Income Tax Appellate Tribunal - Delhi
Mohan Lal Ram Niwas Huf, New Delhi vs Acit, New Delhi on 9 April, 2018
In the Income-Tax Appellate Tribunal,
Delhi Bench 'E', New Delhi
Before : Shri Bhavnesh Saini, Judicial Member And
Shri L.P. Sahu, Accountant Member
ITA No. 426/Del./2015
Assessment Year: 2006-07
Mohan Lal Ram Niwas HUF, vs. A.C.I.T., Central Circle-9,
S-228, Greater Kailash-II, New Delhi.
New Delhi.
PAN - AAEHM3638L
(Appellant) (Respondent)
Assessee by Sh. P.C. Yadav, Advocate
Revenue by Ms. Shefali Swaroop, CIT/DR
Date of Hearing 15.03.2018
Date of Pronouncement 09.04.2018
ORDER
Per L.P. Sahu, A.M.:
This is an appeal filed by the assessee against order dated 27.11.2014 passed by the ld. CIT(A)-XXVII, New Delhi for assessment year 2006-07 on the following grounds :
1. That the Ld. CIT (Appeal) has erred in law and on facts in confirming the addition of Rs. 25,20,884/- as income from undisclosed sources which was added by the ACIT, Central Circle-9, New Delhi in as much as the entire addition is unwarranted, based on surmises and conjectures, without any basis, illegal and thus, requires to be deleted in toto.
2. That the Ld. CIT (Appeal) has erred in law and on facts in not appreciating that the addition of Rs. 25,20,884/- has been made without any positive & cogent evidence and rather on irrelevant facts.
3. That the Ld. CIT (Appeal) has erred in law and on facts in not appreciating that the Ld. AO has not considered the evidences produced by ITA No. 426/Del./2015 2 the appellant which clearly establishes that no cash payment was made by the appellant.
4. That the impugned appellate order is arbitrary, illegal, bad in law and in violation of rudimentary principles of contemporary jurisprudence.
2. From the above grounds of appeal, it emerges out that the assessee has challenged the action of the ld. CIT(A) in sustaining the addition of Rs.25,20,884/- on account of income from undisclosed sources, both on legal grounds as well as on merit.
3. The briefly stated, the facts of the case are that consequent upon the search proceedings carried out u/s. 132 of the Income-tax Act, 1961 (in short 'the Act') at the premises of the assessee on 10.02.2012, notice under section 153A of the Act was issued on 30.09.2013. In response, the assessee submitted that return filed under section 139(1) of the Act on 25.07.2006 may be treated as return filed in response to notice u/s. 153A of the Act. Thereafter, statutory notices under section 143(2) and 142(1) of the Act were issued and complied with. The Assessing Officer noted that on the basis of material seized in search action on 'AEZ Group', it was observed that assessee invested a sum of Rs.32,70,884/- in purchase of flat/space/land with M/s Indrapuram Habitat Center Pvt. Ltd. In the seized documents, breakup of the investment of Rs.32,70,884/- was recorded as cheque of Rs.7,50,000/- and cash of Rs.25,20,884/-. The Assessing Officer further noted that on similar evidences found during the search action at the AEZ Group, one of the investors 'Sh. I.E. Soomar' admitted the cash amount invested amounting to Rs.6.64 crores and paid taxes on the said amount. In the submission filed, the assessee denied any investment in cash. The Ld. Assessing Officer, rejected the ITA No. 426/Del./2015 3 contention of the assessee and added a sum of Rs. 25,20,884/- to the total income of the assessee.
3.1 Aggrieved, the assessee appealed before the Ld. CIT(A) and made detailed submissions challenging the addition and the ld. CIT(A) after considering the facts attending to the case, findings of the Assessing Officer and the submissions of the assessee, sustained the action of the Assessing Officer on the impugned issue observing as under :
"6. I have gone through the contents of the assessment order, written submissions of the appellant and the finding given by the Assessing Officer and considered them. In support of the contents that were raised, the AR of the appellant also furnished the citation in the case laws on which he relied upon. During the course of search on 17.8.2011 at the corporate office of the AEZ group at 301/303, Bakshi House, Nehru Place, New Delhi a hard disk was found and were seized as Annexure A-32 from which a print out of the file named "D.P. Correction sheet. xls" containing the sales status of Indirapuram Habitat Centre was taken out wherein at Sl. No. 26- 31 the names of the entities related to Lakhotia family was found. The data in the file contained details like sale price, cheque-cash-total- amount received-cheque-cash-total and balance cheque-cash-total. It showed a total investment of Rs.1,51,25,300/- by Lakhotia family for purchasing space in Indirapuram Habitat Centre.
