TaxTMI 
TaxTMI 
2016 (4) TMI 945
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....in short "the Act". The Revenue has filed appeals ITA Nos. 1864 to 1866/Ahd/2012 in case of Shri Kanubhai Maganlal Patel in assessment years 2007-08 to 2009-10; respectively followed by assessee's cross appeal in first assessment year ITA 1885/Ahd/2012. The Revenue thereafter prefers next three appeals in case of Shri Anil Shakarabhai Patel ITA Nos. 1867 to 1869/Ahd/2012 in assessment years 2007-08 to 2009- 10 as against assessee's cross appeal in first assessment year ITA 1884/Ahd/2012. Then comes Revenue's appeal ITA 1882/Ahd/2012 in assessment year 2007-08 in the case of third assessee Smt. Nayana Anil Patel. Revenue's last appeal is ITA 1883/Ahd/2012 in case of Shri Suresh Chandulal Patel in assessment year 2007-08. This completes the instant batch of ten cases. 2. Both parties submit at the outset that the CIT(A) has disposed off all eight appeals filed by these four assessees vide a common order under challenge. And that facts and issues involve are identical in all cases. They express agreement that Revenue's appeal ITAs 1864 to 1866/Ahd/2012 along with assessee's cross appeal ITA 1885/Ahd/2012 in case of Shri Kanubhai Maganbhai Patel for assessment year 2007-08 to 2009-1....
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....8/09 & A.Y. 2009/10 after verification when the factual record clearly demonstrates that no land was purchased by the appellant from the above 2 farmers in those years. Ld. CIT (A) ought to have deleted the additions himself. 5. Ld. CIT (A) erred in law and on the facts in confirming action of AO in making additions for land purchased in Moti Bhoyan on the basis of loose paper # 72 & 73 of Annexure AS-5 seized from the premises of third party. Both the lower authorities erred in adopting rate per bigha @ Rs. 9 lacs on the basis of seized document when a much lower rate is accepted of subsequent sale of land in vicinity. This action of Id. CIT (A) confirming addition of unaccounted investment by relying on a dumb document in absence of any statement of the searched party is harsh and against the legal principles that deserves to be quashed. 6. Both the lower authorities erred in law and on facts in not appreciating the fact that only 10 bighas land was purchased from the person searched, whereas balance purchase was directly from the farmers who were never confronted by AO to confirm about any cash transaction with the appellant. Ld. CIT (A) ought to have considere....
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....gricultural land, if any. Ans.: We, three brothers, had ancestral agricultural admessuring 70 to 80 bighas. 20 years back some of the land was acquired by the Government for development of GIDC, Kerala. For the acquisition of land the State Government paid us @ Rs. 18,000/- per bigha. After that 2 years back 25 bighas land was sold @ 1,40,000/-; to 1,50,0007- per bigha. This land was sold to land brokers Dilipsinh Darbar of Modasa village, Noorbhai Vora of Rupal village and Haribhai Prajapati of Siyada village. This land was jointly held by our family members-... For sale of this land we have received some amount by cheque and I received Rs. 8,50,000/- in cash being 1/3rd share in our ancestral property. My other two brothers also received cash and cheque according to their 1/3th share each on sale of this land. I deposited the cheque received on sale of land in Punjab National Bank, Bavla. Out of cash amount received, I kept some amount with me and the balance amount was deposited with the bank. The amount received on sale of the land was utilized by me for construction of residential house, marriage of my daughter and other household expenses. The residential house was c....
