT THERE WAS A DELA Y IN FILING OF THIS CROSS OBJECTION AND AS SUCH DELAY OCCURRED DUE TO MISTAKE/LAPSE ON PAGE 5 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS THE PART OF THE ASSESSEES COUNSEL AND AFFIDAVIT IN THIS REGARD HAD BEEN SUBMITTED EXPLAINING THE REASONS. ACCORDINGLY HE P RAYED THAT THIS COULD BE CONDONED. 5. THE LD. CIT DR ON THE OTHER HAND OPPOSED THE SAME . 6. ON DUE CONSIDERATION OF FACTS AND CIRCUMSTANCES RES ULTING INTO DELAY WE ARE OF THE VIEW THAT IN RESPECT OF OTHER APPEALS OF THE GROUP CROSS OBJECTION WAS FILED IN TIME AND DUE TO AN UNI NTENTIONAL LAPSE THIS WAS NOT FILED. ACCORDINGLY WE ADMIT THE SAME FOR R E-ADJUDICATION. 7. THE LD. DEPARTMENTAL REPRESENTATIVE REFERRED TO THE ADDITIONAL GROUND RAISED BY THE REVENUE IN ALL OTHER APPEALS WHEREIN IT HAD BEEN CONTENDED THAT ACTION OF REFERENCE BY THE A.O. U/S 142(2A) SPECIAL AUDITOR WAS NOT AN APPELLABLE ORDER IN VIEW OF THE DECISION OF THE HON'BLE SUPREME COURT CITED THEREIN. HENCE THIS AD DITIONAL GROUND OF THE CROSS OBJECTION WAS NOT MAINTAINABLE. THE LEARNED C OUNSEL ON THE OTHER HAND INITIALLY STATED THAT THIS ISSUE WAS MAINTAIN ABLE AS THE ASSESSMENT ORDER WAS BASED UPON SUCH SPECIAL AUDIT AND WHEN SU CH ASSESSMENT ORDER WAS SUB-JUDICE. HENCE IT WAS AN IMPLIED RIGHT OF T HE ASSESSEE TO CHALLENGE THE VALIDITY OF ACTION U/S 142(2A). HOWEV ER SUBSEQUENTLY THE LEARNED COUNSEL SUBMITTED THAT IF THE MATTER WAS TO BE DECIDED IN FAVOUR OF THE ASSESSEE THEN INSPITE OF IT BEING A COVERED ISSUE INVOLVED OF THE ASSESSEE HE WAS READY NOT TO PRESS THIS ADDITIONAL GROUND. WE FIND THAT PAGE 6 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS THE POINT RAISED BY THE REVENUE IN THE ADDITIONAL GROUND FILED IN OTHER APPEALS REGARDING LACK OF JURISDICTION OF LD. CIT(A ) AND THE TRIBUNAL CONSEQUENTLY TO LOOK INTO THE VALIDITY OF ACTION OF A.O. U/S 142(2A) WAS NOT BEFORE THE TRIBUNAL IN THE CASE OF RAJ HOMES PR IVATE LIMITED. HENCE IN VIEW OF THESE FACTS AND CONCESSION MADE BY THE A SSESSEE WE DISMISS THIS ADDITIONAL GROUND OF THE ASSESSEES CROSS OBJE CTION NO. 70/IND/2008 8. NOW WE SHALL TAKE UP THE REVENUES APPEALS AND DEC IDE THE REMAINING GROUNDS OF THIS CROSS OBJECTION THEREAFTE R. 9. THE GROUNDS RAISED BY THE REVENUE IN THIS APPEAL READ AS UNDER :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN 1. DELETING THE ADDITION OF RS. 15 99 500/- MADE BY TH E ASSESSING OFFICER ON ACCOUNT OF ADVANCE FROM CUSTOMERS RECEIVED IN CASH; 2. DELETING THE ADDITION OF RS. 25 000/- ON ACCOUNT OF UNDISCLOSED INVESTMENT IN STAMP PAPERS IN FINANCIAL YEAR 1998-1999 WHICH WAS RIGHTLY ADDED BY THE ASSESSING OFFICER IN ACCORDANCE WITH LAW; 3. DELETING THE ADDITION OF RS.90 000/- OUT OF TOTAL ADDITION OF RS. 1 65 000/- ON ACCOUNT OF UNDISCLOSE D PAGE 7 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS INCOME WHICH WAS RIGHTLY ADDED BY THE ASSESSING OFFICER; 4. DELETING THE ADDITION OF RS. 2 50 000/- ON ACCOUNT OF UNACCOUNTED TRANSACTION IN PURCHASE OF PLOT IN FINANCIAL YEAR 2000-01; 5. DELETING THE ADDITION OF RS. 3 12 000/- ON ACCOUNT OF UNACCOUNTED RECEIPTS. 6. DELETING THE ADDITION OF RS. 11 29 350/- TOWARDS DIFFERENCE BETWEEN RETURNED INCOME AND ASSESSED INCOME; 7. DELETING THE ADDITION OF RS. 5 89 663/- ON ACCOUNT OF UNDISCLOSED INCOME FOR ASSESSMENT YEAR 2002-03. 8. DELETING THE ADDITION OF RS. 1 60 000/- ON ACCOUNT OF REDUCING RETURNED UNDISCLOSED INCOME. 10. THE REVENUE HAS ALSO RAISED THE FOLLOWING ADDITIONA L GROUNDS :- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE LEVY OF SURCHA RGE BY THE A.O. WHICH WAS LEVIED IN ACCORDANCE WITH LAW IN VIEW OF THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. SURESH N. GUPTA (214 CTR 274) WHICH IS IN FAVOUR OF THE REVENUE. PAGE 8 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 11. THE LD. CIT DR REQUESTED FOR ADMISSION OF SUCH ADDI TIONAL GROUND BEING A LEGAL ISSUE. THE LEARNED COUNSEL FOR THE ASSESSEE DID NOT OPPOSE AND HENCE WE ADMIT THE SAME. 12. BOTH THE PARTIES AGREED THAT THIS ISSUE WAS COVERE D IN FAVOUR OF THE REVENUE IN VIEW OF THE SAID DECISION OF THE HON 'BLE SUPREME COURT . HENCE THIS ADDITIONAL GROUND OF THE REVENUE IS ALL OWED. 13. THE LEARNED COUNSEL FOR THE ASSESSEE FOR THE SAKE OF CONVENIENCE SUBMITTED THAT THE ISSUE RAISED IN GRO UND NO.1 WAS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE T RIBUNAL IN THE CASE OF RAJ HOMES PRIVATE LIMITED (SUPRA) WHEREIN THE TRIB UNAL HAD CONFIRMED THE DELETION OF ADDITION ON THE GROUND THAT THE TRA NSACTION OF DEPOSITS WERE DULY DISCLOSED IN THE BOOKS OF ACCOUNT AND NO MATERIAL WAS FOUND TO SHOW THAT SUCH DEPOSITS WERE NOT GENUINE. THE LEARN ED COUNSEL REFERRED TO PARAS 22 TO 24 OF THE SAID ORDER FOR OUR READY R EFERENCE. THE LD. CIT DR ON THE OTHER HAND REFERRED TO RELY ON THE ORDE R OF A.O. 14. