TaxTMI 
TaxTMI 
2022 (3) TMI 341
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....n u/s. 132 Income-tax Act, 1961 (in short "Act") was conducted at M/s. Avighna Group on 04.04.2014 and concluded on 05.06.2014 covering its head office, its branches and site office and residences and office premises of its key persons and also on individual who had paid "On-Money" for booking of a flats with M/s. Nish Developer Pvt. Ltd. Assessee has booked two flats in the "One Avighna Park" the project developed by M/s Nish Developers Pvt Ltd. One flat is booked in the name of assessee and his son and the second flat is booked in the joint name of Smt Chhaya Badani (wife of Shri Vinayak Badani) and two other two relatives. It was alleged that assessee has also facilitated sale of flats in One Avigna Park. In search conducted in M/s. Avighna Group, the assessee's residence was also covered. Statements of the assessee, Account Holder of Oriental Bank of Commerce, Mumbai and Jankaiyan Sahakari Bank. Ltd., Mumbai was recorded on oath u/s. 132(4) of the Act on 19.05.2014. Subsequently, notice u/s. 153A of the Act was issued and served on the assessee. In response assessee filed return on 06.02.2015 declaring total income of Rs..9,36,160/-. Subsequently, notice u/s. 143(2) and 142(1) ....
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....in Mishra. The said pen drive contains details of cash payment made on various dates against my - name. At the time of search at my premises conducted on 04 04 2014, the questions related to this cash payment were asked to me. The relevant paras of that statement have been reproduced in this show cause -notice also. For that, I would like to submit that the Statement at the time of search at my premises. was given and recorded under threat and mental pressure. | was not-agreeing with the. content of the statement, but I was pressurized to agree to the statement and I was pressurized: to put my signature on the statement on gun point. | was very nervous and could 'not understand anything and I was being mentally tortured that I could not think anything, I did not understand what was happening. And in mental torture and pressure, I signed the statement. The answer that are written in the statement and which is being said that I have given the answers is totally wrong. The officers have written the answers as per their wish only and I was compelled to put my signature on the statement. I do not agree with the statement. | was pressurized to admit and sign the statement and th....
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....ourse of search, then it has to be of assessee's own. Accordingly, he brought the amount mentioned in the pendrive as above as the undisclosed investment in the hands of the assessee for the impugned Assessment Order, as per the statement the assessee has remitted Rs..5.01 crores. Accordingly, the addition was made as unaccounted investment made by the assessee. 9. Aggrieved assessee preferred an appeal before the Ld.CIT(A) and before the Ld.CIT(A), assessee filed detailed submissions which are reproduced below: - "ADDITION ON THE POINT OF UNACCOUNTED INVESTMENT AMOUNTING TO RS. 5,01,00,000/- A search action was conducted at M/s One Avighna group on 4/4/2014 and the places of office and residence of the group and other key persons was also covered. One pen drive was found from Mr. Praveen mishra, one of the key persons of the group, the pen drive contains data of cash transactions. In that pen drive the cash details of 15.33 crs was found against different years in the name of the appellant as mentioned in the order. On being asked Mr. Praveen mishra replied that the appellant is a broker of the company and used to handle cash and has also brought cash on behal....
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..... The officers have written the answers as per their wish only and I was compelled to put my signature on the statement. I do not agree with the statement. I was pressurized to admit and sign the statement and that if I do not sign there may be serious consequences including imprisonment etc. ete. I have immediately retracted the statement on the very next day, the copy of affidavit showing retraction is enclosed herewith. I would once again like to submit that whatever has been stated at the time of search action is not correct. I do not agree with it. I have never given any cash to m/s nish developers put ltd. I do not know why my name is being written over there. I have never paid any cash for this to anybody whether for my own flats or for somebody else. I have nothing to do with the cash and I have not paid even a single rupee in cash for the flats. I would once again like to state that me or my family members have not given any cash for the flats purchased by us. We have also not handed over any other person's money to Mr. Kailash Agarwal. In nutshell, I am not involved in any kind of cash payment or cash movement. I don't know why my name is writte....
