TaxTMI 
TaxTMI 
2016 (10) TMI 1157
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....s and COs by this consolidated order. 2. General Facts The brief facts of the case that the proceedings u/s 153A of the Act was initiated consequent to the search u/s 132 conducted on 25.2.2009 at the residential and business premises of "Saltee Group" promoted and owned largely with his family members by Mr. Surya Prakash Bagla. The assessee through its associate concern is engaged mainly in the business of Real Estate & Civil Construction. Consequent to search u/s 132 of the Act, notice u/s 153A of the Act was issued for Asst Years 2003-04 to 2008-09 and assessments framed u/s 153A of the Act thereon and for the Asst Year 2009-10, being the year of search, assessment was framed u/s 143(3) of the Act. The assessee's appeal is mainly containing the validity of the search and the grounds of appeal in all the years can be summarized as follows : 1. For that in view of the facts and in the circumstances, the assessment order made by the AO was wholly bad, illegal and void abinitio both on points of law and in view of the facts and in the circumstances the ld CIT(A) was wholly unjustified in confirming the action of the AO as far as legal issues were concerned and the Ld. C....
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....ital rather it has taken undisclosed income in A.Y.2010-11 2. Ground No. 2 - The Ld. CIT(A) has erred in not appreciating the fact that the applicant Shri S.P. Bagla himself has not treated the cash receipt of Rs. 6,00,90,000/- as Capital Gain from sale of shares, rather, he has taken it as undisclosed income from other sources in A.Y.2010-11. 3. Ground No. 3 - The Ld. CIT(A) has erred in holding that capital gain arising on the 100% sale of shares of M/s. Graphitech is taxable in 2010-11 and not in the year in which MOU (contract for Sale) i.e. /F.Y. 2005-06 relevant for A.Y.2006-07 was signed and that the order of Ld. CIT(A) is in contravention to the circular No. 704 dated 28/04/1995 of CBDT. 4. Ground No. 4 -The Ld. CIT (A) erred in directing A.O. to take the consideration as 14,01,00,000/- for sale of shares of Graphitech as against sale value of Rs. 6,51,00,000/- mentioned in MOU (sale contract) 5. Ground No. 5 - The Ld. CIT (A) has further erred in holding that the sale consideration for the sale of shares is to be taken as Rs. 14,01,00,000/- and the date of sale as 25/05/2009. A.Y 2007-08: (Department's appeal - ITA No. 35/K/2012) 1. Ground No. 1 - The Ld.....
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....hearings. 4.1. The brief facts of this issue is that Saltee Infotech Pvt Ltd was holding 100% shares in M/s Graphitech India Ltd, a company incorporated under the Companies Act, 1956. One Mr. Surya Prakash Bagla (assessee herein) is its director. M/s Graphitech India Ltd has long term lease on a piece of land measuring about 60 cottahs and there was no legal impediment to construct commercial building on the said land. There was a Memorandum Of Understanding (MOU) on 4.8.2005 between Saltee Infotech Pvt Ltd represented by its Director Mr. Surya Prakash Bagla and one Mr. Vivek Kathotia, with a recital that the shareholders of M/s Graphitech India Ltd went to transfer their 100% holding in M/s Graphitech India Ltd to Mr. Vivek Kathotia for a consideration of Rs. 16,51,00,000/-. In the said MOU there was a recital to the effect that all the original share certificates and transfer deed shall be deposited with Mr. B. K. Jain Advocate in trust and the same shall be handed over to the transferee on making their full and final payment of the consideration amount. Further, vide clause 4 in liabilities and responsibilities of the transferor, it was stipulated that the transferor at his c....
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....onsent, letters dated 01.11.2007 and 19.11.2007 as void, delivery up and cancellation of such letters and a decree for perpetual injunction restraining the transferee from demanding delivery of possession of the shares and from giving effect to the MOU dated 04.08.2005. In the said suit it was pleaded that pursuant to the MOU the original share certificates were deposited with Advocate Shri B. K. Jain and subsequently all the steps were taken to see that the terms of MOU are implemented, but inspite of various corrections made from time to time to the building plan got prepared by the transferee, the same could not be accomplished and Bidhannagar Municipality refused to approve the plan as such, the transferee ultimately decided to abandon the project and with mutual consent, the contract was rescinded but to the surprise of the transferor, a letter was received from Mr. B. K. Jain, Advocate, wherein the rescinding of contract was disputed and delivery of shares was insisted. In those circumstances, the declaratory suit came to be filed. 4.1.3. The transferee also filed another suit in T.S. No. 222 of 2007 before the Civil Judge (Sr. Division), 2nd Court at Barasat disputing the....
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....hanges, the date of contract for sale as declared by the parties shall be treated as the date of transfer, provided it is followed up by actual delivery of shares and the transfer deeds. In view of this circular, the date of contract for sale assumes importance. According to the revenue, the date of contract for sale is the date of MOU whereas, according to the assessee, the date of subsequent compromise by way of which the condition as to the approvals by different authorities was got rid of. Further according to the Revenue, the sale consideration is the entire Rs. 16.51 Cr whereas the Assessee claims it to be only 14.01 Cr as reduced in the compromise decree by way of adjustment. 4.2. The assssee offered capital gains for sale of shares in Asst Year 2010-11 on the basis of transfer of shares that happened pursuant to decree and revised MOU dated 25.5.2009. The assessee also offered the sums of Rs. 7,40,90,000/- in the revised return for Asst Year 2010- 11 under the head 'income from other sources' being the cash component received on sale of shares. But during the course of assessment proceedings, the assessee pleaded before the ld AO to treat the sums of Rs. 7,40,90,000/- as....
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....ation it forms part for sale consideration. According to him, sale consideration remained the same although the transaction but the liability of the transferor for compensation only intervened. He, therefore, argued that the date of MOU is the date of contract for sale and the sale consideration is the entire amount of Rs. 16,51,00,000/-. On this premise, Ld. Counsel argued that the sale consideration of shares of the assessee is Rs. 16.51 cr. and following the CBDT circular 704 dated 28.04.1995, such date (i.e the date of MOU dt 4.8.2005) will be treated as the date of transfer, since, it is only pursuant to the terms of the MOU, the delivery took place. He placed reliance on a decision reported in AJAY GULIYA vs. ASSISTANT COMMISSIONER OF INCOME TAX (2012) 209 TAXMAN 0295 (Del) wherein it was observed that,- The reasoning of the Tribunal is premised upon the fact that capital assets were transferred on a particular date the assessee passed on the execution of the agreement. There is no material on the record or in the agreement suggesting that even if the entire consideration or part is not paid the title to the shares will revert to the seller. In that sense the controlling e....