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 15. IT IS NOTED THAT IN THE COURSE OF SEARCH PROCEEDING S IT WAS NOTED THAT THE ASSESSEE COMPANY STARTED BOOKING AND TOOK DEPOSITS/ADVANCES FROM CUSTOMERS FOR ITS MINAL SHOPPING COMPLEX WHIC H WERE DULY RECORDED IN THE BOOKS OF ACCOUNT REGULARLY MAINTAIN ED BY THE ASSESSEE. IT PAGE 9 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS IS FURTHER NOTED THAT NO INCRIMINATING MATERIAL OR CORROBORATIVE EVIDENCE WAS FOUND IN THE COURSE OF SEARCH OR PROCEEDINGS TH EREAFTER TO SHOW THAT IT WAS THE UNDISCLOSED INCOME OF THE ASSESSEE BROUGHT INTO THE BOOKS OF ACCOUNT IN THIS FIRM. IT IS ALSO WORTHWHILE TO NOTE THAT MOST OF THE DEPOSITS WERE RECEIVED THROUGH CHEQUES AND THE POSSESSION OF THE SHOPS/UNITS HAD BEEN GIVEN BY THE ASSESSEE IN SUBSEQUENT YEARS TO T HE RESPECTIVE CUSTOMERS. ON IDENTICAL FACTS IN THE LEADING CASE OF THE ASSESSEE GROUP THE TRIBUNAL HAS DELETED THE SIMILAR ADDITION FOR T HE REASON THAT IN THE CASE OF BLOCK ASSESSMENT NO ADDITION COULD BE MADE IN T HE ABSENCE OF ANY EVIDENCE FOUND RELATING THERETO AND ALSO FOR THE RE ASON THAT THE A.O. DID NOT MAKE REQUIRED INQUIRY FOR MAKING ADDITION. ACCO RDINGLY WE FIND NO MERIT IN THIS GROUND OF THE REVENUE AND THEREFORE WE DISMISS THE SAME. 16. THE FACTS RELATING TO GROUND NO.2 ARE THAT THE AS SESSEE FILED BLOCK RETURN SHOWING UNDISCLOSED INCOME AT RS. 1.60 LAKHS WHICH INCLUDED A SUM OF RS. 25 000/- FOR FINANCIAL YEAR 1 998-99. THE A.O. FOUND THAT THIS CLAIM OF RS. 50 000/- HAD BEEN MADE FOR UNRECORDED EXPENDITURE FOR PURCHASE OF STAMP PAPERS IN FINANCI AL YEAR 1998-99 CORRESPONDING TO ASSESSMENT YEAR 1999-2000. HOWEVER SINCE THE ASSESSEE HAD DISCLOSED ONLY RS. 20 000/- IN THE BLO CK RETURN THE A.O. MADE AN ADDITION OF RS. 25 000/-. IN THE APPELLATE PROCEEDINGS THE ASSESSEE PLEADED THAT INCOME FOR THE BLOCK PERIOD H AD BEEN OFFERED PURELY PAGE 10 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS ON ESTIMATE BASIS AND THE ASSESSEE HAD RESERVED THE RIGHT TO MAKE ADJUSTMENT AND APPROPRIATION OF THE INCOME IN OTHER YEARS OF BLOCK PERIOD AND SINCE BLOCK RETURN HAD BEEN ACCEPTED BY THE ASS ESSING OFFICER THEREFORE NO SEPARATE ADDITION WAS CALLED FOR. THE LD. CIT(A) AGREED WITH THE SUBMISSIONS OF THE ASSESSEE TO THE EXTENT THAT NO SEPARATE ADDITION WAS CALLED FOR. 17. AGGRIEVED BY THIS THE REVENUE IS IN APPEAL BEFORE US. 18. THE LEARNED COUNSEL FOR THE ASSESSEE FOR THE SAKE OF CONVENIENCE OF THE BENCH SUBMITTED THAT THE ASSESS EE MADE A TOTAL DISCLOSURE AND THEN BIFURCATED INTO VARIOUS GROUP E NTITIES AND SUCH UNRECORDED EXPENDITURE WAS INCLUDED IN THE OVER ALL INCOME OF RS. 1.60 LAKHS DECLARED BY THE ASSESSEE FOR THE BLOCK PERIOD . HENCE NO SEPARATE ADDITION WAS CALLED FOR. HE FURTHER PLACED STRONG R ELIANCE ON THE ORDER OF THE LD. CIT(A). 19. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER H AND PLACED STRONG RELIANCE ON THE ORDER OF THE A.O. 20. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 21. IT IS THE CLAIM OF THE ASSESSEE THAT UNDISCLOSED IN COME SHOWN BY IT IN THE BLOCK RETURN COMPRISED OF UNDISCLOSED EXP ENDITURE OF RS. 50 000/- ALSO AND THE LD. CIT(A) HAS ACCEPTED THIS CLAIM OF THE ASSESSEE PAGE 11 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS AND EVEN THE A.O. FOR RS. 25 000/- DECLARED IN THE RELEVANT ASSESSMENT YEAR ACCEPTED THIS CLAIM OF THE ASSESSEE. WE FURTHE R FIND THAT THE STAND OF THE ASSESSEE IS THAT UNDISCLOSED INCOME WAS DECLARE D FOR ENTIRE BLOCK PERIOD ON ESTIMATED BASIS AND THAT HAS BEEN BIFURCA TED AFTER VERIFICATION OF THE CORRECT FACTS IN EACH ORDER FALLING THE BLOCK P ERIOD. THIS CLAIM OF THE ASSESSEE HAS REMAINED UNCONTROVERTED AND THEREFORE WE DO NOT FIND ANY MERIT IN THIS GROUND OF THE REVENUE. 