AMIT JAIN,NEW DELHI vs. ACIT CENTRAL CIRCLE-13, NEW DELHI

Here both the parties at length. Case files perused.

We first of all deal with assessee’s appeal 69A r.w.s. 115BBE of the Act for making addition of Rs.20,00,000/-. Learned Assessing Officer’s detailed discussion in para 6 pages 2 to 3 dated 30.09.2018 has itself not disputed the clinching facts in principle that the assessee had filed cash flow statement(s) as on 01.04.2016 along with cash withdrawal from April to July, amounting to Rs.31,00,000/- which should simply brushed aside on the ground that “it is difficult to understand why would someone take out so much cash and keep in the home……”. All this leads us to the only inference that the learned Assessing Officer was more swayed by his conjecture and surmises than having rejected the assessee’s cash flow statement filed during the course of assessment. The facts also remains that even learned counsel could not explain each and every cash withdrawal entry as forming source of the cash seized before us during the course of hearing. Faced with this situation, we deem it appropriate a lump sum addition of Rs.2,00,000/- only would be just and proper with a rider that the same shall not as a precedent. The assessee gets relief to Rs.18,00,000/- in other words. We further clarify that once the source herein in assessee’s cash withdrawals in principle, the learned Assessing Officer’s consequential computation shall not invoke u/s 115BBE against him. This assessee’s appeal is partly allowed.

It is in this factual backdrop that we find the CIT(A) has reversed the Assessing Officer actions invoking section 69 r.w.s. 115BBE addition of Rs.12,99,00,000/- on the ground that the same does not deserves to be assessed at the higher rate under the said latter provision.

During the course of search and seizure operation at the premises of Mahagun India Pvt. Ltd., incriminating documents which were found and seized contained details of commodity trading done by Shri Dheeraj Jain to the tune of Rs. 12.45 crores. Documents so found were confronted to the brother of the assessee who admitted unaccounted income on account of commodity trading amounting to Rs. 12,45,40,000/- for F.Y. 2016-17 pertaining to A.Y 2017-18.

Return of income was accordingly filed including income of Rs. 12.45 crores shown as income from other sources being the amount disclosed during the course of search and seizure operation. Invoking 4 provisions of section 69 of the Act, the Assessing Officer was of the firm belief that income has to be charged to tax u/s 69 r.w.s 115BBE of the Act as income was never disclosed by the assessee and would never have been disclosed had there been no search proceedings.

In our considered opinion, provisions of section 69C of the Act do not apply as the impugned item is income and not investment. In our view, provisions of section 115BBE of the Act would apply if the income of the assessee is either declared or assessed u/s 68/69/69A/ 69B/69C/69D of the Act. But facts of the case in hand show that the assessee has declared income from commodity trading, which has been accepted as such by the Assessing Officer.

Entries on the documents seized relate to offline commodity trading transactions relating to the assessee and the amount of profit of Rs. 12.45 crores is reflected on the account of these transactions.

In our considered opinion, transaction reflected on the seized paper represents future contract of purchase and sale of gold and silver on various dates. Since the income has been accepted by the Assessing Officer, it can be safely presumed that the transactions recorded in the seized documents do not have any different character than that reflected on the seized paper and that is income of the assessee.

We are of the considered view that the assessee has clearly explained the source of profit earned by him and as the source of income is identifiable, deeming provisions of section 69 cannot be applied.

Considering the totality of the facts on the given circumstances, we have no hesitation to hold that the provisions of section 69 of the Act are not applicable on the profit from trading of speculative transactions. We, CO No. 31/Del/2022 Amit Jain therefore, decline to interfere with the findings of the Assessing Officer.” 7. This being the clinching case, we adopt judicial consistency in absence of any distinction on facts or law as the case may be, to upheld the CIT(A) foregoing detailed discussion rejecting applicability of section 115BBE of the Act in assessee’s hands. Ordered accordingly. This Revenue’s appeal fails in very terms.

No other ground or argument has been raised or pressed before us.

To sum up, this assessee’s appeal