Income Tax Appellate Tribunal - Amritsar
Jaswinder Singh Bains Alia Jazzy B, ... vs D.C.I.T, Central Circle - Ii, Jalandhar on 28 March, 2019
IN THE INCOME TAX APPELLATE TRIBUNAL
AMRITSAR BENCH, AMRITSAR
Before Sh. N. S. Saini, Accountant Member
And
Sh. N. K. Choudhry, Judicial Member
ITA No. 337/Asr./2017 : Asstt. Year : 2007-08
ITA No. 338/Asr./2017 : Asstt. Year : 2008-09
ITA No. 339/Asr./2017 : Asstt. Year : 2009-10
ITA No. 340/Asr./2017 : Asstt. Year : 2010-11
ITA No. 341/Asr./2017 : Asstt. Year : 2013-14
Jaswinder Singh Bains Alia Vs Dy. Commissioner of Income
Jazzy B, 10, Seiyu Complex, Tax, Central Circle-II,
Model Town, Jalandhar Jalandhar
(APPELLANT) (RESPONDENT)
PAN No. AMZPS7517F
Assessee by : Sh. J. S. Bhasin, Adv.
Revenue by : Sh. M. P. Singh, CIT DR
Date of Hearing :21.02.2019 Date of Pronouncement : 28.03.2019
ORDER
Per N. S. Saini, Accountant Member:
These are the appeal s fil ed by the assessee agai nst the orde r of CIT(A)-1, Jal andhar all dated 14.03.2017 for the assessment years 2007-08, 2008 -09, 2009-10, 2010-11 and 2013-14.
2. The assessee has rai sed addi ti onal ground of appeal i n the assessment years 2007-08 a nd 2008-09 whi ch reads a s under:
"That the notice issued u/s 153C for this year, not being consistent with the first proviso to section 153C, is illegal and the consequ ential orde r under appeal, pa ssed thereupon is also illegal."2 ITA Nos.337 to 341/Asr./2017
Jaswinder Singh Bains Alia Jazzy B
3. At the ti me of hearing, the l d. Authori zed Representati ve of the asse ssee submi tted that t hi s i s a l egal ground whi ch goes to the root of the assessm ent order and therefore, the same shoul d be admi tted for hearing. For thi s, he rel i ed on the deci si on of the Hon'bl e Supreme Court i n the case of CIT Vs Si nghad Techni cal Educati on Society (2017) 397 ITR 344 (SC) and in the case of Nati onal Thermal Power Co. Ltd. Vs CIT (SC).
4. The l d. Departmental Representati ve had no objecti on to the admi ssi on of the above addi tional ground of a ppeal of the assessee. Hence, the same was admi tted and the parti es were all owed to make thei r submi ssi on thereon.
5. The common ground of appeal i n ground no. 1 i n all the assessment years under a ppeal taken by the assessee reads a s under:
"1. That the very initiation of proceedings under section 153C, sans proper satisf action recorded in the case of person sea rched, is ill egal and therefore, all proceedings, flowing from such illegal assumption of jurisdiction , are void ab initio."
6. We have heard the ri val submi ssi ons and peruse d the orde rs of the l ower authori ties and materi al s avail abl e on record. The undi sputed facts of the case are that a search and sei zure operati on u/s 132 of the Act was conducted at th e resi denti al premi ses of Sh. Dinesh Kumar Aul uck on 05.12.2012. In pursuance to the sai d search n oti ces u/s 153C of the Act was i ssued in the name of the assessee on 12.01.2015 for the assessment years under consi derati on, 3 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B namely, assessment years 2007 -08, 2008-09, 2009-10 and 2011-12.
7. The impugned assessment orders for al l the sai d four years were passed i n pursuance t o the sai d noti ce u/s 153C of the Act.
8. The contenti on of the assessee is that the ini ti ati on of proceedi ngs u/s 153C of the Act was voi d in absence of recordi ng of any sati sfacti on by the Assessi ng Offi cer of the searched person and i n absence of recordi ng of any val i d sati sfacti on by the Assessi ng Offi cer of the assessee.
9. We fi nd on a perusal of Secti on 153C of the Act as w as i nforce at the materi al ti me that two sati sfacti on notes were requi red before noti ce u/s 153C of the Act can be i ssued and vali d juri sdi cti on to make assessment can be assumed.
10. The fi rst sati sfacti on note is to be recorde d by the Assessi ng Offi cer of the sea rched person to the effect that an y money, bulli on, jewell ery, or other val uabl e arti cl es or things or books of account or documents sei zed bel onged to a person other than the searched person .