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....s rejoinder drew our attention to Circular relied upon by the ld AO which is placed at page 257 of paper book No. 2 and pointed out that even as per the Board's Circular, taxability of shares arise only in the year of transfer of share certificates. The ld AR took us to pg 48 of PB No. 2 which is the MOU dt. 4.8.2005 and in the "consideration" part of such MOU at Clause 5 it has been categorically mentioned that share transfer deed were to be deposited with Mr. B. K. Jain (Advocate) in trust and were transferred to transferee (i.e. Vivek Kathotia) only on full and final payment of consideration. The ld AR further took us to the letter written by the assessee to the Solicitor Mr. B. K. Jain (Paper Book No.2 page 48) which shows that the Solicitor was holding such share certificates only in trust in terms of the MOU dt. 4.8.2005 and the shares were never transferred to Mr. Vivek Kathotia and/ or his assignees/ associates as mentioned in MOU. The ld AR further took us to ROC returns for Asst Years 2006-07 & 2007-08 as well as for Asst Year 2010-11 which are placed at pages 151 to 245 of the Paper Book No.2 and contended that since the share certificates have been transferred by the as....
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....d Sewerage etc, and till the permissions are granted, neither of the parties will be in a position to perform or demand performance of contract from other party. By way of stipulation in the MOU by way of Clause 13 thereof, viz, if the Transferor fails to get plan sanctioned then the transferor shall refund the entire amount received from Transferee within one month, the parties adopted a mechanism in the MOU that till the transferor gets the required permissions and clearances, the amounts paid by the transferee would remain as advance only, and it is only on the accomplishment of this pre requisite condition, further steps would be taken. This intention is very clear from the MOU itself. 4.7.2. It is not in dispute that, for one reason or the other, permissions were not granted by the authorities and there was litigation. By the date of filing of the title suit No 222/2007 by the transferee seeking specific performance, transferee claims to have paid a sum of Rs. 13,91,90,000/- from time to time, and only a sum of Rs. 2,59,10,000/- was due and as such the transferee demanded the delivery of shares following by filing of such suit. It is only by way of settlement deed, pursuant....
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....rence to section 2(42A) says that in cases of transactions taking place directly between the parties and not through stock exchanges, the date of contract for sale as declared by the parties shall be treated as the date of transfer, provided it is followed up by actual delivery of shares and the transfer deeds. In this case according to the assessee, date of contract for sale is the date of compromise and compromise decree i.e 25.5.2009. For the reasons set forth in the preceding paragraphs, we find that the date of MOU cannot be taken as the date of contract for sale because unless and until the condition in Cl 13 is fulfilled the understanding does not assume the character of agreement for sale, and it is only on that event the amount becomes the part consideration. Till such time it is only an advance amount only, not liable for tax under the head of capital gains. 4.7.5. Next question that arises is as to what exactly the sale consideration was, whether it was Rs. 16,51,00,000/- as contemplated in the MOU or Rs. 14,01,00,000/- as adjusted in Cl 12 (a) read with Cl 11 of the Terms of Settlement reached by parties and taken cognizance by the Court vide Compromise Decree in TS ....
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....ishment of such condition any further steps would be taken, in such situation the controlling expression of "transfer" is non conclusive as to the true nature of the transaction till the condition is fulfilled and then the date of fulfillment of such condition shall be taken as date of contract for sale within the meaning of Circular No. 704 dated 28.04.1995 with reference to section 2(42A) and the amounts paid by the transferee till the fulfillment of such condition would remain as advance only, but not as part for sale consideration for the purpose of reckoning the capital gains. Further, in the absence of any express contract between the parties, any liability of the parties in the form of costs etc due to some intervening circumstances, would not in any manner detract from the chargeability of total sale consideration. At best those costs would be expenses relating to the sale or purchase as the case may be, which in any case, would be eligible for deduction while computing capital gains. 4.7.8. As regards the handing over of the share scripts to the Solicitor Mr. B. K. Jain, it is seen that it was not accompanied with the transfer deeds and indeed the transfer deeds have be....
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.... treated as capital gain arising on sale of such shares and as such the contention of the revenue to treat the same as otherwise cannot be upheld in any manner even in Asst Year 2010-11. In any case, the said receipt cannot be taxed in Asst Years 2006-07 and 2007-08 separately. 4.7.9. As discussed earlier, transfer having taken place only in Financial Year 2009-10 relevant to Asst Year 2010-11, when executed transfer deeds along with share certificates were handed over Mr. Kathotia and when transfer pursuant to order of Court was completed, the entire capital gain is taxable in Asst Year 2010-11 only and cash components in this regard received earlier cannot be taxed in the Asst Years 2006-07 and 2007-08. 4.7.10. As a result, we hold as follows : Asst year Appeal No. Ground Nos. Result 2006-07 34/K/12 1 to 5 Dismissed 2007-08 35/K/12 1 to 5 Dismissed 2010-11 857/K/14 1 to 4 Dismissed Hence, these grounds are disposed accordingly. 5. ADDITION MADE BASED ON SEIZED DOCUMENT MARKED SSG/1 A.Y 2008-09: IT(SS) 36/Kol/2012 1. Ground No. 2 - The Ld. CIT(A) has erred in treating the addition of undisclosed receipt of....
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....tion so made/ confirmed by the Ld. CIT(A) treating the same as alleged unexplained expenditure. A.O. and the Ld. CIT(A) erred in appreciating the facts that the amount of Rs. 28,12,000/- pertaining to the seized document No. SSG/1 at page 9 has been added by the AO twice and as such, such amount having been considered twice by AO, the appellant's income has been increased by such amount wrongly and in view of the facts and in the circumstances it may kindly be held accordingly. Addl. Ground No.3 -For that in view of the facts and in the circumstances and without prejudice to the Ground No. 1 above, treating Rs. 3,03,65,126/- as unexplained expenditure, the AO and Ld. CIT(A) failed to appreciate the facts that the amount considered on the basis of SSG/1 at pages 29-30 has been wrongly considered at Rs. 1,16,00,000/- without considering the figures appearing in the books of account and on consideration of such amount as appearing in the books of account, the addition in respect of the such seized documents will reduce to 'Zero' and in view of the facts and in the circumstances it may kindly be held accordingly. The additional ground raised in assessee's appeal in IT....
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....cannot be treated as estimate. The ld AO noted that the seized material contained land development expenses of Rs. 5,07,50,375/- out of which sum of Rs. 2,03,85,249/- only was recorded in the books of account. The ld AO treated the difference of Rs. 3,03,65,126/- as undisclosed receipt of the assessee which was assessable as his undisclosed income in A.Y 2008-09. The ld AO also found that the seized material shows receipt of cut money of Rs. 46,34,960/- and Rs. 27,92,230/- which was assessable in the case of the assessee as his undisclosed income in Asst Year 2008-09. The ld AO has mentioned in the assessment order that the assessee had already admitted the cut money of Rs. 45,54,460/- and has also included the same in his statement of cash flow. The ld AO further noted that page 54 of SSG/1 shows undisclosed expenditure of Rs. 1,25,000/- on account of legal expenses and that of Rs. 3,05,272/- on account of land development cost which was assessable as undisclosed expenditure in Asst Year 2006-07. 5.2. On a perusal of the ld AO's order it is observed as under :- "Page 1 to 30 of the seized documents marked SSG/1 reflect land development expenses of Rs. 5,07,50,375/- and cut m....
