TaxTMI 
TaxTMI 
2021 (10) TMI 859
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....ment proceedings. 2. The Ld. CIT(A) failed to appreciate that statements recorded from the persons associated with the group, mainly Mr. Haresh Mohanlal Mehta, one of the director stated that the assessee company has been indulged in accepting the cash payment @ 30% over & above the agreement value, which works out to be Rs. 2,96,10,000/-. 3. The Ld. CIT(A) failed to appreciate that the statements recorded from the sales persons suggested receipt of cash by the assessee company over & above the agreement value. 4. The Ld. CIT(A) erred in admitting the additional evidences furnished by the assessee during the appellate proceedings as assessee failed to demonstrate the reasons &/circumstances which prevented it to furnish these evidences before the AO. 5. The Ld. CIT(A) ignored the findings of the AO in his remand report regarding the creditworthiness of the loanee & genuineness of the loan transactions and restricted the addition to the extent of Rs. 5,00,000/-." ITA No.6042/M/2019 (Assessee'S Appeal) 3. The grounds are reproduced as under: "1. On the facts and in the circumstances of the appellant's case and in law the Ld. CIT(....
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..../office premises to the tune of 30% are being received by Rohan Group of companies in cash. The search team also recorded the statement of Late Shri Jitendra Mehta who in a statement recorded u/s 132(4) on 22.07.2011 rebutted the allegation of receiving of any on-money on sale of flats/office premises and also stated that no reliance can be placed on the statements of Ms. Chaulla Joshi (Ex. Sales Executive), Shri Vijay Jasani (Office Assistant), Shri Paresh Panchlotiya (Office Assistant) and Shri Harresh Mehta (Director) as none of these persons are connected with any sales related matter. During the course of assessment proceeding, the statements given during search were retracted by filing retraction affidavits of Shri Harresh Mehta, Ms. Chaulla Joshi, Shri Vijay Jasani and Shri Paresh Panchlotiya. The AO, however, without re-examining the persons /deponents viz; Shri Harresh Mehta, Ms. Chaulla Joshi, Shri Vijay Jasani and Shri Paresh Panchlotiya and by relying heavily on their original statements recorded u/s 132(4) of the Act and on the basis of Pg. No 114 of Annexure A-1, held that Rohan Group of companies received 30% on-money on sale of flats/office premises and accordingly,....
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....proceedings. It is very clear that neither the name of the assessee nor the name of the project is appearing in the paper. The assessee had objected before the AO that the statements of the employees were not given to it. We do not know as to whether same were made available to the assessee or not. The statements of the employees, in search and seizure cases, can be used if they are supported by some kind of collaborative evidence. On a specific query by the bench to the DR about supporting evidence proving the receipt of alleged on money,she could not refer to any material. As the assessment for the AY. 2007-08 was not pending, so, without some incriminating material the AO should not have made the addition to the total income of the assessee.The FAA had taken notice of the order of the special bench and dismissal of the Departmental appeal by the Hon'ble Bombay High Court and had decided the issue.In our opinion, her order does not suffer from any legal or factual infirmity. So, confirming the same, we decide effective ground of appeal (GOA-1&2) against the AO." 8. In the case of sister concern the co-ordinate Bench in ITA No.4023/M/2016 A.Y. 2008-09 & ors. has decided the sim....
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.... assessee and the independent project carried out by HMM, that the declaration made by HMM u/s. 132 (4) could not be taken to relates the projects of the assessee. After considering the submission of the assessee and taking note of the cash and jewellery found at the office premises, the AO made an addition of Rs. 36.71 lakhs under the head on money received during the year under consideration. 3.Aggrieved by the order of the AO, the assessee preferred an appeal before the First Appellate Authority(FAA).Before her, the assessee challenged the validity of the order passed u/s. 153A of the Act and relied upon certain case laws.After considering the elaborate submissions of the assessee,the FAA held that original return u/s. 139 of the Act on 2/7/2007, that search was carried out in the case of Rohan group on 26/05/2011, that the time limit for issue of notice u/s. 143(2) for the year under consideration expired on 31/03/2008,that there was no proceedings pending in the case of the assessee,that it was not a case where assessment proceedings were pending and had abated.She referred to the case of All Cargo Global Logistics Ltd. of the special bench of the Tribunal an....
