SAJJAN KUMAR AGARWAL ,KOLKATA vs. DCIT, CENTRAL CIRCLE - 3(4), KOLKATA , KOLKATA

1. That on the fact and circumstances of the case the learned CIT(Appeal) was not right in law in confirming the addition of Rs.18,00,00,000 (Rupees Eighteen Crores Only).

The assessee in the present case is an individual. A search and seizure action under section 132(1) was conducted in the assessee’s residential premises at 49A & 50 Tollygunge Circular Road, Kolkata-700 053 on 18.09.2012 and the subsequent dates. During the course of the said action, cash, jewellery and silver utensils were found from the residential premises of the assessee. During the course of the continuation of the search action, a statement of the assessee was recorded under section 132(4) on 10.10.2012, wherein he offered to disclose voluntarily additional income of Rs.18 crores. During the course of search of the assessee’s Bank Locker No. 5/35 maintained with Union Bank of India, New Alipore Branch, Kolkata on 08.11.2012, a diary and loose bunch of papers identified as SKA/L/1 and SKA/L/2 were seized. The statement of the assessee under section 132(4) was again recorded on 08.11.2012, wherein he was required to explain the entries appearing in the said documents seized from his Bank Locker. In reply, the assessee stated that the said entries represented details of his undisclosed transactions and reconfirmed the disclosure of Rs.18 crores made on account of additional income in the statement earlier recorded under section 132(4) on 10.10.2012 as based on the said seized documents. Thereafter on 15.12.2012, the assessee along with Shri Mahesh Agarwal submitted a disclosure petition before the DDIT (Investigation), Unit- II(2), Kolkata reiterating that the disclosure of Rs.18 crores was made in good faith and voluntarily. He also stated that the said disclosure was made on estimated basis and gave his assurance that full and true disclosure will be made in the returns of the respective assessees by making required adjustments after going through details of all the impounded documents. Thereafter the return of income for the year under consideration was filed by the assessee on 25.07.2013 declaring total income of Rs.29,02,280/-. During the course of assessment proceedings, the assessee was called upon by the Assessing Officer to explain as to how the amount mentioned in seized documents SKA/L/1 and SKA/L/2 had been taken into account for the year under consideration, i.e. A.Y. 2013-14 and how the undisclosed income of Rs.18 crores surrendered by him during the course of search was disclosed in the assessee’s return as well as the returns of the group concerns. In reply, the following explanation was offered by the assessee in writing:- “During the course of search so many deeds and documents were seized from our premises, including the purported shown document ID SKA/L/l & SKA/L/2 from the Union Bank locker. As already said in our earlier letter, during the search proceedings because of unhealthy state of mind we had been forced to give disclosure to the tune of Rs.18 crore (approx). This disclosure was made on the basis of the above said documents such as SKA/L/l & SKA/L/2 seized by the department, retraction of which is well conveyed by means of the disclosure petition wherein we have also mentioned that the disclosure is being made without going through the details of the documents seized by the dept. We have also submitted in our disclosure petition that, we are not aware of the contents of all the statements recorded of various persons during the course of search & seizure which were given in a stressful and unhealthy state of mind.

The certificate stated to be issued by the Chief Manager of Union Bank of India, New Alipore Branch and furnished by the assessee was found to be vague and not clear by the Assessing Officer. He, therefore, issued a summons under section 131 requiring the Branch Manager, Union Bank of India, New Alipore Branch to appear personally on 22.01.2015. In response to the summons, the Branch Manager appeared before the Assessing Officer on 22.01.2015 and admitted in his statement recorded under section 131 that in the absence of locker operation register for the period prior to 28.02.2011, he was not in a position to give any specific comments regarding frequency of the operation of the locker of the assessee. He also stated that the operation details of the locker prior to 28.02.2011 could not be provided since the locker operation register was not traceable. He further stated that he was not in a position to comment on the exact nature of the locker at the time of breaking it open as he was not present at the time of breaking open of the said locker. He accordingly expressed his inability to support and substantiate the claim of the assessee that the locker was not operated for the period of more than a decade.