11. Thereafter, the se cond sati sfacti on note i s to be recorde d by the Assessi ng Offi cer of the other pe rson (non searche d person) t o the effect that the sei zed assets or documents, etc. has a beari ng on the determi nati on of i ncome of such other person for the rel evant year.
12. It i s an establ i shed posi ti on of l aw that even when the Assessi ng Offi cer of the searched person and the other person 4 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B i s one and same then al so the l egal requi rement of recordi ng of two sati sfacti on notes have to be ful fill ed, the fi rst sati sfacti on note has to be prepa red i n the capaci ty of the Assessi ng Offi cer of the searched person and the second sati sfacti on note i s to be pre pared i n the capaci ty of the Assessi ng Offi cer of the other person. The a bove vi ew has been accepted by the CBDT vi de its Ci rcul ar No. 24/2015 dated 31.12.2015 wherei n i t has been opi ned that even i f the Assessi ng Offi cer of the searched person and the "other pe rson" i s one and the same then al so he i s requi red to record hi s sati sfacti on as has been hel d by the Courts i ncl udi ng the Hon'bl e Supreme Court in the case of CIT Vs Cal cutta Knitwears (2014) 362 ITR 673 (SC)
13. The l d. Departmental Representati ve was di rected to furni sh copy of sati sfacti on note prepa red before a ssumi ng juri sdi cti on i n the instant case u/s 153C of the Act and heari ng was adjourned to 21.02.2019.
14. On the appoi nted date, the l d. Departmental Representati ve fil ed copy of one sati sfacti on note and submi tted that thi s common sati sfacti on note was re corded f or all the years under consi derati on and no other sati sfacti on note was avai l abl e i n records. The sati sfacti on note produced before us reads as under:
"In the file of Sh. Dinesh Kumar Auluck for the A.Yrs. 2007-08 to 2012-13 Na m e & Ad d r es s o f t h e a s se s se e S h . Ja s w in d e r S in g h B a in s A lia s Ja z z y B , 1 s t F lo o r , O p p . L u c ky M a rb le , A vt a r Na g a r , Ja la n d h a r / (1 0 -S e iyu C o m p le x), M o d e l To w n , Ja la n d h a r .
PAN AMZPS7517F
Status I n d ivid u a l
5 ITA Nos.337 to 341/Asr./2017
Jaswinder Singh Bains Alia Jazzy B
Satisfaction n ote
A sea rch and seizure operati on u /s 132 of the Income Tax Act, 1961, was carrie d out at the residential premises of Sh. Dinesh Kumar Aul uck, 136- Seth Hukum Chand Col ony, Nea r DAV Col lege, Jalandha r on 05.12.2012. During the course of search, certain loose documents were found and sei zed as per Annexure A-1 to A-5 t o the Panchnama drawn at the conclusi on of th e search ope ration. On pe rusal of the seized documents, it is noticed that as per the description of the documents and statements recorded during the course of search proceedings, the following documents belonged to the mentioned abov e i.e. Sh. Jaswinde r Singh Bains Alias Jazzy B. A n n ex. Page Descri pt i on of Docu m ent No No. A -1 1 -3 Ori gi n al agreem en t dat ed 1 6 .03 .2 00 7 bet ween A n ju B eh al w/o S u bh ash Ch an der B eh al , 8 4 9 , U rban E st at e, Jal an dh ar (Fi rst part y ) an d Jaswi n der S i n gh B ai n s s/o Gu rm ail S in gh B ai n s, 87 A , S et h H uk am Ch an d Col on y , Jal an dh ar (secon d par t y ) regardi n g l an d si tu at ed at Kapu rth al a Road, Jal an dh ar, Fl at No . 3 0 1 , 3 r d Fl oor Jal an dh ar f or Rs. 17 lac s by secon d part y .
A -1 88- Regi st rat i on deed dat ed 1 6 .01 .2 0 08 bet ween Rajan 92 Ch opra an d Jaswi n der S in gh B ai ns f or pu rch ase of Fl at No. 3 0 2 -B , 3 r d Fl oor, m easu ri n g 14 9 0 sq.f t . f or Rs.1 4 .0 l ac i n -Si l v er Pal m .
