Appellant:rajeev Mujumdar v. Commissioner Of Income Tax-I, Bhopal

THE HIGH COURT OF MADHYA PRADESH: JABALPUR(Division Bench) ITA No. 7/2020 APPELLANT:Rajeev Mujumdar Versus RESPONDENT :Commissioner of Income Tax-I, Bhopal ------------------------------------------------------------------------------------------- Coram: Hon’ble Shri Justice Ajay Kumar Mittal, Chief JusticeHon’ble Shri Justice Vijay Kumar Shukla, Judge ------------------------------------------------------------------------------------------- Appearance: Shri G.N. Purohit, Senior Advocate with Shri Rahul Deshmukh,Advocate for the Appellant. Shri Sanjay Lal, Advocate for the Respondent-Revenue on advancecopy. ------------------------------------------------------------------------------------------- JUDGMENT (Oral)[04.03.2020] Per: Ajay Kumar Mittal, Chief Justice: This appeal under Section 260A of the Income Tax Act, 1961 (forshort “the Act”) has been preferred by the assessee against the order dated13.09.2019 passed by the Income Tax Appellate Tribunal, Indore Bench,Indore (hereinafter referred to as “the Tribunal”) in ITA (SS) No.203/Ind/2018 whereby his appeal against the order dated 26.11.2018 of theCommissioner of Income Tax (Appeals) [for brevity “the CIT(A)”] has beenpartly allowed deleting only an addition of `65,20,000/- as against the totaladdition of `87,60,000/- made by the Assessing Officer towardsunaccounted investment. The appeal relates to the assessment year 2013-14. 2.The appellant-assessee has claimed the following substantial questions of law for determination by this Court:- (i)Whether in the facts and circumstances of the case thefinding of the Tribunal is perverse, holding that`22,40,000/- is the income of the appellant, withoutappreciating evidence on record, that the loose paper wasnot found from the possession of the appellant andSection 292C of the Act is not attracted, the addition of`22,40,000/- as income in the hands of the assessee? finding of the Tribunal is perverse, holding that`22,40,000/- is the income of the appellant, withoutappreciating evidence on record, that the loose paper wasnot found from the possession of the appellant andSection 292C of the Act is not attracted, the addition of`22,40,000/- as income in the hands of the assessee? (ii)Whether under the facts and circumstances of the casethe Tribunal was correct in holding that document LPS-1page no.4 as document belonging to the assessee withoutappreciating the fact that no reasons under Section 153Cof the Act were recorded by the Assessing Officer and notspelt out anywhere in the proceedings including theassessment order, the assumption of jurisdiction wascorrect in law? the Tribunal was correct in holding that document LPS-1page no.4 as document belonging to the assessee withoutappreciating the fact that no reasons under Section 153Cof the Act were recorded by the Assessing Officer and notspelt out anywhere in the proceedings including theassessment order, the assumption of jurisdiction wascorrect in law? (iii)Whether in the facts and circumstances of the case theLPS-1 page no.4 being not in the handwriting of assesseenot recovered from the premises of the assessee could betreated as belonging to the assessee in spite of assessee’sspecific denial that such document does not belong tohim whether the finding of the Tribunal is correct in law?LPS-1 page no.4 being not in the handwriting of assesseenot recovered from the premises of the assessee could betreated as belonging to the assessee in spite of assessee’sspecific denial that such document does not belong tohim whether the finding of the Tribunal is correct in law? (iii)Whether in the facts and circumstances of the case theLPS-1 page no.4 being not in the handwriting of assesseenot recovered from the premises of the assessee could betreated as belonging to the assessee in spite of assessee’sspecific denial that such document does not belong tohim whether the finding of the Tribunal is correct in law?LPS-1 page no.4 being not in the handwriting of assesseenot recovered from the premises of the assessee could betreated as belonging to the assessee in spite of assessee’sspecific denial that such document does not belong tohim whether the finding of the Tribunal is correct in law? 3.Briefly stated, the facts of the present case, as borne out from therecord are that the appellant-assessee is the Proprietor