TaxTMI 
TaxTMI 
2019 (12) TMI 660
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....y and engaged in the business of developing/building the real estate projects. The assessee purchased a piece of plot along with 2 parties namely Shri Amit Rajnikant Joshi and Shri Sureshbhai Thakkar vide sale deed bearing serial No. 8778 dated 11 May 2012. The total consideration of such piece of plot was Rs. 6,18,60000/- plus stamp duty of Rs. 30,31,200/- only. The share of the assessee in such piece of plot was 50% whereas the remaining parties owned 25% each in such piece of land. 3.1 The assessee in the year under consideration has shown 2 projects in its balance sheet namely Divine 1 and Divine 2. The relevant details of the sales, work in progress, expenses incurred with respect to such projects stands as under: S. No. Particulars Divine-I Divine-II 1. Sales Rs. 7,54,21,991/- NIL 2. Opening working progress Rs. 6,49,75,489/- Rs. 22,21,822/- Add: purchases Rs. 2,31,69,768/- Rs. --- Construction and other site exp. Rs. 6,07,03,627/- Rs. 4,26,96,909/- 3. Total cost incurred Rs. 14,88,48,884/- Rs. 4,49,18,731 3.2 The cost under the head 'construction and other site expenses' includes an expense of Rs. 4,20,0000....
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....L/2018-19 dated 11 December 2018 proposing the assessment order as erroneous insofar prejudicial to the interest of revenue. 5. The assessee in response to such notice submitted that the impugned sundry creditors are genuine as the payment was made to them in the year under consideration as well as in the subsequent years in pursuance to the development agreement which was duly registered dated 28 March 2014. The assessee in support of its contention filed the copy of the document agreement, copy of the PAN, driving license and voter identity card. Accordingly the assessee claimed that non-response of the notice by the parties cannot be the criteria to hold them as non-genuine. Furthermore, the assessee claimed that one of the sundry creditors/ parties has acknowledged the receipt of Rs. 15 lakhs in his reply. The assessee in support of its contention also filed the ledger copies and bank statement showing the payment made to these sundry creditors/parties. 5.1 The assessee further submitted that it had 2 projects in the year under consideration which were located in different parts of the Ahmedabad namely Divine 1 and Divine 2. The assessee in support of its contention filed t....
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....he land was held jointly with others. The A.O. never enquired how on a jointly held land, the municipal approvals etc. could be given to the assessee exclusively. The assessee has completed 87% of the project and 87% of revenue is credited. Whether this is actually so? Moreover, the land cost booked in the account is much higher than the actual cost incurred by the assessee and the co-owners. Whether the co-owners have paid tax on the land transferred to the assessee in this year, is also not examined or verified by the A.O. Hence, the assessment has been completed erroneously in a manner that it is prejudicial to the interest of the revenue. 7. Therefore, the assessment order dated 29/08/2016 passed by the A.O. 3 (3) of the Act in the case of the assessee is set aside and the A.O. is directed to make a fresh assessment after making all necessary enquires property and verification in respect of all relevant aspects including those indentified in this order supra Being aggrieved by the order of the land CIT , the assessee is in appeal before us. 7. The learned AR before us filed a paper book running from pages 1 to 33 and submitted that the necessary verification has been ca....
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....ssee claimed to have incurred the cost on the development of project till 31-3-2014 with respect to its project DIVINE-1 in the manner as detailed under: Calculation of closing WIP Opening WIP-50% land & construction expenses up-to 31-03-2013 Rs. 6,49,75,489.00 Construction Expenses & development charges 50% of land Rs. 6,07,03,627.00 Purchases 13-14 Rs. 2,31,69,768.00 Total Rs. 14,88,48,884.00 9.4 It is also pertinent to note that the assessee has received certain amounts against the sale of its projects. The details of the same stands as under: Flat of Sold/Unsold value Total value of project Rs. 17,46,46,000/- Booked amount as on 31.03.2014 Rs. 2,49,00,000/- Registry amount as on 31.03.2014 Rs. 48,00,000/- Banakhat amount as on 31.03.2104 Rs. 5,69,46,000/- Total sold value as on 31.03.2104 Rs. 8,66,46,000/- Total value of the unsold project Rs. 8,80,00,000/- 9.5 The sales made by the assessee comes to 49.61% (8,66,46,000/17,46,46,000* 100) of the total project revenue. 9.6 As the project was completed to the extent of 87.05%, therefore the assessee decided to recognize the revenue as discussed above to the ex....
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....e relevant points read as under: 17. Please find the list of major creditors as on 31st March 2014, Annexure IX. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 21. Please find the working for valuation of closing stock with supporting proof of price taken for valuation. Annexure XIII XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 24. Please find details of creditors for purchases of goods during the year. Annexure XVI 25. Please find ledger copy of head wise revenue from operation. Supporting sales invoice are ready available for your inspection Annexure XVII. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 28. Please find ledger copy of all expenses accounts as your desired. All expenses bills, voucher or supporting are ready available for your inspection. Annexure XX. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 34. Books of accounts, voucher Bank statement invoice and purchase bills are ready available for your inspection. In view of the above, we hold that the assessment order was framed under section 143(3) of the Act after due verification by the AO. Accordingly, we are of the view that the order of the AO cannot be held as erroneous insofar prejudicial to th....