As regards the other claim made by the assessee that the disclosure of additional income of Rs.18 crores was made by him during the course of search under pressure and coercion, the Assessing Officer found that the assessee had on two occasions given and reconfirmed the disclosure of undisclosed income through his statements recorded on oath on 10.10.2012 and 08.11.2012. He also noted that this disclosure made by the assessee was again reiterated and reconfirmed in the disclosure petition filed by the assessee on 15.12.2012 before the DDIT (Investigation), Unit-II(2), Kolkata. He held that since this reiteration and reconfirmation of the disclosure was made by the assessee in a period of 2-3 months after the date of search, the point of its being given under any kind of pressure, coercion, force, etc. could not hold good. He held that the allegation made by the assessee of having made surrender/disclosure under force and in a stressful and unhealthy state of mind was nothing but an after-thought and it was far from the reality as it was given on the basis of material evidence collected during the course of search reflecting unaccounted transactions. He noted that the relevant seized documents identified as SKA/L/1 and SKA/L/2 contained notings related with the details of both debit and credit entries worth Rs.17,39,47,305/- each and the same represented unaccounted investment of the assessee which was voluntarily disclosed by the assessee as his undisclosed income. He accordingly treated the entries appearing in the relevant seized documents as representing the undisclosed income of the assessee and made an addition of Rs.18 crores under section 69A of the Act to the total income of the assessee in the assessment completed under section 143(3) vide an order dated 30.03.2015.

I have also carefully considered the submissions of the appellant relating to the issue of the operation of the Bank Locker. I find that the Ld. AO has recorded the statement of the concerned bank Manager, and he has under oath stated that in the absence of the Locker operation Register prior to the period of 28.02.2011, the matter could not be said with any certainty whether the bank locker was operated or not. This being the factual situation, I find that the matter remains unequivocal, and does not come to the rescue of the appellant. In view of these reasons I am not inclined to interfere with the findings of the Ld. AO and his action in making the impugned addition of Rs.18,00,00,000/-, and treating the said amount as undisclosed income of the assessee-individual for the subject assessment year. Such action stands confirmed, and the grounds of appeal taken by the appellant-individual stand dismissed”.

As regards the disclosure of undisclosed income of Rs.18 crores stated to be voluntarily made by the assessee during the course of search, he invited our attention to the copy of the statement of the assessee recorded during the course of search on 19.09.2012 (copy placed at page no. 13 to 17 of the paper book) and pointed out that the assessee was asked the question no. 30 seeking his desire to disclose an additional income and in reply it was stated by the assessee that he was not in a position then to disclose any additional income and that it could be disclosed in due course. He then invited our attention to the statement of the assessee recorded under section 132(4) on 10.10.2012 (copy at page no. 18 and 19 of the paper book) and submitted that the assessee was made to surrender/disclose additional income of Rs.18 crores of the Companies and persons belonging to his group for the previous year relevant to A.Y. 2013-14. He submitted that the locker of the assessee with Union Bank of India, New Alipore Branch was thereafter broke open on 08.11.2012 and in the statement of the assessee recorded under section 132(4) on 08.11.2012 (copy placed at page no. 20 and 21 of the paper book), the assesse was made to rely on the documents found and seized from the locker to justify the disclosure of additional income of Rs.18 crores made on 10.10.2012.

The ld. Counsel for the assessee submitted that all the Bank accounts of persons and entities belonging to the assessee’s group were meanwhile attached by the Income Tax Department in the month of September, 2012 itself and only after the disclosure of additional income of Rs.18 crores made by the assessee in the statement recorded on 10.10.2012, the attachments there revoked by the Department. He invited our attention to the copies of revocation orders placed in his paper book at page no. 108 to 122 of the paper book to point out that the attachment of the Bank accounts of the group members was revoked by the Department only after the disclosure of additional income of Rs.18 crores by the assessee on 10.10.2012. He contended that the assessee thus was put under pressure by way of attachment of Bank accounts of the persons and entities belonging to his group and after extracting the disclosure of additional income of Rs.18 crores from the assessee under the said pressure, the attachment of Bank accounts was revoked. He contended that the disclosure of additional income of Rs.18 crores thus was not made by the assessee voluntarily and the same cannot be relied upon to make any addition to the total income of the assessee.