of M/s SamarthDevelopers and Builders, engaged in the business of developing a residentialcum commercial complex in his individual capacity and also as partner byjoining others in partnership. The respondent-Department conducted searchunder Section 132(1) of the Act in the business and residential premises ofthe appellant and Shri K.L. Sharma, Neeraj Sharma as well as other builder Firms and made seizure of certain books of accounts and documents on12.08.2014. Survey was conducted in the business premises of M/s EnvoPromoters Developers Pvt. Ltd. The Department, thereafter, issued a noticeto the assessee under Section 153A of the Act. In response, the appellantsubmitted his return (Annexure A-1) for the block period including thereturn for assessment year 2013-14. Thereafter, the Assessing Officer issueda notice dated 25.08.2016 (Annexure A-2) under Section 142(1) of the Act.The appellant submitted reply to the said notice on 06.09.2016 and07.10.2016 vide Annexure A-3. The Assessing Officer vide order dated30.11.2016 (Annexure A-4) framed assessment under Section 153A readwith 143(3) of the Act and made an addition of `87,60,000/-. Feelingdissatisfied with the order, the appellant preferred an appeal before theCIT(A), which was dismissed vide order dated 26.11.2018 (Annexure A-6).On appeal being preferred by the appellant against the order of the CIT(A),the Tribunal held that only the addition of `22,40,000/-, which was found tobe unaccounted investment, was to be sustained and thus, the appeal wasallowed to that extent. In this manner, the present appeal has been filed bythe appellant-assessee. 4.Learned counsel for the appellant submitted that the alleged loosepaper on the basis of which income of `22,40,000/- is associated with theappellant is neither in the handwriting of the appellant nor was it found fromhis possession. It is an undated document which was written and maintainedby somebody from M/s Envo Promoters Developers Pvt. Ltd. and the words“`22,40,000/- Lena Hai” found to be written on it means that the said sumwas receivable by somebody in M/s Envo Promoters Developers Pvt. Ltd. 4.Learned counsel for the appellant submitted that the alleged loosepaper on the basis of which income of `22,40,000/- is associated with theappellant is neither in the handwriting of the appellant nor was it found fromhis possession. It is an undated document which was written and maintainedby somebody from M/s Envo Promoters Developers Pvt. Ltd. and the words“`22,40,000/- Lena Hai” found to be written on it means that the said sumwas receivable by somebody in M/s Envo Promoters Developers Pvt. Ltd. and not by the assessee. The assessee was partner in M/s Regal SamarthKrishna Builders Company. He joined the said Firm on 20.11.2011 andretired from there on 01.04.2012. The assessee’s capital of `30.00 Lac wasin Regal Samarth Krishna Builders Company and another `30.00 Lac wasappearing in the Firm M/s Regal Samarth Construction Company, which hasalso been appreciated by the Tribunal in the impugned order. The appellanthas no interest or connection whatsoever with Triveni Project, which name isrecorded in such loose paper. Therefore, the finding of the Tribunal that`22,40,000/- is the income of the appellant is perverse and withoutappreciating the evidence on record. On the basis of the said contention,learned counsel argued that Section 292C of the Act is not attracted in thepresent case. It was further submitted that no reason, as required underSection 153C of the Act, has been recorded by the Assessing Officer withregard to document LPS-1 page-4 being of the assessee and, therefore, theassumption of jurisdiction is not correct in law. In this connection, learnedcounsel has placed heavy reliance upon the judgment of this Court inCommissioner of Income Tax vs. Mechmen, (2015) 280 CTR (MP) 198,Indore Bench in ITA No.53/2017 (The Principal Commissioner of IncomeTax-I vs. Shri Pukhraj Soni) decided on 06.02.2019; Delhi High Courtjudgments in Pepsico India Holdings (P) Ltd. vs. Assistant Commissionerof Income Tax and Another, (2014) 270 CTR (Del) 467, PrincipalCommissioner of Income Tax vs. Nikki Drugs & Chemicals (P) Ltd.,(2016) 386 ITR 680 (Del); decision of Bombay High Court in Director ofIncome Tax vs. Ingram Micro (India) Exports Pte Ltd., (2015) 234Taxman 464 (Bom); and Allahabad High Court judgment in Commissionerof Income Tax vs. Gopi Apartment, (2014) 270 CTR (All) 447. 