TaxTMI 
TaxTMI 
2015 (7) TMI 1253
X X X X Extracts X X X X
X X X X Extracts X X X X
....The appellant prays that the ALV of the said property may be taken at Rs.Nil. Ground No. 3: Without prejudice to Ground no. 2, on the facts and circumstances of the case and in law, the Hon'ble CIT (A) erred in confirming the action of the AO in assessing the ALV of vacant residential flats at Central Garden Complex building at Rs. 1,71,94,824/- and in assessing income at Rs. 1,20,36,377/- under the head 'Income from House Property'. The appellant prays that the said addition is unjustified and may please be deleted. Ground No. 4: On the facts and circumstances of the case and in law, the Hon'ble CIT (A) erred in confirming the addition made by the AO of Rs. 2,46,69,000/-, as investment in Pawna land not fully disclosed in the books of account, u/s. 69B of the Income Tax Act, 1961. The appellant prays that the said addition is unjustified and requires to be deleted. The Appellant craves to add, alter, amend or omit any of the grounds of appeal before or during the hearing of the appeal." Ground No.1 2. At the outset, the Ld. A.R. of the assessee has stated at bar that as per the instructions of his client he does no....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was held that the basis on which a self-occupied property is valued under rule 1BB of the Wealth-tax Rules and municipal ratable value is arrived at under the municipal law is the same i.e. "a reasonable amount of rent that can be expected by the owner from a hypothetical tenant". That while arriving at such reasonable amount of rent that can be expected by the owner from a hypothetical tenant, the amount of statutory deduction, if any, permissible under the local municipal law must be added to the ratable value. Thus, the Hon'ble High Court held that while applying the provisions of rule 1BB for valuing the self-occupied property, municipal rateable value with addition of statutory deductions, if any, may be adopted instead of standard rent, for arriving at the gross maintainable rent. Respectfully following the order of jurisdictional High Court, matter is restored back to the file of AO with a direction to re-compute the ALV in terms of above decision of Hon'ble Bombay High Court." 13. The case of the assessee is squarely covered by the above decision of the Tribunal and respectfully following the same, it is accordingly directed that the ALV be computed as per the mu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....resentatives of both the parties and have also gone through the record. The Ld. A.R. of the assessee, before us, has submitted that except the seized document, the contents of which have been duly explained by the assessee, no other evidence of any kind was found or seized which would indicate that the assessee had incurred the cost of land in cash as alleged by the Revenue. He has further contended that even the email relied upon by the revenue itself doesn't support the case of the revenue when it is considered and read with other documents relied upon by the revenue itself. The allegations leveled by the Revenue regarding the payment of on money have not been corroborated with any reliable or convincing evidence. He has further submitted that none of the sellers have been examined in the matter to ascertain whether any amount has been paid to them in cash in spite of the fact that the assessee had specifically asked the AO to examine the sellers if required. The AO has also not examined the directors of Durvish Agri Realtors, one of the Group Companies of Jai Corp. Group which is closely related to the assessee. The AO straightaway rejected the contention of the assessee that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ions made by the Tribunal in the case of Anand Jain are reproduced as under: "We find that in the case of "M/s. Avkash Land Realty Pvt. Ltd. and others Vs. DCIT and others" ITA Nos. 8327M/2011and others, the Tribunal, while dealing with the identical issue while adjudicating 67 appeals of 52 different assessees in relation to additions made under section 69B in the case of Jai Corp. Group Companies on account of on money cash payments for purchase of land, has made the following observation: "22. .......The entire dispute revolves around the alleged cash payment amounting to Rs. 43 crores approx. and which has been added u/s. 69C of the Act. Sec. 69C of the Act reads as under: "Where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof, or the explanation, if any, offered by him is not, in the opinion of the AO, satisfactory, the amount covered by such expenditure or part thereof, as the case may be, may be deemed to be the income of the assessee for such financial year." 23. A perusal of the aforementioned section shows that the requirement of the section....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rty was Rs. 45 lakhs and paid tax thereon. In view of vendor's statement, the AO made an addition of Rs. 39 lakhs to the income of the assessee towards unexplained investment. The action of the AO was justified and the additions were confirmed. Thus in view of the aforesaid decision, in the present case, none of the sellers have been examined by the AO to strengthen his views that cash has been paid over and above the registered amount. There is not even a single document/evidence of parties involved in the sale of land at different villages brought on record to show that an amount other than the payment of consideration has exchanged hands. No confession from the sellers have been brought on record. The entire additions have been made merely on the strength of loose papers found during the course of the search not supported by any independent authority. Considering the entire addition, in the light of the provisions of Sec. 69C, as per A.O's own interpretation, investments in purchase of land have been fully financed by some other persons, therefore, the addition in the hands of the assessee cannot be justified as the assessee has not incurred any expenditure. There may be one mor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....expenditure to invoke the provisions of section 69C of the Act. The conclusions drawn by the AO and the Ld. CIT(A) were based on the entries found on loose sheet of papers for which it was explained by the assessee/concerned persons that they were only estimates/budgetary figures. The allegations made by the lower authorities were not supported by any evidence of actual cash passing hands. The Revenue Authorities had not brought a single statement on record of the vendors of the land in different villages. None of the sellers had been examined to substantiate the claim of the Revenue that the extra cash had actually changed hands. The Tribunal, after considering the evidences in relation to the additions in the light of provisions of section 69C of the Act, has held that no additions were warranted under section 69C of the Act in the hands of the assessee. We find that in the case of the assessee, the additions have been made by the lower authorities under section 69B of the Act which provides that where the assessee has made investments or is found to be the owner of any bullion, jewellery or other valuable article and the AO finds that the amount expended on making of su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....This appeal of the assessee is accordingly partly allowed." 10. The facts are identical in the case in hand also. In this case also except the loose paper relied upon by the AO, no evidence was found that the assessee had incurred expenditure on the purchase of land more than that was recorded in the books of account. In this case also the revenue has not denied the contention of the assessee that the consideration recorded in the sale agreements was much more than the value adopted by the Stamp Duty Authorities. There was no evidence that any extra cash other than the sale consideration as recorded in the deed had changed hands. No statement of the vendors of the land had been recorded. No other corroborative evidence has been produced on the file by the Revenue Authorities to substantiate their allegation. We further note that the AO while making the additions vide his assessment order has concluded as under: "4.7 The discussion made so far, various incriminating evidence, and preponderance of probability further clearly establish that- The notings on page no.36 of Annexure A-6 relates to the land transaction stated by Mr. Virendra Jain concluded in the name of Mr. Ha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ave been mentioned in the loose paper. The said loose paper has not been found from the possession of the asssessee but from an employee of Jai Group Company. The document is neither in the hand writing of the assessee nor is signed by the assessee. Even there are no signatures of the alleged recipient of the cash amount. None of the alleged recipient has been examined by the AO. Even the AO did not examine the Directors of Durvish Agri Realtors. The AO straightaway rejected the contention of the assessee that the cheques paid by the said company on behalf of the assessee were never encashed by the vendors of the land but were returned back to the assessee/ Durvish Agri Realtors on the failure of the vendors to get converted the land from Agriculture category to non- agriculture nature. The addition in this case also has been made only on the basis of the entries in the loose paper found during the search action. As held by the Tribunal in the case of Anand Jain (supra) and as also in the cases of another group companies (supra), that the said loose paper at the most can be considered to have raised a suspicion about the transfer of money other than the sale consideration, but the ....