Shri Neeraj Goel Vs. ACIT (ITAT Delhi)
Addition on account of alleged interest income is not sustainable in the eyes of law, because the document does not mention the name of the assessee, does not bear the signature of the assesee, not in the handwriting of the assessee, documents has imply jottings of certain figures and does not indicate whether it is an investment or deposit or loan, hence, the said seized document is dumb/bald and even otherwise, the same was never found either in the possession or control of the assessee. Therefore, on this basis, I delete the addition in dispute.
FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:-
This appeal filed by the assessee against the order of the Ld. CIT(A)-XXVI, New Delhi dated 21.8.2017 and pertains to assessment year 2009-10.
2. The grounds raised read as under:-
1. The Ld. CIT(A) has grossly erred on facts as well as in law in confirming the order passed by the AO which is illegal being against the principles of natural justice and against the provisions of I.T. Act, 1961.
2. The Ld. CIT(A) has grossly erred on facts as well as in laws in confirming the addition of Rs. 5,31,217/- on account of alleged interest income
3. The Ld. CIT(A) has grossly erred on facts as well as in law in confirming the addition by invoking section 292C in spite of the fact that the document was not found either in the possession or control of the appellant.
4. The Ld. CIT(A) has grossly erred on facts as well as in law in holding that the appellant has not discharged the onus of offering suitable explanation.
5. The appellant craves leave to add, alter, modify and withdraw any grounds before or during the course of appellate proceedings.
3. The brief facts of the case are that the original return in this case was filed on 20.1.2010 declaring an income of Rs. 10,97,600/- which was processed u/s. 143(1) of the I.T. Act, 1961. A search and seizure action was conducted in this case u/s. 132(1) of the Act on 7.3.2014. Return u/s. 153A of the Act was filed on 9.10.2015 declaring the same income as filed originally. The AO has made the addition of Rs. 5,31,217/- on account of alleged interest income on the basis of a seized document and assessed the income of the assessee at Rs. 16,38,570/- vide his order dated 29.2.2016 passed u/s. 153A assessment order dated 29.2.2016, assessee appealed before the Ld. CIT(A), who vide his impugned order dated 21.8.2017 has affirmed the action of the AO and dismissed the appeal of the assessee.
4. Aggrieved with the Ld. CIT(A)’s order, assessee appealed before the Tribunal.
5. At the time of hearing, Ld. Counsel of the assessee stated that during the course of search, one loose paper was seized containing some jottings, which is a bald document, because the same does not have either the name of the assessee or any other person; the document is not in the handwriting of the assessee; the document is neither signed by the assessee nor by any other person; the document does not show whether the figures jotted therein represent receipt of payment; the document does not indicate whether it is an investment or deposit or loan. He further stated that the document in dispute was found at the residence of the assessee which was being frequently visited by various visitors including friends and relatives. Therefore, the assessee did not have any control over the residential premises and this document was not seized from the possession or control of the assessee, hence, the addition made on the basis of such a bald document needs to be deleted. In support of his aforesaid contention, he relied upon the order dated 29.7.2016 of the ITAT, ‘F’ Bench, New Delhi in the case of Praveen Juneja passed in ITA Nos. 3031-3032/Del/2012 (AYrs. 2003-04 & 2004-05) wherein on similar facts and circumstances, the addition made by the AO and confirmed by the Ld. CIT(A) were deleted. He further stated that the aforesaid decision of the ITAT in the case of Praveen Juneja has been upheld by the Hon’ble Delhi High Court vide order dated 14.7.2017 passed in ITA No. 56/2017 in the case of CIT, Central-3 vs. Praveen Juneja and Appeal of the Revenue was dismissed. In view of the above, he requested that by respectfully following the precedent, as aforesaid, the present appeal of the assessee may be allowed.
6. On the contrary, Ld. DR relied upon the orders of the authorities below and stated that a document bearing computations of interest @18% on a base quantum of Rs. 12 lacs was found from the residential quarters of the assessee and the calculations are depicting regular periodicity. The assessee has not sought to furnish any explanation in respect of the document and the undeniable fact is that this document was seized from the residential quarters of the assessee. Therefore, the addition in dispute was rightly made and confirmed by the Ld. CIT(A), which does not need any interference. To support his contention, he relied upon the following cases laws decided by the Hon’ble Delhi High Court, Hon’ble Jharkhand High Court and the Hon’ble Kerala High Court wherein the appeal was decided in favour of the Revenue.
– Hon’ble Delhi High Court in the case of Daya Chand vs. CIT (2001) 117 Taxman 438 (Delhi)
– Hon’ble Delhi High Court in the case of CIT vs. Nagesh Kumar Aggarwala (2011) 9 taxmann.com 249 (Delhi)
– Hon’ble Jharkhand High Court in the case of Mahabir Prasad Rungta vs. CIT (2014) 43 taxmann.com 328
– Hon’ble Kerala High Court in the case of Bhagheeratha Engineering Ltd. Vs. ACIT (2017) 79 taxmann.com 325 (Kerala).
7. I have heard both the parties and perused the records, especially the impugned order and the case laws cited by both the parties. I find that the case laws cited by the Ld. DR are not on exactly the similar and identical facts of the present case, but the case laws cited by the Ld. Counsel of the assessee is exactly on the identical and similar facts as involved in the present case, hence, the issues involved in the present case is squarely covered by the decision dated 29.7.2016 of the ITAT, ‘F’ Bench, New Delhi in the case of Praveen Juneja passed in ITA Nos. 3031-3032/Del/2012 (AYrs. 2003-04 & 2004-05) wherein the Tribunal has examined and dealt the similar issue as under:-
“4. We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case.
5. Ld. AR for the assessee challenging the impugned order contended inter alia that none of the loose paper recovered from the residential premises of the Omaxe Limited bears his signatures, handwriting, address of the assessee, date, etc.; that none of the paper was recovered from the possession of the assessee; that no house belonging to the assessee has brought on record by the AO as alleged in the loose paper; that the loose paper even does not pertain to the period under assessment; that there is no entry in the books of account of the assessee pertaining to the payment made by cheque in question; that opportunity of being heard has not been provided to the assessee during assessment proceedings and relied upon the judgments cited as CIT vs. Vivek Aggarwal 2015-TIOL-459-HC-DEL-IT, Bansal Strips (P) Ltd. & Ors. Vs. ACIT (2006) 99 ITD 177 (Del.), Ashwani Kumar vs. ITO (1992) 42 TTJ (Del) 644 and N.K. Malhan vs. DCIT (2004) 91 TTJ (Del) 938. However, on the other hand, ld. DR relied upon the order passed by AO/ CIT(A).
6. Undisputedly, seized documents pertain to addition of Rs.98,16,450/- qua the AY 2003-04 are available at pages 1 to 4 of the paper book filed by the assessee; that seized documents pertaining to addition of Rs.95,27,126/- qua the AY 2004-05 are available at pages 1 to 3 of the paper book filed by the assessee; that seized document, available at pages 1 to 4 qua AY 2003-04 and pages 1 to 3 qua AY 2004-05, do not bear name, address, signatures and handwriting of the assessee.
7. In the backdrop of the aforementioned facts and circumstances, undisputed facts and contentions raised by the parties, the first question arises for determination is :- “as to whether addition made by AO and affirmed by CIT (A) at Rs.98,16,450/- and Rs.95,27,126/-qua AYs 2003-04 and 2004-05 respectively on the basis of loose paper recovered during search and seizure operation conducted at the residential premises of M/s. Omaxe Limited on 22.09.2005 is not sustainable as alleged by the assessee.”