5.Heard learned counsel for the appellant and perused the impugnedorders. 6.Questions No.(i) and (iii) being interconnected, are taken up togetherfor discussion. It may be noticed that search and seizure operations underSection 132(1) of the Act were carried out in the residential and businesspremises of the main persons/partners and associated Concerns of M/s RegalHomes and M/s Dwarkadheesh Haveli Builders Group of Bhopal on12.08.2014. They are collectively referred to as “Regal Homes Group”. It ispromoted by Shri Krishan Lal Sharma (Shri K.L. Sharma). The group isengaged in the real estate sector. Some of the other partners of Regal HomesGroup namely, Shri Suresh Kumar Maheshwari and Smt. SunitaMaheshwari; Shri S.S. Yadav and Shri Rajeev Majumdar – appellant-assessee were also covered in the search operations. The assessee beingmember of Regal Homes Group is one of the partner of M/s Regal SamarthKrishna Builders, M/s Regal Samarth Construction Company and M/s RegalSamarth Infrastructure Company. The search and seizure was carried out inthe premises of the appellant-assessee in pursuance of warrant ofauthorization under Section 132 of the Act issued by the Director of IncomeTax (Investigation) Bhopal for A-44, Aakriti Garden, Nehru Nagar, Bhopal. 7.At the time of survey at the office of M/s Envo Promoters DevelopersPvt. Ltd. at 6/4, Chittor Complex, M.P. Nagar, Bhopal, Page No.1 to 8 ofLPS-I (at some places mentioned as LPI-I) was impounded. These paperscontained detailed working of ‘Triveni Heights’ Project of the Firm – M/sRegal Samarth Krishna Builders and the amounts paid for purchase of landfor the project as well as ledger of the partners of the Firm and 7.At the time of survey at the office of M/s Envo Promoters DevelopersPvt. Ltd. at 6/4, Chittor Complex, M.P. Nagar, Bhopal, Page No.1 to 8 ofLPS-I (at some places mentioned as LPI-I) was impounded. These paperscontained detailed working of ‘Triveni Heights’ Project of the Firm – M/sRegal Samarth Krishna Builders and the amounts paid for purchase of landfor the project as well as ledger of the partners of the Firm and payments/contribution made by them. In this account appearing under thehead ‘Majumdar ji’ at page 4 of LPS-I following matter (converted intoEnglish version) is appearing:- “` 60,00,000=00 Cash + Ch ` 85,00,000=00 To be taken from Chitrakoot` 2,60,000=00 Ch boundary w.` 62,60,000=00 ` 85,00,000=00 8.The assessee was partner holding 20% share in partnership Firm M/sRegal Samarth Krishna Builders, which was executing ‘Triveni Heights’project. The assessee became partner in the said Firm on 20.10.2011 andretired therefrom on 01.04.2012. The assessee had capital of `30,00,000/- ason 15.06.2012 in the said Firm which was receivable by him. The assesseewas also partner in M/s Regal Samarth Construction Company having 20%share (which stood enhanced to 30% w.e.f. 01.04.2012) also engaged in thebusiness of real estate. The total capital invested by the assessee as on15.06.2012 was again `30,00,000/-. Thus, total investment of the assessee inthese two Firms as on 15.06.2012 was `60,00,000/-. Besides, `2,60,000/-was paid by cheque for the boundary wall. 9.The Assessing Officer while rejecting the submission of the assesseeand making addition of `87,60,000/- in the declared income in paras 9.6 and9.7 of the assessment order dated 30.11.2016 (Annexure A-4) had concludedas under:- “9.6The submission of the assessee has been considered but the same isnot acceptable due to the following reasons: i).The details contained in the pages 1 to 8 of LPS-1 is very muchsystematic as the details mentioned in one page matches with theother page.systematic as the details mentioned in one page matches with theother page. ii).The amounts of `21,82,500/- and `2,45,000/- mentioned againstregistry expenses and receipts at page no.8 are also exactlymatching with the registry made for purchase of land from theTanwani family.registry expenses and receipts at page no.8 are also exactlymatching with the registry made for purchase of land from theTanwani family. iii)The details contained in these papers are very much systematic andcontain total land cost along with percentage and amount of shareof each partner. The amounts received from each partner till thatdate in cash and cheque and the amount due from them are alsomentioned.contain