TaxTMI 
TaxTMI 
TaxTMI 
2013 (10) TMI 825
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..../- on account of profit & sale of plot not shown though not made separately. 4. On the facts and circumstances of the case and in law the Ld.CIT(A) has erred in not appreciating fully the submissions of the appellant and thereby erred in making enhancement of income by Rs.16,00,000/- u/s.69C of the Act and thereby further erred in initiating penalty proceedings u/s.271(1)(c) of the Act for concealing the particulars of with regard to this income of Rs.16,00,000/- as income not disclosed in the return. 2. Briefly stated facts are that the case of the assessee was picked up for scrutiny assessment and the assessment u/s.143(3) of the Income Tax Act,1961 (hereinafter referred to as "the Act") was framed vide order dated 29/12/2010 thereby the Assessing Officer(AO) made addition on account of expenses claimed from unaccounted/non-business income, addition on account of profit on sale of plots not shown and addition on account cash payment made u/s.40A(3) of the Act for land. Against this, assessee filed an appeal before the ld.CIT(A), who after considering the submissions of the assessee dismissed the appeal. 3. Now, the assessee is in second appeal before this Tribunal. 3.1. First....
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....t out from the order of ld.CIT(A) where the submission of the assessee that the payment was made to the agent who was required to make payment in cash for purchase of land on behalf of assessee is dealt with by the ld.CIT(A). We find that ld.CIT(A) nowhere in his order has adverted to and decided this submission of the assessee. Therefore, in our considered view, decision of ld.CIT(A) on this issue is not justified, the same is hereby set aside. However, this being legal issue, therefore, in the interest of justice, the same is restored back to the file of AO to verify the claim of the assessee that the payment was made to the agent for the purpose of buying the land and the person to whom the sale consideration was handed over in cash was acting as an agent to the assessee. Needless to say that the AO would give reasonable opportunity of hearing to the assessee. The AO is directed to decide this issue afresh in the light of the provisions of Rule 6DD(k) of the IT Rules, 1962. This ground of assessee is allowed for statistical purposes only. 5. Ground Nos.2, 3 & 4 are inter-connected and hence disposed of together. 5.1. The brief facts regarding these issues till the assessment s....
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.... treated this Rs.10 lac as covered in undisclosed income shown separately at Rs.16 lac." 6. Being aggrieved, the assessee carried the matter before the ld.CIT(A). After examining the facts, ld.CIT(A) issued a notice for enhancement and after considering the submission of the assessee, ld.CIT(A) not only upheld the addition made by the AO of Rs.9,99,009/- but also he enhanced the assessment by an amount of Rs.16 lacs. The basis of ld.CIT(A)regarding confirming the addition made by the AO and making enhancement was this that the addition of unexplained expenses whose source was admittedly not there and, therefore, was not recorded in the books of accounts and, therefore, this amount was required to be added u/s.69C of the Act. He has further noted on page-11 of his order that no such income has been offered by the assessee and the income offered is by cash entry which had been subsequently utilized in the books of accounts and cannot be said to be related to expenses already incurred. He has also given a finding that these expenses are not allowable because of the specific proviso to section 69C of IT Act. On this basis, he upheld the addition made by the AO and also made enhancemen....
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....r miscellaneous expenses, such as, advertising, architect fee, bank charges, electric and office expenses, etc. This claim was disallowed by AO and confirmed by ld.CIT(A) on the basis that the same is incurred out of undisclosed income declared in the course of survey on the basis of various expenses and, therefore, as per proviso to section 69-C of the IT Act, the same is not allowable. But we find that as per paragraph No.5.7 of the order of the ld.CIT(A), the details of expenses incurred by the assessee of Rs.16 lacs for which disclosure was made during the course of survey is regarding purchases of Rs.11,67,594/-, carting expenses of Rs.1,97,647/-, development expenses of Rs.2,10,000/- and labour expenses of Rs.32,000/- totalling to Rs.16,07,241/-, whereas the assessee declared an amount of Rs.16 lacs in the course of survey. Hence, it cannot be said that these expenses of Rs.9.99 lacs were incurred in respect of this income of Rs.16 lacs declared by the assessee in the course of survey. This cannot also be inferred that the assessee in claiming any deduction in respect of amount of Rs.16 lacs which was declared by the assessee during the course of survey and, therefore, in our....
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.... 8.2. Regarding second issue, i.e. ground No.3, we are of the considered opinion that no separate addition was made by the AO in this regard and no material facts has been brought on record by him in respect of actual sale of plots and profit thereon. He has made the observation in the assessment order that the assessee might have earned this much profit by selling plots on the basis of the statement of one of the partners by ignoring the explanation of the assessee that although talks were going for sale of ten plots but such sale did not materialize because the income tax survey took place at the same point of time. In the absence of any evidence having been brought on record by the AO regarding actual sale and actual profit, we are of the considered opinion that no such addition is justified. Moreover, the observation of the AO that this amount might have been utilized for the purpose of incurring expenditure made out of books is on the basis of conjectures and surmises. The AO ought to have brought on record some evidences in support of his finding. In view of above discussion, we hold that this addition is not called for because no evidence has been brought on record by the A....