2013 (11) TMI 266

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....assessee and deleting the addition of Rs. 1,50,00,000/- made on account of business income. 2. On the facts and in the circumstances of the case and in law, the Ld CIT (A) erred in accepting additional evidence and submission, which was not before the AO at the time of assessment proceedings, in contravention of Rule-46A(3) of IT Rules, 1962. 3. On the facts and in the circumstances of the case and in law, the Ld CIT (A) failed to appreciate that in the terms and conditions of agreement with Success Developes Pvt. Ltd. (SCPL) there was no clause of security deposit on account of surplus FSI as claimed by the assessee before the CIT (A). 4. On the facts and in the circumstances of the case and in law, the CIT (A) failed to appreciat....

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....y found in the assessment records. Without going into the details furnished by the assessee, the AO proceeded to make addition of Rs. 1.5 Crs and deemed it as „business receipts‟. Matter travelled to the first appellate authority. 4. During the proceedings before the first appellate authority, assessee brought all the fact leading to the said addition and filed the written reply, the extracts of the same are reproduced in para 3.3 of the impugned order. In this reply, assessee demonstrated the facts about the said transaction and the fact of furnishing the relevant replies. CIT (A) examined the said submissions of the assessee and held that the said amount of Rs. 1.5 Crs is a kind of security deposit, which is refundable to t....

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....Memorandum dated 28.5.2007 entered into by the assessee and the SDPL. 7. We have heard both the parties and perused the orders of the Revenue Authorities. To start with, we have gone through the Memorandum dated 28.5.2007 and found that the said amount of Rs. 1.5 Crs is payable to the assessee as a security towards violation of guidelines, if any, by the SDPL and clause-2 of the agreement provides for the same. The same amount is refundable vide agreement clause no.4(e), which reads as under: "4(e) The party of the First Part would refund to the Part of the Second Part the sum of Rs. 1,50,00,000/- (Rupees One crore fifty lacs only) paid by the Party of the Second Part to the Party of the First Part as interest-free security deposit wi....

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....mpleted. The appellant has also paid cost of construction to Success Developers Pvt. Ltd. The copy of confirmation has been filed and a letter from the said developer has been filed. These documents are central to the issue and therefore, they have been filed as required by this office during appeal proceedings. According to the facts of the case, the amount of Rs. 1,50,00,000/- was a deposit and cannot be treated as business income. It has been claimed that the appellant has refunded this deposit in later years. According to existing facts, it can be seen that Rs. 1,50,00,000/- was not business income of the assessee and therefore, the addition made by the AO is deleted." 9. From the above, on merits of the additions, it is evident that....