NEERAJ GOEL,NEW DELHI vs. ACIT, CENTRAL CIRCLE- 28, NEW DELHI

The ld. AR for the assessee challenging the impugned order contended that the document in question cannot be relied upon for making any addition being a bald document and relied upon the decision rendered by the coordinate Bench of the Tribunal in assessee’s own case in for AY 2008-09 book.

To repel the arguments addressed by the ld. AR for the assessee, ld. DR for the Revenue contended by way of written submissions that the assessee was confronted during the assessment proceedings by the AO to explain the document in question and the case of the assessee falls within the deeming provisions of section 292C of the Act as the assessee has not denied the seizure of document from his residence and further contended that the AO/CIT (A) have rightly held that even this rate of interest of 18% is commensurate with the prevailing market rate and have relied upon the decision of Hon’ble High Courts in Dayachand vs. CIT – (2001) 117 taxmann 438 (Delhi), CIT vs. Nagesh Kumar Aggarwal - (2011) 9 taxmann.com 249 (Delhi), Mahabir Prasad Rungta vs. CIT (2014) 43 taxmann.com 328 & Bhagheeratha Engineering Ltd. vs. ACIT – (2017) 79 taxmann.com 325 (Kerala).

Bare perusal of the document in question marked as A-1, extracted in the preceding paras, found and seized from the residence of the assessee apparently goes to prove that the document is unnamed, unsigned, vague & ambiguous one and it is not proved on record also that if the same is in the handwriting of it bears the name of some other person. No doubt, the presumption arises u/s 292C in case of such document but the presumption is rebuttable one.

It is the case of the assessee that he is Director in one of the Bindal group of companies, namely, Neeraj Papers Marketing Ltd. and numerous persons keep visiting his residence and he was having no control on the visitors and the documents they carry and seized document was not found from the control and possession of the assessee. Moreover, no money, bullion or investment was found during the search and seizure operation to corroborate the document in question.

No doubt, date and amount has been jotted down in the seized document with one year gap but it is beyond imagination as to how the amount written has been attributed to the assessee having been given as loan to someone because there is neither name of the assessee nor the name of the loanee. The entire findings have been arrived at on the basis of presumptions and assumption that the amount of Rs.12,00,000/- attracts the interest @ 18% because when we examine para 5.4, the AO has tabulated the presumptive figure of interest calculated @ 18% on the 31.10.2013 interest figures continued the same i.e. Rs.5,31,217/-.

The coordinate Bench of the Tribunal in assessee’s own case in AY 2008-09 (supra) has deleted the addition for AY 2008-09 made on the basis of same seized document A-1 on the ground that alleged interest income cannot be attributed to the assessee on the basis of dumb document.

In view of what has been discussed above, we are of the considered view that addition made on the basis of unnamed, unsigned, undated, vague and ambiguous document without any further corroboration is not sustainable in the eyes of law.

Furthermore, the assessee has also categorically denied that the seized document belongs to him. So, when the seized document does not bear the name of the assessee not it is in the handwriting of the assessee nor does it explain the purpose of making and receiving the payment, rather it is silent as to the names of payers and payees qua the amount mentioned therein nor does it disclose that the payment was made by cheque or cash, addition cannot be made merely by invoking the deeming provisions without collecting any corroborative evidence. So Consequently, additions made by the AO and confirmed by the ld. CIT (A) is not sustainable, hence ordered to be deleted.