6.1. Similarly, another file by name "Down Payment booking details.xls"
was retrieved from the hard disk found and seized as Annexure A-27 from the corporate office of AEZ Group. The data on the file contained details pertaining to sales-status-Nehru Vikas Minar (Down Payment) in respect of different investors of the AEZ Group. It also contained the name of the purchaser, deal date, covered area, super area, basic sale price, rebate, achieved rate, sale price-cheque-cash-total and amount received. As per this sheet, lakhotia family invested Rs.63,71,700/- in cash for space in Nehru Vikas Minar of AEZ Companies.
"6.1.1 During the course of search at the residence of lakhotia group on 10.2.2012, several post dated cheques or its details issued in the names of lakhotia family who made booking in respective projects ITA No. 426/Del./2015 4 were found and seized. Such details of post dated cheques (PDC) were seized as Annexure A-7 and A-8.
6.1.2 On perusal of the details of sales pertaining to Indrapuram Habitat Center, it was found that the appellant is related to lakhotia family and is one of the purchaser of 500 sq. ft. super area for a total consideration of Rs. 34,40,883/-. As per the details in excel sheet, the amount received from the appellant by way of cheque and cash was shown at Rs.7,50,000/- and Rs.25,20,883/- respectively aggregating to Rs.32,70,883/- and the balance of Rs. 1,70,000/- was again shown to have been received by cheque. On the basis of the information contained in the excel sheet, the Assessing Officer gave an opportunity to the appellant to explain the source of cash payment amounting to Rs. 25,20,883/- made for purchase of 500 sq. ft. super area in the Indrapuram Habitat Center. Except for the denial of cash payment, the appellant did not deny the other details mentioned in the excel sheet against its name at Serial No. 27. When all other contents pertaining to the appellant mentioned in the excel sheet were not disputed, I do not find any reason as to why the appellant denied the cash transaction. No doubt the material relied upon by the Assessing Officer was found during the course of search at the premises of the third party, but the same also constitutes an incriminating material so far as the appellant is concerned in respect of its income that was not disclosed and earned through undisclosed sources. There is a reasonable belief regarding the specific information that was available on the excel sheet to be true and correct as few persons admitted to have made the investment in cash. The appellant's name appeared in the said list which it admitted to the extent of cheque payments that endorses its link with some degree of certainty that cannot be ignored or overlooked. The "DP correction sheet.xls" threw light on the reliability of information, specific and intimate facts, and corroboration of the same by admission of few persons mentioned in the list. This sheet also described every day or common transactions that could have accrued at that time.ITA No. 426/Del./2015 5
6.1.3 For Indirapuram Habitat Centre Project, one person by named Sh. I E Soomar invested Rs.5,00,00,000/- in cash and Rs. 1,54,00,000/- by way of cheque out of the total cheque amount of Rs.1,88,70,000/-. It was found that till the date 30.6.2007 Rs.1,54,00,000/- was paid by cheques in addition to the cash. In the said file, the column "remarks"
at point 5 of the table in the data showed "Buy back option upto 30.6.2007 for repurchase of Rs.6,54,00,000/-". It was found that this buy back amount was exactly similar to the total investment made by Sh. I E Soomar as he appeared and admitted that cash investment of 6.54 crores was made and taxes thereon was paid.