The ld. Counsel for the assessee further contended that the disclosure of additional income of Rs.18 crores as made by the assessee in the statements recorded under duress and pressure was in respect of all the persons and entities belonging to the assessee’s group as specifically mentioned by the assessee in his statement. He submitted that the Assessing Officer vide a letter dated 17.09.2013 issued during the course of assessment proceedings had asked the assessee to furnish the details of tax paid in respect of the disclosure of Rs.18 crores made during the course of search and in reply to the said letter, the relevant details were furnished by the assessee to show that the persons and entities belonging to the group had offered to tax in their returns of income for the year under consideration, total income of Rs.15.45 crores as against the total income of Rs.4.40 crores offered for the immediately preceding year i.e. A.Y. 2012-13 and also paid a tax of Rs.3.12 crores on the income so declared. He contended that inspite of the additional income of more than Rs.11 crores declared by the persons and entities belonging to the assessee’s group for the year under consideration, the Assessing Officer still added the entire amount of Rs.18 crores allegedly declared by the assessee voluntarily as his undisclosed income during the course of search to the total income of the assessee for the year under consideration by stating that the said addition was supported by the entries found recorded in the loose papers found and seized from the bank locker of the assessee. He contended that there was nothing whatsoever in the said documents to indicate that the transactions allegedly reflected therein were related to the assessee and the same represented undisclosed income of the assessee for the year under consideration. He contended that the relevant loose documents found and seized from the Bank locker of the assessee were of the old diary of 1992 and in the absence of any date mentioned therein, the same could not be formed the basis of making any addition on account of undisclosed income of the assessee for the year under consideration. He contended that even the conclusion that the entries appearing in the relevant seized documents represented loans and advances given by the assessee to the different persons, whose names were appearing in the said seized documents, was drawn by the Assessing Officer without making any enquiry whatsoever with the said persons. He contended that section 69A of the Act invoked by the Assessing Officer to make the said addition is also not applicable in the facts and circumstances of the case.

To summarise his arguments, the ld. Counsel for the assessee contended that the admission/surrender made by the assessee regarding undisclosed income of Rs.18 crores was not voluntary and since the same made under coercion and duress was not supported or corroborated by any evidence found during the course of search or brought on record by the Assessing Officer during the course of assessment proceedings, the addition of Rs.18 crores made by the Assessing Officer and confirmed by the ld. CIT(Appals) is not sustainable. In support of this contention, he relied on the following judicial pronouncements:- (i) Pullangode Rubber Produce Co. Limited –vs.- State of Kerala & Another [91 ITR 18 (Supreme Court)];

The ld. D.R., on the other hand, submitted that there is no conclusive proof to show that the loose sheets found and seized from the bank locker of the assessee were from the same diary of 1992, which was also found and seized from the same locker. He contended that the summary of the relevant transactions found to be recorded in the said loose sheets was given on the separate page found from the locker of the assessee and the same admittedly was not from the old diary of 1992. As regards section 69A of the Act invoked by the Assessing Officer for making the impugned addition of Rs.18 crores, he contended that the same is applicable where the assessee in any financial year is found to be the owner of any money, bullion, jewellery or other valuable articles which is not recorded in the books of accounts and the assessee offers no explanation about the nature and source of acquisition thereof. He contended that the assessee in the present case was found to be the owner of assets, which were not recorded in his books of account and since the assessee failed to offer any satisfactory explanation about the nature and source of acquisition thereof, section 69A was clearly applicable. He also relied on the provisions of section 292C to contend that where any documents are found in the possession or control of any person in the course of search under section 132, there is a presumption available to be drawn that such documents belong to such person and the contents thereof are true.

As regards the claim made on behalf of the assesese that the Bank locker with Union Bank of India, New Alipore Branch was not operated by the assessee from 17.10.2001, the ld. D.R. contended that there is no evidence to conclusively prove this claim made by the assessee. He submitted that even the certificate of the Bank filed initially by the assessee in support of this claim was found to be unreliable in the absence of Bank locker operation register for the period prior to 28.02.2011 to support and substantiate the same. He contended that the Bank Manager in his statement recorded subsequently has clearly admitted that the relevant Bank locker operation register was not traceable and in the absence of the same, he was unable to make any comments regarding non-operation of locker as claimed by the assessee.