total land cost along with percentage and amount of shareof each partner. The amounts received from each partner till thatdate in cash and cheque and the amount due from them are alsomentioned. iii)The details contained in these papers are very much systematic andcontain total land cost along with percentage and amount of shareof each partner. The amounts received from each partner till thatdate in cash and cheque and the amount due from them are alsomentioned.contain total land cost along with percentage and amount of shareof each partner. The amounts received from each partner till thatdate in cash and cheque and the amount due from them are alsomentioned. iv)Shri K.L. Sharma was also one of the partners in the firm M/sRegal Samarth Krishna Builders and thus the pages 1 to 8 of LPS-1also contained details of amounts paid/contributed in cash andcheque by Shri K.L. Sharma. During the course of search at hisoffice premises, Shri K.L. Sharma was confronted with thesepapers. In response, Shri K.L. Sharma stated that these pages arerelated to his firm M/s Regal Samarth Krishna Builders in whichthe project Triveni Heights was launched and for which the landwas purchased from Tanwani family. The entries in these papersare the complete details of land purchased. He further submittedthat according to page no.8 of LPS-I, the total cost of the land is`8,18,48,270/-. He stated that as his shareholding in the firm wasof 30%, hence, the payable amount from his end was calculated at`2,45,54,481/-. The expenses on registry and receipt of registrywere `21,82,500/- and `2,45,000/- respectively, which were paidby him through his capital. According to the details of his ledger,he paid `1,37,28,230/- to firm against the purchase of land.However, he submitted that he also contributed the remainingamount of `1,08,31,251/- in cash in the firm as his capitalcontribution which is not entered in his books of account. Headmitted that he had paid this amount out of his undisclosedincome and thus he offered `1,08,31,251/- as his undisclosedinvestment for the assessment year 2012-13.Regal Samarth Krishna Builders and thus the pages 1 to 8 of LPS-1also contained details of amounts paid/contributed in cash andcheque by Shri K.L. Sharma. During the course of search at hisoffice premises, Shri K.L. Sharma was confronted with thesepapers. In response, Shri K.L. Sharma stated that these pages arerelated to his firm M/s Regal Samarth Krishna Builders in whichthe project Triveni Heights was launched and for which the landwas purchased from Tanwani family. The entries in these papersare the complete details of land purchased. He further submittedthat according to page no.8 of LPS-I, the total cost of the land is`8,18,48,270/-. He stated that as his shareholding in the firm wasof 30%, hence, the payable amount from his end was calculated at`2,45,54,481/-. The expenses on registry and receipt of registrywere `21,82,500/- and `2,45,000/- respectively, which were paidby him through his capital. According to the details of his ledger,he paid `1,37,28,230/- to firm against the purchase of land.However, he submitted that he also contributed the remainingamount of `1,08,31,251/- in cash in the firm as his capitalcontribution which is not entered in his books of account. Headmitted that he had paid this amount out of his undisclosedincome and thus he offered `1,08,31,251/- as his undisclosedinvestment for the assessment year 2012-13. v)It is to be noted that page no.4 of LPS-1 is ledger of Shri RajeevMajumdar. On the right side of page-4, it has been written as‘`85,00,000/- to be taken from Chitrakoot’. Chitrakoot is the nameof the project, run by the Firm M/s Regal Samarth ConstructionCompany in which Shri Rajeev Majumdar is also a partner. vi)The details of Triveni Heights & Chitrakoot cannot be said asrough working as both the projects are run by the firms in whichShri Rajeev Majumdar is a partner.rough working as both the projects are run by the firms in whichShri Rajeev Majumdar is a partner. v)It is to be noted that page no.4 of LPS-1 is ledger of Shri RajeevMajumdar. On the right side of page-4, it has been written as‘`85,00,000/- to be taken from Chitrakoot’. Chitrakoot is the nameof the project, run by the Firm M/s Regal Samarth ConstructionCompany in which Shri Rajeev Majumdar is also a partner. vi)The details of Triveni Heights & Chitrakoot cannot