22. THE FACTS IN RESPECT OF ISSUE RAISED IN GROUND NO.3 ARE THAT THE SPECIAL AUDIT AUDITOR REPORTED UNACCOUNTED RECEIPTS OF RS. 1.65 LAKHS OUT OF WHICH ASSESSEE ACCEPTED A SUM OF RS. 75 000/- AN D CLARIFIED THAT RS. 90 000/- REPRESENTING BOOKING ADVANCE/DEPOSITS BY R UHI KHANAM AND SHRI RAJNEESH JAIN FOR A SUM OF RS. 40 000/- AND RS . 50 000/- RESPECTIVELY WAS DULY RECORDED IN THE BOOKS OF ACCOUNT AND THE O RIGINAL DULY CANCELLED RECEIPTS WERE ALSO SUBMITTED BEFORE THE A.O. HENCE NOT TO BE ADDED. IT WAS ALSO CONTENDED THAT IT WAS A CASE OF REFUNDABLE DEPOSITS AND THEREFORE NOT OF INCOME NATURE. THE A.O. HOWEVER ADDED THE SAME. IN APPEAL BEFORE THE LD. CIT(A) THE SAME PLEAS WERE R AISED AND IT WAS ALSO CONTENDED THAT AS PER THE COPY OF ACCOUNT AND AFFID AVIT OF SHRI RAJNEESH JAIN SHOWING THAT NO AMOUNT OF RS.50 000/- WAS GIVE N BY HIM ON 3.12.2001. THE ADDITION MADE BY THE ASSESSING OFFIC ER WAS NOT JUSTIFIED. IT WAS ALSO CONTENDED THAT WHEN THE A.O. WAS ASKED TO SUMMON THE SAME PAGE 12 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS PERSON TO VERIFY THE FACTS. HOWEVER THE A.O. DID N OT DO SO HENCE THE ACTION OF A.O. WAS NOT JUSTIFIED. THE LD. CIT(A) HE LD THAT THE SAID RECEIPTS WERE NOT INCOME AT THE FIRST PLACE HENCE IT COULD NOT BE TREATED AS INCOME MUCH LESS UNDISCLOSED INCOME. AGGRIEVED B Y THIS THE REVENUE IS IN APPEAL BEFORE US. 23. THE LD. DR NARRATED THE FACTS AND PLACED RELIANCE O N THE ORDER OF THE AO. THE LD. COUNSEL FOR THE ASSESSEE ON THE OT HER HAND PLACED STRONG RELIANCE ON THE ORDER OF THE LD. CIT(A). 24. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 25. IT IS NOTED THAT THE SAID AMOUNTS HAVE BEEN RECORDE D IN THE BOOKS OF ACCOUNT BY CREDITING THE ACCOUNT OF CONCER NED CUSTOMERS AND DEBITING ACCOUNT OF PERSON COLLECTING THE DEPOSITS. IT IS FURTHER NOTED THAT THE ORIGINAL RECEIPT DULY CANCELLED HAS BEEN PRODUC ED BEFORE THE A.O. AND THE A.O. HAS NOT EVEN CALLED SHRI RAJNEESH JAIN FOR VERIFICATION OF THE FACTS AS REQUESTED BY THE ASSESSEE. IT IS ALSO TO B E NOTED THAT NO MATERIAL /EVIDENCES HAVE BEEN FOUND IN THE COURSE OF SEARCH TO SHOW THAT IT WAS THE UNDISCLOSED INCOME OF THE ASSESSEE BROUGHT IN THE B OOKS IN THIS MANNER. THUS TAKING OVER-ALL VIEW IN THE MATTER WE FIND N O MERIT IN THIS GROUND OF THE REVENUE. THE SAME IS THEREFORE DISMISSED. BEFORE PARTING WE PAGE 13 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS MAY FURTHER ADD THAT THIS ISSUE ALSO COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF RAJ HOMES PRIVATE LIMITED ( SUPRA). 26. THE FACTS RELATING TO GROUND NO.4 ARE THAT THE A.O . ON THE BASIS OF THE SAME OBSERVATIONS BY THE SPECIAL AUDITORS H ELD THAT THERE WAS AN UNDER HAND PAYMENT TO SMT. JOY DAS FOR PURCHASE OF PLOT AMOUNTING TO RS. 2.50 LAKHS AND THERE WAS ALSO A DISCREPANCY IN DATES OF REGISTRATION EXPENSES OF RS.77 000/-. HENCE THE A.O. MADE AN AD DITION OF RS. 3 27 000/- BEING UNDISCLOSED INVESTMENT IN THE PU RCHASE OF SAID PLOT. THE ASSESSEE IN APPEAL BEFORE THE LD. CIT(A) POI NTED OUT THAT EVEN THE SPECIAL AUDITOR HAD REPORTED THAT A SUM OF RS. 2.50 LAKHS HAD BEEN PAID IN FINANCIAL YEAR 2000-01 AND BALANCE SUM OF RS. 2 45 000/- WAS OUTSTANDING ON 27.2.2002 ( DATE OF SEARCH ) AND NO MATERIAL WAS FOUND TO SUBSTANTIATE THE VIEW OF THE A.O. HENCE SUCH ADDIT ION WAS UNWARRANTED. AS REGARD TO ADDITION OF RS. 77 000/- IT WAS SUBMI TTED THAT THIS AMOUNT HAD BEEN PAID BY THE DIRECTOR OUT OF MONEY COLLECT ED BY HIM FROM DIFFERENT CUSTOMERS AND BOTH THE TRANSACTIONS WERE RECORDED IN THE BOOKS OF ACCOUNT HENCE THE SAME COULD NOT BE CONSIDERED AS UNDISCLOSED INCOME. THE LD. CIT(A) AFTER EXAMINING THE FACT AGR EED WITH THE SUBMISSION OF THE ASSESSEE AND DELETED THE ADDITION . 27. AGGRIEVED BY THIS THE REVENUE IS IN APPEAL BEFORE US. PAGE 14 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 28. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIE S BELOW. 