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13-05-2019, Braham Arenja, Section 153A, 133A, 132, 69, Tribunal Delhi

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1 week 4 days ago #9427 by amit
Section - 153A, 133A, 132, 69
Order Date - 13-05-2019
Favouring - Partly
Court - Tribunal Delhi
Appellant - Braham Arenja
Respondent - ACIT
Citation - 519Taxpundit190
Appeal No. - ITA No. 2581/Del/2015
Asstt. Year - 2011-12



1. This appeal is filed by assessee, individual against the order of the Commissioner of income tax appeals –XXVII, New Delhi dated 27/2/2015 for assessment year 2011 – 12.

2. The assessee has raised the following grounds of appeal:-

1. That the search u/s 132 conducted at the premises of the appellant on 10-02-2012 was without jurisdiction and not based on any incriminating material on record. Therefore, the proceeding; initiate erroneous and without jurisdiction, deserves to be quashed.

2. a) All the transactions of the appellant with Mr. Jayant Ghadia were duly recorded in the books of accounts. The CIT (Appeals) went wrong on facts and in law in sustaining the addition made by the assessing Officer of a sum of Rs. 75,00,000/- as unexplained income of the appellant based on a receipt of Rs. 75,00,000/- given by Mr. Jayant Ghadia to the appellant as a security.

b) The consequent addition of Rs. 75,00,000/- made by the assessing officer and sustained by Ld CIT(A) being illegal, erroneous and without jurisdiction, deserves to be deleted.”

3. The only dispute in this appeal is with respect to the addition of INR 7,500,000 made by the learned assessing officer in the hands of the assessee. Brief facts of the case shows that assessee is an individual, who was issued notice u/s 153A of The Income Tax Act on 13/12/2013 in pursuance to search conducted in the Arens group on 17/8/2011. The assessee filed his return of income declaring income of INR 645770/–. Notices u/s 142 (1) was issued to the assessee.

4. Search was conducted on 17/08/2011 on Arens group. Consequent to that search on residential premises of the assessee was also conducted on 10/2/2012. The office of the assessee was also covered and survey was conducted thereon. During survey 1 memorandum of understanding dated 25/6/2010 along with the receipt signed by one Mr Jayant Ghadia was found. The receipt contains the information that Mr Jayant Ghadia has received INR 2,500,000 by cheque dated 25/06/2010 and INR 7,500,000 in cash. The dispute is about the addition of INR 7,500,000 in the hands of the assessee. On enquiry by the learned assessing officer, Assessee submitted that the cash amount of INR 7,500,000 shown in the receipt appearing at page number 62 of annexure A – 1 of the seized document was never paid by the assessee nor received by him. Thus the receipt of Rs. one crore is null and void as by giving the cheque number 894382
dated 25/06/2010 the assessee squared up his account with Shri Jayant as on 25/06/2010 and no amount was receivable for him at that time. However the learned assessing officer rejected the contention of the assessee stating that the explanation given by the assessee is not satisfactory and no evidence whatsoever has been given by the assessee relating to the correspondence between the assessee and Sri Jayant regarding the negotiation of other properties. The learned AO noted that the MOU and receipt are duly signed by Sri Jayant and 2 witnesses from the office of the assessee. One of the witness also confirmed that he along with another witness has signed the document on the direction of assessee and Mr Jayant. Therefore the learned assessing officer noted that it clearly shows that INR 7,500,000 has been received by Shri Jayant from the assessee. He further stated that on perusal of the receipt given by Sri Jayant on which the word „received‟ itself confirms the receipt of the entire amount of Rs. One crore and not only INR 2,500,000/- as claimed by the assessee. He further stated that during the course of assessment proceedings the assessee produced Shri Jayant who has reiterated the stand of the assessee. Accordingly he made an addition of INR 7,500,000 and determined the total taxable income of INR 8145770/- vide order under section 153A read with section 143 (3) of The Income Tax Act dated 27/3/2014.

5. The assessee aggrieved with the order of the learned assessing officer preferred an appeal before the learned CIT – A who confirmed the addition stating that the explanation of the assessee with regard to the cash payment of INR 7,500,000 is vague and motivated and afterthought. Therefore assessee aggrieved with the order of the learned CIT –A has preferred this appeal before us.

6. At the beginning of the hearing the learned authorised representative submitted that the ground number 1 of the appeal is not pressed. Therefore same is dismissed.

7. Ground number 2 of the appeal is with respect to the addition made by the learned assessing officer of INR 7,500,000 as unexplained income of the assessee based on receipt of INR 7,500,000 given by Mr Jayant to the appellant as security. He submitted that memorandum of understanding dated 25/6/2010 and receipt signed were found during the course of survey under section 133A of the income tax act. He submitted that in case of a survey addition u/s 6960 9C can you made if explanation of the assessee is not satisfactory.Merely on the basis of the memorandum of understanding without further collaborating the material no addition can be made. He further relied upon the decision of Harish Daulatram Inanni vs deputy Commissioner of income tax (2008) 24 SOT 541 (MUM). He further submitted that from

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