TaxTMI 
TaxTMI 
2015 (4) TMI 1216
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....djudicated in the case of sister concerns. Therefore we are only taking the facts of Business Park Builders Pvt. Ltd as the lead case and going ahead to adjudicate the issues raised in appeal before us one by one. ITA No.1768/Del/2013 (assessee's appeal) and 1530/Del/2013 (Revenue's appeal) ( For Assessment Year 2006-07) ITA No.1733/Del/2013(Assessee's appeal) for Assessment Year 2007-08. 2. These are appeals preferred by the assessee against the order of the ld CIT(A), XXXIII, New Delhi 110055 dated 17.12.2012 for the Assessment Year 2006-07 and 2007-08 and the cross-appeal preferred by the revenue for Assessment Year 2006-07. Since the facts are the same and the ground raised are also identical, we are deciding these matters together, taking the facts of the case for Assessment Year 2006-07. 3. Ground No.1, 2, and 2.1 of the assessee's appeal are with regard to validity of issue of notice u/s 153C of the Income Tax Act, 1961 (herein after 'the Act') and the ground Nos. 5 and 6 of appeal are general in nature. These grounds are not pressed at the time of hearing so the same are rejected as such. 4. The grounds of appeal pressed by the ld AR are as under:- "....
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....), who was pleased to partly allow the appeal by deleting the addition of Rs. 10,74,959/- made by the AO in view of section 37(1) of the Act and sustained the disallowance u/s 40A(3) of the Act. Being aggrieved by the order of the ld CIT(A), both the assessee and revenue are before us. 8. The ld AR of the assessee submitted that additional payments having not been claimed as deduction by appellant, no disallowance could have been made in the hands of the appellant. The Assessing Officer disallowed the payment on the ground that payments were made to the parties both in cash and cheque, which was in violation of the provision of Section 40A(3) of the Act. Thus a sum of equal of 20% of Rs. 38,62,959/- paid in cash in contravention of the provision of section 40A(3) was disallowed and which works out to Rs. 772,592/- and the same was added to income of the assessee company. The ld AR brought to our notice the order of the co-ordinate Bench of this Tribunal in the case of M/s Glitz Builders and Promoters Pvt. Ltd., ITA No.1747/Del/2013 dated 01.01.2015, C Bench of this Tribunal, in which on identical facts and circumstances and on the same issues i.e. deletion of additional payment ....
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....f the additional payment is not established. Accordingly, the total additional payment of Rs. 13,06,377/- was disallowed. He also disallowed the sum of Rs. 4,59,999/- under Section 40A(3). On appeal, learned CIT(A) sustained the disallowance under Section 40A(3). However, in respect of additional payment to the owner of the land, he partly allowed the assessee's appeal with the following direction:- "In view of the above additional payment made to the owner of the land or to his brother, father, sons & their spouses, who have got some legal claim over such land by way of account payee cheque is hereby allowed as an expense u/s 37 and additional payment made to other payments are not supported by any legal right over the land and similarly payment made in cash to the owner of land is confirmed as, there are instances of not conforming the receipt by few seller as stated supra. Therefore, the ground is partly allowed." 6. The assessee, aggrieved with the disallowance sustained under Section 40A(3) and part disallowance in respect of additional payment, is in appeal while the Revenue is in appeal in respect of relief allowed on account of additional payment. ....
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....laimed by the assessee as deduction, the question of any disallowance under Section 40A(3) or otherwise in the case of the assessee does not arise. We, therefore, delete the entire disallowance made by the Assessing Officer under Section 40A(3) as well as additional payment. 11. In the result, the appeal of the assessee is allowed whereas the appeal of the Revenue is dismissed." 9. Ld AR for the assessee further submitted that since the facts in the present case are identical to the facts in the case of M/s. Westland Developers Pvt. Ltd., in ITA No.1752/Del/2013, decided by 'H' Bench of ITAT Delhi dated 22.08.2014, he prayed that no disallowance could be made u/s 37 as no expenditure was claimed by it. Ld AR further submitted that in the case of M/s Glitz Builders and Promoters Pvt. Ltd. (supra) the co-ordinate bench of this tribunal has deleted the disallowance vide order dated 02.12.2015, so considering the aforesaid precedent on identical grounds facts, we may allow the appeal of the assessee. 10. Ld DR referred to Page 81 of the Paper Book wherein the collaboration agreement between assessee and M/s. Countryside Promoters Pvt. Ltd referred and pointed out that in....
