TaxTMI 
TaxTMI 
2016 (3) TMI 119
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....rned property was sold to the buyer." 2. During the course of hearing, arguments were made by Shri Vijay Mehta on behalf of the assessee and Dr. Promod Nikalje on behalf of the revenue. 3. The brief facts relating to the issue before us are that the assessee is a real estate developer and engaged in construction of buildings. Return of income declaring total income of Rs. 5,76,607/- was filed on 31.10.07 showing income from sale of flats in building Silver Arch 'B' constructed by the assessee company. A search and seizure action u/s 132(1) of the I.T. Act was taken in the case of Shri Dilip Kapoor and his wife Smt. Suman Kapoor on 6.11.06. In connection with the search and seizure, the companies of Shri Dilip Kapoor group were surveyed u/s. 133A of the I.T Act. In the course of survey operations, documents, loose papers and diaries were impounded inventorised as Annexure A-1 and A-2 from 5, Divyang S.B. Singh Marg, Mumbai and as Annexure A-1 to A-7 from office at 1102, Silver Arch B, New Milat Nagar, Andheri (W), Mumbai. On verification of the documents and loose papers it was found that certain documents pertained to the affairs of the assessee company. The assessment was co....
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....he entry written by Shri Prajapati in Page no.48, A-2. (b) Shri Mukesh Prajapati, on the other hand submitted that he did not remember anything about the entry. He was also made aware of the inference drawn from the entry but he reiterated his ignorance about the entry, though he submitted that the diary was maintained by him. 4.0 It is an admitted fact that the diary was maintained by Shri Mukesh Prajapati. However, he submitted on oath that he does not remember anything about the entry. The words mentioned in the entry are 'sales, cash, 1003, Rangila, 40 lacs', which undisputedly prove that the amount of Rs. 40 lacs was cash sales to Mr. Humayun Rangila in pursuance of sale of flat no. 1003. The submission of Mukesh Prajapati and Shri Humayun Rangila are untenable in view of the speaking evidence. In view of the above, it is stated that the appellant's claim is devoid of merit and must be rejected. 5.0 Accordingly, it is clear that the additions made in the assessment order were justified. Thus, I agree to the addition made in the assessment order. 6.0 In view of Para 4.0 and 5.0, it is stated that the additions made in the assessment o....
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....ion was made in the hands of the purchaser viz. Mr. Humayun Rangila. The ld. DR could not controvert the statement of the ld. Counsel in this regard. v) Ld. Counsel made an alternate submission that without prejudice to the earlier submissions, in case it is held that cash was received by the assessee, then, no addition could have been made in this year for the reason that the assessee has already disclosed the entire sales value of the project in which this flat was located in the preceding financial year i.e. F.Y 2005-06 and since the assessee was following 'project completion method', even if allegation was made that cash was received, the same could be added, as per law, only in A.Y 2006-07 in which sale has been booked by the assessee. For this proposition, the ld. Counsel has relied upon the following judgments:- a) DCIT v. Tejas Constructions, Jalgaon, ITA No. 934/PN/2009 dt. 31.1.2012 (ITAT, Pune) b) ITO v. Karda Construction Pvt. Ltd., ITA No. 971/PN/2011 dt. 31.7.2012 (ITAT, Pune) 7. On the other hand, the ld. DR submitted that there are ample evidences to show that cash has been received by the assessee on sale of the impugned property. He h....
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....rther noted by us that the stamp value assessed by the stamp valuation authority for the adjoining flats has been varying between Rs. 38.5 lakhs to Rs. 42.20 lakhs during the period when the impugned sale deed was registered, whereas these properties were sold between Rs. 15 lakhs to Rs. 19 lakhs. Thus, there was clearly a gap between the stamp value and the actual sales consideration. Thus, no conclusive inference could be drawn that merely because the stamp value was more, there was exchange of cash between the parties, unless some more cogent contrary material is brought on record. 11. Lastly, we find force in another argument of the ld. Counsel that even if, although denied by the assessee, it is assumed that cash was received by the assessee, the same could not have been brought to tax in the year under consideration since the entire sales consideration of impugned property sold by the assessee has been received and booked by the assessee in its books of accounts in F.Y 2005-06. On the basis of perusal of the profit and loss account it is noted that the sale value of the entire project has been booked in F.Y 2005-06. It is also an admitted case that the assessee is followin....