29. IT IS NOTED THAT THE A.O. HAS NOT APPRECIATED THE F ACTS IN CORRECT PERSPECTIVE AND THEREFORE HAS MADE THE ADDITION. THE LD. CIT(A) HOWEVER HAS EXAMINED THE ISSUE IN DETAIL WHILE DEL ETING THE ADDITION. WE FURTHER FIND THAT ALL THE TRANSACTIONS ARE RECORDED IN THE BOOKS OF ACCOUNT AND ARE DULY SUPPORTED BY THE DOCUMENTARY EVIDENCES . HENCE IN THE ABSENCE OF ANY INCRIMINATING MATERIAL IN OUR OPINI ON THERE IS NO MERIT IN THIS GROUND OF THE REVENUE. THE SAME IS THEREFORE DISMISSED. 30. THE FACTS RELATING TO GROUND NO.5 IN BRIEF ARE T HAT THE ASSESSEE COLLECTED REFUNDABLE DEPOSITS/ADVANCES THROUGH DIRE CTORS AT SITE BY CREDITING THE INDIVIDUAL ACCOUNTS OF THE CUSTOMERS AND DEBITING THE RELEVANT ACCOUNTS OF THE PERSON COLLECTING THE SAME . SPECIAL AUDITOR REPORTED THAT THESE RECEIPTS WERE NOT CREDITED IN T HE BOOKS ON THE DATE OF RECEIPT. THE A.O. TREATED SUCH RECEIPTS AS UNRECORD ED ONE RESULTING INTO UNDISCLOSED INCOME AND MADE AN ADDITION. THE ASSESS EE IN APPEAL BEFORE THE LD. CIT(A) SUBMITTED THAT THE RESPECTIVE RECEIP TS WERE DULY RECORDED IN THE BOOKS OF ACCOUNT AS PER METHOD OF ACCOUNTING AND MERELY BECAUSE SOME OF THE BOOKING ADVANCES/DEPOSITS WERE NOT CRED ITED INTO BOOKS OF ACCOUNT ON THE DATE OF RECEIPTS THE SAME COULD NOT BE TREATED AS UNDISCLOSED INCOME OF THE ASSESSEE. THE LD. CIT(A) FOUND THAT SINCE ALL PAGE 15 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS THE RECEIPTS PRIOR TO AND AFTER THE IMPUGNED RECEIP TS ISSUED BY THE ASSESSEE WERE DULY ACCOUNTED FOR IN THE REGULAR BOO KS OF ACCOUNT HENCE THERE WAS NO REASON TO ASSUME THAT THE RESPECTIVE R ECEIPTS WOULD NOT HAVE BEEN DISCLOSED TO THE DEPARTMENT BUT FOR THE SEARC H. HENCE THERE WAS NO REASON TO ADD THE SAME AS UNDISCLOSED INCOME OF THE ASSESSEE. AGGRIEVED BY THIS THE REVENUE IS IN APPEAL BEFORE US. 31. THE LEARNED COUNSEL AT THE VERY OUT-SET SUBMITT ED THAT THIS ISSUE WAS COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF RAJ HOMES PRIVATE LIMITED (SUPRA) AND REFERRED TO PARA 33 AT PAGE 693 AND 694 OF THE ORDER. THE LEARNED COUNSEL FURTHER SUBMI TTED THAT VALID RECEIPTS WERE ISSUED TO THE CUSTOMERS AND BOOKS WER E NOT CLOSED ON THE DATE OF SEARCH AND THEREAFTER SUCH RECEIPTS WERE DULY ACCOUNTED FOR IN THE BOOKS OF ACCOUNT HENCE NO ADDITION WAS TO BE MADE. 32. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAND PLACED STRONG RELIANCE ON THE ORDER OF THE A.O. 33. WE FIND THAT A SIMILAR ISSUE AROSE BEFORE THE TRIBU NAL IN THE CASE OF RAJ HOMES WHEREIN IT HAS BEEN HELD THAT THE REC EIPT OF THE AMOUNTS WAS NOT IN DISPUTE AND THE ENTRIES WERE ACTUALLY RE CORDED IN THE BOOKS OF ACCOUNT HENCE NO ADDITION WAS TO BE MADE. THE FAC TS OF THE PRESENT CASE ARE SIMILAR HENCE FOLLOWING THE SAME WE DISMISS THIS GROUND OF THE REVENUE. PAGE 16 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 34. GROUND NO. 6 IS THAT THE LD. CIT(A) HAS ERRED IN DE LETING THE ADDITION OF RS. 11 29 350/- TOWARDS DIFFERENCE BETW EEN RETURNED INCOME AND ASSESSED INCOME. 35. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE IMPUGNED ADDITION WAS A CASE OF TAXATION OF SAME IN COME TWICE I.E. ONE IN BLOCK ASSESSMENT AND ONE IN THE REGULAR ASSESSME NT. IT WAS ALSO CONTENDED THAT THE ADDITION WAS MADE PURELY ON PRES UMPTION WITHOUT ANY MATERIAL FOUND DURING THE COURSE OF SEARCH. IT WAS ALSO SUBMITTED THAT THE INCOME ASSESSED IN REGULAR ASSESSMENT COULD NOT BE SUBJECTED TO TAX UNDER BLOCK ASSESSMENT. THE LEARNED COUNSEL SUBMITTED THA T THE SIMILAR ISSUE AROSE IN THE CASE OF RAJ HOMES PRIVATE LIMITED (SUP RA) WHEREIN THE VIEW OF THE LD. CIT(A) WAS CONFIRMED AND DREW OUR ATTEN TION TO PARA 39 OF THE SAID ORDER. 36. WE FIND THAT IDENTICAL ISSUE AROSE BEFORE THE TRIBU NAL IN THE CASE OF RAJ HOMES PRIVATE LIMITED WHEREIN THE TRIBUNAL HELD THAT INCOME DISCLOSED BY THE ASSESSEE IN THE REGULAR RETURN COU LD NOT BE INCLUDED IN THE BLOCK ASSESSMENT. ACCORDINGLY THE DECISION OF THE LD. CIT(A) DELETING THE ADDITION WAS CONFIRMED. THE SAME IS SITUATION H ERE AND THEREFORE FOLLOWING THE RATIO OF THE SAID DECISION WE CONFIR M THE FINDINGS OF THE LD. CIT(A). THUS THIS GROUND OF THE REVENUE IS DIS MISSED. PAGE 17 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 37. GROUND NO. 7 IS THAT THE LD. CIT(A) HAS ERRED IN DE LETING THE ADDITION OF RS. 5 89 663/- ON ACCOUNT OF UNDISCLOSE D INCOME FOR ASSESSMENT YEAR 2002-03. 