be said asrough working as both the projects are run by the firms in whichShri Rajeev Majumdar is a partner.rough working as both the projects are run by the firms in whichShri Rajeev Majumdar is a partner. vii)The assessee has submitted that the amount of `60,00,000/- may bethe sum of addition in capital in the firm namely M/s RegalSamarth Krishna Builders & M/s Regal Samarth ConstructionCompany amounting to `30,00,000/- each. But the same is notacceptable as on the page no.4, it is clearly mentioned that theamount of `60,00,000/- is related to the project ‘Triveni Heights’only which is run by the firm M/s Regal Samarth Krishna Builders.The same is confirmed in page no.3 & 7 of LPS-1 also asmentioned above.the sum of addition in capital in the firm namely M/s RegalSamarth Krishna Builders & M/s Regal Samarth ConstructionCompany amounting to `30,00,000/- each. But the same is notacceptable as on the page no.4, it is clearly mentioned that theamount of `60,00,000/- is related to the project ‘Triveni Heights’only which is run by the firm M/s Regal Samarth Krishna Builders.The same is confirmed in page no.3 & 7 of LPS-1 also asmentioned above. 9.7In the light of facts & discussion above, it is clear that the assesseehas made unaccounted investment of `32,60,000/- (`62,60,000/-minus `30,00,000/- which has been paid by cheque) in the firmnamely M/s Regal Samarth Krishna Builders and `55,00,000/-(`85,00,000/- as per the seized document minus `30,00,000/-which is the accounted investment) in the firm namely M/s RegalSamarth Construction Company and the same is added to the totalincome of the assessee for A.Y. 2013-14.” has made unaccounted investment of `32,60,000/- (`62,60,000/-minus `30,00,000/- which has been paid by cheque) in the firmnamely M/s Regal Samarth Krishna Builders and `55,00,000/-(`85,00,000/- as per the seized document minus `30,00,000/-which is the accounted investment) in the firm namely M/s RegalSamarth Construction Company and the same is added to the totalincome of the assessee for A.Y. 2013-14.” 10.On appeal by the assessee, the CIT(A) affirmed the assessment order. The relevant observations in para 4.2 of the said order read, thus:- “4.2 Ground No.2 for AY 2013-14:- Through this ground of appealappellant has challenged addition of `87,60,000/- on account ofunaccounted investment. During the course of survey at office premises ofM/s Envo Promoters Developers Pvt. Ltd. at 6/4 Chittor Complex, MPNagar, Bhopal page no.1 to 8 of LPI-I was impounded. These pagescontain detailed working of project Triveni heights of M/s Regal SamarthKrishan Builders. The seized paper contains details of land purchased andpayments made to various individuals. On page 4 of LPI-I it has beenmentioned under main heading “Shri Rajeev Majumdar” and `85,00,000/-is to be taken from Chitrakoot. It is important to note that projectChitrakoot is run by M/s Regal Samarth Construction Company and theappellant is one of the partner of M/s Regal Samarth ConstructionCompany. Appellant during appellant proceedings, submitted that loose paper seizedLPI-4 shows that someone is suppose to receive `85,00,000/- from Appellant during appellant proceedings, submitted that loose paper seizedLPI-4 shows that someone is suppose to receive `85,00,000/- from chitrakoot and not by the assessee. Since the assessee is one of theworking partner in M/s Regal Samarth Construction Company, therefore,he cannot deny the fact that there exists a nexus between the amountmentioned on the loose paper and project Chitrakoot. Further, appellantfailed to produce any material evidence in support of his claim neitherduring assessment proceedings nor at the time of appellate proceedings.The working in the loose paper contains total land cost along withpercentage and share of each partner and the amount received from eachpartner through cash and cheque has been mentioned. The loose paper hasbeen found from the premises of Shri KL Sharma who is one of thepartner in the said project. The simultaneous searches have been carriedout at the premises of the appellant and Shri KL Sharma on the groundthat both are common partners in the firms and there is every likely hoodthat paper belonging to one person might be found at premises of otherperson. The entries in these papers are related to land purchased where theappellant is one of the partner. The page 4 of loose paper is