6.1.4 The overall balance of the evidence is a matter how decisively any data would tell in favour of a proposition. The AR of the appellant did not furnish any evidence to support the contention that no payment in cash was made against the property to be purchased. The evidence that was deciphered and linked to few persons cannot be denied as they did admit to have paid cash in addition to the said cheque payment. When a probable cause of action was undertaken by the department, and evidence was found, the appellant cannot take the leverage of admitting what suits it and keep silent about the rest. The appellant cannot shut the eye to a pointing needle without bringing some evidence to contradict the proposition of the Assessing Officer. Therefore, Sh. I E Soomar case is a witness to other persons appearing in the list which is not only credible but definitive. The finding in this case is based on evidence where an inference was drawn on an undisputed fact. The findings do not rest on partial admission of the details given by the appellant, but on an evaluation of documentary evidence and credibility of information by the person who was an approver or a witness through transaction found recorded in the data. In such transactions, it is not necessary that any evidence is to be found from the premises of the investor, but the evidence found in the premises of the other parties is also relevant as it is linked to the appellant as a cogent piece of evidence in respect of the undisclosed investment.
ITA No. 426/Del./2015 66.1.5 It is also surprising to note that inspite of the above documentary evidence in the form of data available on the hard disk mentioned above, the AR of the appellant is asking the department to provide documentary evidence as it thinks that the department is making "allegation without any basis." Needless to say, the cheque payments made by the lakhotia family as reflected in the file named "D P Correction Sheet.xls" and "Down payment booking details.xls"
matched exactly with the cheques paid in the name of each family member of lakhotia family. Based on this definitive evidence, it can be concluded that cash payment is also definitive as no prudent person would maintain the record for no reasons otherwise. This was found contrary to the statement given on oath on 10.2.2012 at the time of search. No plausible explanation was filed by the appellant in the course of the assessment proceedings accept to state/narrate the history of the case and put forth a single line argument as under:
"No addition can be made to its income as cash investment made in immovable property on the basis of an excel sheet found at the premises of a third party, especially because no single piece of evidence is available to prove our investment of alleged cash amount in the property."
Other than the above contention, the appellant did not file any supporting evidence pertaining to the above denial. However, the AR of the appellant has relied on the judicial pronouncement of various case laws where addition cannot be made on the basis of the material found at the third party premises. I do not find any merit in the argument of the appellant because the facts are entirely different and are distinguishable from the facts of the cases referred. Here, the evidence found at the third party premises is a probable cause that can be linked to the transactions of the appellant where a part of them were admitted by the appellant. Therefore, this is not a case where the evidence found at the third party is not related to the appellant and that no subsequent evidence was found at her place when the search took place. Attention is drawn to the post dated cheques found at the residential premises of the lakhotia family where the cheques are in ITA No. 426/Del./2015 7 agreement with the details found in the data. In the absence of any evidence furnished by the appellant in support of his contentions, I do not find any reason to interfere and disturb the impugned addition made by the Assessing Officer. Accordingly, the addition of Rs.25,20,884/- made by the Assessing officer on the basis of the evidence found in the course of search pertaining to the cash payment against the property is upheld and confirmed."
3.2 Aggrieved by the impugned order of the learned CIT(A), the assessee is in appeal before the Tribunal on the grounds reproduced hereinabove.
4. Reiterating his submissions made before the ld. CIT(A), the ld. AR of the assessee submitted that no incriminating paper or document or any type of evidence or agreement was found during the course of search at the premises of the assessee to prove the existence of any cash /unaccounted money payment for the purchase of the flat/space/land with M/s Indrapuram Habitat Center Pvt. Ltd. The assessee submitted that merely on the basis of the information found from the premises of third party, no addition could be made in the hands of the assessee. It was submitted that the opinion of the ld. CIT(A) that the material found from the premises of third-party also constituted an incriminating material, is not sustainable at all so far as the assessee is concerned and the ld. CIT(A) has wrongly rejected the objection of the assessee on validity of the assessment and upholding the addition, mainly relying on the statement of Sh.IE Soomar i.e. another investor who admitted the cash and investment of Rs. 6.64 crores on the basis of document seized from the premises of the AEZ group. It was further submitted that in the identical facts, similar addition has been deleted by Co-ordinate Bench of Tribunal in one of the group case, Asha Rani Lakhotiya vs. ACIT (ITA No.
424.Del/2015 vide order dated 16.01.2018, wherein the assessment order and the order of ld. CIT(A) was verbatim same as in the instant case.