38. THE LEARNED COUNSEL FOR THE ASSESSEE AT THE OUT-SE T SUBMITTED THAT SIMILAR ISSUE AROSE BEFORE THE TRIBUNAL IN THE CASE OF RAJ HOMES PRIVATE LIMITED (SUPRA) WHEREIN THE TRIBUNAL HELD THAT WHATEVER AMOUNT HAD BEEN DECLARED IN THE REGULAR RETURN FILED BY TH E ASSESSEE AFTER THE SEARCH COULD NOT BE TREATED AS UNDISCLOSED INCOME F OR THE BLOCK PERIOD. THE TRIBUNAL IN HOLDING SO ALSO CONSIDERED THE EXPL ANATION U/S 158BA WHICH PROVIDED THAT BLOCK ASSESSMENT SHALL BE IN OU T OF REGULAR ASSESSMENT IN RESPECT OF/PREVIOUS YEAR INCLUDED THE BLOCK PERIOD. WE FURTHER FIND THAT THE LD. CIT(A) IN THE PRESENT CAS E HAS GIVEN A SPECIFIC FINDING THAT SUCH ADDITION WAS MADE BY THE ASSESSIN G OFFICER PURELY ON GUESS WORK AND WAS IMAGINARY. THUS TAKING INTO CON SIDERATION THE FINDINGS OF THE LD. CIT(A) AS WELL AS THE DECISION OF THE COORDINATE BENCH WE FIND NO MERIT IN THIS GROUND OF THE REVEN UE. THE SAME IS THEREFORE DISMISSED. 39. GROUND NO. 8 IS THAT THE LD. CIT(A) HAS ERRED IN DE LETING THE ADDITION OF RS. 1 60 000/- ON ACCOUNT OF REDUCING R ETURNED UNDISCLOSED INCOME. PAGE 18 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 40. THE LEARNED COUNSEL AT THE VERY OUT-SET SUBMITTED THAT THIS ISSUE WAS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE SAID DECISION OF THE TRIBUNAL AND REFERRED PARA 43 44 & 45 THERE FO R OUR PERUSAL. THE LD. CIT DR ON THE OTHER HAND ON THE OTHER HAND PREFE RRED TO RELY ON THE ORDER OF THE A.O. 41. WE FIND THAT THE ASSESSEE HAS DECLARED THE UNDISCLO SED INCOME AS A WHOLE WHEREAS THE A.O. HAS MADE SPECIFIC ADDI TIONS AND ACCORDINGLY HAS NOT GIVEN SET OFF OF UNDISCLOSED I NCOME OFFERED BY THE ASSESSEE IN THE BLOCK RETURN. THE TRIBUNAL IN THE C ASE OF RAJ HOMES PRIVATE LIMITED (SUPRA) HAS HELD THAT WHATEVER DECL ARATION WAS MADE BY THE ASSESSEE AS UNDISCLOSED INCOME COULD NOT BE IGN ORED ELSE IT WOULD AMOUNT TO DOUBLE ADDITION. HENCE THE TRIBUNAL UPHE LD THE ORDER OF LD. CIT(A). THE IDENTICAL ISSUE IS INVOLVED HERE AND WE RESPECTFULLY FOLLOWING THE SAID RATIO DISMISS THIS GROUND OF TH E REVENUE. 42. IN THE RESULT THE APPEAL FILED BY THE REVENUE STA NDS PARTLY ALLOWED. 43. NOW WE SHALL TAKE UP THE OTHER GROUNDS OF CROSS OB JECTION NO.70/IND/2008. 44. GROUND NO.2 RELATING TO TELESCOPING BENEFIT WAS NOT PRESSED HENCE DISMISSED AS NOT PRESSED. PAGE 19 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 45. GROUND NO.3 RELATING TO CHARGEABILITY OF INTEREST U /S 158BFA IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE TRIBUNAL IN THE CASE OF RAJ HOMES PRIVATE LIMITED (SUPRA) HENCE A CCEPTED. 46. AS REGARD TO THE ISSUE RAISED IN GROUND NO.1 RELATI NG TO CONFIRMATION OF ADDITION OF RS. 60 000/- WE FIND T HAT IT IS THE CLAIM OF THE ASSESSEE THAT SUCH AREA WAS GIVEN BY THE ASSESSEE T O THE RESIDENCE/CUSTOMERS AS A COMMON FACILITIES AND THE COST THEREOF HAD BEEN CODED OVER THE SALEABLE AREA HENCE NOT TO BE CONS IDERED AS STOCK OF THE ASSESSEE AS POINTED OUT BY THE ASSESSEE. WE FURTHE R FIND THAT THE ASSESSEE ALSO REQUESTED THE A.O. TO VERIFY THIS CLAIM OF THE ASSESSEE THROUGH PHYSICAL VERIFICATION WHICH WAS NOT DONE. BOTH THE REVENUE AUTHORITIES HOWEVER HAVE CONFIRMED THE ADDITION. IN OUR VIEW THERE HAS TO BE SOME COMMON PLACES IN SUCH PROJECTS AND ONCE THE ASSESSE E HAS REQUESTED A.O. TO VERIFY ITS SUCH CLAIM AND THAT BEING NOT THEN IN OUR OPINION THE ADDITION IS NOT JUSTIFIED. ACCORDINGLY WE DELETE T HE SAME. THUS THIS GROUND OF THE CROSS OBJECTION STANDS ALLOWED. 47. IN THE RESULT CROSS OBJECTION FILED BY THE ASSESSE E STANDS PARTLY ALLOWED. 48. NOW WE SHALL TAKE UP OTHER APPEALS OF REVENUE AND CROSS OBJECTIONS WHEREIN FOLLOWINGS COMMON ISSUES ARE IN VOLVED:- 49. ISSUE NO. 1 AGRICULTURAL INCOME : PAGE 20 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS NAME OF ASSESSEE BY DEPARTMENT APPEAL NO. /GROUND NO. SANDHYA SAHLOT 85/2006 3 ARUN SAHLOT 86/2006 -4 HITESH MEHTA 87/2006 1 SANDEEP MEHTA 88/2006 3 SANJAY MEHTA 89/2006 2 50. ISSUE NO.2 NOT REDUCING THE RETURNED UNDISCLOSED INCOME FROM THE ASSESSED INCOME. S.NO. ASSESSEE INCOME DISCLOSED AS PER RETURN BY DEPARTM ENT (APPEAL NO. GRO UND BY ASSESSEE C.O. NO. /GROUND NO. 1. MINAL BUILDERS 1 60 000/- 55/2007 8 2. SANDHYA SAHLOT 1 40 000/- 85/2006 - 89/2006 GROUND NO. 4 3. ARUN