A -1 107- Ori gi n al A greem en t dat ed 08 .0 3 .2 00 9 bet ween 109 Di n esh Au lu kh (Com pan y M/s S peed Rec ords bri n gi n g Mu si cal ali v e) an d Jaswi n der S i n gh B ains (Jai zy B ) ! A -1 154- Copy of Regn . Dee d dat ed 0 2 .0 7 .1 99 9 regardi n g 162 Propert y No .8 7 -8 8 m easu ri n g 2 0 m arl a 2 5 f t .
si t u at ed at V i ll . Maqsu dpu r, Teh si l & Dist t . Jal an dh ar f or R s.3,23,000/-.
S el l er : Ram Park ash Si kk a, B an si Lal Si k k a & Ki sh an Lal S /o Ram Lai r/ o W F-1 45 , A li Moh al l a, Jal an dh ar.
Pu rch aser : Jaswi n der S i n gh B ai n s s/o G u rn ail S in gh , r/o Du rga Pu r, Di stt . Nawan sh eh ar 6 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B A -1 163- Ori gi n al Regn . Deed dat ed 2 1 .0 3 .2 0 0 2 regardi n g Pl ot 167 No. L R-1 8 9 , m easu rin g 1 m arl a 1 23 sq.ft . si tu at ed at 2 n d f l oor, Model Town , Jal an dh ar f or Rs. 1,50,000/-.
S el l er : Jasraj S i n gh , s/o J ogi n der S i ngh , r/o Preet Nagar, Jal an dh ar Pu rch aser : Jaswin der S in gh B ain s s/o G u rn ai l S m gh , r/o NK-4 , Bazar Nauhrian, Jalandhar A-1 168- Original Agreement dated 16.03.2007 between Lalit Kumar s/o 170 Girdhari Lal, r/o WG-312, Islamabad Mohalla, Jalandhar and Jaswinder Singh Bains s/o Gurnail Singh, r/o 87-A, Seth Hukam 3hand Colony, Jalandhar regarding Plot No. 10, measuring 19 marla 232 sq.ft. situated at Vill. Waryana, Distt. Jalandhar for Rs.4,50,000/-.
A-1 204- Original agreement dated UNDATED (Stamp paper dated 206 21.03.2007) made by Pardeep Gupta s/o Karam Chand Gupta r/o 5, Church Road, Civil Lines, Hoshiarpur in the name of Jaswinder Singh Bains s/o Gurnail Singh Bains, 87A, Seth Hukam Chand Colony, Jalandhar regarding Flat No. 302, Silver Apartment, Block-B, Jalandhar Kunj, Kapurthala Road, Jalandhar for Rs. 17,75,000/-.
A-2 42- Papers relating to stage show programme booked by Jazzy B by 48 different persons/parties in the year 2009, totaling Rs.
15.06.000/-..r A-2 49 Letter dated 15.12.2010 of Jullundur Gymkhana Club addressed to Dinesh regarding Booking of Artist Jazzy B for Live Show for consideration of Rs. 5.76 lacs.
A-2 50- Papers relating to stage show programme booked by Jazzy B by 79 different persons/parties from 2011 upto 2013, totaling Rs.
1,37,20,000/-.
A-2 91- These are small slips showing some expenses, Pay-in-siip and 94 also slips under the head show expenses, video shoots and Jazzy, totaling Rs. 39,62,304/-.
A-2 98- This page contains various misc. expenses. However this page 99 contains some major entries to Jazzy B-3,00,000-dollar(page
98), Dinesh-Rs. 5 lac-Page 99 and Jazzy's Papa-Rs. 15 lacs & Rs.1 lac to Jazzy's Relative (also backside of 99 page) A-2 101 Backside of this page contains entries of Rs. 53,47,900/- and Rs. 28,64,300/- under the head Jazzy Account (written on the left side of the page) A-2 102 This page contains detailed calculations of amount in Indian Currency of Rs. 11,27,800/- and detail of cash m hand in Indian Currency of Rs. 8,78,000/- as on 31st August. The page is written under the head 'Jazzy in UK'.
7 ITA Nos.337 to 341/Asr./2017Jaswinder Singh Bains Alia Jazzy B A-2 104 Backside of this page contains entries under the head Dinesh, such as :-
30000 lac - Cash 3 30000 - Jazzy 100000 - Mummy 150000 - Bank Account A-2 114 This page relates to Jazzy B Video Shows of 2008 showing cash transaction of Rs. 40 lacs & 80 lacs A-2 1 17 This page shows some bank transactions for Rs. 53,80,000/- of Jazzy B. A-2 119- These pages show heavy transactions of Jazzy B for the 140 different period in foreign currency. A-3 53- Original Booking Agreement dated 10.04.2006 of f Silver Pam 56 Apartments, Kapurthala Road in the name of Jaswinder Singl Bains for booking the flat No. 302, 3* floor, Block-B for Rs. 17 jlacs alonewith payment details.