As regards the allegation made by the assessee that the disclosure of undisclosed income made by him during the course of search was under coercion and pressure, the ld. D.R. contended that there is nothing to show that there was any such coercion or pressure which made the assessee to surrender the undisclosed income of Rs.18 crores. He contended that the disclosure petition reiterating and reconfirming the disclosure of undisclosed income of Rs.18 crores made during the course of search was filed by the assessee before the DDIT (Investigation), Unit- II, Kolkata on 15.12.2012 and since the said disclosure was filed after the revocation of bank attachments of the persons and entities belonging to the assessee’s group, the case now being made by the ld. Counsel for the assesese of coercion and pressure on the basis of the said revocation orders is only an after-thought and not acceptable. He also invited our attention to the copy of letter dated 27.09.2013 submitted by the assessee before the Assessing Officer during the course of assessment proceedings to point out that there was no categorical retraction even at this stage by the assssee of his statement surrendering undisclosed income of Rs.18 crores. He submitted that in the case of Pullangode Rubber Produce Co. Limited –vs.- State of Kerala & Another [91 ITR 18] relied upon by the ld. Counsel for the assessee, it was held by the Hon’ble Supreme Court that timing and facts of retraction need to be seen. He contended that even the decision of the Hon’ble Supreme Court in the case of K.T. M.S. Mohammed & Another –vs.- Union of India [197 ITR 196] is not applicable in the present case as there is no proof of pressure, coercion or duress as alleged by the assessee. He contended that even the other case laws cited by the ld. Counsel for the assessee are distinguishable on facts and are not applicable to the facts of the present case.

Relying on the decision of the Hon’ble Kerala High Court in the case of CIT –vs.- Shri Naresh Kumar Agarwal [350 ITR 71], the ld. D.R. contended that the burden is on the assesese to successfully and satisfactorily retract the confession and the assessee in the present case has clearly failed to discharge the same. He also relied on the following judicial pronouncements in support of his contentions raised on behalf of the revenue:- (i) Rajiv Aggarwal –vs. ACIT 395 ITR 255 (Delhi); (ii) ACIT –vs.- Hukum Chand Jain [337 ITR 238]; (iii) DCIT –vs.- Ghanshyam M. Tamakluwala [217 Taxmann 37 (Gujarat)];

In the rejoinder, the ld. Counsel for the assessee submitted that section 69A is applicable only in a case where the assessee is found to be the owner of any money, bullion, jewellery or other valuable articles, which are not recorded in the books of account and the assessee offers no explanation about the nature and source of acquisition thereof. He contended that the assessee in the present case was not found to be the owner of any money, bullion, jewellery or other valuable articles and since the impugned addition of Rs.18 crores was made on the basis of entries found recorded in the relevant seized documents allegedly representing loans and advances given by the assessee, section 69A is not applicable. In support of this contention, he relied on the decision of the Hon’ble Madras High Court in the case of R. Thiagaran –vs.-CIT [239 ITR 557] as well as the decision of the Hon’ble Punjab & Haryana High Court in the case of CIT –vs.- Ravi Kumar [294 ITR 78]. He submitted that the documents found and seized from the locker of the assessee pertained to the old transactions and no question whatsoever was asked to the assessee in this regard. He contended that no addition can be made on the basis of statement made by the assessee unless there is corroborating evidence which supports the statement made by the assessee. He contended that the statement on his own has no evidentiary value and in the absence of any corroborating material found in the present case, the addition made merely on the basis of the statement of the assessee is not sustainable.

We have considered the rival submissions and also perused the relevant material available on record. Before us, the main two contentions raised before the authorities below have been reiterated by the ld. Counsel for the assessee. The first contention raised by him is that the undisclosed income of Rs.18 crores was surrendered/disclosed by the assessee in the statements recorded under section 132(4) under pressure and duress and the same not being voluntary cannot be relied upon to make any addition to the total income of the assessee on account of the alleged undisclosed income. He has also contended that the relevant loose documents found and seized during the course of search and relied upon by the authorities below to confirm the addition of Rs.18 crores surrendered/disclosed by the assessee in the statements under section 132(4) were recovered from the Bank Locker of the assessee with Union Bank of India, New Alipore Branch and since the said locker was not operational since 17.10.2001 having been sealed by the Income Tax Department, the entries found recorded in the relevant seized documents pertained to the period prior to 17.10.2001 which could not be formed basis to determine the undisclosed income of the assessee for the year under consideration, i.e. A.Y. 2013-14. At the time of hearing before the Tribunal, the ld. Counsel for the assessee has also raised the third contention in support of the assessee’s case by submitting that the disclosure of Rs.18 crores was made by the assessee on estimated basis in respect of all the persons and entities belonging to the assessee’s group and since the additional income of about Rs.11 crores was declared by the persons and entities belonging to the assessee’s group in their returns of income filed for the year under consideration, there is no justification to make a separate addition of Rs.18 crores to the total income of the assessee for the year under consideration.

