TaxTMI 
TaxTMI 
TaxTMI 
2021 (3) TMI 1189
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....ning the total income of the assessee at Rs. 1,95,16,090/- interalia making addition on account of unexplained cash credit of Rs. 73,34,520/- and reworking the long term capital gains on sale of land by disallowing the assessee's claim of, payment of commission on sale of land and also adding liabilities shown by the assessee, in the balance sheet. 2.1. The assessee carried the matter in appeal. Before the ld. CIT(A), he made various submissions on merits. The ld. CIT(A), called for a remand report. The Assessing Officer furnished the remand report on 02/09/2011. The assessee filed his reply to the remand report. The ld. CIT(A) called for a second remand report from the Assessing Officer. The Assessing Officer furnished the second remand report on 04/12/2013. A third remand report was called for by the ld. CIT(A) and the Assessing Officer gave his third remand report on 28/01/2015. The ld. CIT(A) passed his order u/s 250 of the Act partly allowing the appeal of the assessee. He confirmed the addition of Rs. 15,20,000/- as unexplained cash deposits in bank and disallowed the claim of the assessee of payment of development charges and commission on sale of land while computing long ....
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....evelopment charges are very high and that this proves that the claim is not genuine. He further submitted that notice u/s 133(6) of the Act, was issued but the person was not found at her address. Thus, he submits that the disallowance/addition has to be confirmed. 5.1. The ld. Counsel for the assessee, in reply, submitted that the notice u/s 133(6) of the Act, was given after 10 years at the address mentioned in the agreement and under these circumstances, adverse inference cannot be drawn if the person is not found in the address. He relied on the judgment of the Hon'ble Jurisdictional High Court in the case of Diagnostics vs. CIT reported in [2012] 20 taxmann.com 692 (Calcutta), for the proposition that, just because the person could not be found at the given address after three (3) years of the transaction, it cannot be inferred that the party does not exist or the transaction is not genuine. 6. We have heard rival contentions. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, we hold as follows:- 7. On the first issue, the ld. CIT(A) at page 4 & 5 held as follows:-....
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....mments the AO. The A.O. vide letter dated 28.01.2015 has stated that the assessee did not comply at the remand stage & therefore the source of cash deposits of Rs. 15,20,000/- remained unexplained. I find that since the appellant has failed to explain the source of cash deposits before the A.O. in course of original assessment as well as remand stage, the addition of Rs. 15,20,000/- is upheld. This ground is dismissed." 7.1. A perusal of the same demonstrates that the addition was sustained by the ld. CIT(A) for the reason that compliance was not made during the original assessment proceedings and at remand stage. This cannot be a ground of making addition for the reasons that the Assessing Officer had made the addition on the ground that the deposits in bank accounts are not explained. Without a copy of the bank account, the Assessing Officer cannot come to a conclusion that the deposits made in a bank account are unexplained. All details including copies of bank accounts were furnished by the assessee. Moreover, the Assessing Officer had in the remand report dt. 04/12/2013, had held as follows:- "Rs. 5,00,000/- received from Mr. N.V.Rama Raju for Kapulappada land. The remaini....
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....he tune of Rs. 66,09,875/-, it is to state that assessee could not come up with sufficient corroborative evidence of payments other than furnishing a copy of agreement. Out of Rs. 66,09,875/-, Rs. 65,62,475/- is shown as development charges, and Rs. 47,000/- as commission on sales. Assessee claimed that development charges were paid to Mrs. Geetha Kumari as per agreement between parties for the development of the dry land at Vadlapudi. Moreover, percentage of commission and development charges is too high as compared to sale price of Rs. 85,60,100/-. In absence of sufficient corroborative evidence, cost of development charges and commission expenses cannot be allowed as admissible." 11. The Assessing Officer in his remand report dt. 28/01/2015, stated as follows:- "1. Disallowance of Rs. 66, 09,875/-on account of land: Out of the total amount of Rs. 66,09,875/- Rs. 6562475/- was claimed by the assessee to have paid to Smt. Dantuluri Gita Kumari and Rs. 47000/- is shown as commission paid .During remand report stage notice u/s. 133 (6) of the Act, was issued to Smt. Dantuluri Gita Kumari to whom the assessee claimed to have paid Rs. 65, 62,475/- as development charges. The lette....