SAHLOT 2 70 000/- 86/2006 - 90/2006/ GROUND NO.6 5. SANDEEP MEHTA 1 30 000/-** 88/2006 - 92/2006 GROUND NO. - 6. SANJAY MEHTA 1 45 000/- 89/2006 - 93/2006- GROUND NO.2 PAGE 21 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 51. ISSUE NO. 3 INTEREST U/S 158BFA(1). NAME OF ASSESSEE C.O.NO./GROUND NO. MINAL BUILDERS -/3 SANDHYA SAHLOT 89/2006 GROUND NO.6 ARUN SAHLOT 90/2006-GROUND NO. 8 HITESH MEHTA 91/2006 GROUND NO. 4 SANDEEP MEHTA 92/2006GROUND NO. 4 SANJAY MEHTA 93/2006 GROUND NO.4 52. REFERENCE FOR SPECIAL AUDIT U/S 142(2A). ASSESSEE BY DEPARTMENT BY ASSESSEE APPEAL NO GR.NO . C.O.NO. GROUND NO. MINAL BUILDERS 55/2007 - THROUGH ADDITIONAL GROUND SANDHYA SAHLOT 85/2005 - 89/2006 ABRIDGED GROUND OF EARLIER GROUNDS 1 TO 4 ARUN SAHLOT 86/2006 - 90/2006 (ABRIDGED GROUND OF EARLIER GROUNDS 1 TO 4) PAGE 22 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS HITESH MEHTA 87/2006 - 91/2006 (ABRIDGED GROUND OF EARLIER GROUNDS 1 TO 4) SANDEEP MEHTA 88/2006 - 92/2006 (ABRIDGED GROUND OF EARLIER GROUNDS 1 TO 4) SANJAY MEHTA 89/2006 - 93/2006 (ABRIDGED GROUND OF EARLIER GROUNDS 1 TO 4) 53. IN VIEW OF CONCESSION GIVEN BY THE ASSESSEE IN ITS CROSS OBJECTION NO.70/IND/2008 ADDITIONAL GROUND NO.1 OF THE REVENUE IS ALLOWED IN ALL THE APPEALS. 54. BOTH THE PARTIES HAVE AGREED THAT THE ISSUE RAISED IN ADDITIONAL GROUND NO.2 IS COVERED IN FAVOUR OF THE ASSESSEE H ENCE THIS GROUND OF THE REVENUE IS ALSO AGREED IN ALL THE APPEALS FILED BY THE REVENUE. 55. NOW SPECIFIC GROUNDS IN REMAINING APPEALS/CROSS OBJ ECTIONS WHICH HAVE NOT BEEN MENTIONED HEREIN BEFORE ARE REP RODUCED HEREUNDER :- GROUNDS TAKEN IN I.T.(SS)A.NO. 85/IND/2006 : ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN PAGE 23 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 1. DELETING THE ADDITION OF RS. 75 000/- RIGHTLY MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDISCLOSED INCOME. 2. DELETING THE ADDITION OF RS. 2 07 000/- RIGHTLY MAD E BY THE ASSESSING OFFICER ON ACCOUNT OF THE AMOUNT CLAIMED AS PAYABLE TO CONTRACTORS. 4. DELETING THE ADDITION OF RS. 94 000/- RIGHTLY MA DE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDECLARED BANK DEPOSITS. 5. DELETING THE ADDITION OF RS. 75 291/- RIGHTLY MA DE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDISCLOSED CRE DIT FROM SHRI V.K.PRASAD. 6. GRANTING THE RELIEF OF RS. 46 000/- OUT OF TOTAL ADDITION OF RS. 50 000/- RIGHTLY MADE BY THE ASSESSING OFFIC ER ON ACCOUNT OF SUPPRESSION ON RECEIPT. GROUNDS TAKEN IN CROSS OBJECTION NO. 89/IND/2006: 1. THAT THE ENTIRE BLOCK ASSESSMENT WAS ABINITIO VOID AND BAD IN LAW. PAGE 24 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 4 000/- OUT OF OTHER RECEIPTS OF RS. 50 000/-. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) ERRED IN SUSTAINING ADDITION OF RS. 38 3 88/- OUT OF MISC. RECEIPTS OF RS. 42 000/- THOUGH THE SA ME WAS DULY DISCLOSED AS INCOME IN THE REGULAR BOOKS O F ACCOUNT. GROUNDS TAKEN IN I.T.(SS)A.NO. 86/IND/2006 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN 1. DELETING THE ADDITION OF RS. 2 44 930/- RIGHTLY MAD E BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CAS H FOUND AT RESIDENCE DURING THE COURSE OF THE SEARCH AND SEIZURE OPERATION. 2. GRANTING THE RELIEF OF RS. 58 000/- OUT OF TOTAL AD DITION OF RS. 1 76 000/- RIGHTLY MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED FUND INTRODUCED I N THE CASH BOOK. PAGE 25 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 3. DELETING THE ADDITION OF RS. 87 000/- RIGHTLY MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED LOA N PAYMENT. 5. DELETING THE ADDITION OF RS. 70 000/- RIGHTLY MA DE BY THE ASSESSING OFFICER ON ACCOUNT OF INCOME FROM UNUTILIZED BANK WITHDRAWALS. 6. GRANTING THE RELIEF OF RS. 2 37 342/- OUT OF TOT AL ADDITION OF RS. 4 98 920/- RIGHTLY MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED DEPOSIT S IN BANKS. 7. DELETING THE ADDITION OF RS. 18 000/- RIGHTLY MA DE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED BAN K DEPOSITS. 