TaxTMI 
TaxTMI 
2014 (8) TMI 156
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....22,64,000/-. A search and seizure operation was carried out u/s 132 of the Income Tax Act, 1961 in Akruti Group of cases on 10.08.2006. On perusal of documents seized from the premises of group cases, it was seen that the page Nos. 34, 36, 67 to 69, 73, 76 to 79 and 82 of Annexure A-1 seized from the main office of the group at 6th Floor, Akruit Trade Centre, Road No. 7 MIDC, Marol Andheri (E), Mumbai pertained to the project at Tulsiwadi. M/s Akruti Nirman Ltd, submitted that the pages belong to the assessee company as the Tulsiwadi Project was being carried out by it. Accordingly, the case of the assessee company was deemed fit for proceeding u/s 153C of the Act as the assessment year was pertaining to the previous year in which the search was conducted. Further facts pertaining to the present appeal are that the assessee had entered into an agreement on 18.03.2005 with Jivanlal Narayan Boricha, Nathbhai Narayan Boricha, Tejabhai Narayan Boricha, and Ms. Shamu Narayan Boricha in respect of Boricha land for a consideration of Rs. 51,00,000/-. In this connection, Rs. 1,00,000/- was given on signing of the assignment deed and Rs. 50,00,000/- was payable on obtaining approval from NC....
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....d.CIT(A) was of the view that the impugned payment of Rs. 20,00,000/- was paid in assessment year 2005-06 and therefore the addition made by the AO had been confirmed on substantive basis during the year under consideration. Aggrieved by the impugned order, the assessee is in appeal before us in connection with the assessment year 2005-06. 2.2 Having heard both the sides and perused the material on record, the only issue to be decided by us is whether the consideration paid by the assessee for the purchase of Boricha land is Rs. 71 lakhs or Rs. 51 lakhs. To state more specifically, whether the seized materials/documents can be the basis for presuming that the assessee has made the impugned payment of Rs. 20 lakhs, which is in excess of the agreed consideration of Rs. 51 lakhs. Firstly, as regards the contention of the Revenue that page nos. 34 to 36, 69, 79 and 82, indicate that the assessee company has purchased Boricha Land for a total consideration of Rs. 71,00,000/-, which is evidencing at page 34 as (51+20), it is pertinent to mention that the seized paper at page 34 does not contain any reference as to whether '71.00' was 'paid' or 'payable' for the Boricha Land. It appear....
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....s relevant to state that during the search, there is no document found which shows that an amount of Rs. 20,00,000 is 'paid' by the assessee company. Further no undisclosed cash has been found on the basis of which the AO could have inferred that the assessee company keeps unaccounted cash from which it makes payments which are not recorded in its books of accounts. Also, there are no unaccounted cash or any incriminating documents found which can lead to any such conclusion. In view of the aforementioned discussion, we are of the considered view that the consideration paid by the assessee for the purchase of Boricha land is only Rs. 51 lakhs as per the agreement and the figure mentioned at page 34 as (51+20) of the seized document represents only an estimated budget as contended by the assessee. Since, the Ld.CIT(A) has not taken cognizance of the correct facts aforementioned while confirming the addition made by the AO, the impugned order of the Ld.CIT(A), in our view, deserves to be reversed. Resultantly, the impugned addition of Rs. 20 lakhs made/confirmed by the AO/Ld.CIT(A) stands deleted. 3. In the appeal filed by the assessee for the assessment year 2007-08, the assessee....
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....t are made and forwarded to each of the stakeholders/ co-venturer. In this context, it is relevant to state that the figure is an estimate, which is supported by the fact that while all balances as per loose paper match perfectly with the trial balance of that period, the difference of exactly Rs. 51 lakhs is in construction expenses along, which is an ongoing and continuous expense for the company, for which the construction work is done by the contractor and bill for the same is to be raised by him. The perusal of the records further supports that the amount under the column 'Spent Till date' not only includes the amount which is actually paid, but it also includes the amount of liability which is incurred but not yet paid. Thus, the difference of 51 lakhs is also an expense which though was only 'incurred' but not paid. The amount was on account of construction expenses alone, which is an ongoing and continuous expense for the company, for which the construction work is done by the contractor and bill for the same is to be raised by him. Thus, the amount is known by the assessee to be paid to the contractor but since the bill is not raised, the amount is not recorded in the book....