First we shall deal with the third contention raised by the ld. Counsel for the assesee for the first time before the Tribunal. It is observed that as per the relevant details furnished at the paper book page no. 44, total income of Rs.15.45 crores was declared in their returns of income by the concerned persons and entities belonging to the assessee’s group as compared to the total income of Rs.4.40 crores declared by them for the immediately preceding year, i.e. A.Y. 2012-13. On this basis, the ld. Counsel for the assessee has contended that the undisclosed income of Rs.18 crores surrendered by the assessee during the course of search on estimated basis was offered to tax by the entire group to the extent of Rs.11 crores and there was no justification to make a separate addition of Rs.18 crores to the total income of the assessee. We are unable to accept this contention of the ld. Counsel for the assessee. No details whatsoever are furnished before us to show that the increase in income of the persons and entities belonging to the assessee’s group as declared in their returns of income for the year under consideration as compared to that of the immediately preceding year was on account of their undisclosed income as detected during the course of search. There is no iota of evidence to show that the additional income returned by them was worked out on the basis of any material found and seized during the course of search. It is also observed that no such case was made out by the assessee during the course of assessment proceedings before the Assessing Officer or even during the course of appellate proceedings before the ld. CIT(Appeals). There can be various reasons for the increase in the income of the persons and entities belonging to the assessee’s group in the year under consideration as compared to that of the immediately preceding year and such increase cannot be taken or accepted as undisclosed income of the said entities surrendered during the course of search in the absence of any relevant details or documents to support and substantiate the same.

Coming back to the first contention raised on behalf of the assessee that the surrender/disclosure of undisclosed income of Rs.18 crores was extracted from the assesese under duress and pressure, we find that the search and seizure operation in the case of the assessee was commenced on 18.09.2012 and the first statement of the assessee was recorded on 19.09.2012. In the said statement, the assessee vide question no. 30 was asked as to whether he wanted to disclose any additional income in respect of the total family business and it was stated by him in reply that he was not in a position to do so at that stage. He also stated that the additional income could be disclosed in due course. The second statement of the assessee was recorded under section 132(4) of the Act on 10.10.2012, wherein he first time while replying to a question no. 8 agreed to disclose additional income of Rs.18 crores stating that he was doing so voluntarily. He also stated clearly that his statement was correctly recorded as his own version without any fear, force, threat or coercion. He further stated that the said statement was given by him in sound state of mind and health. Thereafter on 08.11.2012, the Bank locker of the assessee with Union Bank of India, New Alipore Branch was broken open and another statement of the assessee under section 132 of the Act was recorded on that date. In the said statement, he reconfirmed the disclosure of Rs.18 crores made in the earlier statement and stated that the said disclosure was based on the documents seized from his Bank locker and identified as SKA/L/1 and SKA/L/2. At the end of this statement, he again stated that his version was exactly recorded and the statement was given voluntarily in sound state of mind and health without any threat, pressure or coercion.

