Ved Prakash, Haryana v. ACIT, Bhiwani

ITA 3106/DEL/2008 | 2001-2002
Pronouncement Date: 29-01-2010 | Result: Partly Allowed

Appeal Details

RSA Number 310620114 RSA 2008
Bench Delhi
Appeal Number ITA 3106/DEL/2008
Duration Of Justice 1 year(s) 3 month(s) 19 day(s)
Appellant Ved Prakash, Haryana
Respondent ACIT, Bhiwani
Appeal Type Income Tax Appeal
Pronouncement Date 29-01-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted H
Tribunal Order Date 29-01-2010
Date Of Final Hearing 14-01-2010
Next Hearing Date 14-01-2010
Assessment Year 2001-2002
Appeal Filed On 10-10-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : H NEW DELHI BEFORE SHRI RAJPAL YADAV JUDICIAL MEMEBR AND SHRI K.G. BANSAL ACCOUNTANT MEMBER I.T.A NOS. 3096 3097 3098 3099 3106 3107 3108/DEL/ 08 ASSESSMENT YEARS - 1999-2000 2000-01 2003-04 2005 -06 2001-02 2002-03 2004-05 SHRI VED PARKASH PARAS WALI GALI NEAR BUS STAND CHARKHI DADRI (HARYANA). VS. ASSTT. COMMISSIONER OF INCOME TAX BHIWANI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PANKAJ JAIN& SHRI GURJIT SI NGH ADVOCATE RESPONDENT BY : SHRI V.K. TIWARI CIT (DR) ORDER PER BENCH: THE PRESENT SEVEN APPEALS ARE DIRECTED AT THE INSTA NCE OF ASSESSEE AGAINST THE ORDERS OF LD. CIT(A) DATED 31 ST JULY 2008 (FOR ASSTT. YEARS 1999- 2000 TO 2001-02) AND DATED 22 ND AUGUST 2008 (FOR ASSTT. YEAR 2002-03 TO 2005-06). THE ASSTT. ORDER PASSED BY THE AO IS A CO MMON ORDER FOR ALL THESE SEVEN ASSTT. YEARS. IT WAS PASSED ON 15.12.2006. SI NCE THE COMMON ISSUES ARE INVOLVED IN ALL THESE APPEALS THEREFORE WE HEAR D THEM TOGETHER AND DEEM IT APPROPRIATE TO DISPOSE OFF THEM BY THIS COMMON O RDER. ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 2 2. THE FIRST COMMON GROUND IN THREE ASSTT. YEARS I. E. 1999-2000 AND 2000- 01 AND 2001-02 IS GROUND NO. 2. IN THESE GROUNDS OF APPEAL THE GRIEVANCE OF ASSESSEE IS THAT LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 3 28 680/- RS. 2 54 045/- AND RS. 4 96 0 72/- RESP ECTIVELY IN ASSTT. YEAR 1999- 2000 TO 2001-02. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SEARCH AN D SEIZURE OPERATION WAS CARRIED OUT ON THE RESIDENTIAL PREMISES OF ASSESSEE ON 4 TH MARCH 2005. DURING THE COURSE OF SEARCH CASH OF RS. 21 120/- AND GOLD JEWELLARY WEIGHING 78 GMS WERE FOUND. A NOTICE U/S 153A WAS ISSUED TO THE ASS ESSEE ON 15 TH JULY 2006 VIDE WHICH HE WAS DIRECTED TO FILE THE RETURN OF IN COME WITHIN 15 DAYS FOR THE ASSTT. YEARS 1999-2000 TO 2005-06. THEREAFTER AO H AD ISSUED NOTICE U/S 142 ALOGNWITH QUESTIONNAIRE. THE ASSESSEE SOUGHT TIME A ND