TaxTMI 
TaxTMI 
2021 (9) TMI 1387
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....,00,000/- made in hands of assessee on issue of unaccounted commission without appreciating that the market rate of plots of lands was Ranging between Rs.22000/- to 25000/- instead of Rs.4000/-per sq yard taken by Ld. CIT(A) and hence the rate of unaccounted commission comes to about 3% on such value as has been mentioned in assessment order and also held in assessment orders of buyers and sellers. 2. Whether on the facts and circumstances of the case and in law, the Ld. ClT{A) erred in deleting the addition of Rs.3,00,00,000/- made in hands of assessee on issue of unaccounted commission without appreciating that assessee had deliberately not furnished the details of his so-called other three partners during investigation and assessment proceedings so as to thwart the inquires by evading the summons and letters of Department. 3. Whether on the facts and circumstances of the case and in law, the Ld. CIT{A) erred in deleting the addition of Rs.68,00,000/- made in hands of assessee on issue of unaccounted brokerage on four plots of land at Zundal without appreciating that the assessee had suomotu and voluntarily disclosed the same under oath u/s 131 and hence Hon'....
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....In the affidavit, among other things, it was furnished that: i. Actual area of the land was 33,831 square yard only of all the 3 plots as discussed above. ii. In the land transaction deal, the prevailing commission rate ranges between 1 to 2 percent only whereas the amount of commission of Rs.3 crores constitutes 22% of the land transaction deal which is not possible in this line of trade. iii. Thus, at the most the commission income from such land transaction deal can be worked out at Rs. 27 Lacs only being 2% of Rs. 13.55 crores (33881 sq yd x Rs. 4000, sale value). But, in actuality only a sum of Rs.18 lacs was received in total as commission against such land transaction deal which belongs to all the 4 parties including the assessee. iv. Furthermore, the amount of commission on such land was already included in the diary seized during the search as discussed above. 4.3 Besides the above, the assessee also contended that there cannot be any addition based on the statement until and unless it is supported by any documentary evidence. 4.4 However the AO disagreed with the contention of the assessee by observing that the statement was retra....
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....e sale deed of land of survey No.315 at Chandkheda (Registered on dated 10/11/2009), the area is 5059 sq.mtr and consideration is Rs.1.5 crore. The area of land of survey No.316 at Chandkheda is 4856 sq.mtr (registered on 6th April, 2010) and sale consideration is Rs.1.44 crores. Therefore, the total area of these three plots of land comes to 28328 sq.rntrs, which is equal to 33881 sq.yards. These facts clearly prove that the appellant has stated the land area of these three plots which is about double the area shown in the sale deeds. Therefore, the appellant's statement is factually incorrect beyond doubt to this extent. These facts were submitted before the ADIT(lnv) by filing affidavit dated 15.10.2013.The appellant filed above affidavit 4 months after the date of search which can be said as afterthought. However, the correct facts mentioned in the affidavit alongwith the documentary evidence cannot be brushed aside and ignored to find out the^ correct nature of transaction. lt_is important to note that the land at survey No.315 at Chandkheda was registered on 10th November, 09, which falls in the F.Y. 2009-10 and related to AY 2010-11 and the same is beyond the period of t....
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....es to Rs.10,16,2507-. Therefore, additions of Rs.10.16.250/- is confirmed in the hands of the appellant and remaining additions is deleted. This ground of appeal is partly allowed. The AO may consider initiation of proceedings in the hands of other three partners. 6. Being aggrieved by the order of the learned CIT (A), both the Revenue and the assessee are in before us. The Revenue is in appeal against the deletion of the addition made by the learned CIT (A) for Rs. 2,89,83,750/- whereas the assessee is in the CO against the confirmation of the addition of Rs. 10,16,250/- Lacs only. 7. The grounds raised by the assessee in the CO bearing No. 110/Ahd/2019 in IT(SS)A No.121/Ahd/2018 for A.Y. 2011-12 stand as under: 1. The Ld.CIT(A) has erred in law and on facts in confirming the addition of Rs.10,16,250/- out of total addition of Rs.3,00,00,000/- on account of alleged brokerage income. On facts and circumstances of the case, the Ld.CIT(A) ought to have deleted the entire addition of Rs.3,00,00,000/- 2. The Ld. CIT(A) after carefully considering the facts of the case and submission of the Respondent has rightly deleted the addition of Rs. 68,00,000/- on account....