8. DELETING THE ADDITION OF RS. 86 000/- RIGHTLY MA DE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED BAN K DEPOSITS. GROUNDS TAKEN IN C.O.NO.90/IND/2006 1. THAT THE ENTIRE BLOCK ASSESSMENT WAS AB INITIO VOI D AND BAD IN LAW. PAGE 26 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN MAINTAINING ADDITION O F RS. 1 18 000/-. HE OUGHT TO HAVE UNDERSTOOD THAT SUFFICIENT CASH WAS AVAILABLE WITH THE GROUP AS PER CONSOLIDATED CASH ROTATION CHART/PEAK STATEMENT FURNISHED BEFORE THE A.O. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN SUSTAINING ADDITION OF RS. 10 000/- AS ALLEGED UNRECORDED EXPENDITURE ON ACCOU NT OF INTERIOR DECORATION OF M/S. DESIGNING CELL. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS WRONG IN MAINTAINING ADDITION OF RS. 42 000/- OUT OF THE ADDITIONS MADE BY THE ASSESSING OFFICER AT PARA 12(A) OF HIS ORDER. 5. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) WAS NOT CORRECT IN MAINTAINING ADDITION OF RS. 51 135/- AS UNPROVED EXPENSES. GROUNDS TAKEN IN I.T.(SS)A.NO. 87/IND/2006: 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS . PAGE 27 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 10 88 160/- RIGHTLY MADE BY THE ASSESSING OFFICER O N ACCOUNT OF UNEXPLAINED BANK DEPOSITS. GROUNDS TAKEN IN C.O.NO.91/IND/2006 1. THAT THE ENTIRE BLOCK ASSESSMENT WAS AB INITIO VOI D AND BAD IN LAW. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE A.O. ERRED IN SUSTAINING ADDITION OF RS. 65 000 /- ( 25 000/- + 40 000/-) AS UNEXPLAINED ADVANCE AGAINST CONTRACT RECEIPTS. GROUNDS TAKEN IN I.T.(SS)A.NO. 88/IND/2006: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS . 1 19 172/- RIGHTLY MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDECLARED INVESTMENT IN SHARES. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS . 2 82 829/- RIGHTLY MADE BY THE ASSESSING OFFICER BY ESTIMATING THE AMOUNT INCURRED ON HOUSE HOLD EXPENSES SPENT FROM INCOME FROM UNDISCLOSED SOURCES. GROUNDS TAKEN IN C.O.NO.92/IND/2006 PAGE 28 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 1. THAT THE ENTIRE BLOCK ASSESSMENT WAS AB INITO VOID AND BAD IN LAW. GROUNDS TAKEN IN I.T.(SS)A.NO. 89/IND/2006: 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE TE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS . 5 76 000/- RIGHTLY MADE BY THE ASSESSING OFFICER BY TREATING AGRICULTURE INCOME AS INCOME FROM UNDISCLOSED SOURCES. GROUNDS TAKEN IN C.O.NO.93/IND/2006: 1. THAT THE ENTIRE BLOCK ASSESSMENT WAS AB INITIO VOI D AND BAD IN LAW. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE A.O. ERRED IN NOT REDUCING RETURNED INCOME FROM THE UNDISCLOSED ASSESSED INCOME. THE LD. CIT(A) ERRED IN MAINTAINING THE SAME. 56. THE REVENUE HAS ALSO TAKEN TWO FOLLOWING ADDITIONAL GROUNDS IN ALL THESE APPEALS :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN MAINTAINING/ADMITTING PAGE 29 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS GROUNDS OF APPEAL CHALLENGING DIRECTING U/S 142(2A ) ISSUED FOR SPECIAL AUDIT BY THE CIT WHICH WAS NOT APPELABLE BEFORE HIM IN VIEW OF HON'BLE SUPREME COURTS DECISION IN THE CASE OF RAJESH KUMAR VS. DY . CIT 287 ITR 91 WHEREIN IT WAS HELD THAT THE ORDER OF ASSESSMENT CAN BE THE SUBJECT MATTER OF AN APPEAL A DIRECTION ISSUED U/S 142(2A) OF THE ACT IS NOT AND NO INTERNAL REMEDY IS PRESCRIBED UNDER THE ACT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE LEVY OF SURCHA RGE BY THE ASSESSING OFFICER WHICH WAS LEVIED IN ACCORDANCE WITH LAW IN VIEW OF THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. SURESH N.GUPTA ( 214 CTR 274) WHICH IS IN FAVOUR OF THE REVENUE. 57. THE GENERAL FACTS RELATING TO ALL THESE ADDITIONS A RE THAT NO EVIDENCE/INCRIMINATING MATERIAL WAS FOUND IN THE CO URSE OF SEARCH. HOWEVER THE ASSESSEE SURRENDERED CERTAIN INCOME IN THE ASSESSEE OF GROUP AS A WHOLE HAS TAKEN CREDIT FOR THE SAME WHIL E FILING THE BLOCK RETURN FOR UNDISCLOSED INCOME. IN RESPECT OF SPECIF IC ADDITIONS MADE BY PAGE 30 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS THE ASSESSING OFFICER THE LD. CIT(A) HAS DELETED T HESE ADDITIONS MAINLY FOR THE REASON EITHER THEY WERE DISCLOSED IN THE BO OKS OF ACCOUNT MAINTAINED BY THE ASSESSEE OR THERE WAS NO EVIDENCE FOR MAKING SUCH ADDITION/ESTIMATION. IT IS ALSO NOTEWORTHY THAT MOS T OF THE ISSUES ARE ALSO COVERED BY THE DECISION OF THE TRIBUNAL IN ASSESSE ES GROUP LEADING CASE NAMELY ACIT VS. RAJ HOMES PRIVATE LIMITED AS REPOR TED IN 13 ITJ 658. 