ULTIMATELY FILED THE RETURN ON 31 ST AUGUST 2006. THE LD. COUNSEL FOR THE ASSESSEE HAS PLACED ON RECORD COPY OF THE WRITTEN SUBMISSION FILED BEFORE THE LD. CIT(A). IN THIS SUBMISSION ASSESSEE HAS TABULATED THE STATUS OF THE ASSTT. EXHIBITING THE DATE OF FILING RETURN INCOME DECLARED BY HIM ETC. FOR U NDERSTANDING THE CONTROVERSY IN A CONVENIENT WAY IT IS WORTH TO TAKE NOTE OF THESE DETAILS :- S. A.Y. DATE ASSTT. U/S INCOME RETURNED AGRICULTUR AL INCOME CAPITAL B/F CASH IN HAND NET PROFIT 1 1999-00 31.8.06 18.10.06 42395 60 000 6 85 180.95 328680.00 42395 2. 2000-01 31.8.06 18.10.06 45970 62 000 7 63 575.9 5 254055.00 45970 3. 2001-02 31.8.06 18.10.06 45425 60 000 8 47 545.9 5 496072.00 45425 4. 2002-03 31.8.06 18.10.06 35971 70 000 9 38 970.9 5 5906.00 35971 ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 3 5. 2003-04 31.8.06 18.10.06 43868 60 000 9 19 841.9 5 192869.95 43868 6. 2004-05 31.8.06 18.10.06 47125 70 000 8 89 709.9 0 186207.95 47125 7. 2005-06 31.8.06 18.10.06 49108 72 000 8 71 834.9 5 7490.95 49108 4. WHILE PROCESSING THE RETURN FOR ASSTT. YEAR 1999 -2000 THE AO HAS OBSERVED THAT ASSESSEE HAS SHOWN OPENING BALANCE OF RS. 6 85 180.95. HE OBSERVED THAT OPENING BALANCE SHOWN BY THE ASSESSEE IS NOT ACCEPTABLE AND ONLY AN AMOUNT OF RS. 3.5 LACS CAN BE ACCEPTED. HE MADE AN ADDITION OF RS. 3 35 180/- OUT OF THIS OPENING BALANCE. THE ASSESSE E HAS SHOWN CASH IN HAND AT RS. 3 28 680/-. THIS AMOUNT WAS DISBELIEVED BY T HE ASSESSEE BUT HE DID NOT MAKE ANY ADDITION BECAUSE IT IS THE PART OF TOTAL B ALANCE SHOWN BY THE ASSESSEE. SIMILARLY IN ASSTT. YEAR 2000-01 ASSESSEE HAS SHOWN CASH IN HAND RS. 2 54 055/- AND RS. 4 96 072/- IN ASSTT. YEAR 20 01-02. THE INCOME COMPUTED BY THE AO IN THESE THREE ASSTT. YEARS READ AS UNDER :- RETURNED INCOME 42 395/- ADD: I) INCOME FROM UNDISCLOSED SOURCES SHOWN IN THE FORM OF OPENING BALANCE AS DISCUSSED ABOVE. 3 35 180/- II) INCOME FROM UNDISCLOSED SOURCES SHOWN IN THE FORM OF AGRICULTURE INCOME AS DISCUSSED ABOVE. 45 000/- TOTAL 4 22 575/- AGRICULTURE INCOME FOR RATE PURPOSES 15 000/- ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 4 RETURNED INCOME 45 970/- ADD: INCOME FROM UNDISCLOSED SOURCES SHOWN IN THE FORM OF AGRICULTURE INCOME AS DISCUSSED ABOVE 47 000/- TOTAL 92 970/- AGRICULTURE INCOME FOR RATE PURPOSES 15000/- RETURNED INCOME 45 425/- ADD : I) INCOME FROM UNDISCLOSED SOURCES SHOWN IN THE FORM OF AGRICULTURE INCOME AS DISCUSSED ABOVE 45 000/- II) INCOME FROM RUNNING OF SCHOOL 1 00 000/- III) INCOME FROM UNDISCLOSED SOURCES SHOWN IN THE FORM OF