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....Dilipsinh Darbar of Modasa village, Noorbhai Vora of Rupal village and Haribhai Prajapati of Siyada village. This land was jointly held by our family members..... For sale of this land we have received some amount of Rs. 1,50,000/- by cheque and Rs- 8,50,000/- in cash. Out of my receipts I had given Rs. 3,00,000/- cash to my sister and Rs. 5,00,000/- cash was kept with me. The cheque of Rs. 1,50,000/- and cash of Rs. 5,00,000/-was deposited in Punjab National Bank, Bavla and Ahmedabad district Co-op Bank, Bavla. The money deposited in banks were withdrawn to construct a house. For construction of house, I had incurred expenses of Rs. 2,50,000/-. For construction of small hut in bavkyard, I spent Rs. 50,000/-. I had also purchased a new Hero-Honda Splender and Rs. 1,75,000/- were utilized to pay the debt of my father.........." Details of Bank A/c of Budhaji M Thakore with PNB (A/c No. 0070000100117753) 6. It is to be seen that these two vendors retracted from their statements vide affidavits dated 29-07-2008 filed within a period of less than 1 & ½ months. The Assessing Officer formed reasons to believe in view of all this material that the assessee had paid on m....
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....us. Thus according to the Department an amount of Rs. 1,41, 86,227 (1,99,92,720 - 58,06,500) has been paid in cash towards purchase price. You have therefore asked me to show cause as to why an addition of Rs. 28,37,245 being 20% (my share) of Rs. 1,41,86,227/- be not made in my case u/s. 69B of the I.T. Act, 1961. 5. I have to submit that the statement made by both the framers i.e. Budhaji Thakor and Bhagaji Thakor are not supported by any cogent material or evidence in support of their statement and I also understand that the said statement has been retracted by both the farmers by filing their retraction affidavit. Thus the retracted statement cannot be used against me unless I have been given an opportunity to cross examine them. 6. I have to further submit that we have purchased only 21 bighas of agricultural land from the two farmers i.e. Bhudaji M. Thakor and Bhagaji M. Thakor. The balance 112 bighas of agricultural land has been purchased from the farmers other than Bhudhaji Thakor and Bhagaji Thakor. The statement of both these farmers cannot be applied to the others who have not been examined. During the course of search no incriminating material and / o....
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....in case of assessee's partner Shri Deepak M. Patel, Shri Jayash K. Patel and others in his orders dated 02/08/2011 upholding the impugned unexplained investments additions qua Bavla and Kerala lands only to the extent of those sold by Shri Budhaji and Bhagaji Thakore. He concludes that there is no supportive evidence to conclude the inference for making on money additions pertaining to the 112 bighas of lands in the two villages. Both parties raise their first issue qua correctness of additions made in relation to Bavla and Kerala lands. The Revenue submits that the CIT(A) ought to have upheld whole of on money additions as against assessee's arguments seeking to delete the entire amount of unexplained investments made in land purchases of these two villages. 9. We have heard rival contentions. Case file perused. We state at the risk of repetition that the authorities below have added impugned on money based on vendors' statements extracted hereinabove followed by their retractions. The CIT(A) relies on assessee's partners' orders wherein the very additions was restricted to the land sold by the above stated two vendors. Case records reveal that the Revenue filed appeals in case....
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.... We take note of the fact that the Central Board of Direct Taxes in its circular dated 10/03/2003 has already stated that such admission/confession made in course of search have to be based on the relevant evidence collected. Hon'ble jurisdictional high court in Kailashben Manharlal Choksi vs. CIT (2010) 328 ITR 411 deals with a case of assessment year 1989-90 and holds identical situation after noting Board's circular that addition of undisclosed investments merely on search statement not supported by any evidence is not sustainable. We deem it appropriate to observe here that the impugned addition is also based on mere statements retracted within two months which nowhere names the assessee or establish any link to the alleged unexplained investments in question. We draw support from the above stated precedents for accepting assessee's arguments. The Revenue's submissions supporting the Assessing Officer's findings stand rejected. We delete entire addition of Rs. 28,37,245/- made u/s. 69B of the Act qua lands purchased in villages Bavla and Kerala (supra). Revenue's appeals ITA 1864 to 1866/Ahd/2012 fail. 12. Now we come to assessee's second substantive ground challenging unexp....