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..... 1-21) ends page 10-22-32) 1,539,878 456,202 1,083,676 12 Puskar Infrastructure 4,222,350 2,990,048 1,232,302 14 Utkarsh Horticulture 5,409,600 613,258 4,796,342 15 Darsh Enclave (P) Ltd. 930,000 944,300 (14,300) 16 Fast Flow 8,037,713 - 8,037,713 17 Debnath Consultant 1,869,151 363,973 1,505,178 18 Saltee Parks 1,600,000 309,726 1,290,274 22&23 Kerf Construction (P) Ltd. 3,569,939 377,459 3,192,480 23 & 24 Saltee Village (Details starts from page 23 and end at 24) 1,664,485 287,702 1,366,783 25 Ankit Plantation 2,282,030 1,710,462 574,568 26 Dewan Export 2,659,970 1,078,250 1,581,720 29 & 30 Marine Park (Statement started page 30 and B/F 26,70,967 and end page 29) 3,143,788 - 3,143,788 50,750,375 20,385,249 30,365,126 The difference is treated as the undisclosed income of the assessee. Therefore, the sum of Rs. 3,03,65,126/- on account of 'Land Development Cost' receipt and Rs. 74,27,109/- on account of 'Cut Money' receipt totaling to Rs. 3,77,92,236/- is added as ....
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....126/- being the difference in the amounts as shown in the seized documents and those as recorded in the regular books of account of the group companies. The AO further held that the cut money also was not recorded in the books of account. The AO noted that though the appellant has admitted cut money of Rs. 45,54,460/- only, there was evidence of receipt of cut money of Rs. 46,34,960/- on page 12 and that of Rs. 27,92,230/- on page 5 of SSG/1. The AO also observed that the land development cost and the cut money has actually been received by the appellant as charges for the services rendered by him. In view of the above, the AO made total addition of Rs. 3,77,92,235/- (Rs. 3,03,65,126/- plus Rs. 74,27,109/-) on account of undisclosed receipts in A.Y 2008-09. The Ld. A.R has argued that the seized documents were recovered from the custody and possession of the company Saltee Construction Co. Pvt. Ltd. and also the AO has brought no material or evidence on record to show that such seized documents were in the handwriting of the appellant or his accountant. Under the circumstances no addition could be made in the case of the appellant. The Ld. A.R contended that the land development....
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..... Secondly, once the appellant has himself admitted the receipt of cut money of Rs. 45,54,460/-, he cannot argue that similar cut money of Rs. 27,92,230/- recorded in the same seized documents SSG/1 does not belong to him. Hence the entire cut money of Rs. 74,27,109/- should be treated as cut money received by the appellant; and, is assessable in his case as undisclosed income. Hence, this action of the AO in treating the cut money of Rs. 74,27,109/- should be treated as undisclosed receipt of the appellant is confirmed. However once the cut money of Rs. 27,92,230/- is assessed as undisclosed receipt, then consequential effect has to be given in as much as such receipt has to be considered as being available for use towards any unexplained expenditure made by the appellant. I have considered the submission made on behalf of the appellant that the land development cost, which is mentioned on an average basis @ Rs. 5000/- per cottah in the seized document, cannot be the same for all kinds of land and as such it should be considered as estimate only. However, the appellant on his part has failed to adduce any separate evidence in this regard. In this factual background, I am of the....
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....te is little higher as well such as pages 470, 505, 528 & 555 of Paper Book No.4. However, the same is mere estimate of expenditure and cannot be treated as actual expenditure in any manner. (iv) The ld AR also contended that such sum of Rs. 3,03,65,126/- merely represents expenditure and cannot be treated as income since the assessee had done land filling for such company which is corroborated by the expenses booked by respective companies to their books of account. (v) The assessee then referred to Additional Ground No. 2 of C.O and Additional Ground No.2 of assessee's appeal being addition of Rs. 1,16,00,000/-. The ld AR drew our attention to the fact that such transaction pertains to Marine Park Ltd. details of which are at page 611 of the Paper Book (Volume 4). The ld AR then submitted that the land development expenses as per books has been considered at Nil by ld AO, whereas the same is Rs. 1,16,56,247/-. As such there could not be any addition on such account. 5.4.1. The ld AR then referred to Additional Ground No.3 of C.O and Additional Ground No.3 of assessee's appeal being addition of Rs. 28,12,000/-. The ld AR drew our attention to the fact that such transactio....
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....,92,330/- Rs.78,57,562/- (Undisclosed receipt) Pages 1 - 30 Rs.3,03,65,126/- (Undisclosed receipt /expenses) As regards the sum of Rs. 27,92,330/- and Rs. 4,30,272/-, the same has been accepted by the assessee at the assessment stage and as such we do not find much merit in the matter and since the nature of Rs. 46,34,960/- (comprised in Rs. 46,34,960/- + 27,92,330/- = Rs. 74,27,290/-) is same i.e. cut money and since assessee has already accepted Rs. 27,92,330/, Rs. 46,34,960/- is also treated as undisclosed receipt only and hence the same treated accordingly as undisclosed receipt only. 5.7.1. As regards the sum of Rs. 3,03,65,126/- pertaining to pages 1 - 30 of SSG-1, we find assessee's contention is that the same is an estimate of expenses. On a perusal of the document , we find that there is a much variation of such sums as reflected in seized documents and such sum is not merely Rs. 5,000/- per Cottah. The assessee's contention in such seized documents pages 1-30 of SSG/1 cannot be accepted. However, the ld AR has successfully pointed out that in some documents such amount has been mentioned whereas nothing has mentioned in the books of account and he....
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....As a result, we summarize as follows : Asst year Appeal No. Ground Nos. Result 2006-07 34/K/12 7 Dismissed 145/K/12 5 Dismissed 2008-09 36/K/12 2 Dismissed 3 Dismissed 4 Dismissed 147/K/12 5 Dismissed Addl. Ground 1 Allowed for statistical purposes Addl. Ground 2 Allowed for statistical purposes Addl. Ground 3 Allowed for statistical purposes 6. ADDITION MADE BASED ON SEIZED DOCUMENT MARKED SSG/3 A.Y 2007-08: C.O. 146/Kol/2012 Ground No. 5 -For that in view of the facts and circumstances the Ld. CIT(A) erred in confirming the action of the AO in treating Rs. 18,00,000/- as undisclosed expenditure of the appellant on the basis of the alleged document SSG - 3 and in view of the facts and in the circumstances the action of the Ld. CIT(A) in such regard is without appreciating the facts and in the circumstances it may be kindly be held accordingly. A.Y 2008-09 C.O. 147/Kol/2012 Ground No.6 - For that in view of the facts and circumstances the Ld. CIT(A) erred in confirming th....