ITA No. 426/Del./2015 85. On the other hand, the ld. DR, relied on the orders of the authorities below and submitted that the assessee failed to submit any cogent evidence/material to discard the findings reached by the lower authorities in their orders. Therefore, the impugned orders do not call for any interference.
6. We have considered the rival submissions and have gone through the entire material on record and we find that the case of assessee is squarely covered by the decisions of co-ordinate Bench in the case of Asha Rani Lakhotia vs. ACIT(supra), where the Tribunal has decided the issue in favour of the assessee observing as under :
"4. We have heard the rival submission of both the parties and perused the relevant material on record. As far as legal grounds of the assessee are concerned, the issue in dispute before us is, whether any addition could have been made in proceedings under section 153A of the Act in the instant assessment year, without any incriminating material found from the premises of the assessee, relying on the decision of the Hon'ble Delhi High Court in the case of Kabul Chawla reported in 380 ITR 573. The fact that no incriminating material was found in the course of search at the premises of the assessee, has not been disputed before us by the Ld. CIT(DR). The Ld. CIT-(A) in para-6.1.1 of the impugned order has given details of the material seized from the premises of the assessee. The relevant para is extracted as under:
"6.1.1 During the course of search at the residence of lakhotia group on 10.02.2012, several post dated cheques or its details issued in the name of lakhotia family who made booking in respective projects were found and seized. Such details of post dated cheques (PDC) were seized as Annexure A-7 and A-8.
5. Further, both the Assessing Officer as well as the Ld. CIT-(A) has noted that the fact of cash investment was recorded in two documents found during the course of search action at the 'AEZ Group'. Those two documents are as under:
(i) Excel file named "down payment booking details.xls printed from the hard disk found during search on 17/08/2011 from the corporate office of the AEZ group at 301/303, Bakshi house, Nehru Place, New Delhi
(ii) Excel file named "down payment booking details.xls retrieved from the hard disk found and seized as Annexure A-27 from the corporate office of AEZ group ITA No. 426/Del./2015 9
6. The Ld. CIT-(A) has mentioned that in both these 'Excel files' name of the assessee as purchaser, covered area, sale price, cheque amount and cash amount received by the seller are recorded.
7. The Ld. CIT-(A) in para-6.1.2 of the impugned order has mentioned that on the basis of the 'Excel sheet', the amount received from the assessee by way of cheque and cash was shown at Rs.7,90,000/- and Rs.31,85,850/- respectively aggregating to Rs.39,35,850/- and the balance of Rs.40,000 was again shown to have been received by cheque.
8. In view of the above factual information, it is clear that during the course of search action at the premises of the assessee, which attracted proceedings under section 153A of the Act, no incriminating material was found.
9. The Ld. CIT-(A), however, has based his finding on the conclusion that the material found during the course of search at the premises of the third-party constituted an incriminating material. The finding of the Ld. CIT-(A) on the issue in dispute is reproduced as under:
"6.1.1 During the course of search at the residence of lakhotia group on 10.2.2012, several post dated cheques or its details issued in the names of lakhotia family who made booking in respective projects were found and seized. Such details of post dated cheques (PDC) were seized as Annexure A-7 and A-8.
6.1.2 On perusal of the details of sales pertaining to Nehru Vikas Minar, it was found that the appellant is related to lakhotia family and is one of the purchaser of 500 sq. ft. super area for a total consideration of Rs. 39,35,850/-. As per the details in excel sheet, the amount received from the appellant by way of cheque and cash was shown at Rs.7,90,000/- and Rs.31,85,850/- respectively aggregating to Rs.39,35,850/- and the balance of Rs.40,000/- was again shown to have been received by cheque. On the basis of the information contained in the excel sheet, the Assessing Officer gave an opportunity to the appellant to explain the source of cash payment amounting to Rs.31,85,850/- made for purchase of 500 sq. ft. super area in the Nehru Vikas Minar. Except for the denial of cash payment, the appellant did not deny the other details mentioned in the excel sheet against her name. When all other contents pertaining to the appellant mentioned in the excel sheet were not disputed, I do not find any reason as to why the appellant denied the cash transaction. No doubt the material relied upon by the Assessing Officer was found during the course of search at the premises of the third party, but the same also constitutes an incriminating material so far as the appellant is concerned in respect of its income that was not disclosed and earned through undisclosed sources. There is a reasonable belief regarding the specific information that was available on the excel sheet to be true and correct as few persons admitted to have made the investment in cash. The appellant's name appeared in the said list which it admitted to the extent of cheque payments that endorses its link with some degree of certainty that cannot be ignored or overlooked. The "DP correction sheet.xls" threw light on the reliability of information, specific and intimate facts, and corroboration of the same by ITA No. 426/Del./2015 10 admission of few persons mentioned in the list. This sheet also described every day or common transactions that could have accrued at that time.