A -3 57 H an dwri tt en paper h avi n g som e am oun ts i n th e n am e of Jazzy B . & Oth ers t ot al in g Rs.1 ,7 3 ,100 /- A -3 72 Pol i cy accou nt st at em ent i n respect of A v i v a Lif e I n su ran ce i n t h e n am e of Jaswi n der S in gh as on 0 7 .0 4 .2 01 0 A -3 93 H an dwri tt en paper cont ai ni n g det ai l of am ou n t of R s.
4 3 ,9 9 ,5 00 /- i n t h e n am e of Jazzy B , V een a a/c, E l ec. B i l ls, I CI CI etc. A -3 100 Copy of ch equ e dat ed 1 8 .0 4 .2 0 10 No. 1 9 2 9 47 f or R s. | 1,80,000/- of I n du sin d B an k a/c No. 0 0 2 0 -1 9 04 2 9 -
0 5 0 i n t h e n am e of Jaswin der S in gh B ai ns.
On t h e bot t om of t hi s page, t h ere is h an dwri tt en det ai l of t ran sact i on s in r/o Kell y Cash f or Rs. 2 l ac, Nav jeet A U S f or R s. 90 0 00 /- et c.
A -3 133- Papers sh owi n g Tot al i n h an d amou n t at Rs.
138 7 6 ,0 2 ,0 00 /-, expen ses f or 20 0 9 -1 0 at Rs.
4 2 ,5 7 ,6 41 /- an d bal an ce Rs. 3 3 ,4 4 ,35 9 i n t h e n am e of Di n esh al on gwit h appli cati on s of t h e am ou n t u n der v ari ou s h eads, on e of wh i ch con t ai n s pay m en t sh i ft t o Can ada, am ou n t i n g t o Rs. 1 0 ,2 0 ,00 0 /- on pages 1 36 -
138. Page N o. 1 3 5 al so con t ai n s en t ri es tot al i n g at Rs. 7 6 ,0 2 ,0 00 /-, wh ich i n cl u des 19 l acs as sh own , as gi v en t o S peed an d Rs. 23 ,8 7 ,0 00 /-, as cash in h an d Jazzy B .
A -3 147 Det ai l of NRO A /c No. 1 2 6 31 0 10 0 00 2 00 i n t h e n am e of Jaswi n der S in gh B ai n s 8 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B A -3 171, Th i s page un der th e h ead Tot al in h ead + accou n t 174 con t ai n s di f f eren t ent ri es of am ou nt s of di f f eren t & n at u re l i k e PTC Sh ow, B i g S h ow, PTC Pu n jab et c., 178 t ot al i n g R s. 79,51,000/-. Major en t ri es are det ai l ed bel ow:-
R s. 21,31,000/- against f lat payment R s. 4 lac s Jaswinder ac c o unt R s. 4,75,000/- D inesh P ro duc tio ns R s. 10 lac s P T C c hannel etc .
A -3 172 Th i s page i s u n der t h e h ead Tot al amou n t in h an d & S peed+ad+f l at an d m ore, sh owi n g t ot al am ou n t of 181 R s. 1,11,13,418/- an d i t s f in al di sbu rsem en t un der t h e n ame Di n esh Produ cti on s accoun t , Jaswi n der S i n gh accou nt , Cash in Jazzy B , Cash i n h an d et c. A -3 173 H an dwri tt en papers sh owi n g cal cu l at i on s of Rs.
5 4 ,6 5 ,0 00 /-, wh i ch appears t o be m ean t f or som e Fl at . Th ere i s al so an ot h er cal cul ati on of t ot al in g Rs. 5 5 ,0 0 ,0 00 /-, wh ich appears t o be recei pt f rom di f f erent person s, su ch as Jazzy B , Jassi Lon wal i H om e, S eth i Pi ck sam e day Fari dabad A -3 183 Recei pt dat ed 2 3 .1 2 .07 f or R s. 1,50,000/- as adv an ce m th e n am e of Jaswi n der S in gh B ai n s I am satisfied that these documents belong to Sh .
Jaswinder Singh Bains, Alias Ja zzy B, 1st Floor, Opp. Lucky Marble, Avta r Naga r, Jalandhar/(10- Seiyu Complex), Model T own, Jalandha r. The t ransactions a s recorded in these documents have a bearing on determination of t otal income of Sh. Jaswinde r Singh Bains Alias Ja zzy B for the rele vant A.Ys. 2007-08 to 2012-13 owing to the nature of documents as descri bed above.