In support of the assessee’s allegation that the disclosure/surrender of the undisclosed income was extracted under coercion and duress, the ld. Counsel for the assessee has submitted that all the Bank accounts of the persons and entities belonging to the assessee ‘s group were attached by the Income Tax Department and inspite of the repeated request made by the assessee, the Prohibitory Orders were not revoked. He has contended that only when the assessee surrendered/disclosed the undisclosed income of Rs.18 crores on 10.10.2012, the Bank accounts attachments were lifted by issuing revocation orders. He has contended that the assessee this way was pressurised by the Income Tax Department by attaching all the Bank accounts of the persons and entities belonging to the assessee’s group and under this pressure, the assessee was left with no option but to surrender/disclose the undisclosed income of Rs.18 crores which cannot be said to be voluntary. We find it difficult to accept this contention raised on behalf of the assessee. It is observed that the Bank accounts of the persons and entities belonging to the assessee’s group were attached consequent to the search and seizure action conducted on 18.09.2012 and the request for lifting the said attachments was made by the assesee vide various letters issued during the period from 22.09.2012 to 15.10.2012. As per the request made by the assessee, the attachments over Bank accounts were lifted by issuing revocation orders under section 132(3) by the Income Tax Department in the period of about one month starting from 09.10.2012. It is thus clear that the process of lifting the bank accounts attachment was started by the Department even before the statement of the assessee was recorded on 10.10.2012, wherein he for the first time made a surrender/disclosure of undisclosed income of Rs.18 crores. It is also observed that there was no extra-ordinary delay in lifting of attachments over the said Bank accounts so as to say that the assessee was put under pressure to the extent that he was left with no option but to surrender the undisclosed income of Rs.18 crores. It is also pertinent to note here that the disclosure petition reiterating and reconfirming the disclosure of undisclosed income of Rs.18 crores made during the course of search was filed by the assessee before the DDIT (Investigation), Unit-II(2), Kolkata on 15.12.2012 and since the said disclosure was filed after the revocation of all the Bank accounts attachments, we find merit in the contention raised by the ld. D.R. that the case now being made by the ld. Counsel for the assessee of coercion and pressure on the basis of the said revocation orders is only an after- thought which cannot be accepted. We also find that there is no material that is brought on record before us to show any type of coercion, pressure, duress, etc. during the course of search and seizure action. There are also no circumstances that are specifically brought to our notice which can lead to the conclusion that there was such pressure, duress or coercion compelling the assessee to make surrender/disclosure of undisclosed income of Rs.18 crores. On the contrary, in his submissions recorded under section 132(4), it was reiterated by the assessee time and again that the disclosure of the surrender of Rs.18 crores was being made by him voluntarily without there being any pressure, duress or coercion. Moreover, the search and seizure action was commenced on 18.09.2012 while the statements of the assessee disclosing the undisclosed income were recorded only on 10.10.2012 and 08.11.2012. Even the disclosure petition reiterating and reconfirming the disclosure of undisclosed income was filed by the assessee before the DDIT (Investigation), Unit-II(2), Kolkata only on 15.12.2012. Keeping in view all these facts and circumstances of the case, we find no merit in the contention raised on behalf of the assessee that the surrender/disclosure of undisclosed income of Rs.18 crores was made under coercion, duress or pressure and it was not a voluntary disclosure.

Another contention raised on behalf of the assesese is that the relevant loose documents found and seized during the course of search and relied upon by the authorities below to corroborate the statement of the assessee surrendering undisclosed income of Rs.18 crores were recovered from the locker of the assesese maintained with Union Bank of India, New Alipore Branch, and since the said Bank account was not operational from 17.10.2001 having been sealed/seized by the Income Tax Department in the earlier search operation, the entries found recorded in the said seized documents pertained to the period prior to 17.10.2001 and the same cannot corroborate the statement of the assessee surrendering /disclosing the undisclosed income of Rs.18 crores. He has contended that there is thus nothing to corroborate the statement given by the assessee and the addition made merely on the basis of the statement is not sustainable. After considering the submissions made by the ld. D.R. on this aspect of the matter and carefully perusing the relevant material placed on record, we find that there are many discrepancies, deficiencies, anomalies and inconsistencies. First of all, there is no evidence to conclusively prove that the relevant Bank locker was not operated by the assessee from 17.10.2001 as claimed. The stand taken by the Bank in this regard initially was found to be unreliable and the position that finally emerged in the enquiry conducted by the Assessing Officer was that in the absence of the relevant Bank locker operational register available for the period prior to 28.02.2011, even the Bank authorities were unable to give any confirmation in support of the assessee’s statement that the Bank locker was not operated by him from 17.10.2001. It is also not clear that if the said Bank locker was seized/sealed by the Income Tax Department on 17.10.2001 during the course of search conducted earlier, whether the same was broken open or not. If at all it was broken open at that time, why the diary and other loose documents lying therein were not seized and why the Prohibitory Order was not revoked. Nothing has also been brought on record to show as to whether the assessments were completed in pursuance of the search and seizure operation conducted in the year 2001 as claimed and how the material seized, if any, from the locker of the assessee was dealt in the said assessment. It is also not clear that when the Bank locker of the assessee was sealed/seized on 17.10.2001 as claimed and no Prohibitory Order was issued, how the Investigation Team, which broke open the locker on 08.11.2012, did not realise this position. It appears that the assessee was present when the Bank locker was broken open on 08.11.2010 but he also did not point out this position. On the contrary, in his statement recorded under section 132(4)