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.... The appellant is a joint owner and he owns only 50 % of the share, inspite of this the whole amount is added in appellants hand. Such a huge amount of 15.33 cr in toto for all year cannot be the on money for one flat. I would like to bring to your notice that the total addition made for the flats comes to 15.33 crs as on money which is on very higher side. The total carpet area of the flat is 1740 sq. ft and agreement value is 3.85 cr. Hence, if we consider 15.33 cr as on money then the total value of the flats comes to 19.18 cr and per sq. ft cost comes to Rs. 110230/-. The agreement is made in 2011 and the market rate in lower parel was never that much high whether in 2011 or even today. 110000 per sq.ft rate is very high and even today it is not that high. So the addition is giving absurd result and cannot be accepted. the addition is totally baseless and only base with the department is pen drive of Praveen mishra and while giving Statement on the content of the pen drive, Praveen mishra has never Said that it is the on money of appellant for the purchase of flat, on the contrary he said that he is broker and used to handle cash of the one avighna group. Hence, Praveen mishra ....
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....t he had not charged any brokerage/commission from M/s. Nish Developers Pvt. Ltd. and therefore, two flats were allotted to him at discounted rates. This is a pointer that the assessee had brought in customers for which he had not taken brokerage from M/s. Nish Developers Pvt. Ltd but had got two fats allotted at discounted rates, Similarly, he could have taken brokerage from i the parties for whom he had arranged the transaction. The four parties involved are already mentioned supra. Purchase consideration of the assessee is higher than the stamp duty value and, therefore, the assessee's queue contention that he has not paid on-money for his flats is found to be acceptable but in view of the categorical finding that cash had been delivered to M/s. Nish Developers Pvt. Ltd. on 39 occasions during the period of four years which fact has also been admitted by the assessee during the search but subsequently retracted, and the component of brokerage being prevalent in this line of business, it is presumed that the assessee would have received brokerage from the parties concerned. This brokerage is estimated at 2% of the cash passed on to M/s. Nish Developers Pvt. Ltd. During the year u....
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.... value but it is the amount charged by builder / developer and paid by purchaser over and above the consideration recorded in written Agreement?" 14. Assessee has filed Additional ground of appeal as under: - "1) On the facts and circumstances of the case as well as in Law, The Ld.AO as well as CIT(A) erred in making addition in the order u/s 153A of the Income Tax Act, 1961 on the basis of statements recorded and document found in third party premises." 15. Ld. AR submitted that additional grounds raised by the assessee is purely legal issue and placing reliance on the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd v. CIT [229 ITR 383] requested the same may be admitted for adjudication. 16. On hearing both sides, we are of the view that the issue is only legal and following the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd v. CIT (supra), we admit the additional ground for adjudication. 17. Considered the submissions of the assessee that addition cannot be made in the Assessment Order based on the statement recorded and document found in third party premise and Ld. AR relied on....
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....No. 11 to 15 of the Ld.CIT(A) order and he also brought to our notice the statement and retractions of the assessee from the order of the Ld.CIT(A). He submitted that the statement recorded is not proper and brought to our notice Page No. 48 and 50 of ITAT order in the case of Jt. CIT (OSD) v. M/s.Nish Developers (supra) and submitted that ITAT has observed that the onus is on the revenue to prove the contents of the pendrive and other lose sheets by bringing on record corroborating evidences. They noticed that the revenue has not bothered even to make further enquiry from the flat buyers to ascertain the amount of on-money. Therefore, in view of the facts and circumstances, we held that the pendrive cannot be relied on to make on-money addition in the hands of the assessee. 22. Further he brought to our notice at Page No. 50 wherein ITAT observed that Ld. CIT(A) applying a blanket rate of 20% on the on-money calculated on the basis of data in the pen drive wherein the name of the customers were not even matching with the data in the pen drive and also the fact that the amounts mentioned against the various flats purchasers having glaring and huge variations and that the pen dri....
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....he other parties to whom assessee has recommended for purchase of flats had denied that they have paid cash for the flats bought by them through the assessee. Since the denial of such payment and also the statement given by the Shri Praveen Mishra that he has received cash from the assessee to the extent of Rs..15.33 crores, subsequently Assessing Officer issued notice to the assessee based on the denial of the other parties to whom assessee has introduced for purchase of flats as well as collected cash from them. It is from the record that assessee has collected cash from the buyers of the flat or it is not clear why the assessee has deposited such huge money to the M/s.Nish Developers Pvt. Ltd. Only during the assessment proceedings on receipt of show cause notice assessee has retracted the statement given two years ago and filed an affidavit submitting that he has given the statement under duress. We observe from the record that company M/s.Nish Developers Pvt. Ltd., has preferred appeal before ITAT against the additions made in the hands of them for the same issue of cash receipt and ITAT has decided in favour of the assessee M/s. Nish Developers Pvt. Ltd., the same case was qu....