LIABILITY AS DISCUSSED ABOVE 1 70 000/- TOT AL 3 60 425/- AGRICULTURE INCOME FOR RATE PURPOSES 15 000/- 5. ON APPEAL LD. CIT (A) HAS DELETED THE ADDITION O F RS. 3 35 180/- MADE IN ASSTT. YEAR 1999-2000. HOWEVER IN PLACE OF THIS HE MADE AN ADDITION OF RS. 3 28 680/-. THE LD. CIT (A) IS OF THE OPINION THAT THE ASSESSEE WAS EARNING INCOME FROM THE LAST MORE THAN 18 YEARS FROM THE DA Y WHEN THE SEARCH WAS CARRIED OUT AT HIS PREMISES AND THUS HE WOULD BE IN A POSITION TO EARN AN INCOME OF RS. 6 85 180/- AS CLAIMED IN THE FINANCIA L STATEMENT SHOWING OPENING BALANCE. IN THIS WAY LD. CIT(A) HAS ACCEPTE D THE OPENING CASH BALANCE CLAIMED BY THE ASSESSEE. WITH REGARD TO THE CASH IN HAND SHOWN AT RS.3 28 680/- LD. CIT(A) HAS OBSERVED THAT ASSESSEE WAS UNABLE TO EXPLAIN ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 5 THE CASH AVAILABLE WITH HIM WITH THE HELP OF SUPPOR TING EVIDENCE AND THEREFORE AO OUGHT TO HAVE MADE ADDITION OF THIS AMOUNT. LD. CIT(A) ACCORDINGLY MADE THE ADDITION OF RS. 3 28 680/- IN ASSTT. YEAR 1999- 2000. SIMILARLY THE CASH IN HAND CLAIMED BY ASSESSEE IN OTHER TWO YEARS HAS BEE N ADDED. 6. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ONCE THE OPENING CAPITAL AT RS. 6 85 180/- IN ASSTT. YEAR 1999-2000 IS ACCEPTED THEN IT ITSELF EXPLAIN THE SOURCE OF CASH IN HAND CLAIMED BY THE ASSESSEE. THE CLOSING BALANCE DEPICTING THE CASH IN HAND CANNOT BE ADDED. THIS IS THE REASON AO HAS NOT MADE ANY ADDITION OF THE CASH IN HAND CLAIMED BY TH E ASSESSEE. LD. DR RELIED UPON THE ORDER OF LD. CIT(A) AND WAS UNABLE TO CONT ROVERT THE CONTENTION OF LD. COUNSEL FOR THE ASSESSEE. 7. WE HAVE DULY CONSIDERED THE RIVAL CONTENTION AND GONE THROUGH THE RECORD CAREFULLY. THE ASSESSEE HAD SHOWN CAPITAL OF RS. 6 85 180.95 AS CAPITAL BROUGHT FORWARD IN ASSTT. YEAR 1999-2000. T HIS OPENING CAPITAL HAS BEEN ACCEPTED BY THE LD. CIT (A). THE ASSESSEE HAD CLAIMED SUM OF RS. 3 28 680/- AS CASH IN HAND OUT OF THE TOTAL OPENING CAPITAL BALANCE CLAIMED BY HIM OF RS. 6 85 180/-. THE AO HAS DISPUTED THE OPEN ING CLAIM MADE BY THE ASSESSEE AND HE DISBELIEVED HIS CLAIM TO THE EXTENT OF RS. 3 35 180/- BUT LD. CIT(A) ACCEPTED THIS CLAIM . THUS ONCE LD. CIT (A) ACCEPTED THE OPENING CLAIM MADE BY ASSESSEE AT RS. 6 85 180.95 WHICH INC LUDE CASH IN HAND OF RS. ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 6 3 28 680/- HE CANNOT HELD THAT ASSESSEE WAS UNABLE TO EXPLAIN THE SOURCE OF CASH IN HAND. IT IS PART OF THE PAST SAVING AND CLA IMED AS OPENING CAPITAL BALANCE THEREFORE WE ALLOW THE GROUND OF APPEAL RA ISED BY ASSESSEE AND DELETE THE ADDITION OF RS. 3 28 680/- MADE IN ASST T. YEAR 1999-2000. IN ASSTT. YEAR 2000-01 LD. CIT(A) HAS NOT GIVEN ANY SPECIFIC FINDING ON THIS ISSUE. HE SIMPLY OBSERVED THAT ASSESSEE HAS RAISED SEVEN GRO UNDS OF APPEAL IN THIS YEAR AND THE ONLY DIFFERENCE IN THE GROUNDS OF APPE AL IS IN GROUND NO. 3 WHICH PERTAINS TO THE ADDITION ON ACCOUNT OF AGRICULTURAL INCOME. THE AO HAS NOT MADE ANY SPECIFIC ADDITION IN THE ASSTT. PROCEEDING S. GROUND NO. 2 TAKEN BY THE ASSESSEE CHALLENGING THE ADDITION OF RS. 2 54 0 55/- IN ASSTT. YEAR 2000-01 IS THE RESULT OF FINDING GIVEN IN ASSTT. YEAR 1999- 2000. THEREFORE FOLLOWING OUR OBSERVATION IN THAT ASSTT. YEAR THIS ADDITION IS AL SO DELETED. 8. IN ASSTT. YEAR 2001-02 AGAIN LD. CIT(A) HAS NOT RECORDED ANY SPECIFIC FINDING. IN PARAGRAPH 12. HE OBSERVED THAT GROUND N O. 4 PERTAINED TO NON ACCEPTANCE OF CASH IN HAND AT RS. 4 96 072.- BY THE AO. THE LD. CIT(A) HAS REJECTED THIS GROUND AS INFRUCTUOUS BECAUSE IT DOES NOT HAVE ANY BEARING ON THE TAXABLE INCOME OF THE ASSESSEE. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS FINDING IS TO BE READ IN THE LINE OF FIND ING RECORDED IN ASSTT. YEAR 1999- 2000. ON DUE CONSIDERATION OF THE FACTS AND CIRCUMS TANCES AND THE FINDING OF THE REVENUE AUTHORITIES BELOW WE ARE OF THE OPINION THAT THIS FINDING OF THE LD. CIT(A) OUGHT NOT TO BE CONSIDERED AS IF AN ADDITION OF RS. 4 96 072/- IS MADE ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 7 IN ASSTT. YEAR 2001-02. THERE IS NO SPECIFIC ADDITI ON BY THE AO OF THIS AMOUNT IN THE COMPUTATION OF INCOME AS NOTICED BY US. IN T HE RESULT GROUND NO. 2 IN ALL THE THREE YEARS ARE ALLOWED THE ADDITIONS MADE BY T HE LD. CIT(A) IN RESPECT OF THE AMOUNTS REPRESENTING CASH IN HAND SHOWN BY THE ASSESSEE ARE DELETED BECAUSE THE OPENING CASH BALANCE HAS BEEN ACCEPTED BY THE LD. CIT(A). 9. THE NEXT COMMON GROUND IN ALL THE ASSTT. YEAR IS IN RESPECT OF AGRICULTURAL INCOME. THE BRIEF FACTS OF THE CASE AR E THAT ASSESSEE IS THE OWNER AND POSSESSION OF 3 ACRES OF AGRICULTURAL LAND. HE CLAIMED AGRICULTURAL INCOME AT RS. 60 000/- RS. 62 000/- RS.60 000/- RS. 70 000/- RS. 60 000/- RS. 70 000/- AND RS. 72 000/- IN ASSTT. YEARS 1999-2000 TO 2005-06 RESPECTIVELY. THE AO HAS OBSERVED THAT AGRICULTURAL LAND IN THIS AREA AT THE MOST COULD GENERATE AN INCOME OF RS. 5 000/- PER ACRE. HE TOOK AGRICULTURAL INCOME AT RS. 15 000/- AND TREATED REST OF THE CLAIM MADE BY THE ASSESSEE AS INCOME FROM OTHER SOURCES. THE AO ACCORDINGLY MADE THE ADDITION . 