As per the provisi ons of se ction 153C of the I.T. Act, 1961, where the A.O. is satisfied that any money, bullion, jewellery or other valuable article s or things or books of accounts or documents seized... belongs or belong to a person other than the pe rson refe rred t o in secti on 153A (where a search w as initiated) then the A.O. having jurisdiction ove r such person sh all proceed a gainst and issue notice to each such other person and assess or reassess such other pe rson in accordance with the provisi ons of section 153A of the I.T. Act, 1961.
Since no search was conducte d in the case of the assessee, provisi ons of section 15 3C of the I.T. Act, 1961 9 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B are applica ble to the assessee. Accordingly, this is a fit case where n otice u/s 153C of the I.T. Act, 1961 i s required t o be issued t o assess/ reassess the income of the assessee for the assessment years 2007-08 to 2012- 13 i.e. six assessment years immediately prior to the assessment year relevant to the previous year in which search was conducted.
In vi ew of the above discussion, I p roceed in t he case o f Sh. Jaswinder Singh Bains, Alias Jazzy B, 1 s t Floor, Opp. Lucky Marble, Avtar Nagar, Jalandhar/(10-Seiyu Complex), Model Town, Jalandhar for the A.Y. 200 7-08 to 2 012- 13, falling within six assessment years immediately preceding th e assessment year relevant to the prev ious year in which search is conducted & issue no tice u/s 15 23 C of th e I.T. Ac t, 19 61."
Sd/-
(Aditya Shukla) Deputy Commissioner of Incom e Tax, Central Circle-II, Jalandhar Dated: 12.0 1.201 5
15. The l anguage empl oyed in the above recordi ng shows that the above was recorded i n the capaci ty of the Assessi ng Offi cer of the assessee. Thus, we find that no sati sfacti on note was recorded by the Assessi ng Offi cer of the searche d pe rson or i n capaci ty of the Assessi ng Offi cer of the searched person.
16. As discus sed earlie r, reco rdi ng of satisfact ion by the Assessing Offi cer of the sea rched p erson or in the capac ity of t he Assessing Office r of t he searc hed p erson is a co ndit ion p recedent for assumi ng juris dicti on u/s 153C of the Act. Therefore, in o ur conside red view, no val id jurisd icti on to iss ue notice u/s 153C of the Act and to make assessment u/s 153C of the Act was assumed in the i nsta nt case. Cons equently, the imp ugned o rde r of assessment passed u/s 153C of the Act for all t he four years i.e. a ssessment yea rs 2007-08, 2008-09, 2009-10 and 2011-12 under c ons ideratio n is void ab init i o. We accordi ngly quash the 10 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B same. Therefore, thi s ground of a ppeal of the assessee f or al l the years under consi derati on i s all owed.
17. In vi ew of our above deci si on, the other grounds of a ppeal have become i nfructuous and therefore, not adjudi cated upon.
18. In the resul t, the appeal s of the assessee for the assessment years 2007-08, 2008-09, 2009-10 and 2011-12 are all owed.
Assessment Year 2013-14
19. Ground No. 1 of the appeal of the assessee reads a s under:
"1. That the very initiation of proceedings unde r section 153C, sans prope r satisfaction recorded in the case of person searche d, is illega l and therefore, all proceedings, flowing from such il legal assumption of jurisdiction , are void ab initio."
20. We have heard the ri val submi ssi ons and peruse d the orde rs of the l ower authori ties and materi al s avail abl e on record. In the i nstant case, the assessee fi l ed hi s return of i ncome on 29.11.2014. As per the i mpugned order of assessment noti ce u/s 142(1) of the Act was i ssued on 12.01.2015 and n oti ce u/s 143(2) of the Act was i ssued on 05.02.2015.
21. No materi al coul d be brought before us by the Authori zed Representati ve of the assessee to show that the i mpugned orde r of assessment was pa ssed in pursuance of any proceedi ngs i ni ti ated u/s 153C of the Act for the yea r unde r consi derati on. In absence of the same, we do not fi nd any 11 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B meri t in thi s ground of the a ppeal of the assessee and accordi ngl y, the same i s di smi ssed.
22. Ground Nos. 2 & 3 of the appe al of the assessee reads as under:
"2. That there being no incri minating document found in search of a third person, identified as belonging to or pe rtaining to this assessee , in st rict terms of section 153C, the relian ce placed by Id.AO on some loose documents found in the search of M/ s Speed Records and M/s Movie Box Records P Ltd, Jalandhar, to justify addition of Rs.11,00,000/- made in this case, is grossly misplace d and contra ry to law and facts of the case.
