TaxTMI 
TaxTMI 
2019 (11) TMI 204
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....tion of Rs. 2,04,00,000/- being income allegedly earned by the appellant form the deal of transfer of shares of M/s. Raj Refuellers & Fire Safety Equipments Pvt. Ltd. which had been terminated by the parties." 3. Appellant, ACIT, Central Circle 3, New Delhi (hereinafter referred to as the 'Revenue') by filing the present appeal being ITA No.2773/Del/2014 & 3347/Del/2014, sought to set aside the impugned orders dated 13.02.2014 & 14.03.2014 respectively passed by the Commissioner of Income - tax (Appeals)-I, New Delhi qua the assessment year 2009-10 on the grounds inter alia that:- "ITA No.2773/Del/2014 That the Commissioner of Income Tax (Appeals) has erred in law and on facts of the case in deleting the addition of Rs. 9,20,00,000/- (correct amount is Rs. 7,16,00,000/-) made by AO on account of income from undisclosed sources." ITA No.3347/Del/2014 1. That the Commissioner of Income Tax (Appeals) has erred in law and on facts of the case in deleting the addition of Rs. 1,48,51,840/- made by AO on account of income from undisclosed sales." 2. That the Commissioner of Income Tax (Appeals) erred in law and on facts of the case in restricting the addition of Rs. 9,20,00,000....
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....as been received by the seller is of Rs. 18,50,01,100/- as on 22.02.2008. 6. When due to some technical objection raised by HSIIDC qua the transaction of the aforesaid plot, Mahesh Mehta and Kusum Mehta agreed to transfer the property to Kunjan Arora through transfer of shares in favour of Arora family for recorded consideration of Rs. 5,18,00,000/- and the remaining amount was apparently paid in cash by Kunjan Arora to Mahesh Mehta. AO also recorded that Mahesh Mehta admitted that the real transaction qua the property was for Rs. 25,00,00,000/- only and further admitted that net profit of Rs. 18,40,00,000/- on sale of shares i.e. Rs. 9,20,00,000/- each in his own hand and in the hands of his wife is an unrecorded income. The said statement was also signed by Kusum Mehta. Statement of Kunjan Arora was also recorded. From the facts on record and circumstances in this case, AO proceeded to hold that the property bearing Plot No.115, Phase I, Udyog Vihar, Gurgaon stands transferred in the name of Kunjan Arora and Associates and the original documents found from the residence of Mahesh Mehta also speaks of the transfer of the same manner which was finally executed and as such, compan....
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....the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 11. Undisputedly, in a search and seizure operation carried out at the premises of Mahesh Mehta Group of cases on 30.06.2009, a draft unsigned Agreement dated 22.02.2008 on a stamp paper of Rs. 100/- qua the property bearing Plot No.115, Phase I, Udyog Vihar, Gurgaon, available at pages 4 to 6 of the paper book, was found and seized. It is also not in dispute that in the draft Agreement to Sell, Kusum Mehta and Mahesh Mehta was referred to as vendor and Kunjan Arora was referred to as buyer. It is also not in dispute that a recital has been made in the Agreement to Sell itself that Kusum Mehta and Mahesh Mehta were not registered owner of the property in question at the time of execution of the agreement. It is also not in dispute that Rakesh Kumar Garg and Santosh Kumar Garg of RRFSL was the original owner of the property in question. It is also not in dispute that out of the total sale consideration of Rs. 25,00,01,100/- settled in the draft agreement, an amount of Rs. 18,50,01,100/- was paid but the sum of ....
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....9) 223 CTR 179 (Del.), M. Narayanan & Bros. vs. ACIT (2011) 13 taxmann.com 49 (Mad.), Chetnaben J Shah vs. ITO in ITA No.1437 of 2007 order dated 14.07.2016, CIT vs. Ramanbhai B. Patel in ITA No.207 & 208 of 2008 order dated 20.07.2016 and CIT vs. K. Bhuvanendra & Ors. (2008) 303 ITR 235 (Mad.). 13. However, on the other hand, ld. DR for the Revenue to repel the arguments advanced by the ld. AR for the assessee contended inter alia that u/s 292C, presumption is attached to the statement of Mahesh Mehta recorded u/s 132 (4A) which the assessee has failed to controvert that retraction has not been made spontaneously and the subsequent agreement dated 21.04.2009 has been prepared just to camouflage the actual facts; that the assessee has never filed any criminal case if any fraud has been committed with them qua the transfer of the property in question and relied upon the decisions of Bela Juneja vs. CIT (2012) 20 taxmann.com 392 (Delhi), Surendra M Khandhar vs. ACIT (2010) 321 ITR 254 (Bombay), M/s. Pebble Investment and Finance Ltd. vs. ITO (2017-TIOL-238-SCIT), Greenview Restaurant vs. ACIT (2003) 263 ITR 169 (Gauhati), Raj Hans Towers (P.) Ltd. vs. CIT 373 ITR 9, PCIT vs. Avinash....
