2020 (10) TMI 1118

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....ating the additional income declared in survey as income from other sources as against the business income claimed by the assessee in the facts and circumstances of the case. 3. Heard both parties and perused the material available on record. The assessee is a firm and engaged in the business of construction of housing project namely "Aayodhya Nagari" during the period relevant to the assessment year under consideration. A survey was conducted on 30-11-2012 in the business premises of assessee u/s. 133A of the Act. We note that the assessee offered additional income basing on some incriminating documents found during the said survey. The assessee filed return of income declaring a total income of Rs. 1,06,32,791/- on 30-09-2013 and th....

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....me from other sources. 5. Before us, the contention of ld. AR is that the assessee sold 37,752 sq. ft. of area in Aayodhya Nagari project that the assessee received Rs. 200/- extra per sq. ft. over and above its regular income, the said declared amount of Rs. 75,50,400/- is a trading receipt and contended the same should be treated as business income. We find that the assessee during the course of assessment proceedings explained that it received Rs. 200/- extra per sq. ft. of 37,752 sq. ft. The said cash payment given by customers as per their convenience. He referred to Q. No. 9 at page 11 of Paper Book during the course of survey the assessee clearly stated that written Atirikt Rakam is over and above agreement value which is not reco....

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....13 at page 30 of Paper Book. Therefore, the nature and source of said amount disclosed during the course of survey is established as business income as the assessee does not have any other business activity except business income from construction of housing project. Therefore, we hold the entire disclosed amount Rs. 75,50,400/- are attributable to the business activity and consequently is eligible for all allowances u/s. 40(b) of the Act. We find a similar issue arose in the case of Rashtriya Leather Works in ITA No. 253/PN/2003 for A.Y. 1999-2000 before this Tribunal and vide order dated 23-06-2006 this Tribunal held unexplained excess stock found during the course of the survey is to be treated to be a part of book profits and were charg....