ledger account of appellant whereas it hasbeen written as “`85,00,000/- to be taken from Chitrakoot”. Chitrakoot isthe name of the project, run by the firm M/s Regal Samarth ConstructionCompany in which appellant is a partner. The details of project Triveniheights and project Chitrakoot cannot be considered as rough workingbecause in the firms appellant is one of the partner. Therefore, the AOcorrectly held in para 9.6 of the assessment order that the loose papercannot be said to be a rough working paper because in both the projectsi.e. Triveni heights and Chitrakoot appellant is a working partner. Thus inabsence of any conclusive documentary proof, the addition made by theAO amounting to `87,60,000/- is confirmed. Therefore, the appeal on thisground is Dismissed.” 11.The learned Tribunal after marshalling through the record found thatthe loose papers bearing LPS-1 page 1 to 8, seized during the course ofsurvey at the office of M/s Envo Promoters Developers Pvt. Ltd. among theaccounts of various group concerns and partners, also contained the accountsunder different heads, namely, Triveni, K.L. Sharmaji, S.S. Yadavji andMujumdarji. At page 5, under the account of S.S. Yadav, remark“Mujumdarji-vale” is also found to be mentioned. On the left hand/debit side, figures of `60,00,000/- + `2,60,000/- are mentioned whereas on righthand side an amount of `85,00,000/- (Chitrakoot Se Lena) is written and it isalso written “`22,40,000/- balance to be taken”. On the basis of these loosepapers, which contained the name of the assessee, the addition of`87,60,000/- was made. It was further found that the assessee had enteredinto partnership in Regal Samarth Construction Company, which wasrunning its business of construction of flats in the name and style as“Chitrakoot”. He was also one of the partner in the Firm Regal SamarthKrishna Builders as on 20.10.2011, which was running a project in the nameof “Triveni Heights”. The capital account produced by the assessee in thosetwo partnership Firms, which carried the entry of capital of `30,00,000/-each, were also corroborated and on that basis the Tribunal gave the benefitof doubt to the assessee by holding that out of the total amount of`85,00,000/-, the amount of `60,00,000/- which was appearing in the seizedmaterial, stood duly explained with the capital accounts of the partnershipFirms, namely, Regal Samarth Construction Company and Regal SamarthKrishna Builders and further the remaining amount of `2,60,000/-, whichwas paid through cheque, also stood duly explained and since the Revenuefailed to produce any material evidence to the contrary, the addition made bythe Assessing Officer to the extent of `62,60,000/- was deleted. 12.The assessee introduced capital in the partnership Firm Regal SamarthConstruction Company, carrying out the construction work as “ChitrakootProject” and therefore, it cannot be said that he has no nexus with“Chitrakoot Project”. Once on the basis of the same entries, the Tribunalgave benefit of doubt to the appellant by deleting the addition of `62,60,000/- out of `85,00,000/-, it cannot be said that the appellant had noconnection with the seized material. In such circumstances, the Tribunal hadconcluded that the remaining balance of `22,40,000/-, which is taken to bean unaccounted investment of the assessee is to be added to his income,which was exactly the same balance which would remain when theexplained addition of `62,60,000/- is deleted out of `85,00,000/-. However,the contention as sought to be raised in these questions that no presumptionagainst the appellant under Section 292C of the Act could be raised, is notedto be rejected. The Authorities below have not placed reliance or drawnsupport of Section 292C of the Act. Instead, on appreciation of the materialand keeping in view the entire facts and circumstances, concluded that thereexisted nexus between the appellant and the seized material (i.e. LPS-I page4). Therefore, since the appellant has failed to give any account for the saidunaccounted investment of `22,40,000/-, we do not find any illegality orperversity in the findings recorded by the Tribunal in that behalf. The viewtaken by the Tribunal on appreciation of material is plausible one. Thus, thereliance of the assessee on Shri Pukhraj Soni’s case (supra) is of noassistance to his case. The relevant extract of the findings recorded by theTribunal