10. ON APPEAL LD. CIT(A) ESTIMATED THE AGRICULTURAL INCOME AT RS. 7 500/- PER ACRE AND ACCORDINGLY DIRECTED THE AO TO TAKE AN NUAL AGRICULTURAL INCOME FROM 3 ACRES AT RS. 22 500/- IN ASSTT. YEAR 1999-20 00. HE DIRECTED THE AO TO REDUCE THE ADDITION ACCORDINGLY. ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 8 11. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASS ESSEE HAS CLAIMED AGRICULTURAL INCOME AT RS. 20 000/- PER ACRE. THE A O ESTIMATED IT AT RS. 5000/- LD. CIT (A) HAS ESTIMATED IT AT RS. 7 500/- PER ACR E. THE ASSESEES BROTHER HAS CLAIMED AN AGRICULTURAL INCOME OF RS. 15 000/- FOR IDENTICAL LAND. IN THE CASE OF HIS BROTHER THE INCOME TAX DEPARTMENT HAS A CCEPTED GENERATION OF AGRICULTURAL INCOME FROM ONE ACRE AT RS. 13 000/-. LD. COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT AGRICULTURAL INCOME IN THIS AREA VARIES FROM RS. 15 000/- TO RS. 25 000/- PER ACRE. LD. DR ON TH E OTHER HAND RELIED UPON THE ORDER OF LD. CIT(A). 12. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS A ND GONE THROUGH THE RECORD CAREFULLY. THE ASSESSEE WAS NOT MAINTAINING ANY SPECIFIC DAY TO DAY DETAILS IN RESPECT OF AGRICULTURAL EXPENSES VIZ. A VIZ. SALE OF AGRICULTURAL PRODUCE. THUS IT IS PRACTICALLY IMPOSSIBLE TO WORK OUT EXACT QUANTUM OF AGRICULTURAL INCOME FROM 3 ACRES OF LAND. THE AGRIC ULTURAL INCOME WOULD FLUCTUATE DEPENDING UPON THE QUALITY OF LAND MODE OF IRRIGATION AND TYPE OF CROP SOWN BY AGRICULTURISTS. THE ASSESSEE HAS CLAIM ED AGRICULTURAL INCOME AT RS. 20 000/- PER ACRE . THERE IS NO EVIDENCE SUPPOR TING TO THIS CLAIM. AO HAS ESTIMATED THE INCOME AT RS. 5 000/- PER ACRE. AGAIN HE ALSO NOT BASED HIS FINDING ON ANY EVIDENCE. LD. CIT(A) HAS ACCEPTED TH E INCOME AT RS. 7 500/- PER ACRE. FACED WITH THIS SITUATION WE ARE OF THE O PINION THAT IN DETERMINING THE AGRICULTURAL INCOME OF ASSESSEE ELEMENT OF GUESS WO RK WOULD BE INEVITABLE. ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 9 LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT IN TH E CASE OF HIS BROTHER THE DEPARTMENT HAS ACCEPTED THE AGRICULTURAL INCOME @ R S. 13 000/- PER ACRE. TAKING INTO CONSIDERATION THIS ARGUMENT OF THE LD. CIT(A) COUPLED WITH OUR EXPERIENCE AND ACQUAINTANCE WITH THE AREA WE CAN RE ASONABLY CONSTRUE THAT AN ACRE OF LAND IN THIS AREA COULD GENERATE INCOME OF RS. 13 000/- PER ACRE. WE ALLOW THE GROUND OF APPEAL RAISED BY THE ASSESSE E IN ALL THE ASSTT. YEARS PARTLY AND DIRECT THE AO TO TREAT AGRICULTURAL INCO ME AT RS. 39 000/- IN EACH ASSTT. YEAR. 13. GROUND NO. 4 IN ASSTT. YEAR 2001-02 IS COMMON W ITH GROUND NO. 3 IN ASSTT. YEARS 