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....s of the employees, in search and seizure cases, can be used if they are supported by some kind of collaborative evidence. On a specific query by the bench to the DR about supporting evidence proving the receipt of alleged on money,she could not refer to any material. As the assessment for the AY. 2007-08 was not pending, so, without some incriminating material the AO should not have made the addition to the total income of the assessee.The FAA had taken notice of the order of the special bench and dismissal of the Departmental appeal by the Hon'ble Bombay High Court and had decided the issue.In our opinion, her order does not suffer from any legal or factual infirmity. So, confirming the same, we decide effective ground of appeal (GOA-1&2) against the AO. 16. After having gone through the facts of the present case and also perusing the orders of the Coordinate Bench of ITAT in the case of group concern with regard to the same search, we are also of the view that the statements of the employees, in search and seizure cases, can be used only if they are supported by some kind of collaborative evidence. However, Ld. DR could not point out the evidence proving the receipt of ....
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....nders in order to prove the identity, genuineness of the transactions and creditworthiness of the lenders. In respect of which 7 parties from whom the loans aggregating to Rs. 55,00,000/- were raised during the year, the Ld. CIT(A) admitted the additional evidences and called for a remand report from the AO on such additional evidences. The AO filed the remand report with Ld. CIT(A) and thus Ld. CIT(A) deleted the addition to the tune of Rs. 55,00,000/- in respect of the 7 parties whereas the addition of Rs. 5,00,000/- qua the loan raised from V.J. Shah & Co. was confirmed as the assessee did not file any documents in respect of said party. 14. After hearing the rival contentions of both the parties and perusing the material on record, we find that in this case though the assessee has not filed any evidence before the AO, however, all these evidences comprising names and addresses, loan confirmations, ITRs, bank account of the lenders, bank account of the assessee were filed substantiating all the three ingredients in respect of 7 parties out of 8 parties. The Ld. CIT(A) called for a remand report and by taking into account the observations/report of the AO deleted the addition ....
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....ch action was also carried out at the residential premises of Mr. Samir Shah (Finance broker of the appellant group). The search team during the course of search found several loose papers from the residential premises of Mr. Samir Shah wherein papers relating to interest working in respect of loans taken by the appellant was found and seized. The details of cash interest paid is as under: Sr. No. Name of the Party Amount 1 Rohan Developers Pvt. Ltd. 122,236,512 2 Goodwill Properties Pvt. Ltd. 4,866,667 3 Silver Arch Builders & Promoters 17,782,408 4 Om Shanti Developers 3,889,083 5 Esque Finmark Pvt. Ltd. 2,237,583 6 Harresh Mehta 21,023,428 Total 172,035,681 During the course of search in the statement recorded under section 132(4) on 27.05.2011 late Shri Jitendra Mehta had offered undisclosed interest income as stated above Rs. 17,20,35,681/- on account of cash interest, however, in the return filed under section 153A the late Shri Jitendra Mehta did not offer the said undisclosed income to tax. Consequently, on the basis of the said seized papers the AO held that the assessee has paid interest in ....