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....d document SSG/3 contains undisclosed expenditure of Rs. 17,63,664/- & Rs. 36,53,564/- incurred in respect of projects at EN-62 and DN-18. The ld AO further found that page 27 contains detail of payments by cash as well as by cheque - the cash component being Rs. 6,51,288/-. Similarly, page 29 to 32 contain net loss of Rs. 7,77,878/- on book fair organized by the assessee. The ld AO concluded that undisclosed expenses of Rs. 7,77,878/- was embedded in such loss. The ld AO found, on the other hand, that page 3 of the seized document SSG/3 is account statement of Mackintosh Burn Limited reflecting unaccounted receipt of Rs. 10,00,000/- which was admitted by the assessee, and was also included in the cash flow statement. The ld AO thus made addition of Rs. 10,00,000/- in Asst Year 2009-10 as undisclosed receipt and additions of Rs. 18,00,000/-, Rs. 37,25,000/- and Rs. 84,66,724/- (Rs. 16,20,000/- plus Rs. 17,63,994/- plus Rs. 36,53,564/- plus Rs. 6,51,288/- plus Rs. 7,77,878/-) in Asst Years 2007-08, 2008-09 and 2009-10 as undisclosed expenditure on the basis of the seized documents marked SSG/3. The order of the ld AO is reproduced as under :- "This seized document consists of loo....
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....o accepted by the AO. The cash flow statement had been filed before the AO in respect of the unaccounted income which mainly comprised of cash received on different dates from the Fort Group in connection with sale of shares. The cash flow statement was forwarded to me by the AO along with his remand report. I find from its perusal that the appellant had sufficient cash balance available with him for expenses or investment. And, as the AO has brought no material on record to show that such cash balance was otherwise invested or spent by the appellant, it has to be accepted that such cash balance was available with the appellant to cover for the unexplained expenses. Accordingly, the AO is directed to consider the net of the unexplained expenses of Rs. 18,00,000/-, Rs. 37,25,000/-, Rs. 16,20,000/- , Rs. 17,63,994/-, Rs. 36,53,564/-, Rs. 6,51,288/- and Rs. 7,77,878/- , if any, for the purposes of addition. 6.3. The ld AR argued the following:- (i) He contended that the money receipts are not in the name of the assessee, and so, no addition can be made in his case. It was also argued that the seized material was not found from the possession or custody of the assessee. (ii) T....
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....er the finding given by ld AO in its order. 6.5. We have heard the rival submissions and perused the materials available on record including the paper books submitted in that regard. We have gone through the material placed i.e. SSG/3 particular pages as follows : Pgs 3 & 8 Rs. 18,00,000/- A.Y 2007-08 Expenses Various pages Rs.37,25,000/- A.Y 2008-09 Expenses Pgs 32,33, 26 & 27 Rs.84,66,724/- A.Y 2009-10 Expenses Pg 33 Rs. 10,00,000/- A.Y 2009-10 Income The assessee has merely re-iterated that the documents doesn't belong to it. However, he failed to rebut the contention that the contents of such document does not relate to him and indeed we find that the ld AO had rightly added such sum as undisclosed receipt in respect of page 33 and undisclosed expenses in respect of pages 3,8,33 and other pages as mentioned . Hence, we find merit in the action of revenue and assessee's grounds in that regard fails and are confirmed as undisclosed expenses / income accordingly. As regards the revenue's ground in treating Rs. 18,00,000/-, Rs. 37,25,000/- & Rs. 84,66,724/- out of available cash, we find merit in the fact that the ld AO himself....
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....TA in his order has observed and decided as follows : - The AO found that page 13 of the seized documents SSG/6 contains detail of expenses totaling to Rs. 6,00,000/- on purchase of tickets and TV, and also cash payments of Rs. 3,55,080/-. It was contended before the AO that the seized documents was not related to the appellant as it was not found from his possession. The AO did not accept the explanation and made addition of Rs. 6,00,000/- as undisclosed expenses in A.Y 2009-10. The Ld. A.R reiterated the submission made at the assessment stage. I do not find merit in the submission. The order of the AO in considering the expenses of Rs. 6,00,000/- is confirmed. However, the AO is directed to consider the same as part of the cash flow and then, consider the net of the unexplained expense of Rs. 6,00,000/- if any for the purposes of addition. 7.3. We have heard the rival submissions and perused the materials available on record including the paper book filed in that regard. We find no merit in assessee's appeal. However, as regards revenue's appeal, we hold that as regards the ld CITA's action in allowing the set off of the expenses so incurred by assessee and / or its associ....
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.... (A) erred in confirming the action of the AO in treating Rs. 1,67,000/- as undisclosed expenditure on the basis of alleged seized document SSG-8 and in view of the facts and in the circumstances the action of Ld. CIT (A) in such regard is without appreciating the facts in the matter properly and in view of the facts and in the circumstances it may kindly be held accordingly. This ground is without prejudice to the fact that the appellant has shown the same as application of the income offered by it and hence it may kindly be considered accordingly. Additional Ground - For that in view of the facts and circumstances and without prejudice to the legality of addition of Rs. 26,64,00,000/- made on the basis of SSG-8 alleged to have been found from the appellant and without prejudice the Ld. CIT(A) erred in treating the said Companies as Group Companies of the appellant without bringing the an evidence on record as to the shareholding of such company vested with the appellant and consequently the observation by the Ld. CIT(A) in such respect may kindly be deleted accordingly. A.Y 2006-07 IT(SS) 34/Kol/2012 Ground No. 8 - The Ld. CIT(A) is erred in directing the A.O. to cons....
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....64,00.000/- was made towards the purchase of land. As sum of Rs. 1l,00,00,000/- was recorded towards investment in land in the books of account of the group companies, the ld AO concluded that the assessee had made undisclosed investment or Rs. 26,64,00,000/- towards purchase of land. The ld AO also considered the undisclosed expenditure on account of land-filling charges at Rs. 37,64,000/-. The ld AO thus made total addition of Rs. 27,03,31,000/- (Rs.26,64,00,000/- plus Rs. 37,64,000/- plus Rs. 1,67,000/-) in Asst Year 2009-10. The assessment order of the ld AO is reproduced as under - Pages - 19, 21, 22 to 24 contains money receipt of Rs. 50,000/-, Rs. 67,000/-, Rs. 10,00,000/- , Rs. 20,11,000/- & Rs. 1,00,000/- respectively, out of which the assessee admitted the following amounts as his undisclosed expenditure. Payments F.Y A.Y Amount (Rs.) 2005-06 2006-07 10,00,000/- 2007-08 2008-09 50,000/- 2008-09 2009-10 1,67,000/- It appears that page - 31 of SSG/8 contains the details of land purchased upto 15.12.2008 under the head written as "Account as on 15th December, 2008". The figures on this page ....
