On-money additions limited to profit element, with taxation under normal provisions instead of section 115BBE.

In alleged on-money reassessment disputes, the Tribunal applied its earlier binding precedent on identical facts and held that only the profit element could be taxed, not the entire receipt. It therefore restricted the addition to 8% of the disputed on-money amount and directed taxation under the normal provisions. It also held that section 115BBE did not apply on these facts, and relief was granted to that extent. The stated ratio is that where an on-money transaction is covered by binding precedent, taxation may be limited to the estimated profit element rather than the full amount.

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Issues: Whether the addition made on account of alleged on-money in reassessment proceedings was to be sustained in full or restricted to an estimated percentage, and whether such addition was to be brought to tax under the normal rate rather than under section 115BBE.

Analysis: The Tribunal noted that the dispute was covered by its earlier order in the connected family group matters, with no change in facts or law. Following that binding precedent, it held that the entire on-money amount could not be taxed as income and only the profit element was liable to be assessed. The Tribunal therefore sustained the addition only to the extent of 8% of the amount in question and directed that the resulting income be taxed at the normal rate.

Conclusion: The addition was restricted to 8% of the on-money amount and taxation under section 115BBE was disallowed; relief was granted to the assessees to that extent.

Final Conclusion: Both appeals were allowed only in part, with the assessed addition confined to 8% of the disputed on-money and taxed under the normal provisions.

Ratio Decidendi: Where the transaction represents alleged on-money, only the estimated profit element, and not the entire amount, may be brought to tax when the issue is covered by binding precedent on identical facts.

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