2002-03 TO 2005-06. IN THIS GROUND OF APPEAL GRIEVANCE OF ASSESSEE IS THAT LD. CIT(A) IS NOT JUSTIFIED IN DIR ECTING THE AO TO EXPLORE THE POSSIBILITY OF TAKING ACTION AGAINST THE ASSESSEE F OR VIOLATING SECTION 269SS AND 269T OF THE INCOME TAX ACT. FOR VIOLATING THESE PROVISIONS PENALTY U/S 271D OR 271E IS IMPOSABLE UPON THE ASSESSEE. IT IS PRE MATURE TO GIVE ANY FINDING ON THIS DIRECTION BECAUSE ASSESSEE WILL HAV E FULL OPPORTUNITY TO EXPLAIN HIS POSITION IN CASE ANY SUCH PROCEEDINGS ARE INITI ATED AT THE END OF AO. IN THE PRESENT APPELLATE PROCEEDING EXPLORATION OF POSSIBI LITY TO PROCEED IN ACCORDANCE WITH THE LAW CANNOT BE STALLED. 14. GROUND NO. 5 IN ASSTT. YEAR 2001-02 IS COMMON W ITH GROUND NO. 4 IN ASSTT. YEARS 2002-03 TO 2005-06. IN THESE GROUNDS OF APPEAL THE GRIEVANCE OF ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 10 ASSESSEE RELATES TO ESTIMATION OF SCHOOL INCOME. TH E BRIEF FACTS OF THE CASE ARE THAT AN ESTIMATED ADDITION OF RS. 1 LAC HAS BEE N MADE BY THE AO ON THE GROUND THAT ASSESSEE HAS UNDISCLOSED INCOME FROM RU NNING SCHOOL. HE MADE A REFERENCE TO THE LOOSE PAPER BEARING NO. 5 TO 31 OF A6. THE FINDING OF THE AO IN ASSTT. YEAR2001-02 IN THIS RESPECT READ AS UN DER :- THE ASSET SIDE OF THE BALANCE SHEET SHOWS AN INVES TMENT OF RS. 2 75 139/- FOR SCHOOL. THE INCOME FROM THE SCHOOL IS TAKEN AT RS. 1 00 000/- IN VIEW OF LOOSE PAPERS PAGE NOS. 5 TO 31 OF DOCUMENT NO. A-6 SEIZED SHOWING INCOME OF RS. 1 79 576.50 FOR THE FINANCIAL YEAR 2003-04. DURING THE YEAR THE ASSESSEE HAS BIG BANK BALANCES WITH HKGB AND CANARA BANK OF AMOUNTS RS. 1 02 419 RS. AND RS. 2 06 902/- RESPECTIVELY. THIS SHOWS THAT THE ASSESSEE WAS HAVING A LARGE INCOME DURING THIS PERIOD. ALSO DURING THIS YEAR THE ASSESSEE HAS SHOWN A LIABILITY OF RS. 1 70 000/- IN THE NAME OF SMT. SUKHMAYA. THE ASSESSEE HAS NOT BEEN ABLE TO FURNIS H EVIDENCE OR PRODUCE THE SAID LADY. HENCE THIS LIABILITY IS NOT ACCEPTE D AND ADDITION MADE ON THIS SCALE. 15. ON THE BASIS OF THIS FINDING AN ESTIMATED ADDIT ION BY AN INCREMENTAL ENHANCEMENT IN THE SUBSEQUENT ENHANCEMENT YEAR HAS BEEN MADE. IN ASSTT. YEAR 2002-03 RS. 1 25 000/- ASSTT. YEAR 2003-04 RS . 1 26 000/- ASSTT. YEAR 2004-05 RS. 2 29 050/- AND ASSTT. YEAR 2005-06 RS. 2 05 000/- HAVE BEEN ADDED IN THE INCOME OF THE ASSESSEE. LD. CIT (A) HA S CONFIRMED THE ADDITION ON THE GROUND THAT LOOSE PAPERS WERE FOUND FROM THE PREMISES OF ASSESSEE WHICH INDICATE TOTAL RECEIPT OF RS. 3 39 520/- AFTE R DEBITING EXPENSES OF RS. 3 80 367/- A SUM OF RS. 3 59 153/- WAS DISTRIBUTED BETWEEN TWO PERSONS. THESE ENTRIES RELATE TO ASSTT. YEAR 2003-04 AND TH US IT INDICATE THAT ASSESSEE ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 11 WAS HAVING INCOME FROM RUNNING A SCHOOL. THUS AO HA S RIGHTLY ESTIMATED THE INCOME FROM SCHOOL. 