6.1.3 For Indirapuram Habitat Centre Project, one person by named Sh. I E Soomar invested Rs.5,00,00,000/- in cash and Rs. 1,54,00,000/- by way of cheque out of the total cheque amount of Rs.1,88,70,000/-. It was found that till the date 30.6.2007 Rs.1,54,00,000/- was paid by cheques in addition to the cash. In the said file, the column "remarks" at point 5 of the table in the data showed "Buy back option upto 30.6.2007 for repurchase of Rs.6,54,00,000/-". It was found that this buy back amount was exactly similar to the total investment made by Sh. I E Soomar as he appeared and admitted that cash investment of 6.54 crores was made and taxes thereon was paid.
6.1.4 The overall balance of the evidence is a matter how decisively any data would tell in favour of a proposition. The AR of the appellant did not furnish any evidence to support the contention that no payment in cash was made against the property to be purchased. The evidence that was deciphered and linked to few persons cannot be denied as they did admit to have paid cash in addition to the said cheque payment. When a probable cause of action was undertaken by the department, and evidence was found, the appellant cannot take the leverage of admitting what suits it and keep silent about the rest. The appellant cannot shut the eye to a pointing needle without bringing some evidence to contradict the proposition of the Assessing Officer. Therefore, Sh. I E Soomar case is a witness to other persons appearing in the list which is not only credible but definitive. The finding in this case is based on evidence where an inference was drawn on an undisputed fact. The findings do not rest on partial admission of the details given by the appellant, but on an evaluation of documentary evidence and credibility of information by the person who was an approver or a witness through transaction found recorded in the data. In such transactions, it is not necessary that any evidence is to be found from the premises of the investor, but the evidence found in the premises of the other parties is also relevant as it is linked to the appellant as a cogent piece of evidence in respect of the undisclosed investment.
6.1.5 It is also surprising to note that inspite of the above documentary evidence in the form of data available on the hard disk mentioned above, the AR of the appellant is asking the department to provide documentary evidence as it thinks that the department is making "allegation without any basis." Needless to say, the cheque payments made by the lakhotia family as reflected in the file named "D P Correction Sheet.xls" and "Down payment booking details.xls"
matched exactly with the cheques paid in the name of each family member of lakhotia family. Based on this definitive evidence, it can be concluded that cash payment is also definitive as no prudent person would maintain the record for no reasons otherwise. This was found contrary to the statement given on oath on 10.2.2012 at the time of search. No plausible explanation was filed by the appellant in the course of the assessment proceedings accept to state/narrate the history of the case and put forth a single line argument as under:
ITA No. 426/Del./2015 11"No addition can be made to its income as cash investment made in immovable property on the basis of an excel sheet found at the premises of a third party, especially because no single piece of evidence is available to prove our investment of alleged cash amount in the property."
Other than the above contention, the appellant did not file any supporting evidence pertaining to the above denial. However, the AR of the appellant has relied on the judicial pronouncement of various case laws where addition cannot be made on the basis of the material found at the third party premises. I do not find any merit in the argument of the appellant because the facts are entirely different and are distinguishable from the facts of the cases referred. Here, the evidence found at the third party premises is a probable cause that can be linked to the transactions of the appellant where a part of them were admitted by the appellant. Therefore, this is not a case where the evidence found at the third party is not related to the appellant and that no subsequent evidence was found at her place when the search took place. Attention is drawn to the post dated cheques found at the residential premises of the lakhotia family where the cheques are in agreement with the details found in the data. In the absence of any evidence furnished by the appellant in support of his contentions, I do not find any reason to interfere and disturb the impugned addition made by the Assessing Officer. Accordingly, the addition of Rs.31,85,850/- made by the Assessing officer on the basis of the evidence found in the course of search pertaining to the cash payment against the property is upheld and confirmed."
