Pr. Commissioner Of Income Tax v. Hari Shankar Khemka

. . $ * IN THE HIGH COURT OF DELHI AT NEW DELHI 6. ITA 423/2015 PR. COMMISSIONER OF INCOME TAX[.....Appellant] Through: Ms Suruchi Aggarwal, Senior StandingCounsel with Ms Lakshmi Gurung, JuniorStanding Counsel. versus HARI SHANKAR KHEMKA Respondent Through 7+ AND + ITA 472/2015 PR. COMMISSIONER OF INCOMEAppellant Through: Ms Suruchi Aggarwal, Senior StandingCounsel with Ms Lakshmi Gurung, JuniorStanding Counsel. versus HARI SHANKAR KHEMKA Respondent Through CORAM:HON'BLE DR. JUSTICE S.MURALIDHARHON'BLE MR. JUSTICE VIBHU BAKHRUORDER%24.08.2015 1. The present appeals filed by the Revenue against the common order dated ITA Nos.42312015 & 47212015 2nd December, 2014 passed by the Income Tax Appellate Tribunal ('ITAT')in ITA Nos.4044-45/Del/2015 for the Assessment Years ('AY') 2001-02and 2002-03. 2. A search action was conducted on [l51 ][December, 2004 under Section 132]of the Act in the case of Mr Brij Mohan Gupta, Gali Hing Beg, Tilak Bazar,Delhi. As a result of the search, documents having a bearing on the AssesseeRespondent, who was engaged in cloth business at the Cloth Market, OldDelhi, as well as certain others, were seized by the Investigation Wing.Proceedings under Section 147 of the Act were initiated against theRespondent as a result thereof. It culminated in an assessment order beingpassed on 26th December 2008 under Section 143(3)/254 of the Actdetermining his total income at Rs 29,63,660/- as against Rs.1,63,656/-originally declared for AY 2001-02. Likewise, for AY 2002-03, the totalincome was increased to Rs.42,66,610/- as against Rs 1,66,610/- declaredoriginally. 3.[Against the deletion by the CIT (A) of the said additions, the Revenue file]an appeal before the hAT. By an order dated [16th ][November, 2011 in ITA] No. 175 & 176/Del/2010, the ITAT restored the matter to the file of the AOfor fresh adjudication. On remand, the AU framed fresh assessment orderson [19th ]March, 2013 making additions of Rs.28 lakhs in AY 2001-02 andRs.41 lakhs in AY 2002-03. These additions were confirmed by the CIT(A).Thereafter, the Respondent file an appeal before the ITAT. 4. The ITAT noted that during the course of search operation loosepapers/diaries were found and seized. In some papers full details of theparties were mentioned, whereas in some other papers the details werementioned in coded form. These coded entries were stated to have beenwritten by one Mr Ram Avtar Singhal, who was an Accountant of the groupof Mr Brij Mohan Gupta that was engaged in hundi business. It is alsorevealed that Mr Rajiv Gupta who is son of Mr Brij Mohan Gupta was alsoactively involved in the unaccounted cash loan and hundi transactions. In theremand proceedings, the AU provided the Respondent, [inter a/ia, ][with the]statements of Mr Ram Avtar Singhal, Mr Rajiv Gupta and Mr Brij MohanGupta. 5. In its order dated [16th ][November, 2011, the ITAT had issued a direction] 4. The ITAT noted that during the course of search operation loosepapers/diaries were found and seized. In some papers full details of theparties were mentioned, whereas in some other papers the details werementioned in coded form. These coded entries were stated to have beenwritten by one Mr Ram Avtar Singhal, who was an Accountant of the groupof Mr Brij Mohan Gupta that was engaged in hundi business. It is alsorevealed that Mr Rajiv Gupta who is son of Mr Brij Mohan Gupta was alsoactively involved in the unaccounted cash loan and hundi transactions. In theremand proceedings, the AU provided the Respondent, [inter a/ia, ][with the]statements of Mr Ram Avtar Singhal, Mr Rajiv Gupta and Mr Brij MohanGupta. 5. In its order dated [16th ][November, 2011, the ITAT had issued a direction] that the Assessee should be given an opportunity of cross-examining thepersons on the basis of whose statement the additions were made. The ITATnow found that no such opportunity for cross-examination had in fact beenprovided to the Assessee even in the remand proceedings. Secondly, in thestatements furnished to the Assessee it was found as a matter of fact thatthere was nothing which implicated the Assessee. As noted by the ITAT,"the only nexus as emanating from the said statement is restricted to anoblique reference to one Hari Sanker Khemka, Narayana, in the statement ofShri Ram Avtar, Accountant of BM group. There is nothing to establish thatthe said person is the Assessee, who during the assessment proceedings havedenied that he is not the person referred by Ram Avtar Gupta. Admittedly,the Assessee is not from Narayana but from Cloth Market, Delhi." Theabove factual conclusions by the ITAT have not been shown to be perverseby the Revenue by producing any further material on record. The decisionshaving turned on facts, the Court finds no substantial question of law arisesfor consideration. The appeals are, accordingly, dismisse[d.],,S.MURALIDHAR, J4t^ ^-,VIBHU BAKHRU, J AUGUST 24, 2015/MK