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....G/8. The figure 1.2 in the column of rate actually denotes 1.20 lakhs for purchase of 2707.76 cottah for total value of Rs. 32,49,31,400/- From the discussions in the earlier paras and the assessee's admission vide letter dt. 11.11.2010 that assessee is in the habit of writing figures with zero suppressions. Therefore, Rs. 37,64,00,000/- is being considered as investment by the assessee in purchasing 2950.56 cottah of land in phase -1, phase - 2, Mohammedpur, Jamalpur. Since the above document has been found from the custody of the assesse during he search proceedings and on the basis of presumptive theory the entire undisclosed investment of Rs. 26,64,00,000/- ( out of this investment, Rs. 11 crores has been recorded as investment in the books of the different companies, incidentally it is to be mentioned that bank account details of these company were also found from the custody of the assessee ) is treated as assessee's undisclosed investment. [Undisclosed expenditure for A.Y 2006-07 Rs. 10,00,000/-] [Undisclosed expenditure for A.Y 2009-10 Rs. 50,000/-] [Undisclosed expenditure for A.Y 2007-08 Rs. 27,03,31,000/-] 8.2. The ld CITA observed as follows:- I have peru....
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....rd in support of his action. It was also argued that the entire investment in land was not made in the F.Y 2008-09. On the contrary, land was also purchased in the preceding years. And so, the "Account as on 15th December, 2008" cannot be related to purchase of land. Secondly, the AO has made another presumption without any basis that the figures are mentioned in lakhs. It was contended before me that the AO has wrongly mentioned in the assessment order that the appellant admitted vide submission dt. 11.11.2010 about his habit of suppressing zeros while writing figures. I find substance in the argument that the use of the words like "appears" or "apparently" only suggests that the AO is himself not sure of the facts and that he was relying more on presumptions and guess work that on material facts. I find from the assessment order that the appellant had explained before the AO that the seized document was related to land filling charges in respect of the land that was already owned by the group companies for which investment of Rs. 11 crores was also shown in the regular books of account. The seized document actually contained account given by the contractor for land filling expens....
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....addition. 8.3. The ld AR argued the following:- (i) He contested that money receipts of Rs. 10,00,000/-, Rs. 50,000/- & Rs. 1,67,000/- has been declared in the statement of cash flow and so, these unexplained expenses are covered by the undisclosed income already declared to the department. The ld AO was therefore not justified in making separate additions on account of such undisclosed expenses. (ii) The ld AR re-iterated that the seized document was not seized from the possession or custody of the appellant. Neither it contains the name of assessee or any associate firm / concern and indeed it didn't contain any name. (iii) Secondly, there was no material on record to suggest that the assessee has made purchase of land. The land belongs to the group companies and investment of Rs. 11 Crores is shown in their books of account. (iv) The ld AR explained that page 31 of SSG/8 contains details under the head "ACCOUNT AS ON 15TH DECEMBER, 2008". It was argued that the ld AO has made too many presumptions and assumptions about the seized document. The ld AO has presumed that the seized document contains details regarding purchase of land which is nowhere mentioned on the ....
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....e course of hearing. On page 2186 which was letter dt. 11.12.2010 it was explained before the ld AO that it is mere land filling charges. (viii) The ld AR then took us to page 728 of paper book (Paper Book No.5) and also to pages 31, 32 and 33 of SSG/44 and submitted that the average rate of land is Rs. 44,281/ Cottah only. The ld AR then submitted that the ld AO has merely presumed the rate Rs. 1,00,000 per Cottah on a particular area only and then superimposed this rate of 1,00,000 per Cottah on the entire area of 2950.56 Cottah (as on 15.3.2008) to justify his case of treating the figure "3609.987" as Rs. 36,09,98,700/-. Hence the ld AO has merely picked up and chosen an amount of his choice without considering the document as a whole. (ix) The ld AR also drew our attention to the fact that as per seized documents at page 32 - SSG/44 for the total land area of 2486.20 Cottah the value is Rs. 11,00,93,463/- (as on 15.3.2008) whereas as per page 31 - SSG/8 the land area is 2950.56 Cottah the land value has been considered by ld AO at Rs. 36,09,98,700/- (as on 15.12.2008) and it is only mere presumption by the ld AO . This also clearly shows that said figure of "3609.987" is ....
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....tely no evidence brought on record to conclude that the same represents amounts paid for purchase of land. We also agree with the argument of the ld AR that the ld AO had resorted to divergent stand on the same seized document by one treating it as purchase of land and the other treating it as land filling charges, thereby erroneously making addition on both the counts. It is pertinent from such documents that the value of 2486.20 Cottahs couldn't have become Rs. 36,09,98,700/- for 2950.56 Cottahs from March 2008 to December 2008. As far as the contention of assessee to treat the (pg 31 of SG/8) as land filling charges, it appears to be credible since revenue's action in that regard is merely on assumption. Even otherwise, the revenue failed to bring any evidence on record to prove its finding. Hence the ld AO's action in such respect is rejected and do not find any justifiable reason to interfere with the finding of the ld CITA. As regards the revenue's ground in treating Rs. 10,00,000/-, Rs. 50,000/-, Rs. 1,67,000/- & Rs. 36,09,987/- out of available cash , we find merit in the fact that that ld AO himself has allowed such set off in the assessment order, so revenue cannot be ....
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....gly. A.Y 2009-10 C.O 148/Kol/2012 Ground No.11 - For that in view of the facts and circumstances the Ld.CIT(A) erred in confirming the action of the AO in treating Rs. 86,257/- as undisclosed investment of the appellant on the basis of SSG-9 to 39 and in view of the facts and in the circumstances the action of Ld. CIT (A) in such regard is without appreciating the facts in the matter properly and in view of the facts and in the circumstances it may kindly be held accordingly. This ground is without prejudice to the fact that the appellant has shown the same as application of the income offered by it and hence it may kindly be considered accordingly. A.Y 2006-07 IT(SS) 34/Kol/2012 Ground No. 9- The Ld. CIT(A) is erred in directing the A.O. to consider the unexplained expenditure of Rs. 3,60,500/- as unexplained expenditure as per seized document SSG-9-39 against the undisclosed cash receipt and that the order of the Ld. CIT(A) is against the provision of section 69C of the Act. Ground No. 10 - The Ld. CIT(A) is erred in directing the A.O. to consider the unexplained expenditure of Rs. 8,61,581/- added on the basis of seized document SSG/9-39 against the undisclo....
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....ons, R.K. Nayer, Bablu Mondal, Hanuman Prasad, Jioan Ram, Dayanand Thakur, BSR Constructions Company, Sankar, S. R. Construction etc. the assessee vide Annexure - 'J' to letter dt. 11.11.2010 admitted undisclosed expenditure on account of labour payment amounting to Rs. 23,25,056/-. However, in respect of labour payment on the project DN-9, the assessee claimed that the payments were made by "Saltee Infotex" and not related to us. However, during the assessment proceedings u/s 153A, M/s Saltee Infotex denied the payment of such expenses. Since these diaries are found from the possession of Sri Surya Prakash Bagla and his group companies, the same is presumed to be the expenses of Sri Surya Prakash Bagla and not disclosed in the regular basis. The year wise total of labour payment on DN-9 is as under : - F.Y 2004-05(A.Y 2005-06) F.Y 2005-06 (A.Y 2006-07) SSG/10 (R. K. Narayan) Rs.30,000/- Rs.37,000/- SSG/16 (Bablu Mondal) Rs.90,000/- Rs.95,000/- SSG/32 ( S. R. Construction) Rs.14,00,000/- Rs.6,79,581/- SSG/35 (Monoranjan Baraui) Rs.35,000/- Rs.50,000/- Total Rs.15,55,000/- Rs.8,61,581/- Therefore, total und....