(emphasis supplied externally)
10. In our opinion, the learned CIT-(A) has not appreciated the provisions related to search assessments in Act . It is clearly manifested in section 153C of the Act that if any money bullion, jewellery or other valuable article or thing or belonging to the assessee or any document pertaining to the assessee, is found during the course of search action at third-party, then action in the hands of assessee can be considered under section 153C of the Act .
11. In the case of the assessee proceedings under section 153A of the Act have been conducted, on the basis of the search action at the premises of the assessee on 10/02/2012 and thus the issue before us is that, whether in proceedings under section 153A, any addition could have been made in absence of any incriminating material found during the course of search. The Hon'ble Delhi High Court in the case of Kabul Chawla (supra) has held that in case of completed assessments, no addition could have been made without any incriminating material found in search action. Thus we have to examine whether both the conditions of completed assessment and no incriminating material are satisfied in the case of the assessee.
12. In the case of the assessee, the original return of income was filed on 27/07/2007. As it appears from the orders of the lower authorities, no assessment under section 143(3) of the Act was made. The limitation for issue of notice under section 143(2) of the Act had also expired on or before the rate of the search. Thus, evidently no assessment proceedings were pending in the instant assessment year as ITA No. 426/Del./2015 12 on the date of the search. We may like to mention that this condition of completed assessment, was anyway not disputed by the Ld. CIT(DR).
13. As far as the second condition of the incriminating material is concerned, we have already analyzed the material seized from the premises of the assessee and the material seized from the premises of 'AEZ Group' in above paragraphs. In view of the analysis, we are of the considered opinion that during the search action at the premises of the assessee, which is basis of taking action under section 153A of the Act, no incriminating material was found .
14. Before us, the Ld. counsel of the assessee also relied on the decision of the Hon'ble High Court of Delhi dated 25/07/2017 in the case of Principal CIT, Central-2, New Delhi Vs. Subhash Khattar in ITA 60/2017. In the said case, the Tribunal in ITA No. 902/Del/2015 observed as under:
"8. Considering the above submissions, we find that the Learned CIT(Appeals) has upheld the addition in question mainly on the basis of (i) the details written on the hard disc found during the course of search from the premises Aerens Group, wherein payment through cheque and cash have been mentioned against the name of assessee at Sr. No.32; Shri I.E. Soomar appearing at Sr. No. 39 of the said hard disc had admitted the cash investment of Rs.6.64 crores being made in the said project and had paid the taxes on the same; (iii) the said hard disc cannot be relied upon in part as the assessee has admitted the payment through cheque but denied the cash payment shown therein etc. In our view, a huge addition of Rs.3,21,00,000 cannot be made in a casual manner without having corroborative evidence in support. It is a prevailing practice in the dealings of immoveable properties that cash amount, if any, out of the agreed consideration is paid during the course of execution/registration of the sale deed and admittedly in the present case no sale deed or other mode of transfer has been effected. Merely because name of the assessee is appearing in the said hard disc and amongst other investors are investor Shri I.E. Soomar appearing in the said hard disc has admitted payment of cash amount, cannot be a basis for arriving at a definite conclusion, in absence of corroborative evidence in, support, that the assessee had also paid the amount of Rs.3,21,00,000 in cash. The Hon'ble jurisdictional High Court of Delhi in the case of CIT vs. Prem Prakash Nagpal (supra) wherein Assessing Officer had made certain additions under sec. 69 of the Act on the basis of the documents found during search at a place of third party which indicated that assessee had purchased a plot by paying consideration in cash, it was held by the Hon'ble High Court that the Assessing Officer could not prove by evidence that said documents belonged to the assessee and thafany on money transaction had taken place. The documents at the best only showed tentative/projected purchase consideration held the Hon'ble High Court. Again, in the case of CIT vs. Alpha Impact Pvt. Ltd. (supra), the Hon'ble Bombay High Court has been pleased to hold that addition to assessee's income in respect of additional sales consideration received in sale of land merely on the basis of Email recovered during the course of search action at the premises of another person and there being no independent material available supporting such additions, was not justified. Besides, we also find substance in the ITA No. 426/Del./2015 13 contention of the Learned AR that assessment under sec. 153 A of the Act in absence of incriminating material found during the course of search at the premises of the assessee and in absence of abatement of assessment on the date of search, cannot be made in the present case as per the above cited decisions including the decision of Hon'ble jurisdictional Delhi High Court in the case of CIT vs. Kabul Chawla (supra). Under the circumstances, we are of the view that the Assessing Officer was not justified in assuming jurisdiction under section 153 A and authorities below were also not justified in making and sustaining the addition in question merely on the basis of a hard disc found during the course of search at the premises of Aerens Group without any corroborative evidence in support. We thus hold that the assessee/appellant succeeds on both The above issues i.e. on validity of assumption of jurisdiction under sec. 153A and the addition in question. The grounds involving the above issues are accordingly allowed."