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....). The assessee company has made only part payment of sale consideration to the seller at the time of executing sale deed and balance payment is made by way of post dated cheques (PDCs). During the assessment the A.O. obtained details of such PDCs given at the time of registration to the seller and obtained Date of encashment and applied rate of 15% interest per annum paid for the period from sale deed to date of encashment, on the amount of PDCs on the basis of seized material. A.O. gave the findings in the Assessment Order that total such interest payable comes to Rs. 5,14,018/- on PDCs and such interest is paid in cash out of Books of account. Therefore, such interest is added as unaccounted/ unexplained expenses. 15. Aggrieved by the said order, assessee preferred an appeal before the ld CIT(A) who was of opinion that no interest be added if PDC are encashed with in six months from the date of issue of it and he further directed "If it is not possible to work out the extension of PDCs in each case then A.0. is directed to recompute interest on P DCs after six months from date of issue of PDCs i.e. date of sale, as six months is taken as reasonable period for giving PDC as pe....
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....t if it is not possible to work out the extension of PDCs in each case, then the Assessing Officer is directed to recompute interest on PDCs after six months from the date of issue of the PDCs. Therefore, the ground of appeal of the Revenue that the CIT(A) deleted the addition of Rs. 5,06,625/- made by the Assessing Officer on account of interest PDCs is factual incorrect and contrary to the order of the CIT(A) directed to recalculate the interest on Cs and there was a sound logic for such direction. His direction is based on material found and seized at the time of search. In view of the above, we do not find any justification to interfere with the order of learned CIT(A) in this regard and accordingly, we reject ground No. 1 of the Revenue's appeal 19. Since, the facts of the present case are similar to the facts involved in the aforesaid referred to the case. So, respectfully following the order dated 31.10.2014 In ITA Nos.1674/De1l2013 & 1765/Del/2013 for the assessment year 2008-09 in the case of sister concern of the assessee viz. M/s.IAG Promoters and Developers Pvt. Ltd., we do not see any valid ground to interfere with the findings given by the Id. CIT(A) and accord....
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....ts in the case of M/s. Westland Developers Pvt. Ltd, it was prayed that assessee's contention that no disallowance could be made u/s 37 as no expenditure was claimed may be accepted. On the other hand the ld DR reiterated the contention of the AO and reiterated the contention at para 10(supra). 26. We find that similar issue has been decided by us while adjudicating ITA No.1768/Del/2013 (supra) wherein while concurring with the decision of co-ordinate bench in M/s Glitz Builders and Promoters Pvt. Ltd.(supra) on identical issue we have held that as under:- "We have heard both the parties and have perused the records of the case, we find considerable force in the contention of the ld AR that issue raised in ground No.3, 3.1, 4 and 4.1 is squarely covered by the order of the co-ordinate bench in the case of M/s Glitz Builders and Promoters Pvt Ltd (supra). We concur that when the cost of the land as well as additional payment is not claimed by the assessee as deduction, the question of any disallowance under Section 40A(3) or otherwise in the case of the assessee does not arise. We, therefore, delete the entire disallowance made by the Assessing Officer under Section ....
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....l seized during search and as per the direction the AO has found that there was no interest payable since the PDC were encashed before six months and we have already dismissed the appeal of the revenue on identical ground In ITA No.1530/Del/2013 in the case of Business Park Builders Pvt. Ltd.(supra), so on identical reason following the order of the Tribunal in M/s, IAG Promoters, we are inclined to dismiss this ground of the revenue, and moreover we do not find any infirmity in such a direction of the ld CIT(A) on this issue and so this ground is dismissed. 35. As regards ground No. 2 raised by the Revenue relates to deletion of addition of Rs. 10,74,959/- made by the AO in view of the provisions of Section 37(1) of the Act on account of additional payment is concerned. For this addition, we have already decided similar issue in the Assesse's Appeal as aforesaid vide para No. 11(supra) in favour of the assessee, hence, this ground of appeal raised by the Revenue stands dismissed. 36. In the result the appeal of the revenue stands dismissed. ITA No. 1741/Del/2013 (Assessee's Appeal) (Assessment Year 2006-07) 37. Grounds Nos.1,2 and 2.1, 6 and 7:- These grounds are n....
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....ore the ld CIT(A) who held in para 5.4 at page 16 of his order:- "If it is not possible to work out the extension of PDCs in each case then A.O is directed to recomputed interest on PDCs after six months from date of issue of PDCs i.e. date of sale, as six months is taken as reasonable period for giving PDC as per sale deed" 46. In pursuant to the aforesaid direction of the ld CIT(A), the AO found that since the PDCs were encashed in less than six months from the date of issue, entire interest of Rs. 34,13,714/- was deleted. Copy of appeal effect by way of revised Tax Computation was shown to us and is enclosed at page 103-104 of Paper Book. 47. The ld AR contended that the issue in the present appeal is covered by the order of the Tribunal 'C' Bench Delhi in the case of a sister concern viz., M/s IAG Promoters and Developers Pvt. Ltd dated 31.10.2014 in ITA No. in ITA No.1674/Del/13 & 1765/Del/13 for AY 2008-09. (Copy enclosed at pages 69-78). 48. In respect to revenue's appeal to delete the addition made on account of interest on PDC, we find that the ground of revenue is factually incorrect and it was only a direction of ld CIT(A) to AO to re-calculate ....