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....closed receipts, these additions are confirmed. However, as the undisclosed expenses of Rs. 3,60,500/-, Rs. 6,94,299/-, Rs. 6,28,500/- and Rs. 86,257/- relate to AY 2006-07, 2007-08, 2008-09 and 2009-10, they could possibly be' covered by undisclosed receipts. The AO is directed to consider these expenses as part of the cash flow statement and consider the net of expenses, if any, for the purposes of the addition. The AO has mentioned in the assessment order that undisclosed expenses of Rs. 15,55,000/- and Rs. 8,61,581/- related to A.Y 2005-06 and 2006-07 was recorded in the seized documents SSG/10, 16, 32 & 35. It was contended before the AO that the expenses were related to Saltee Infotex (P) Ltd but then, the same was denied by the said company. The appellant thus failed to support its contention. I find that the appellant is in control of his group companies; and, has also admitted undisclosed receipts as well as undisclosed expenses of the group companies in his own case, I am therefore not inclined to accept the argument that the expenses contained in the seized documents SSG/10, 16, 32 & 35 are not assessable in the hands of the .appellant. However, these undisclosed ....
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....leged seized document SSG-42 & and in view of the facts and in the circumstances the action of Ld. CIT (A) in such regard is without appreciating the facts in the matter properly and in view of the facts and in the circumstances it may kindly be held accordingly. A.Y 2007-08 IT(SS) 35/Kol/2012 Ground No. 9 - The Ld. CIT(A) is erred in directing the A.O. to consider the unexplained expenditure of Rs. 50,64,383/- as per seized document page no.4 SSG/42 against the unaccounted cash receipt. A.Y 2008-09 IT(SS) 36/Kol/2012 Ground No. 8 - The Ld. CIT(A) has erred in deleting the addition of Rs. 5,89,47,000/- as undisclosed investment as per the page No. 6 of seized document SSG/42. A.Y 2009-10 IT(SS) 37/Kol/2012 Ground No.8 - The Ld. CIT(A) erred in deleting the addition of Rs. 1,30,00,000/- made as unexplained investment on the basis of seized document page 6. SSG/42. 10.1. The brief facts of this issue are that the ld AO has mentioned in the assessment order that page 6 of the seized documents marked SSG/42 contains account of one 'Kishanji'. The ld AO interpreted the seized document as containing detail of investment in different places or projects. It al....
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....ess regarding 'kishanji' the total investment is considered in the hand of the assessee. Therefore, amount of Rs. 7,19,47,000/- including cash of Rs. 4,82,00,000/- (other than those mentioned as 'Ch' meaning cheque) has been treated as undisclosed investment by the assessee as per dates mentioned in the seized page as below : - Therefore year-wise addition will be :- Payment / Application F.Y 2007-08(A.Y 2008-09) F.Y 2008-09 (A.Y 2009-10) Rs. 5,89,47,000/- Rs. 1,30,00,000/- Page 4 of SSG - 42 contains the details of expenditure incurred at Jessore Road Project up to 20,03.2008. The assessee admitted the following undisclosedexpenditure vide Annexure 'M' & 'M2' attached to the letter dt.11.11.2010 to the tune of 12,64,383/- has been arrived at by reducing 38,00,000/- on the ground that the undisclosed income of Rs. 38,00,000/- has already been considered in SSG/3. The assessee's explanation is examined. The disclosure for SSG/3 cannot be matched with entries with the seized document. Accordingly, the undisclosed income and expenditure from this seized document comes to Rs. 50,64,383/- for A.Y 2007 - 08. Pages 23 to 37 further s....
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....aid document represented investment. The AO has made further presumption without any basis that the figures are mentioned in lakhs. The AO has mentioned in the assessment order that - "It appears that the figures written on this page are in lakhs of rupees". The Ld. A.R argued that the very language used by the AO only suggests that the AO is himself not sure about the facts. There was no reason or basis or justification for the AO to hold that the figures are in lakhs of rupees. The Ld. A.R has further argued that the seized document has to be considered and believed in totality. When it was mentioned in the seized document itself that it contained the account of Kishanji the AO was not justified in presuming, and that too, without any basis that the seized document was related to the appellant. The AO has made no efforts to locate or examine Kishanji with whom the seized document is possibly related. I find substance in the argument that the AO has brought no corroborative material on record to show that the account of Kishanji as mentioned in SSG/42 was in anyway related to the appellant or even to this group companies. There is no positive material on record to link the account....
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....upto Rs. 12,64,383/-. (iii) As regards page 6 of SSG/42 is concerned, he submitted that such document doesn't pertain to it nor it is aware of contents of such document and rather it pertains to some "Kishanji" as mentioned in such document. (iv) He submitted that is mere assumption & presumption on part of the ld AO to hold that contents of such page 6 are that of assessee and ld AO even presumed that the same is in "Lakhs" and/ or it represents 'unexplained expenditure" without any corroborative material in such respect and / or without making any effort to make any enquiry during search subsequently. (v) He submitted that presumption u/s 292C is not a mandatory presumption and rather a discretionary presumption. Section 292C uses the expression "may be presumed" and as such it is rebuttable presumption. He submitted that such page 6 was a mere loose sheet found at the premises searched. But it was neither under possession nor under control of assessee and nor its contents are corroborated or linked with assessee in any manner and hence it cannot be treated as conclusive evidence merely because it was found at the searched premises. He also relied on judgment of Hon'ble ....
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....2, we find that the ld AO has presumed that the document belongs to assessee and / or its contents pertain to assessee. In this regard, we find that the point is whether the presumption u/s 292C shall be treated as mandatory under the law or whether it shall be treated as a rebuttable presumption and whether, even mandatory presumption about the documents as belonging to the assessee has the conclusive consequence of making the addition in the manner in which the assessment order has done it. In this context, the following observations of the Hon'ble Apex Court in the case of P.R. Metrani vs. CIT reported in (2006) 287 ITR 209 at page 220 about three types of presumptions under the law are relevant:- A presumption is an inference of fact drawn from other known or proved facts. It is a rule of law under which courts are authorized to draw a particular inference from a particular fact. It is of three types, (i) "may presume", (ii) "shall presume" and (iii] "conclusive proof". "May presume" leaves it to the discretion of the court to make the presumption according to the circumstances of the case. "Shall presume" leaves no option with the court not to make the presumption. The cour....
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....ns? The documents belong to the assessee has not been proved. The contents are true has also not been corroborated. The dispute is : what are the contents? Is it permissible to draw the inference against the assessee on his failure to explain the contents of the documents after presuming that the contents are correct? This question is outside the rebuttable presumption made under section 292C of the Act. The legal presumption does not permit the inference that "Kishanji" is none other than the assessee or his representatives. The search action at the premises have not yielded any material which might justify such inference. It is not legally correct to hold that an adverse inference against the assessee unless the assessee explained the contents of the documents. In our opinion, even after presumption applied to the facts u/s 292C of the Act, there is no adequate material to conclude that the transactions in the seized documents are the transactions of the assessee which remained undisclosed. The other aspects of the matter is that the presumption u/s 292C of the Act is rebuttable presumption and they don't lead to conclusive evidence. The assessee, under the principles of natu....
