We have heard Mr. M. R. Bhatt, learned senior counsel assisted by Ms. Mauna Bhatt, learned counsel appearing for the Revenue in this Tax Appeal. 2.0 This Tax Appeal has been filed on the following proposed question of law.
“Whether the Appellate Tribunal has substantially erred in deleting the addition made in the form of unexplained cash credit u/s.68 and unexplained investments u/s.69 of the I.T.Act, 1961 despite the fact that these were based on the seized material and special audit u/s. 142(2A) and ample opportunities were provided to the assessee for explaining the same during assessment proceeding u/s. 158BC r.w.s. 143(3) of the Act?”
3.0 The CIT (Appeals) as well as the Tribunal has deleted the additions made by the Assessing Officer. The Tribunal has recorded finding of facts which are extracted below “9. On a Careful consideration of relevant facts, we notice that the department has not objected to the finding of the Ld CIT (A) that the impugned bank account was used for the purpose of carrying transactions in share market. It is also pertinent to note that the department could find only the dividend warrants. The corresponding share certificates could not be found. According to the assessee, he has already sold the relevant shares. With regard to the receipt of dividend warrants, the assessee explained that he only receive the dividend warrants if the buyers do not get those shares transferred to their respective names. We have carefully considered the record on this issue. The claim of the assessee with regard to the dividend warrants was not proved to be wrong. The AO did not carry out any enquiry with regard to the corresponding share certificates. We also notice that the amount of Rs.5,20,000/ confirmed by Ld CIT (A) was sufficient enough to cover the impugned amount of Rs.4,80,580/. Further there is no material to suggest that the impugned investment in shares was not from out of the funds rotated in the above said bank account. Under these circumstances, we find/no reason to interfere with the decision of Ld CIT (A) on this issue.
10. The next issue relates to the addition of Rs.2,50,000/ relating to the investment in Hundi of Jaydeep Textiles. The assessee's explanation was that the borrower intending to avail loan is required to execute a hundi paper and thereafter, he would try to find the lender. Accordingly he submitted that the transaction pertaining to the impugned hundi did not take place. The Ld CIT(A) found that the said explanation of the assessee is in tune with the prevailing practice and accordingly deleted the impugned addition. We have considered the facts surrounding this issue. We notice that there is no material to suggest that the assessee did invest his own money on the strength of the impugned hundi paper. Hence we do not find any infirmity in the decision of Ld. CIT (A) on this issue.
11. The next issue pertains to the addition of gift of Rs.1.00 lakhs received by the assessee's wife. The assessee also received Rs.6.00 lakhs as gift. As per para 17(x) of the assessment order, the assessee did not file any details with regard to these gifts. Hence the AO added the above said sums of Rs.1.00 lakhs and Rs.6.00 lakhs in the hands of the assessee. However, the Ld CIT(A) has deleted both the additions with the observation that the assessee has filed necessary details before AO. The said observation of Ld CIT (A) is contradictory to that stated in the assessment order. There is no finding by the Ld CIT(A) to the effect that the AO was wrong in stating so. Hence, in our view, these two addition require reconsideration at the end of Ld CIT(A). If the assessee is filing/has filed information with regard to these two gifts before Ld CIT(A) the same should be confronted with the AO. Accordingly, we reverse the order of Ld CIT(A) on this two issues and restore them to his file with direction to dispose them afresh in accordance with law.
12. The next issue relates to the addition of Rs.1,50,000/ pertaining to various items. The Ld CIT(A) deleted the impugned addition with the observation that the AO did not consider the said items while computing the undisclosed income of the period from 1.4.97 to 19.12.97, though he has discussed the details there of in para 16(xiii). Before us, it was not shown by the department that the AO has included the above said amounts in the undisclosed income of the assessee. Hence, we do not find any reason to interfere with the decision of Ld CIT(A) on this issue.
13. The next issue relates to the addition of gift of Rs.6.00 lakhs received by the assessee. We have dealt with the same in para 11 while disposing of the issue relating to the gift received by the wife of the assessee. Accordingly, we set aside this issue to the file of Ld CIT(A) with direction to dispose of the same afresh in accordance with law.
14. In the result, the appeal of the assessee is dismissed and the appeal of the revenue is treated as partly allowed.”
4.0 We are in agreement with the finding recorded by the Tribunal and we do not find any illegality either in the order passed by the CIT(A) or the Tribunal. This tax appeal is concluded finding of facts. No question raised by the department raises any substantial question of law for consideration of this Court. This Tax Appeal is accordingly dismissed.
[V. M. SAHAI, J.] Amit [N. V. ANJARIA, J.]