COMMISSIONER OF INCOME TAX Vs. JAI PAL AGGARWAL

JUDGEMENT

(1.) IN this appeal filed by the revenue under Section 260A of the INcome Tax Act, (,,Act, for short) the following questions are sought to be raised as substantial questions of law: -

(2.) THE assessee is an individual. A search under Section 132 of the Act was conducted at his residence on 20.3.1996 and his bank lockers were also searched on 19.4.1996. Cash, jewellery and documents were found during the search and were seized. An assessment under Section 158BC(c) was made on 29.4.1997. An appeal against that assessment was filed by the assessee before the Income Tax Appellate Tribunal (,,Tribunal, for short), which was the first appellate authority at that time. THE Tribunal set aside the assessment by order dated 23.11.2004 with directions to the Assessing Officer to reframe the assessment after giving due opportunity of being heard to the assessee; the assessee was also directed to extend co-operation for the expeditious finalization of the assessment. THEreafter, a fresh block assessment order was passed on 28.3.2006 as per the directions of the Tribunal in which certain additions were made. THE assessee filed an appeal to the Tribunal in IT(SS)A.No.121/Del./06. THE Tribunal allowed the appeal of the assessee partly, confirming some of the additions and deleting some of them. THE revenue has preferred the present appeal against this order of the Tribunal and the appeal is confined to the following four issues:-

(3.) IT is difficult to uphold the conclusion of the Tribunal. The Tribunal overlooked that though Om Prakash filed an affidavit before the Assessing Officer, Fakir Chand did not respond to the summons issued by the Assessing Officer. There is no plausible explanation from the assessee why the documents relating to the property were found in his residence if he had nothing to do with it. The affidavit on which reliance was placed by the Tribunal (which claims to support the version of the assessee) cannot be relied upon to rebut the inference reasonably drawn by the Assessing Officer from the recovery of the documents from the premises of the assessee. The documents include the General Power of Attorney and an Agreement to Sell which bore the signature of Fakir Chand. The fact that the name of the buyer was not mentioned in the documents is a fact which goes in favour of the revenue. In considering whether any property was acquired benami, possession of the documents relating to the property is a relevant and important piece of evidence. The payment of money can therefore be inferred and since the assessees books of account did not disclose the investment, the Assessing Officer rightly drew the inference that it represented the assessees undisclosed investment. The Tribunal further overlooked that neither Fakir Chand nor Om Prakash, the property dealer, came forward to claim the documents which is quite unusual if the intention of handing over the documents was only to enable the assessee to consider the proposal for buying the property. The Tribunal also overlooked that the name of the owner of the property was not mentioned in the affidavit of the property dealer. In these circumstances, the finding of the Tribunal is contrary to the evidence on record which it failed to take proper notice of. We therefore, answer questions (a) and (b) in favour of the revenue and against the assessee.