reads, thus:- “9. We have heard rival contentions and perused the records placedbefore us. The assessee’s sole grievance is on account of addition forunaccounted investment at `86,60,000/- made by the Ld. A.O and dulyconfirmed by the Ld. CIT(A). The assessee is a part of Regal Homesgroup which was subject to search u/s 132 of the Act on 12.8.14. Variousdocuments were seized from the business concerns subject to search. Inone of such documents found in the office of Envo PromotersDevelopment Pvt. Ltd appearing bearing No. LPS-1 page 1 to 8 containedthe accounts of various group concerns and partners associated therewith.Some of such accounts are under the different head namely Triveni, K.L.before us. The assessee’s sole grievance is on account of addition forunaccounted investment at `86,60,000/- made by the Ld. A.O and dulyconfirmed by the Ld. CIT(A). The assessee is a part of Regal Homesgroup which was subject to search u/s 132 of the Act on 12.8.14. Variousdocuments were seized from the business concerns subject to search. Inone of such documents found in the office of Envo PromotersDevelopment Pvt. Ltd appearing bearing No. LPS-1 page 1 to 8 containedthe accounts of various group concerns and partners associated therewith.Some of such accounts are under the different head namely Triveni, K.L. Sharmaji, S.S. Yadavji, Mazumdarji, Triveni Kisan account etc. The issueraised in the instant appeal is confined to the transaction appearing underthe name Mazumdar who is the assessee i.e. Rajeev Mazumdar. In thisaccount appearing under the head Mazumdarji, following matter(converted to English version) was appearing; *** `22,40,000=00 balance to be taken” ****** Sharmaji, S.S. Yadavji, Mazumdarji, Triveni Kisan account etc. The issueraised in the instant appeal is confined to the transaction appearing underthe name Mazumdar who is the assessee i.e. Rajeev Mazumdar. In thisaccount appearing under the head Mazumdarji, following matter(converted to English version) was appearing; *** `22,40,000=00 balance to be taken” ****** 12. As far as the figures of `60,00,000/- and `2,60,000/- which is onthe left hand/debit side we observe that the assessee entered intopartnership in Regal Samarth Krishna Construction Company which wasexecuting the project of construction of flats in the name of “Chitrakoot”.The assessee also entered into partnership with other concern RegalSamarth Krishna Builders on 20.10.11 which was running another projectnamed “Triveni Heights”. At Page No. 13 to 21 of paper book filed on13.3.2019, copies of capital account of the assessee in the above statedpartnership firms are placed. On perusal of the same we find that in thefirm Regal Samarth Construction Company the assessee has introducedcapital of `30,00,000/- through cheque during financial year 2012-13 andsimilarly in Regal Samarth Construction Company also assessee being30% partner has introduced capital by cheque/cash of `30,00,000/-. Sothere remains no dispute that the amount of `60,00,000/- which isappearing in the seized material, stands duly explained with the capitalaccounts of the partnership firms and supports the contention of Ld.Counsel for the assessee that `60,00,000/- is duly accounted for in thebooks of accounts. Remaining amount of `2,60,000/- have also been paidby cheque as appearing in the seized document, thus the figure of`2,60,000/- also stands duly explained by the assessee. 13. Now as far as amount of `85,00,000/- appearing on the right handside of the account appearing in seized document with the particular “to betaken from Chitrakoot”, we observe that Chitrakoot is the project ofconstruction of flats executed by partnership firm Regal SamarthConstruction Company in which assessee was a partner along with Mr.K.L. Sharma and others. In this partnership firm assessee introducedcapital of `30,00,000/- during financial year 2012-13. So the word “chitrakoot” is having a direct nexus with the Chitrakoot project whichwas carried on by the partnership firm Regal Samarth ConstructionCompany. For the phrase “to be taken from Chitrakoot” out of an amountof `85,00,000/-, contentions made on behalf of the assessee are that thisparticular entry connotes liability on the part of “Chitrakoot” project fromwhich the assessee is entitled to receive back and so it can be treated asincome. However, in our view the phrase “to be taken from Chitrakoot”can be looked from another perspective also. In the alleged account itemsappearing on the left hand side is the capital introduced by the assesseewhich means it was the fund brought in by the assessee in the project andon the right hand side the figure of the amount “to be taken by the assesseefrom Chitrakoot” project. So there is a fair possibility that against theinvestment of `62,60,000/- the assessee is entitled to receive `85,00,000/-from the project. This sum of `85,00,000/- may comprise of the capitalintroduced by the assessee and profits or it can purely be the income. 