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....cts of this issue are that the ld AO found that page 43 of the seized document SSG/45 contains detail of unexplained expenditure of Rs. 79,82,640/- which had been admitted by the assessee, and, was also included in the statement of cash flow. The ld AO thus made addition of Rs. 79,82,640/- as undisclosed expenses in A.Y 2007-08 on the basis of page 43 of the seized document marked SSG/45. 11.2. The ld AO also referred to page 40 of SSG/45. The ld AO has inferred from the said document that the assessee and three other persons have received amount of Rs. 22.75 crores. The ld AO also concluded that the assessee along with other persons had taken over a company for which sum of Rs. 8.71 crores was paid. It was explained before the ld AO that the seized document contains the valuation of shares and working of joint venture which did not materialize. The ld AO has noted in the assessment order that no evidence was produced before him to show that there was no takeover of the company or that no transaction was actually made. The ld AO then concluded by stating that the figure of Rs. 5 crores written against the assessee is treated as undisclosed investment made by him in cash in A.Y 2....
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..... As per this page the assessee, Sri Surya Prakash Bagla along with other three parties received Rs. 22.75 crores. The assessee in his explanation stated that the page contains the valuation of shares and working of joint venture which did not materialize. However, it appears that the assessee along with other parties purchased a company after paying Rs. 8 crores as consideration and for takeover of this company along with incidental expenses totaling to Rs. 8.71 crores because mention of the loan creditors as Adyama Nirman, Bishnu Nirman, Bishnupriya Plaza, Gayatri Plaza, Kartick Plaza cannot be treated as imaginary. It is found from the working pages, bank statement of Saltee Infrastructure, Parimala Mercantiles etc. that on 5.9.2007, M/s Saltee Infrastructure Ltd., a company controlled by the assessee paid Rs. 1,00,00,000/- vide cheque No. 293330 drawn on ABN Amro Bank to M/s Shree Adyama Nirman Pvt. Ltd., a company mentioned in the above referred documents and it is shown as advance against properly in the balance sheet of Shree Adyama Nirman Pvt. Ltd. During the F.Y 2006-07, Shree Adyama Nirman Pvt. Ltd., of Embassy 1-B, 4, Shakespeare Sarani of Assurances - II, Kolkata ....
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.... KEJ ... 2 But, the AO has presumed that SPB meant Surya Prakash Bagla (the appellant), The AO has merely added the said figure of 2 + 2 + 1 = 5; and then, interpreted that the figure 5 actually represents 5 crores. The AO eventually held that the entries made on the seized document suggest that along with others, the appellant has taken-over a company by investing Rs. 5 crores. I find merit in the argument that there is neither any evidence nor corroborative material to justify the finding of the AO. It was argued in course of the appellate proceedings that there could have been a proposal or negotiation for transfer of such 5 companies in A.Y 2008- 09; and, in case the deal was' finalized, the transaction would have been made as suggested in the seized document. But then, the deal having not materialized, there was no question of receipt or payment of any consideration. Hence, the addition based on the presumptions and assumptions of the AO that the appellant acquired or sold the 5 companies in AY 2008-09 cannot be sustained. It was also argued that when 1 was written against RAM, 2 against SPB and 2 against KEJ, there was no basis for the AO to presume that the entire ....
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....the appellant along with others had taken-over a company. But, once the appellant has been able to establish that there was no take-over of any of the 5 companies that was mentioned 'in the seized documents, all the subsequent conclusions and findings of the AO have fallen flat. 'In view of the above, I am of the considered opinion that the AO has made the addition of Rs. 5 crores purely on presumptions and assumptions; that the findings of the AO as contained in the-assessment, order are self-contradictory that there is no material or evidence on .record to support the action of the AO; and also, that the decisions as made by the AO are contrary to the facts of the case and the material available on record. The addition of Rs. 5 crores in AY 2008-09 is directed to be deleted. 11.4. The ld AR submitted that the assessee has already admitted undisclosed expenses of Rs. 79,82,640/- as contained on page 43 of the seized documents SSG/45. But, as these expenses have already been included in the statement of cash flow, no addition can be made on this ground. It was argued that the ld AO was therefore not justified in making addition of Rs. 79,82,640/- in Asst Year 2007-08. ....
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....ave materialized and he submitted that it was a mere planning document which never happened actually. At least, the name of 4 (four) persons appear on second part of such seized document on which reliance has been placed by the ld AO for making addition of Rs. 5 crores. The ld AO has unnecessarily confused himself with SPB which the ld AO has taken to represent Surya Prakash Bagla, which may be representing Shri Shree Prakash Bagla and or any other person by this abbreviation and not Surya Prakash Bagla. The ld AO has unnecessarily placed great reliance on amounts of liabilities which is reflected in the books of certain companies. Since the company proposed to be acquired and which ultimately was not acquired and might be having such liabilities in their books of account but it does not prove in anyway that such company which such liabilities were accounted for had been actually acquired by assessee. Moreover and even otherwise there being no date nor any year, under no circumstances, it could be presumed as that relating to Asst Year 2008-09. The ld AO even never examined such companies before coming to such wild conclusion. Moreover, the ld AO has brought no evidence on record t....
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....maya Nirman, Shree Bishnu Nirman, Shree Bishnu Priya Plaza, Shree Gayatri Plaza and Shree Kartic Plaza and hence even if it is assumed that the contents of page 48 are true, then also the very basis being transfer of such companies having not taken place and hence entire argument of the ld AO fails. However, in the facts and circumstances, we do not find merit in the ld AO's contention since the transfer of company itself not having taken place and hence entire addition of Rs. 5,00,00,000/- fails. As a result, we hold as follows: Asst year Appeal No. Ground Nos. Result 2007-08 146/K/12 8 Dismissed 35/K/12 10 Dismissed 2008-09 36/K/12 10 Dismissed 12. ADDITION MADE BASED ON SEIZED DOCUMENT MARKED SSG / 48 A.Y 2008-09 C.O. 147/Kol/2012 Ground No.9 - For that in view of the facts and circumstances the Ld. CIT(A) was wholly unjustified in confirming the addition of Rs. 1 ,85,08,949/- on the basis of SSG-48 and in view of the facts and in the circumstances it may kindly be held accordingly. This ground is being taken without prejudice to the fact of the AO bad been directed to delete the addition on th....