3. That without prejudice to a bove, in the given facts of the case, the ld.CIT(A) was not justified in mechanically confirming the addition of Rs.11,00,000/-, on a premise different from the one taken by ld.AO, towa rds the a lleged undisclosed receipt for w orking in a movie, based on an unsubstantiated documents, found from a third parties."
23. The Assessi ng Offi cer observed as under:
"3. Issue of undisclose d receipts as per documents seized in search: During the course of the search proceedings at the office of M/ s Speed Records and M/s Movie Box Records Pvt. Ltd. EK-216, Phagwara Gate, Jalandhar loose documents were found and seized a s pa ge nos. 488, 489 of Annexure A-8. Th e document no. 489 is one of the core documents of the search. It is a detail of the ex penses incurre d by various pa rtners and investors in M/s SSS Movies f or the producti on of the movie 'Best of Luck' till the date 11.07.2012. As per this document, there is an entry which mentions payment of second installment to Jazzy B of R s. 11,00 ,000/-. The a ssessee Sh . Jazzy B was an act or in the movie. H owever, when the receipts account of the assessee for the year is examined, it is seen that this entry has not been reflected in his receipts as incom e. The assessee was 12 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B therefore, vide orde r sheet entry dated 23.03.2015 asked to explain as under:
"Refer to page n o.489 Annexure A-8 seized from the office premises of M/s Movie Box Pvt. Ltd. EK- 216, Phagwa ra Gate, Jalandha r. As per thi s document you have received an amount of Rs.11,00,000/- as second installment for the film Best of Luck. However, you are receipt account does n ot show this receipt . Why the same be not treated as unaccounted income du ring the year."
The assessee has not submitted any reply to this query except for stating that the receipts a re as pe r books of accounts. The reply of the assessee has been considere d and is f ound to be unacceptable. The document page 489 clearly mentions the total expenditure on the movie till 11.07.2012 is Rs.2,28,18,472/-. The breakup of this expenditure incurred by each of the partners is as under:
Kataria : Rs. 58,97,000/-
Sunny : Rs. 69,59,320/-
Gunbir : Rs. 46,85,000/-
Speed : Rs. 52,77,152/-
It has been found in the cases of partners mentione d above that a part of the above me ntioned investments have been unaccounted and made outside the books of accounts. Since the investments were unaccounted, a number of payments were made in cash outside the books of a ccounts. The pa ge cl early mention's an amount of Rs.11,00,000/- paid to the assessee. This amount has not been reflected by the assessee in his receipts.
In view of the discussi on above, an amount of Rs.11,00,000/- is being adde d to the income of the assessee on account of undisclosed re ceipts for working in the movie 'Best of Luck'."
24. On appe al , the Commi ssi oner of Income Tax (Appeal s) hel d as under:
13 ITA Nos.337 to 341/Asr./2017Jaswinder Singh Bains Alia Jazzy B "9. During the course of appellate procee dings, the assessee submitted that since these notings were by Sh. Dinesh Auluck sei zed f rom hi m in the course of search and sei zure a ction, the assessee is unaw are about the same an d has corre cted reflected his receipts in his P & L a ccount. The assessee has relied upon judgment of the Supreme Court in case of Common Causes Vs UOI and ot hers. However the judgment is easily distinguishable on the facts inasmuch as it was for setting a side the appointment of Sh. K.V. Chaudhary a s CVC on the basis of some action taken in Income Tax searches related to the Aditya Birla G roup and some oth er pa rties, stating that allegations against Sh . Chaudhary were re quired to be en quired into. I find that t his judgment is fa r removed from the facts of the instant case.
10. Sh. Dinesh Auluck has been regularly looking after the business of the assessee. In fact the assessee resides outside Indi a most of the times and it is Sh. Dinesh Auluck who manages his business affairs including booking of shows, contra cts for various events etc. therefore the notings found and seized at the residence of Sh. Dinesh Auluck cannot be brushed aside by the assessee as not pertaining to him. The notings are very specific inasmuch as dates, names of the shows and amounts received are clearly mentioned. Further the assessee himself has requested for de duction in hands of assesee on payments made to Sh. Dinesh Au luck for managing assessee's business. This further buttresses the fact that Sh. Dinesh Auluck was looking after the business of assessee. This confirms that these are serious notings and reflect the income of the assessee. I therefore see no rea son to interfere in the orde r of the Assessing Officer and the addition is confirmed."