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....y. When we examine both the agreements dated 22.08.2008 and 21.04.2009 in the light of the statement recorded by Mahesh Mehta during the course of search u/s 132 (4) to which presumption is attached and has not been retracted spontaneously and no material whatsoever has been brought on record by the assessee if the said statement was made under coercion or under any undue influence, agreement dated 21.04.2009 does not inspire confidence to believe the same. 19. Furthermore, when we examine facts and circumstances of the case, particularly statement of Kunjan Arora recorded during search investigation, it further leads to the conclusion that the agreement to sell in question dated 22.08.2008 owned by RRFSL was executed for a sale consideration of Rs. 25,00,01,100/- as Kunjan Arora has specifically replied to question no.6 that :- "He has paid a total sum of Rs. 9.66 crores over a period from December 2007 till date and had issued post-dated cheques of Rs. 8.84 crores which have not been encashed till date. Furthermore, a sum of Rs. 1,100/- was paid in cash as initial deal signing amount thus paid a total payment of Rs. 18,50,01,100/-." So, the question is answered accordingly ....
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....,00,000/-. 22. Aforesaid findings returned by the ld. CIT (A) on facts primarily based on undisputed facts cannot be unsettled merely on the contention of the ld. AR for the assessee that the draft agreement dated 22.02.2008 is merely a dumb document because the same has been categorically admitted by assessees in their statements as well as Kunjam Arora recorded during search proceedings, though retracted subsequently. But retraction cannot be relied upon on the ground that it was not spontaneous rather made in the well-orchestrated manner by preparing second agreement dated 21.04.2009 to camouflage the actual transaction. Even Mahesh Mehta during recording of his statement u/s 132 (4) recorded on 01.07.2009 has not disclosed the existence of agreement dated 21.04.2009. Had there been any such agreement in question, Mahesh Mehta would have relied upon the same in support of his case. So, it is a document prepared anti-dated to evade the taxes. Moreover, terms and conditions of the agreement dated 21.04.2009 are against the settled convention followed in such transactions. Moreover, the second agreement was given in the post-search proceedings. 23. Consequently, we are of the con....
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....forfeiture by virtue of the agreement dated 22.02.2008 and 21.04.2009 but continued to suppress one fact after the other from the Revenue authorities as well as the Tribunal and have treated the agreement dated 22.02.2008 as a dumb document. Even no notice is proved to have been served by the assessees to forfeit the amount of Rs. 4,08,00,000/- The assessees have also failed to clarify as to how and under what circumstances, the second agreement dated 21.04.2009 came into existence and in these circumstances is not entitled for protection under section 51 of the Act. 27. So far as question of deletion of addition of Rs. 9,20,00,000/- (correct amount is Rs. 7,16,00,000/-) each in case of Mahesh Mehta and Kusum Mehta by the Ld. CIT (A) is concerned, the AO has merely made addition by relying upon the statement of Mahesh Mehta, co-signed by Kusum Mehta u/s 132(4) of the Act. The ld. CIT (A) has deleted this addition to the extent of Rs. 7,16,00,000/- by returning following findings :- "4.5 I have carefully considered the assessment order, the submissions made and the rival claims relating to the matter in dispute. It is undisputed that the entire consideration for the transfer of....
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....al shareholders of RRFSL and, thus, their profit in the transaction was Rs. 4.08 crore (Rs. 9.26 crore minus Rs. 5.18 crore). As the Mehtas could never become legal owners of the shares of RRFSL, this profit cannot be treated as their capital gain relating to those shares, but can only be treated as income from 'business' or from 'other sources' as broker to the transaction. As the Mehtas have not claimed any business income from this transaction or any other brokerage, and as the profit cannot be treated as capital gain, it can only be treated as income from 'other sources'. The amount is to be allocated equally at Rs. 2.04 crore between the appellant and her husband Shri Mahesh Mehta. I hold accordingly. 4.8 In view of the above, out of the addition of Rs. 9,20,00,000/- the amount of Rs. 2,04,00,000/- is upheld as income of the appellant from other sources and directed to be charged to tax. Appellant gets relief of Rs. 7,16,00,000/-. This ground of appeal is decided in these terms." 28. Ld. CIT (A) has extensively dealt with the issue as to the deletion of addition of Rs. 9,20,00,000/- (correct amount is Rs. 7,16,00,000/-) in para 2.2.13 to 2.2.16 by ex....
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....ghtly), wherein no opening stock of different products / raw material was found. What was found by the forest department, was 549 units of semifinished / liquid katha (unit not specified - whether kgs. / litres / any other unit). It also transpires from the said report that entire 549 units was found to be spoilt and ordered to be destroyed. The appellant has, in its accounts, written off the entire value of closing stock of goods valued at Rs. 1,48,51,840/- as destroyed and claimed is as loss. As against the said loss, the appellant had also written back all related liabilities amounting to Rs. 30,97,268/- and offered it to tax. The revenue, disbelieving the said report, or assuming that the said report did not establish the loss claimed, disallowed the loss of stock at Rs. 1,48,51,840/- claimed by the appellant. The assessment order is however, silent on the related liabilities amounting to Rs. 30,97,268/- written back and offered to tax by the appellant. 4.3 The claim of the appellant, on the other hand, is that during the year there was no production and after sales, whatever stock remained, was spoilt in the rain, destroyed and accordingly claimed as a loss. The appellant ha....