TaxTMI 
TaxTMI 
2021 (7) TMI 1127
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....n the registered sale deed was much lower than the rate mentioned in the agreement seized. 3. The appellant craves leave to add or amend the grounds of appeal on or before is heard and disposed off." 3. The assessee has raised the following grounds of cross objections: "1. That the ld. CIT(A) has grossly misdirected himself in law and in facts, to reject the following legal grounds, having direct bearing on the validity of assumption of jurisdiction in this case and comprehensively argued before him, in a most casual, cryptic and perverse manner: (i) That the present proceedings, as admitted by the AO himself; having been initiated following seizure of an agreement in the search of PISCO Group, having direct bearing on assessee, then the jurisdiction could be invoked only under section 153C and not u/s. 148. Thus, the order under appeal is not sustainable being illegal on this premise. (ii) That the ld. ACIT has grossly erred in facts and in law, in assuming jurisdiction in this case by invoking the provisions of section 147/148 and therefore, the impugned order, passed in consequence thereof, is void ab initio. (iii) That the ACIT Ci....
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....ant that the Assessing Officer has wrongly made disallowance of Rs. 14,00,000/- under section 36(1)(iii). The Assessing Officer has brought on record that the assessee has made interest free advances and loans to his family members/sister concerns in the following manner:- xxxxxxxxxxx At the same time had debited bank interest to the tune of Rs. 22.19 lacs. The Assessing Officer required the assessee to explain as to how the interest bearing funds could be said to be used for the purpose of business especially in face of interest free loans to friends/sister concerns highlighted above. No explanation on the said issue before the Assessing Officer as recorded in the assessment year at para 5.2. The Assessing Officer therefore proceeded to disallow 12% on the entire amount of advances leading to disallowance of Rs. 14 lacs. 26. During the course of appellate proceedings the AR of the appellant submitted his arguments on the issue as under:- xxxxxxxxxxxxxxx 29. I have considered the facts of the case, the basis, of addition made by the Assessing Officer and the arguments of the AR on the issue. It is seen that the entire set of circumstance....
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....revenue." 2. On the other hand, the Ld. DR for the relied upon the order passed by the Assessing Officer. 3. We have heard the rival contention, the parties and perused the material available on record. In the present case the reassessment proceedings in the case of the assessee were initiated for the reason mentioned as under: "02. During the course of search action in PISCO group of cases at various premises, the following documents/papers were seized and also some transactions are noticed. You are requested to explain the source of investment/explanation with supporting evidences and explain its relevance with the respective financial year/assessment year:- 03. Your attention is drawn to an agreement written on stamp papers dated 10.05.2007, entered into between Sh. Ravneet Takhar S/o Sh. Ravinder Singh, M.D. of PISCO, G.T. Road, Jalandhar as a 1st Party & Sh. Mohinder Singh, S/o Sh. Gopal Singh r/o Model Town, Jalandhar & Sh. Joginder Singh S/o Sh. Labh Singh r/o Vill. Rollian Distt. Hoshiarpur as 2nd party. This agreement is in respect of the property M/s. PISCO Ltd., in Vill. Birring, Distt. Jalandhar. The agreement was made at the rate of Rs. 11.05 Cr....
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....ase will be decided on merit. 7. In respect of this office letter No. 1146 dated 29-02-2016 and show cause notice No. 1147 dated 29-02-2015, assessee submitted a reply on 2d 22-03-2016 which is carefully considered and thereafter following observations are made." 4. From the perusal of the reasons/satisfaction note, it is clear that a search was carried out in the premises of Punjab Iron & Steel Company Ltd.(PISCO) on 03.08.2011. During the search proceedings an agreement was found from the residential premises of Sh. Vinay Kumar, Accountant of PISCO wherein an agreement deed of the land was found showing the rate of land as 11,05,00,000/- per acre (1 marla = Rs. 690625). 5. It is the case of the Assessing Officer that the assessee had purchased the land from Sh. Kulwinder Singh who in turn had purchased land from PISCO admeasuring 65.67 marla. 6. The Assessing Officer in this regard had made an addition of Rs. 3,91,71,875/- to the income of the assessee as mentioned in paragraph 7.5 to the following effects: "7.5 Considering the above facts and circumstances and issues discussed above there is documentary evidence on record on the basis of which it is ve....