In support of the assessee’s claim that his Bank account with Union Bank of India, New Alipore Branch was not operational from 17.10.2001 to 08.11.2012, the ld. Counsel for the assessee has relied on the extract of Safe Deposit Locker Ledger of the Bank, a copy of which is placed at page no. 70 of the paper book. As mentioned in the said ledger, stop operation order was received by the Bank from the Income Tax Department on 17.10.2001 at 11-30 a.m. in respect of the assessee’s locker. Thereafter there is a mention of another Income Tax Prohibitory Order served on 18.09.2012, which is stated to be revoked on 08.11.2012 after breaking open the locker by the Income Tax authority on the said date, i.e. 08.11.2012. There is, however, no mention about the revocation of the Prohibitory Order earlier issued by the Income Tax Department on 17.10.2001 in the said ledger and relying on the same, the ld. Counsel for the assessee has contended that the assessee was not in a position to operate the locker right from 17.10.2001. In our opinion, the extract of the Safe Deposit Locker Ledger by itself is not conclusive to arrive at a conclusion that the Bank account of the assessee was not operational during the relevant period as claimed by the assessee keeping in view the various anomalies, discrepancies and inconsistencies as already pointed out by us in the preceding paragraph in this order. Moreover, the Bank locker operational register for the relevant period is found to be un- traceable in the Bank and in the absence of the same, the claim of the assessee cannot be accepted merely on the basis of the extract of the Safe Deposit Locker Ledger alone. As already mentioned by us while pointing out the anomalies, discrepancies and inconsistencies in this claim of the assessee, there are certain other aspects which need verification and this matter is required to be further examined/verified. We, therefore, restore this matter to the file of the Assessing Officer for verifying the claim of the assessee that his Bank locker was not operational right from 17.10.2001 since the Prohibitory Order issued on the said date during the earlier search was in force from the relevant record, which is available with the department in respect of the earlier search conducted in the assessee’s case in the year 2001. The Assessing Officer shall verify the claim of the assessee from the said record and also give proper and sufficient opportunity to the assessee to support and substantiate his claim by filing the relevant assessment orders passed in pursuance of the earlier search as well as any other documentary evidence available with the assessee. If it is found on such verification by the Assessing Officer that the Bank locker of the assessee was not operational from 17.10.2001, it would follow that the entries found recorded in the loose documents seized from the Bank locker of the assessee pertained to the period prior to 17.10.2001 and there being no other evidence to corroborate the statement made by the assessee surrendering the undisclosed income of Rs.18 crores, the addition made on this issue cannot be sustained. On the other hand, if it is found by the Assessing Officer on verification that the Prohibitory Order issued on 17.10.2001 was revoked subsequently and the assessee was in a position to operate his Bank account after such revocation, the Assessing officer shall examine the entries found recorded in the loose documents seized from Bank locker of the assessee to ascertain the exact nature of the transactions reflected therein and if he finds after hearing the side of the assessee that the said transactions represent undisclosed income of the assessee and corroborate the statement made by the assessee surrendering /disclosing the undisclosed income of Rs.18 crores, the Assessing Officer shall take appropriate decision in accordance with law.

As regards the issue of applicability of section 69A of the Act in the case of the assessee as raised during the course of hearing before us, it is observed that a similar controversy was involved in the case of CIT –vs.- Aapki Marketing Pvt. Ltd. (2013) 86 CCH 0138 (Delhi) and after taking note of the fact that the matter was remanded by the Tribunal to the Assessing Officer, it was held by the Hon’ble Delhi High Court that the Assessing Officer could examine if section 69 was not applicable and whether the addition could be made under any other provisions of the Act. To the similar effect is the decision of the Hon’ble High Court of Chhatrisgarh in the case Dhanush General Stores –vs.- CIT [339 ITR 651], wherein it was held that on the basis of the wrong provision applied in the assessment order, the surrendered income cannot be held to be not an income. Keeping in view the ratio of these judicial pronouncements and considering that the issue relating to the addition made on account of income surrendered by the assessee during the course of search as involved in the present case is remanded by us to the Assessing Officer, inter alia, for ascertaining the exact nature of transactions reflected in the entries found recorded in the relevant seized documents, we direct the Assessing Officer to consider the issue of applicability of the exact provisions of the Act for making addition, if any, to the total income of the assessee on the issue remanded.

In the result, the appeal of the assessee is treated as allowed for statistical purposes. Order pronounced in the open Court on March 15, 2019.