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.... 131 of the Act that the assessee along with 3 other persons has entered into a land transaction deal and earned an income of Rs. 3 crores by way of commission. There was no discussion about any piece of evidence/document found during the search proceedings under section 132 of the Act at the premises of the assessee suggesting that the assessee has earned commission income. We note that the CBDT by way of instruction bearing number F.No. 286/98/2013-IT(Inv.III) dated 18th December 2014 has discouraged its officers to make any addition based on the statement obtained during survey/search proceedings until and unless it is corroborated by the documentary evidence. The relevant extract of the instruction of the CBDT reads as under: Instances/complaints of undue influence/coercion have come to notice of the CBDT that some assessees were coerced to admit undisclosed income during Searches/Surveys conducted by the Department. It is also seen that many such admissions are retracted in the subsequent proceedings since the same are not backed by credible evidence. Such actions defeat the very purpose of Search/Survey operations as they fail to bring the undisclosed income to tax i....
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.... affidavit has admitted to have entered into the land transaction deal along with other persons. But in the affidavit it was claimed that he has earned along with other persons only a sum of Rs.18 Lacs only out of the impugned land transaction deals. The relevant extract of the affidavit reads as under: We have received about Rs.18,00,000 which has been entered in my diary in bits and pieces and hence, the said reply No.26 by me, should not be treated as acceptable or recognized by me. 11.3 In our considered view, the affidavit discussed above is a vital piece of evidence wherein the assessee himself has admitted to have earned commission income. In the affidavit it was furnished that the area of the land in dispute was 33,881 square yard which matches with the registry documents of the properties in dispute as evident from the finding of the authorities below. Accordingly, there remains no dispute to the fact that the assessee has earned commission income out of the land transaction deal as discussed above. 11.4 The limited issue that requires adjudication is the quantum of commission earned by the assessee along with the other parties. As per the assessee, he along....
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....a fact and circumstances where no other material available on record except admission of the assessee in such affidavit. Likewise, there was no inquiry conducted by the authorities below from the concerned parties despite having the necessary details on record. Furthermore, there is no yardstick to take the rate of commission at 3% on the value of the land sold. It was the range of the rate i.e. 1 to 3% suggested by the assessee to indicate the prevailing rate which purely depends upon the facts and circumstances. Thus the same cannot be taken on presumption basis to determine the commission income. Thus, in such facts and circumstances, we hold that the amount of commission in impugned transaction stands at Rs. 18 lacs only. 11.7 Now coming to share of assessee in impugned commission. The assessee while furnishing statement under section 131 of the Act at the time of search as well as in affidavit stated that land deal was arranged by him along 3 other partners namely Dhval Navneetbhai Patel, Ketan Jashvantbhai Patel and Bharatbhai Prbhudas Patel. However the AO held that the entire amount of commission is to be taxed in the hand of assessee only on the reasoning that he failed....
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....the Revenue whereas assessee's ground in CO is allowed. 12. The next ground raised by the Revenue is that the learned CIT (A) erred in deleting the unaccounted commission of Rs. 68 lacs only. 13. The assessee in the statement furnished under section 131 of the Act dated 13th June 2013 have stated that he along with 2 other person earned commission of Rs. 33 lacs in land deal bearing survey number 409 at Jundal village and his share was of Rs. 11 lacs. Similarly along 3 other persons earned commission of Rs. 35 lacs in land deal bearing survey number 406, 407, 412, and 413 at Jundal village. Thus his share was of Rs. 8.75 lacs. The assessee in statement also stated that all these receipts are part of the dairy. 13.1 However, the AO treated the entire amount of commission i.e. 68 lacs as income of the assessee only and added to his total income which came to be deleted by the learned CIT (A) by observing as under: Facts of the case, assessment order and the submissions of the appellant have been carefully considered. The AO has made the additions of total brokerage income in appellant's hands inspite of the fact that he stated during the course of search itself ....