58. THE LD. CIT DR HAS MAINLY PLACED RELIANCE ON THE OR DER OF A.O. WE HAVE ALREADY DISCUSSED ISSUES RAISED IN ONE OF T HE APPEALS IN DETAIL HEREINBEFORE HENCE HAVING CONSIDERED THE ORDERS O F THE REVENUE AUTHORITIES AND CONTENTIONS RAISED BY BOTH THE SIDE S IN OUR OPINION THERE IS NO NECESSITY TO DEAL IN RESPECT OF EACH AND EVER Y MATTER IN DETAIL BECAUSE THE METHODOLOGY OF ADDITION BY THE A.O. AND DELETION BY THE LD. CIT(A) IS THE SAME. THUS HAVING REGARD TO THE SETT LED JUDICIAL POSITION THAT NO ADDITION CAN BE MADE IN THE BLOCK ASSESSMEN T IN THE ABSENCE OF ANY EVIDENCE OR MATERIAL FOUND DURING THE COURSE OF SEARCH OR IN SUBSEQUENT PROCEEDINGS THERETO WE CONFIRM THE FIND INGS OF THE LD. CIT(A) IN ALL THESE APPEALS. WE FURTHER HOLD IN SOM E CASES DOUBLE ADDITION HAS BEEN MADE WHICH IS ALSO NOT CORRECT I N LAW HENCE WE DELETE THE SAME. 59. AS REGARD TO THE COMMON ISSUE OF REDUCTION OF RETUR NED INCOME FROM UNDISCLOSED INCOME IS CONCERNED WE FIND THAT THIS ISSUE IS ALSO PAGE 31 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS COVERED BY THE DECISION OF THE TRIBUNAL IN THE CAS E OF RAJ HOMES PRIVATE LIMITED HENCE RESPECTIVE GROUNDS OF REVENUES APP EALS ARE DISMISSED AND RESPECTIVE GROUNDS OF ASSESSEES CROSS OBJECTIO NS ARE ALLOWED. 60. SIMILARLY THE ISSUE OF CHARGEABILITY OF INTEREST U /S 158BFA IS ALSO COVERED IN FAVOUR OF THE ASSESSEE. HENCE RESP ECTIVE GROUNDS OF THE ASSESSEES CROSS OBJECTION STAND ALLOWED. 61. AS REGARD TO GROUND RELATING TO TELESCOPING BENEFIT RAISED IN THE CROSS OBJECTIONS BY THE ASSESSEE IS CONCERNED THE SAME WAS NOT PRESSED HENCE DISMISSED IN ALL THE CROSS OBJECTIONS FILED BY THE ASSESSEE. 62. AS FAR AS THE ISSUE OF REFERENCE FOR SPECIAL AUDIT U/S 142(2A) IS CONCERNED THE LEARNED COUNSEL FOR THE ASSESSEE ULT IMATELY CHOSE NOT TO PRESS THIS ISSUE. HENCE ADDITIONAL GROUND AS WELL AS ORIGINAL GROUNDS IN THE CROSS OBJECTIONS FILED BY THE ASSESSEE ARE DISM ISSED. ACCORDINGLY ADDITIONAL GROUND RAISED BY THE REVENUE IN THIS RE GARD STANDS ALLOWED. 63. AS REGARD THE ISSUE OF LEVY OF SURCHARGE IS CONCERN ED THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THI S ISSUE WAS AGAINST THE ASSESSEE IN VIEW OF SUBSEQUENT DECISION OF HON'BLE SUPREME COURT IN THE CASE OF SURESH N. GUPTA. HENCE THIS GROUND OF THE REVENUE IN ALL THE APPEALS STAND ALLOWED. 64. IN CROSS OBJECTION NO.90/IND/2006 GROUND NO. 2 THE REOF WAS WITHDRAWN BY THE ASSESSEE HENCE DISMISSED AS WITH DRAWN. GROUND NO.3 PAGE 32 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS OF THIS CROSS OBJECTION WAS ALSO NOT PRESSED HENCE DISMISSED AS NOT PRESSED. 65. AS REGARD TO GROUND NO.2 OF ASSESSEES CROSS OBJECT ION NO.89/IND/2006 THE LEARNED COUNSEL SUBMITTED THAT RECEIPTS WERE ACTUALLY ONLY RS. 11 70 000/- UP TO THE DATE OF SEA RCH AND NOT RS. 12 20 000/-. HENCE THE ACTION OF THE LD. CIT(A) IN SUSTAINING THE ADDITION OF RS. 4 000/- BY APPLYING THE RATE OF GRO SS PROFIT ON THE DIFFERENCE AMOUNT OF RS. 50 000/- WAS TO BE DELETE D. THE LEARNED COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE RELEVANT PARAGRAPHS OF THE APPELLATE ORDER AS WELL AS OF THE ASSESSMENT OR DER AND PAGE 88 & 88A OF THE PAPER BOOK TO SUBSTANTIATE HIS SUCH CLAIM. T HE LD. CIT DR. ON THE OTHER HAND PREFERRED TO RELY ON THE ORDER OF THE L D. CIT(A). 66. ON DUE CONSIDERATION OF FACTS WE FIND SUBSTANTIAL MERIT IN THE CONTENTION OF THE ASSESSEE BECAUSE ONCE THE QUANTU M IS RECEIVED HAS BEEN FOUND TO BE OUT OF THE BLOCK PERIOD I.E. AFTER THE DATE OF SEARCH AND BETWEEN THE CLOSURE OF THE FINANCIAL YEAR. HENCE NO PROFIT ON SUCH RECEIPTS CAN BE ASSESSED AS UNDISCLOSED INCOME. THU S THIS CROSS OBJECTION OF THE ASSESSEE STANDS ALLOWED. 67. GROUND NO.2 OF THE ASSESSEES CROSS OBJECTION NO.92 /IND/2006 WAS NOT PRESSED HENCE DISMISSED AS NOT PRESSED. PAGE 33 OF 33 - I.T(SS).A.NO. 55/IND/2007 ETC. MINAL BUILDERS PVT.LTD. AND OTHERS 68. TO SUM UP REVENUES APPEALS AS WELL AS ASSESSEES CROSS OBJECTIONS STAND PARTLY ALLOWED IN TERMS INDICATED ABOVE. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 30 TH APRIL 2010. SD/- SD/- (JOGINDER SINGH) (V. K. GUPTA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 30 TH APRIL 2010. CPU* 2226