15. We find that the Tribunal, both on the validity of addition under section 153A of the Act and merit of the addition in question has decided the issue in favour of the assessee. In the instant case, also the Assessing Officer has relied on the statement of Sh. I.E. Soomar for making addition in the hands of the assessee.
16. On further challenge of the decision of the Tribunal in above case, the Hon'ble Delhi High Court upheld the order of the Tribunal with following observations:
"7. A question was posed to the learned counsel for the Revenue whether in the present case anything incriminating has been found when the premises of the Assessee was searched. The answer was in the negative. The entire case against the Assessee was based on what was found during the search of the premises of the AEZ Group. It is thus apparent on the face of it, that the notice to the Assessee under Section 153 A of the Act was misconceived since the so-called incriminating material was not found during the search of the Assessee's premises. The Revenue could have proceeded against the Assessee on the basis of the documents discovered under any other provision of law, but certainly, not under Section 153A. This goes to the root of the matter.
8. Consequently, the impugned order of the ITAT calls for no interference of this Court. The question framed by this Court on 7th February, 2017 is answered in negative, that is, in favour of the Assessee and against the Revenue.
17. Since the facts and circumstances in the instant case are identical to the facts and circumstances in the case of Subhash Khattar (supra), thus, respectfully relying on the decision of the Hon'ble Delhi High Court in the above case, we are of the opinion that no addition could have been made in the instant assessment year in absence of any incriminating material found from the premises of the assessee.
18. The facts and circumstances of the case being identical to the facts and circumstances of Sh. Subhash Khattar (supra), the addition on merit also deserve to be deleted following the finding of the Tribunal in ITA 902/Del/2015. We hold accordingly. The grounds of the appeal are allowed."
ITA No. 426/Del./2015 147. Similar view has been taken by ITAT in Ram Niwas Asha Rani Lakhotia Trust vs. ACIT (ITA No. 425/Del./2015) and in the case of Subhash Khattar vs. ACIT (ITA No.902/Del/2015) confirmed by Hon'ble High Court in ITA No. 60 of 2017, as also considered by the Tribunal in its findings reproduced above. Therefore, respectfully following the above decisions of co-ordinate Bench and of Hon'ble Jurisdictional High Court, we decide this issue in favour of the assessee and against the Revenue in the present case, as there is no material on record to show any change in the facts and circumstances of the case. Accordingly, the appeal of the assessee deserves to be allowed.
8. In the result, appeal of the assessee is allowed.
Order pronounced in the open court on 9th April, 2018.
Sd/- Sd/-
(Bhavnesh Saini) (L.P. Sahu)
Judicial member Accountant Member
Dated: 9th April, 2018
*aks*
Copy of order forwarded to:
(1) The appellant (2) The respondent
(3) Commissioner (4) CIT(A)
(5) Departmental Representative (6) Guard File
By order
Assistant Registrar
Income Tax Appellate Tribunal
Delhi Benches, New Delhi