Itta/605/2012 Of J.d. Leasing Ltd v. Deputy Commissioner Of Income Tax

THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE Ms. JUSTICE G. ROHINI I.T.T.A.No.605 of 2012 Between: J.D. Leasing Limited And DATED: 19.7.2013 … Appellant Deputy Commissioner of Income Tax,Hyderabad. …. Respondent THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE Ms. JUSTICE G. ROHINI I.T.T.A.No.605 OF 2012 Judgment:(per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is directed against the judgment and order of thelearned Tribunal dated 27.4.2007 in relation to the block assessmentperiod 1989-90 and is sought to be admitted on the following suggestedquestions of law. 1)Whether on the facts and in the circumstances of the case,the ITAT was correct in upholding the addition ofRs.2,42,168/- in spite of the fact that the respondent had failedto show any evidence of the seized material based uponwhich the above addition was made ?the ITAT was correct in upholding the addition ofRs.2,42,168/- in spite of the fact that the respondent had failedto show any evidence of the seized material based uponwhich the above addition was made ? 2)Whether on the facts and in the circumstances of the case,the ITAT was correct in upholding the addition of Rs.Rs.2,42,168/- in spite of the fact that the respondent hadviolated principles of natural justice by not making the seizedmaterial on the basis of which the addition was madeavailable to the appellant ?the ITAT was correct in upholding the addition of Rs.Rs.2,42,168/- in spite of the fact that the respondent hadviolated principles of natural justice by not making the seizedmaterial on the basis of which the addition was madeavailable to the appellant ? 3)Whether on the facts and in the circumstances of the case,the ITAT was correct in upholding the addition of Rs.2,42,168/- in spite of the fact that Mr. Vikas Sethia, adirector of the appellant, had clearly stated that the amount ofRs.40,55,802/- that was disclosed by him should be set offagainst the amount of Rs.50,00,000/- that was disclosedby Mr. Dharamchand Sethia ?the ITAT was correct in upholding the addition of Rs.2,42,168/- in spite of the fact that Mr. Vikas Sethia, adirector of the appellant, had clearly stated that the amount ofRs.40,55,802/- that was disclosed by him should be set offagainst the amount of Rs.50,00,000/- that was disclosedby Mr. Dharamchand Sethia ? We have seen all the grounds taken in this memorandumof appeal and the aforesaid suggested questions of law. We have heard the learned counsel for the appellant andwe have considered his contentions. It is contended that all theauthorities below failed to take notice of the material relied onand passed orders. It was further contended that all theauthorities have relied on materials which were not collectedduring the search and seizure operations. Therefore, the whole question is whether the authoritiesbelow assessed the un-disclosed income on the basis of anyextraneous material which could not be found at the time ofsearch and seizure. To examine this contention, we haveexamined the fact finding of the learned Tribunal. The Tribunal came to the fact finding that the addition wasmade on the basis of the seized material marked asannexure-‘S’, pages 1 to 11 and the statements of Sri P.C.Sethia and Vikas Sethia. The learned Tribunal has recorded adetailed finding as follows: Therefore, the whole question is whether the authoritiesbelow assessed the un-disclosed income on the basis of anyextraneous material which could not be found at the time ofsearch and seizure. To examine this contention, we haveexamined the fact finding of the learned Tribunal. The Tribunal came to the fact finding that the addition wasmade on the basis of the seized material marked asannexure-‘S’, pages 1 to 11 and the statements of Sri P.C.Sethia and Vikas Sethia. The learned Tribunal has recorded adetailed finding as follows: “From the combined reading of the statements of Shri D.C. Sethia,Shri Prakashchand Sethia, Shri Vikas Sethia we find that the impugnedaddition was made on the basis of the statements of Shri P.C. Sethiaconfirmed by Shri Vikas Sethia which was recorded on 5.11.93disclosing a sum of Rs.88,76,305.05 as income after considering theseized material marked as Annexure-S pages 1 to 11 found at the timeof search at Ahmedabad. As regards the set off of disclosure of Rs.50lakhs, made by Shri D.C. Sethia, father of Shri Vikas Sethia andChairman of the company, we find that there is no material on record toshow that while disclosing a sum of Rs.50 lakhs, Shri D.C. Sethia hasreferred or included the income recorded in the said seized material,i.e., annexure-S pages 1 to 11 found at the time of search atHyderabad. Even in his statement there is no reference about theassessee company and the income recorded in the said searchmaterial marked as annexure-S and annexed as pages 1 to 11. In theorder passed by the CIT, dated 21/26.7.1994, accepting the bifurcationof the income declared by Shri D.C. Sethia amounting to Rs.50 lakhs,there is no reference of the assessee-company except that the incomedeclared u/s. 132(4) got generated in the name of six partnershipconcerns, viz., J.D. Electronics assessed at Hyderabad, Poona,Ahmedabad, Madras, Visakhapatnam and Calcutta.” In view of the aforesaid fact finding, it is difficult for us todecide otherwise as there is no challenge to the above said factfinding on the ground of perversity. Under such circumstances, we dismiss this appeal. ___________________ K.J. SENGUPTA, CJ _________________ G. ROHINI, J 19.7.2013 pnb