25. We have heard the ri val submi ssi ons and peruse d the orde rs of the l ower authori ti es and materi al avail abl e on record. The Assessi ng Offi cer observed that a search and sei zure operati on was conducted i n the offi ce premi ses of M/s 14 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B Speed Records and M/s Movi e Box Records Pvt. Ltd. Duri ng the course of the sea rch, certai n docu ments were found and sei zed by the depa rtment. The sei zed document marked as A-8 a t page no. 489 contai ns detail s of expenses i ncurred by vari ous partners and i nvestors i n M/s SSS Movi e for producti on of th e movi e 'Best of Luck' till the date 11.07.2012. As per thi s document, there i s an entry whi ch menti ons payment of second i nstall ment to Jazzy B of Rs.11 ,00 ,000/-. The Assessi ng Offi cer i nferred that Jazzy B stands for Jaswi nder Singh Bai ns, the assessee. The assessee w as an actor i n the movi e "Best of Luck". The assessee i n hi s account has not shown the sai d amount of Rs.11,00.000/- as i ts recei pt. Therefore, the Assessi ng Offi cer concl uded that the sai d amount of Rs.11,00,000/- was undi scl osed recei pt of the assessee and therefore, he added the same to the i ncome of the assessee.
26. On appe al , the Commi ssi oner of Income Tax (Appeal s) confi rmed the acti on of the Assessi ng Offi cer.
27. Before us, the Authori zed Representative of the assessee rei terated the submi ssi ons made before the authori ti es bel ow and the Depa rtmental Representati ve reli ed on the orde rs of the l ower authori ti es.
28. We fi nd that the addi ti on was sol el y based upon a document found duri ng the course of the search in the possessi on of M/s Speed Records and M/s Movi e Box Records Pvt. Ltd. The sai d document was admi ttedl y not found i n possessi on or control of the assessee. Therefore , no l egal assumpti on or pre sumpti on can be dra wn on the basi s of the sai d sei zed document agai nst the assessee.
15 ITA Nos.337 to 341/Asr./2017Jaswinder Singh Bains Alia Jazzy B
29. Further, i t i s not i n di spute that the assessee i s not the author or wri ter of the sai d sei zed document. It i s al so not i n di spute that after thorough search, no document wri tten or si gned by the assessee wherei n the assessee acknowl edged the recei pt of amount in consi derati on was found. No othe r corroborati ve materi al whi ch was found duri ng the course of search has been brou ght on record by the revenue to show tha t the entri es recorded i n the sei zed document was t rue an d authenti c.
30. It i s al so not i n di spute that the sei zed document was not a regul ar books of a ccount mai ntai ned by any person duri ng the course of i ts busi ness.
31. In the above ci rcumstances, i n our consi dered opi ni on, the sai d sei zed document cannot be treated as an evi dence agai nst the assessee.
32. Our above vi ew finds support from the deci si on of the Hon'bl e Supreme Court in the case of Common Cause (A Regi stered Soci ety) and Others Vs Uni on of Indi a and Others (2017) 394 ITR 220 (SC) has hel d as under:
"22. In case of Sahara, in addi tion we have the adjudicati on by the Income- tax Settlement Commission. The orde r has been placed on record along with I. A. No. 4. The Settlement Commission has obse rved that the scrutiny of entries on loose papers, computer prints, hard disk, pen drives, etc. have revealed that the transactions noted on documents were not genuine and have no evidentiary value and that details in these loose pape rs, computer print outs, ha rd di sk and pen drive, etc. do not comply with the requirement of the Indian Evidence Act and are not admissible evidence. It further observed that the De partment has no 16 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B evidence to prove that entries in these loose papers and electronic data we re ke pt re gularly during the course of business of the conce rn ed business house and the fact that these entries we re fabricated, n on- genuine was proved. It held as well that the Principal C ommissioner of Incom e-tax/Departmental representative have not been able to show and substantiate the nature and source of recei pts a s well as the nature and reason of payments and have failed to prove evidentiary value of loose pape rs and electronic documents within the legal parameters. The Commission has also observed that the Department has not been able to make out a clear case of taxing such income in the hands of the applicant-firm on the basis of these documents.
23. It is apparent that the Commi ssion has recorded a finding that transactions n oted in the documents were not genuine and thus has not attached any evidentiary value to the pen drive, ha rd disk, computer loose pape rs, computer printouts.
