TaxTMI 
TaxTMI 
TaxTMI 
2021 (7) TMI 795
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..... The facts relating to the issue are stated in brief. The assessee is carrying on the business of trading in Ceramic Tiles and other Hardware items under the name of M/s. Moonlight Ceramics. The assessee is also carrying on the business in Real Estate and earns commission income from doing liaison works. The assessee filed its return of income for the year under consideration declaring a total income of Rs. 39.91 lakhs. The revenue carried out a survey operation u/s.133A of the Income-tax Act, 1961 ['the Act' for short] on 8.9.2016 in the hands of the assessee. During the course of Survey operations, it was noticed that the assessee was maintaining two savings bank accounts in M/s. Janata Seva Co-operative Bank Ltd., Vijayanagar Br....
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....h regard to the cash deposits, the assessee had produced before the AO certain sale agreements and on the basis of those agreements, the A.O. gave credit of Rs. 76.00 lakhs and assessed the balance amount of Rs. 3,34,63,026/- as unexplained income of the assessee. 4. The assessee carried the matter before Ld. CIT(A). In the first round, the Ld. CIT(A) dismissed the appeal of the assessee since none appeared before him. The assessee challenged the ex-parte order passed by Ld. CIT(A) by filing appeal before the Tribunal and the ITAT, vide its order dated 4.6.2018 passed in ITA No. 2901/Bang/2017, restored the matter back to the file of Ld. CIT(A). Accordingly, the impugned order came to be passed by Ld. CIT(A). 5. Before Ld. CIT(A), the ass....
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....thers and in that process, he has received money from them and spent it on behalf of them. Hence the entire deposits cannot be taken as the income of the assessee. He submitted that the assessing officer has accepted the fact that the assessee is carrying on real estate business also. Hence, the tax authorities are not justified in presuming that the entire deposits belong to the assessee. He submitted that the income element involved in those deposits alone may belong to the assessee. Since there were continuous transactions of deposits and withdrawals, as an alternative, the assessee has requested the tax authorities to assess "peak credit". He submitted that the peak credit worked out to Rs. 94.13 lakhs. Accordingly he prayed that the AO....
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....n in the name of M/s. Moonlight Ceramics which is a proprietary concern. The assessee has also carried on the business of real estate and earns commission from liasoning works. The assessee submitted that he is engaged in developing real estate projects at 1) Mahalakshmi enclave, Sy. No. 74, Yeshwantpura, Hobli, Manganahalli Village, Bangalore North, 2) Nakshatra Residency Sy. No. 5, Sulikere, Kengeri Hobli, Bangalore South and 3) Amoghavarsha Premium Residency Layout Kenchanapura Village, Kengeri Hobli, Bangalore South." Hence, the AO has acknowledged that the assessee has earned commission income from undertaking liaison works. We also refer to some of the question and answers from the statement taken from the assessee at the time of sur....
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....ount and hence these two bank accounts have not been reflected in his books. 9. Thus, we notice that the assessee has maintained his stand that the transactions in these bank accounts relate to liaison works undertaken by him in his real estate business, such as change of land use, conversion of land from agriculture to residential purposes, taking pan approval from local authorities. Since the assessee was doing liaison works on behalf of others, it was contended that the entire deposits cannot be taken as his income. We also notice that the AO has accepted explanations to the tune of Rs. 75.00 lakhs out of the cash deposits found in these bank accounts on the basis of a cancelled sale agreement. This fact also fortifies the stand of the ....