16. LD. COUNSEL FOR THE ASSESSEE WHILE TAKING US TH ROUGH THE FINDING OF THE AO SUBMITTED THAT AO HAS NOT MADE ANY ANALYSIS OF T HE SEIZED MATERIAL. HE STRAIGHTAWAY ESTIMATED THE INCOME AT RS. 1 LAC. THE RE IS NO DISCUSSION FROM HOW HE WORKED OUT THIS INCOME OF RS. 1 LAC. HE FURT HER POINTED OUT THAT SHIV EDUCATION SOCIETY WAS REGISTERED ON 12 TH AUGUST 1998 UNDER THIS SOCIETY SHIV SIKSHA SAMITI SCHOOL WAS BEING RUN. THE GOVT. OF HA RYANA HAD GIVEN RECOGNITION TO RUN THIS SCHOOL UPTO CLASS X ON 27 TH AUGUST 1998. THEREAFTER RECOGNITION WAS RENEWED FROM TIME TO TIME. THE INCO ME FROM THIS INSTITUTION CANNOT BE ADDED IN THE HANDS OF THE ASSESSEE. HE DR EW OUR ATTENTION TOWARDS THE LETTER OF HARYANA GOVT. BEARING NO. 1479 DATED 27 TH AUGUST 1998 EXHIBITING THE TEMPORARILY RECOGNITION GRANTED TO THE SOCIETY FOR RUNNING THE SCHOOL FOR A PERIOD 1.4.1998 TO 31 ST MARCH 1999. HE ALSO BROUGHT TO OUR NOTICE THE REGISTRATION CERTIFICATE OF THE SHIV EDUCATION SOCIETY AVAILABLE AT PAGE 16 OF THE PAPER BOOK. THE ASSESSEE IS THE CHAIRMAN OF THE MANAGING COMMITTEE. THERE ARE 8 OTHER INDIVIDUALS WHO ARE THE MEMBERS O F THE MANAGING COMMITTEE. HE FURTHER CONTENDED THAT AO HAS NOT MAD E ANY ANALYSIS OF THE SEIZED MATERIAL RATHER STRAIGHTAWAY MADE ESTIMATED ADDITION BECAUSE ASSTT. WAS GOING TO BE TIME BARRED. ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 12 17. LD. DR ON THE OTHER HAND SUBMITTED THAT DURING THE COURSE OF SEARCH MATERIAL EXHIBITING INCOME FROM THE SCHOOL RECEIVED BY THE ASSESSEE WAS FOUND. HE MADE A REFERENCE TO PAGE NO. 152 OF THE P APER BOOK WHEREIN PAGE NO. 31 OF ANNEXURE A-6 IS PLACED ON RECORD. REFERR ING TO THIS PAGE HE POINTED OUT THAT IT SPECIFICALLY DISCLOSED HOW MUCH IS THE INCOME FROM THE SCHOOL AND HOW IT IS DISTRIBUTED BETWEEN THE TWO PARTNERS. THU S AO IS JUSTIFIED IN ESTIMATING THE INCOME FROM THE SCHOOL IN OTHER YEAR S ALSO. 18. WE HAVE DULY CONSIDERED THE RIVAL CONTENTION AN D GONE THROUGH THE RECORD CAREFULLY. ON PERUSAL OF PAGE 31 OF SEIZED M ATERIAL A-6 WE FIND THAT THIS PAGE INDICATE THE TOTAL INCOME FROM THE SCHOOL AT R S. 7 39 528/-.AFTER DEBITING EXPENSES OF RS. 3 80 367/- THE AMOUNT OF RS. 3 59 153/- HAS BEEN DISTRIBUTED BETWEEN TWO PERSONS. IT ALSO REFLECT FROM THIS PAPE R THAT THIS SETTLEMENT RELATES TO ASSTT. YEAR 2003-04. THUS