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....der of Ld. CIT(A). 20. The issue raised in ground No.5 is against the deletion of addition of Rs. 12,000/- as added by the AO towards unexplained interest expenditure under section 69C of the Act by ignoring the fact that in the statement recorded on oath Mr. Anuj Shah admitted to have received interest of Rs. 12,000/- from the assessee. 21. The facts in brief are that the AO noted that assessee has accepted cash loans from various persons including Mr. Anuj Shah who has admitted in his statement that he has given a cash loan of Rs. 6,00,000/- to the assessee in A.Y. 2010-11. The said amount was not shown in the books of accounts of the assessee while Mr. Anuj Shah has also admitted that he has provided cash loan to the assessee and received cash interest of Rs. 12,000/-. The AO accordingly issued show cause notice to the assessee as to why Rs. 12,000/- should not be added to the income of the assessee under section 69C of the Act which was duly replied by the assessee. The AO, however, not accepting the contentions of the assessee, added the same to the income of the assessee. 22. In the appellate proceedings, the Ld. CIT(A) deleted the addition by observing and holding a....
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....2019 A.Y. 2010-11 would, mutatis mutandis, apply to this appeal as well. Accordingly, we direct the AO to delete the addition of Rs. 40,00,000/- as the assessee has filed all the necessary evidences to prove the identity, creditworthiness of the lenders and genuineness of the transactions. Accordingly, assessee's appeal is allowed. ITA No.6300/M/2019 (Revenue's Appeal) 25. The issue raised in the Revenue's appeal in ground Nos.1 to 3 in respect of on money on sale of flats is identical to one as decided by us in ITA No.6298/M/2019 A.Y. 2010-11, therefore, our decision in ITA No.6298/M/2019 A.Y. 2010-11 would, mutatis mutandis, apply to this appeal as well. Accordingly, ground Nos.1 to 3 raised by the Revenue are dismissed. 26. The issue raised in ground No.4 is against the deletion of addition by Ld. CIT(A) as made by the AO on account of disallowance of telephone and conveyance expenses. 27. The facts in brief are that the assessee has incurred Rs. 60,300/- under the head "Conveyance charges". The AO was of the opinion that the personal element in these expenses can not be ruled out and accordingly the AO disallowed @ 20% of the conveyance expenses which worked out to ....
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....ssessee could not prove the identity, creditworthiness of the lenders and genuineness of the transactions and accordingly added the same to the income of the assessee under section 68 as unexplained cash credit. 32. In the appellate proceedings the assessee filed some additional evidences before the Ld. CIT(A) and Ld. CIT(A) referred the same to the AO for his remand report. Thereafter, after taking into consideration the remand report and the additional evidences, the Ld. CIT(A) deleted the addition by observing that assessee has proved the identity, creditworthiness of the lenders and genuineness of the transactions. While allowing the appeal of the respondent-assessee, the Ld. CIT(A) also followed his own order in A.Y. 2010-11 & 2011-12. 33. After hearing both the parties and perusing the material on record, we find that the issues raised in the ground Nos.5 & 6 by the Revenue are identical to ones as decided by us in ground No.5 in ITA No.6298/M/2019 A.Y. 2010-11. Accordingly, our decision on ground No.5 & 6 in ITA No.6298/M/2019 A.Y. 2010- 11 would, mutatis mutandis, apply to the ground Nos.5 & 6 as well. Accordingly, ground Nos.5 & 6 of the Revenue are dismissed. 34.....
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....nish any plausible explanation; therefore, the amount was added as undisclosed income. 20.2 A perusal of the copies of the ledger accounts furnished by the Appellant Company reveals that the amount of Rs. 24,66,760/- has been duly reflected in the books of account. I have noted that the ledger account of interest received reflects an amount of Rs. 24,66,760/- on account of interest received from M/s Roxina Real Estate Pvt. Ltd.. Further, TDS on interest u/s.194A of the Act amounting to Rs. 2,46,676/- has also been deducted on the said interest income. The said amount of interest income was reduced from interest paid on various loans. Hence, the net interest paid after reducing the interest received has been debited to the P&L A/c. The amount debited as expenditure on account of interest paid was Rs. 1,02,67,957/-. Thus, on account of netting of the interest received and paid, the interest received amounting to Rs. 24,66,760/- was not directly visible in the return of income of the Appellant Company. 20.3 In view of the above mentioned facts and circumstances, the AO is directed to delete the addition made on account of non-reconciliation of AIR information. Accord....