24. Since it is not disputed that for entries relied on in these loose pape rs and electronic data were n ot regularly kept during the course of business, Page No : 0231 such entries were discusse d in the order dated November 11 , 2016 pa ssed in Sa hara's case by the Settlement Commission and the documents have not been relied upon by the Commission against the assessee, an d thus such documents have no evidentiary value against third pa rties. On the basis of the materials which have been placed on record, we are of the consi dered opinion that no case i s made out to direct investigation against any of the persons named in the Birla 's documents or in the documents A-8, A-9 and A-10, etc., of Sahara ."
33. In the above case, the Hon'bl e Supreme Court has al so quoted from i ts earli er deci si on in the case of CBI Vs V. C . Shukl a wherein i t has been observ ed as under:
17 ITA Nos.337 to 341/Asr./2017Jaswinder Singh Bains Alia Jazzy B "17. It has further been laid down in V. C. Shukla (supra) as to the value of entries in the books of account, that such statement shall not alone be sufficient evidence to charge any person with liability, even if they are relevant and admissible, and that they are only corroborati ve evidence. It has been held even then independent evidence is necessary as to trustw orthiness of those entries which is a requirement to fasten the liability.
17. From a plain reading of the section it is manifest that to make an entry relevant thereunder it must be shown that it has been made in a book, that book i s a book of account and that book of account has been regularly ke pt in the cou rse of business. From the above section it is also manifest that even if the above re quirements are fulfilled and the entry becomes a dmissible as relevant evidence, still, the statement made therein shall not alone be sufficient evidence to cha rge any person with liability. It is thus seen that while the first part of the section speaks of the relevancy of the ent ry as evidence, the second part spea ks, in a negative way, of its evidentiary value for charging a person with a liability. It will, therefore, be necessary for us to first ascertain whether the entries in the documents, with which we are conce rned, fulfil the requirements of the above section so as to be admissible in evidence and if this question is answered in the affirmative then only its probati ve value need be assessed.
19. With respect to evidentiary value of regular account book, this cou rt has la id down in V. C. Shukla, thus:
"37. In Beni v. Bisan Dayal, it w as obse rved that entries in books of account are not by themselves sufficient to charge any person with liability, the reason being that a man cannot be allowed to make evidence for himself by what he chooses to write in his own books behind the back of the parties. There must be independent evidence of the transaction to which the entries relate and in 18 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B absence of such evidence no relief can be given to the party who relies upon such e ntries to support his claim against another. In Hira Lal v. Ram Rakha the High Court, while negativing a contention that it having been proved that the books of account were regularly kept in the ordina ry course of business an d that, therefore , all entries therein should be considered to be relevant and to have been proved, said tha t the rule as lai d down in section 34 of the Act th at entries in the books of account regularly kept in the course of business are relevant whenever they refer to a matter in which the court has to enquire wa s subject to the salient proviso t hat such entries shall not alone be sufficient evidence to charge any person with liability. It is not, therefore, enough merely to prove that the books have been regularly kept in the course of business and the entries therein are correct . It i s f urther incumbent upon the person relying upon those entries t o prove that they were in accordance with facts."
20. It is apparent from the aforesaid discussion that loose sheets of pape rs a re wholly irrelevant as evidence being not a dmissible under section 34 so as to constitute evidence with respect to the transactions mentioned therein being of no evidentiary value. The entire prosecution based upon such entries which led to the investigation was quashed by this court."
34. In vi ew of the above, the entry i n the sei zed document was not an evi dence agai nst the assessee.
35. In the i nstant case as i t i s the all egati on of the revenue that the assessee has re cei ved Rs.11,00,000/- more than the recei pt recorde d i n hi s books of account, the onus was on the revenue to bri ng rel evant and cogent materi al on record to prove that the a ssessee and no other person has actuall y 19 ITA Nos.337 to 341/Asr./2017 Jaswinder Singh Bains Alia Jazzy B recei ved the sai d Rs.11,00,000/- duri ng the year under consi derati on.
36. In absence of any such materi al having been brought on record by the revenue, the addi tion made merel y on the basi s of sai d sei zed document i s unsustai nabl e. We, therefore , del ete the addi ti on of Rs.11,00,000/- an d all ow thi s ground of appeal of the assessee.
37. In the resul t, the appeal s of the assessee are al l owed. (Orde r Pronounced i n the Open Court on28/03/2019) Sd/- Sd/-
(N. K. Choudhry) (N. S. Saini)
Judicial Member Accountant Member
Dated: 28/03/2019
*Subodh*
Copy forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT
ASSISTANT REGISTRAR