14. Since the assessee is one of the working partner in Regal SamarthConstruction Company and the alleged transaction have direct nexus withthe assessee but during the course of proceedings before both the lowerauthorities and before us assessee failed to produce any material evidencein support of his claim that the alleged amount of `85,00,000/- is nothaving any ingredient of undisclosed/unrecorded income. So we are of theview that `85,00,000/- is the amount to be received by the assessee and itcan be purely unaccounted income or it can be an amount whichcomprises of income and capital introduced by the assessee. Since therevenue has not brought any other material evidence to prove that thealleged amount is purely an income the assessee certainly deserves benefitof doubt and further since below the alleged account itself the sum of`22,40,000/- is mentioned as an amount referred as balance to be forpayment. This amount of `22,40,000/- is the difference between`85,00,000/- (i.e. amount to be taken less `62,60,000/- the amountinvested by the assessee), therefore the addition for unaccountedinvestment in our view cannot be more than `22,40,000/-. We therefore inthe given facts and in view of our discussions herein above are of theconsidered view that the alleged addition of unaccounted investment needsto be sustained only to the extent of `22,40,000/- and thus the finding ofLd. CIT(A) is set aside and the assessee gets relief of `65,20,000/-.Ground No.1 of the assessee is partly allowed.” 13.Thus, the question No.(i) and (iii) as claimed, cannot be held to besubstantial questions of law and are not based on any incorrect and improperreading of evidence on record. 14.Taking up the question No.(ii), as claimed by the assessee that noreason has been recorded by the Assessing Officer with regard to the loosepapers (LPS-1 page-4) being of the assessee and therefore, the AssessingOfficer could not have assumed the jurisdiction in terms of Section 153C ofthe Act, it is seen that it is for the first time this contention has been raisedbefore this Court. It may be noted that the premises of Regal Homes Groupwas subjected to search under Section 132 of the Act on 12.08.2014. Theresidential premises of the assessee were also searched together with thegroup Concerns including M/s Regal Samarth Construction Company andRegal Samarth Krishna Builders in which appellant-assessee had interest aspartner therein. Thus, in the present case, Section 153A of the Act wasattracted and accordingly, assessment under Section 153A read with Section143(3) of the Act had been framed. Since the search had taken place at theresidence of the assessee as well, thus, no proceedings for framingassessment under Section 153C of the Act arose. Therefore, Section 153C ofthe Act had no relevancy in the facts and circumstances of the present case.Consequently, it is concluded that the question No.(ii) as claimed, ismisconceived. In this view of the matter, judgments in Mechmen’s case(supra), Pepsico India Holdings’ case (supra), Nikki Drugs & Chemical’s case (supra), Ingram Micro (India) Exports’ case (supra)and GopiApartment’s case (supra) on which reliance has been placed by the learnedcounsel for the assessee are of no help to the appellant, as all these casesrelated to framing of assessment under Section 153C of the Act where the S/ premises of the assessee had not been searched but incriminating materialhad been found during the search against the assessee for taking assessmentproceedings under Section 153C of the Act. 15.In view of the foregoing discussion, no substantial question of lawarises in the present appeal. We find no reason to interfere with the orderimpugned herein. Accordingly, the appeal stands dismissed. (Ajay Kumar Mittal) (Vijay Kumar Shukla) Chief Justice Judge