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....Annexure - "S" [S2 & S3] through Cash flow statement of undisclosed transactions being Annexure - X of letter dated 11.11.2010 and vide Annexure - U being break-up of undisclosed income admitted Rs. 1,85,08,949/- as undisclosed expenditure of A.Y 2009-10. For the remaining account, assessee explained it to be part of regular books of various companies mentioned therein. The assessee produced bank statement of various companies, including their audited final accounts and copy of IT returns, cash flow statements. It was submitted that cash for land purchases were done by withdrawals of cash from bank itself and wherever the assessee could not link the cash expenditures with bank withdrawals, necessary disclosures have been made. SSG/48, page 1 is also an account given by broker for land purchased by our Clients at different locations. The right side shows amount received by the broker and the left side shows the amount expended by the broker and the bottom side below the tabular firm represents amount due to be paid by our Clients against land purchase and amount expended by the broker. The receipt side inter-alia shows Cash received by broker of Rs. 6,91,20,440/-. This figure ....
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....ally Rs. 5,91,83,392/- and treated as undisclosed income for the financial year 2007-08 relevant to A.Y 2008-09, in the hands of the assessee himself since he could not furnish details regarding other persons and whether the transactions were recorded in their regular books. [Undisclosed income for A.Y 2008-09 Rs. 5,91,83,092/-] [Undisclosed expenditure for A.Y 2008-09 Rs. 1,85,08,949/-] [Undisclosed expenditure for A.Y 2008-09 Rs. 2,57,984/-] 12.3. The ld CITA observed as follows:- I have perused the assessment order and considered the submissions of the appellant, and also, the material on record. The AO has mentioned in the assessment order that page 1 and 21 of the seized documents SSG/48 contain detail of undisclosed expenses of Rs. 1,85,08,949/- and Rs. 2,57,984/- which was admitted by the appellant as undisclosed expenses in A.Y 2008-09 and 2009-10, and, was also included in the statement of cash flow. I uphold the order of the AO that the expenses of Rs. 1,85,08,949/- and Rs. 2,57,984/- was to be considered in the case of the appellant as undisclosed expenses. However, as undisclosed expenses are to be considered against undisclosed income, the AO is directed....
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....hat was sold by the companies. The AO did not examine the companies to ascertain the facts or to verify the nature of entries as made in the seized document. The AO has blindly interpreted the seized document without ascertaining the facts or verifying the nature of the entries in the seized document. Even in course of the remand proceedings, the AO has failed to bring positive material on record to substantiate his finding that profit was made on sale of land held by the companies. The AO has simply presumed that there was sale of land resulting in profit of Rs. 5,91,83,392/-. The decision of the AO is not based on proper findings. The explanation submitted by the appellant has been summarily rejected by the AO more on presumption than in factual ground. There is positive material on record in the form of the profit & loss account and balance sheet of the concerned companies for the year ending 31.3.2008, 31.3.2009 and 31.3.2010 to show that no sale of land was actually made by the companies. All the three companies mentioned in the seized document still continue to hold such land as per their respective audited accounts and so the entire presumption of sale of land by the AO carr....
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....to the tune of Rs. 7,40,90,000/- and also other receipts which was available with assessee and the expenses were out of such sums only and hence the ld CITA was fully justified in allowing such set off. The ld AR also submitted that on a perusal of assessment order itself , it can be observed that the ld AO himself has allowed such set off and now the revenue is disputing such action which amounts to disputing its own earlier action and which is not permissible as per law. 12.5. In response to this, the ld DR relied heavily on the order of AO and urged to sustain the addition arising out of page 43 and page 45 of SSG/45. 12.6. We have heard the rival submissions and perused the materials available on record including the paper book submitted by the assessee in this regard. As regards page 43 of the seized document , since ld AR stated that the same is not pressed, the said addition of Rs. 2,57,984/- is sustained and ground raised in CO of assessee is dismissed as not pressed. Hence we do not find any infirmity in the order of the ld CITA in this regard. 12.6.1. As regards page 48, we find that factually there is no change in the shareholding of the impugned companies i.e. ....
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.... the Ld. CIT(A) without appreciating the fact sustained the addition so made and such action of the Ld. CIT(A) is liable to be quashed / cancelled / set aside. A.Y 2007-08 CO. 146/Kol/2012 Ground No. 4 - For that in view of the facts and circumstances the Ld. ClT(A) erred in confirming the action of the AO in treating Rs. 85,863/- being the sum credited in the bank account of the wife of the appellant as undisclosed investment of the appellant and such action of the Ld. CIT(A) in confirming the action of the AO is without appreciating the fact that the said bank account stood in the name of the wife of the appellant and if any addition were to be made such addition have been made in the hands of the wife of the appellant only. However, the Ld. CIT(A) without appreciating the fact sustained the addition so made and such action of the Ld. CIT(A) is liable to be quashed / cancelled / set aside. IT(SS) 35/Kol/2012 Ground No. 6 - The Ld. CIT(A) is erred in directing the A.O. to consider the undisclosed amt. of 67,411/- (Correct amount 85,863/-) found in bank a/c of assesse's wife against the undisclosed cash receipt of assesse. A.Y 2008-09 C.O. 147/Kol/2012 G....
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....out prejudice to the fact that the appellant has shown the same as application of the income offered by it and hence it may be kindly be considered accordingly. Ground No.7 - For that in view of the facts and circumstances the Ld. CIT(A) erred in confirming lhe action of the AO in treating Rs. 17,56,785/- as undisclosed investment of the appellant without appreciating the fact that such jewellery had not been found either in the possession of the appellant or from the premises of the appellant hence such action of the AO is without appreciating the fact that such jewellery belonged to the other persons and hence the action of the Ld. ClT(A) in confirming the action of the AO is liable to be quashed/ cancelled/ set aside. This ground is without prejudice 10 the fact that the appellant has shown the same as application of the income offered by it and hence it may kindly be considered accordingly. IT(SS) 37/Kol/2012 Ground No. 1 - The Ld. CIT(A) has erred in deleting the addition of Rs. 3,74,170/- the unaccounted cash seized from the premises of the assessee. Ground No. 2 - The Ld. CIT(A) has erred in deleting the addition of Rs. 17,56,785/- made against the undisclosed je....
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.... As a result, we hold as follows: Asst year Appeal No. Ground Nos. Result 2006-07 34/K/12 6 Dismissed 145/K/12 4 Dismissed 2007-08 35/K/12 6 Dismissed 146/K/12 4 Dismissed 2008-09 36/K/12 1 Dismissed 147/K/12 4 Dismissed 2009-10 37/K/12 1 & 2 Dismissed 148/K/12 5, 6 & 7 Dismissed 14. The other grounds raised in various years are general in nature and does not require any adjudication. 15. In the result, the appeals of the revenue as well as the assessee and cross objections of the assessee are disposed off as directed above. Order pronounced in the open court on 05.10.2016 ============= Document 1 Seized material Departmen t's appeal Grounds SI.N particula ITA/C.O. 0 rs No. A Y Amount No. Fort transactio 2006 1 n 34/K/12 -07 6,00,90,000 1-5 2007 35/K/12 -08 1,40,00,000 1-5 2010 857/K/14 -11 7,40,90,000 1-4 34/K/12, 2006 2 SSG/1 145/K/12 -07 4,30,272 7 36/K/12, 2008 147/K/12 -09 74,27,109(+) 3,03,65,126....