Document Fragment View

Matching Fragments

12.

5. The last ground is with regard to levy of interest u/s.234A, 234B and 234C of the Act.

6. The facts of the case are that the assessee is an individual having income from partnership firm and other sources. In the Assessment Year 2009-10the assessee filed Return of Income on 22.3.2010 declaring an income of Rs.1,80,139 and for the Assessment Year 2011-12, the assessee declared income at Rs.2,87,140 ITA Nos.462 & 463/Bang/2020 on 20.01.2016 in response to Notice u/s. 148 of the Act. In A.Y. 2011-12, there was no Return of Income filed by the assessee u/s. 139(1) of the Act. Actually there was search action in the case of M/s. RNS Infrastructure Ltd. at Naveen Complex, 7th Floor, MG Road, Bangalore and at Murdeshwar Bhawan, 604-B, Gokul Road, Hubli, evidence was gathered which pointed to receipt of certain amounts by the assessee from the above company. These payments were made in cash and were not disclosed in the regular books of accounts of the above company. Information relating to such payments were gathered from the diary notings of several key personnel of the company as also from the deleted accounts named and styled "Sundry Payments" which were retrieved from the hard disks of the searched company. Consequent to this, the Assessing Officer issued Notice u/s. 148 for the Assessment Year 2009-10 on 13.3.2015. In response to the same, the assessee filed Return of Income on 20.01.2016 disclosing income of Rs.2,07,170 for the Assessment Year 2009-10. Similarly, Notice u/s. 148 was issued for the Assessment Year 2011-12 on 13.3.2015 as narrated earlier, the assessee filed return in response to Notice u/s. 148 of the Act on 20.03.2016, the assessee filed Return of Income declaring an income of Rs.2,87,140. The Assessing Officer while completing the assessment u/s. 143(3) r.w.s. 147 of the Act in these assessment years considered the material seized from the RNS Infrastructure Limited (RNSIL). M/s. RNS Infrastructure Limited is a leading ITA Nos.462 & 463/Bang/2020 contractor which has executed various Government contracts for roads and projects, canals in Karnataka including Upper Badra Irrigation Canal works costing Rs1,100 Crores. There was seized material in the form of daily jottings and recordings in the computer relating to the various payments made by RNSIL to public servants, Bureaucrats and politicians. Jottings are in the hand writing of the Vice President (Finance) of RNSIL. The digital evidence has been retrieved in a foolproof manner using the specialized forensic software "ENCASE" with MD5 hash value. Relating to the assessee, there was a payment entry of an amount of Rs.10 lakhs in the Assessment Year 2009-10 and Rs.49 lakhs in the Assessment Year 2011-12. The Assessing Officer on this issue, made respective additions in these assessment years under the head 'income from other sources. Against the reopening of assessment and also on making addition by the Assessing Officer, the assessee challenged before the CIT (Appeals). The CIT (Appeals), both on reopening of assessment and addition made on merit sustained the findings of the Assessing Officer. Aggrieved by the order of CIT (Appeals), the assessee is in appeal before us.

8. On the other hand, the ld. DR submitted that there was a search in the case of RNS Infrastructure Limited (in short RNSIL) on 16.02.2012. Consequent to search action in the case of RNSIL, various incriminating material were unearthed and seized. This seized material indicates that unaccounted and illegal cash payments made by the assessee to various public servants, bureaucrats and politicians and seized documents are in the form of daily jottings and recordings in the computer. Jottings are in the hand writing of the Vice President (Finance) of RNSIL. The evidence has been retrieved in a fool proof manner using the specialized forensic software "ENCASE" with MD5 hash value. The seized documents revealed that all such illegal payments were took under the head "Sundry" in the accounts of RNSIL and it is a sister concern. However, when accounts are finalized for various strategic purposes, the expenses made under the head "Sundry" were not made part of the accounts. Thus from the seized documents from RNSIL, it was found that there was payment of Rs.10 lakhs in the Assessment Year 2009-10 and Rs.49 lakhs in the Assessment Year 2011-12 to the assessee on hand. These informations were passed on by DCIT, Central Circle ITA Nos.462 & 463/Bang/2020 2(3), Bangalore to the Assessing Officer of the present assessee. On the basis of information gathered from DCIT, Central Circle 2(3), Bangalore, the Assessing Officer of the present assessee issued Notice u/s. 148 of the Act to the present as on 13.3.2015. As discussed earlier, there is a search in the case of RNSIL u/s. 132 of the Act and unearthing of incriminating material on 16.2.2012 on the basis of information supplied by the DCIT, Central Circle 2(3), Bangalore, the Assessing Officer come to a conclusion that there was an escapement of income in the hands of the assessee and issued Notice u/s. 148 of the Act. The reasons were germane to the prima facie reached by the Assessing Officer for any chargeable income to tax has escaped assessment by reason of non-disclosing the above payments recorded any seized material by the assessee in his books of accounts. The material that was considered by the Assessing Officer for reopening of the assessment may not show conclusively that there was escapement of income. The statement available at the time of reopening of assessment, the Assessing Officer reached conclusion that there is escapement of income in the hands of the assessee. It is well settled that at the time of issuing Notice u/s. 148 of the Act, the Assessing Officer is only required to reach a tentative or prima facie belief regarding escapement of income and that requirement is satisfied in the present case.