TO SOME EXTENT IT COMES OUT THAT INCOME FROM THE SCHOOL WAS RECEIVED BY THE ASSESSEE. HOWE VER BEFORE ESTIMATING THE INCOME IN ALL THE ASSTT. YEARS LD. AO OUGHT TO HAVE MADE AN ANALYSIS OF THE DETAILS APPEARING IN THE SEIZED MATERIAL. THERE IS NO ANALYTICAL APPLICATION OF MIND ON THIS ISSUE. THE AO SIMPLY IN A SWEEPING SENTENCE CONCLUDED THAT ASSESSEE HAD AN INCOME FROM THE SCHOOL WHICH DESERV ES TO BE WORKED OUT ON AN ESTIMATED BASIS. IN VIEW OF THE ABOVE WE SET ASI DE THIS ISSUE TO THE FILE OF AO FOR READJUDICATION. IT IS NEEDLESS TO SAY THAT O BSERVATION MADE BY US ON ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 13 THIS ISSUE WILL NOR IMPAIR OR INJURE THE CASE OF AO OR WOULD CAUSE ANY PREJUDICE TO THE DEFENCE / EXPLANATION OF THE ASSESSEE. 19. GROUND NO. 5 IN ASSTT. YEAR 2002-03 :- IN THIS GROUND ASSESSEE IS IMPUGNING THE ADDITION OF RS. 21 000/-. THE BRIEF F ACTS OF THE CASE ARE THAT VALUE OF A GODOWN AT RS. 1 85 000/- WAS SHOWN IN TH E BALANCE SHEET OF THE LAST THREE ASSTT. YEARS. ALL OF A SUDDEN THE VALUE OF THE GODOWN WAS NOT SHOWN IN THE BALANCE SHEET FOR THIS ASSTT. YEAR. THE AO C ONSTRUED THAT ASSESSEE MUST HAVE SOLD THIS GODOWN AND EARN CAPITAL GAIN OF RS. 50 000/-. ON AN ESTIMATED BASIS HE MADE THE ADDITION. BEFORE LD. CIT(A) IT WA S POINTED OUT THAT SALE CONSIDERATION WAS OF RS. 2 35 000/- AND THE INDEX C OST WORKS OUT AT RS. 2 14 000/-. THE ASSESSEE HAS ADMITTED CAPITAL GAIN OF RS. 21 000/-. 20. BEFORE US LD. COUNSEL FOR THE ASSESSEE DID NOT ADVANCE ANY ARGUMENT ON THIS ISSUE. THE ASSESSEE HIMSELF ACCEPTED THE CA PITAL GAIN OF RS. 21 000/- BEFORE LD. CIT(A). THEREFORE WE DO NOT FIND ANY MER IT IN THIS GROUND OF APPEAL. IT IS REJECTED. 21. GROUND NO. 5 IN ASSTT. YEAR 2003-04 IN THIS GRO UND OF APPEAL ASSESSEE IS IMPUGNING THE ADDITION OF RS. 60 000/-. IT IS FO UND BY THE AO THAT ASSESSEE HAS SHOWN RENTAL INCOME OF RS. 12 000/- FROM SHOPS BUT DID NOT SHOW ANY INVESTMENT IN THE SHOPS. HE ESTIMATED THE INVESTMEN T AT RS. 60 000/- AND ITA NOS.3096-3098 /DEL/08 & ITA NOS. 310 6-3108/DEL/09 14 MADE THE ADDITION. THE ASSESSEE COULD NOT ADVANCE A NY ARGUMENT BEFORE LD. CIT(A) AND ADDITION HAS BEEN CONFIRMED. SIMILARLY L D. COUNSEL FOR THE ASSESSEE WAS UNABLE TO ADVANCE ANY ARGUMENT BEFORE US. HENCE THIS GROUND OF APPEAL IS REJECTED. NO OTHER GROUND WAS PRESSED HENCE ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 29.1.2010. [K.G. BANSAL] [RAJPAL YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER VEENA DATED: 29.1.2010 COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT