AI Drafter 
TaxTMI 
TaxTMI 
2022 (12) TMI 936
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....8/SRT/2017, for assessment Year 2011-12, have been taken into consideration for deciding the above appeals en masse. 3.First, we shall take assessee's appeal in ITA No. 48/SRT/2017 for AY.2011-12, ( lead case) wherein the grounds of appeal raised by the assessee are as follows: "1. The learned CIT(A) has erred in law and on facts in upholding the action of the ld. A.O. in making an addition of Rs. 12,50,000/- on account of alleged payments made to Chetanbhai Chanabhai & other vide Satakhat Deed dated 09-10-2010 for purchase of land at Bamroli Block No.45 as unexplained investment u/s. 69 of the Income Tax Act. 2. The learned CIT(A) has erred in law and on facts in upholding the action of the ld. A.O. in making an addition of Rs.10,00,000/- on account of alleged payments made to Lakhiben Chimanbhai & Others vide Satakhat Deed dated 09-10-2010 for purchase of land at Bamroli, Block No.45 as unexplained investment u/s. 69 of the Income Tax Act. 3. The learned CIT(A) has erred in law and on facts in upholding the action of the ld. A.O. in making an addition of Rs.50,00,000/- on account of alleged payments made to Maniben Balabhai & Others vide Satakhat Dee....
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....5. Since, all the grounds raised by assessee are inter-connected and mixed, therefore we shall take these grounds together. 6. Brief facts, as per lead case, are as follows: The assessing officer observed that during the course of survey proceedings under section 133A on 27.12.2012 at the office premises of Turmish B. Kania, Advocate and Meera T. Kania, at A Sai Leela Associates, certain documents of incriminating nature were recovered from the office and impounded as BI-1, BI-2, BI-3 & BI-4. It includes backup hard disc of computers installed in the office. On perusal of working copy of the same hard disc, it was noticed that various satakhats/kabja Rashid/sale deed/purchase deed/promisary note/ memorandum of understanding and other documents related to land/property were prepared by Turmish B. Kania and Meera T. Kania. So with an intention to obtain hard copy of the same satakhat purchase/sale deed, Mazhernama of the impounded hard disc was done on 27.02.2013. The print results and purchase/sale deed//Kabja rasids as available in the impounded hard disc were taken. The print results so recovered were impounded as per Annexure A-l, Page Nos.1 to 149, Annexure-A-2, Page Nos. 1 t....
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....s prepared after taking consent of both the parties. Inclusion of the correct; survey numbers/Block numbers of the plot of land and Name(s) and Address(s) of both the parties clearly indicates that the said satakhat was prepared by Shri Turmish B. Kaniya after obtaining due consent of both the parties. In view of the above facts and findings, the case was re-opened u/s 148 of the I.T. Act for scrutiny. 8.The assessee has filed original return of income for on 26.09.2011 declaring total income of Rs.4,14,477/-. In response to notice u/s 148 issued to assessee on 30.12.2014, the assessee has filed copy of his return of income in response to notice u/s 148 on 13.11.2015 and requested to treat ROI filed on 26.09.2011 as ROI filed in compliance to notice u/s 148. Notice u/s 143(2) was issued for assessee on 13.11.2015 and duly served upon the assessee. Notice u/s 142(1) is issued to assessee on 13.11.2015 and duly served upon the assessee. The assessee was requested to furnish details on 23.11.2015. Further, the assessee has not filed his objection for reopening the case but the reason for reopening was provided to the assessee on 15.12.2015. Further, Assessing Officer given one more....
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....tested signed copy of - Satakhat (signed )entered in by you for this property - Registered document signed by you for this property - any other document w.r.t this land entered in by you & other owners of this land iii) File source of cash & cheque payment of Rs.80,00,000/-". You have not answered the query and not given any evidences of details asked till date. Satakhat is evidence & is signed only when the due amount stated is paid. You are herewith show caused to explain why Rs.40,00,000/- should, not be treated as unexplained investment in your hand as unexplained investment & balance Rs.40,00,000/-be taxed in your hand on protective basis. (b) The assessee has filed his submission before the assessing officer. The AO noted that Assessee denied signing any such Satakhat and also denied purchasing of such land. Therefore assessing officer noted that were no merits in the contentions of the assessee. (c) Thereafter, assessing officer examined relevant statement of the assessee which was given before the DDIT (Inv). Surat on 02.04,2013, is as under: "I have not made any of these deals. I don't know ho....
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....rs by the sellers, Chhanabhai Prabhubhai & others on 18.03.2011 vide Datavej no. 4851. Therefore, role of assessee in transaction cannot be ruled out as per the Satakhat. As a prevailing practice in the market w.r.t to land sale transaction, after the conditions laid in the satakhat is completed by the purchaser, the land is transferred in the name of the purchaser at the rate, which is convenient to the purchaser. The seller save money on account of lower capital gain tax buyer gets the window to invest his unaccounted money and saves tax on lower stamp duty, lower registration cost and no tax on cash / unexplained investment beyond his books of account. The only proof of transaction of unexplained Investment is Satakhat Agreements agreed mutually signed by each other. This document is destroyed after doing the Registration, which destroys any and every evidence of concealed income by the purchaser and beyond books, unexplained Investment made by the purchaser. Assessee's cash book & books of account do not show any such entry of payment. It is held that assessee has done the transaction as investor. Cash of Rs.25,00,000/- is paid as an advance by Kalpeshbhai Mafatlal Patel an....
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....explained investment u/s 69 of I.T Act. (iv) In respect of Satakhat deed with Lilaben Dahyabhai & others with assessee dated 14.03.2012 for the land at Jiav. R.S. No.358/1 & 358/2. Block No.437. 4994.50 Sq.Mtr. out of total area admeasuring 9989 Sq.Mtr. and (ii) Satakhat deed with Dahiben Parshotambhai & others with assessee dated 25.10.2011 for the land at Jiav. R.S. No.358/1 & 358/2. Block No.437, area of 832.42 Sq. Mtrs. out of total area admeasuring 9989 Sq.Mtr., the Assessing Officer made addition observing that assessee's cash book & books of account do not show any such entry of payment. It is held that assessee has given an advance of Rs.1,00,000/- on 19.10.2010 to the sellers in respect of land mentioned at para 7(i) and an advance of Rs.1,00,000/- on 19.10.2010 to the sellers in respect of land mentioned at para 7(ii). Assessee has not shown this investment in his books. As the transaction pertains to FY 2010-11, the amount of Rs.2,00,000/- recorded as paid by the assessee as per the impounded satakhat was treated as unexplained investment u/s 69 of I.T. Act. 12. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before th....
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.... 4. Cash of Rs. 25,00,000/- is paid against sale price of 80,00,000/- AO issued SCN for treating Rs. 40 lacs as unexplained investment in the hands of assessee & balance 40 lacs on protective basis. AO noted that assessee denied signing any such Satakhat and also denied purchasing of such land. AO captured screen shot of impounded Satakhat from computer of Turmish Kania on page 5 of the order and then noted that notary register of Meera Kania showed notarization of Satakhat in the name of Kalpesh Mafatlal Patel. AO during scrutiny assessment made an inquiry from sub registrar office and noticed that land was in possession of persons named in Satakhat which negates plea of the assessee of having not entered into any Satakhat for the lands at Bamroli. 5. Sale deed executed with Tarabcn Ajitbhai Patel & others by Chhanabhai Prabhubhai & others on 18.03.2011 without mention of so called notarized Satakhat in Dastavej bearing # 4851 [Page 6 AO] 6. No mention of assessee in sale deed as confirming party 7. AO makes addition of Rs. 12, 50, 000/- (50% of Rs. 25 lacs) cash only though SCN issued for addition of Rs. 40, 00, 000/- (50%) 8. Addition....
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....hers than the assessee and his co-owner Yogesh Mohanlal Patel vide registered sale deed. AO confirmed the addition drawing conclusion that Satakhat agreements are entered at lower cost to save tax and stamp duty. Reply: Overlooking the fact that unsigned, incomplete and unstamped dumb documents taken as printout from the hard disc impounded from the office of A Sai Leela Associates, AO made addition on the basis of surmise, conjecture & assumptions that is not tenable under law. Ld. CIT (A) without considering submissions, evidences and case laws relied upon confirmed additions made by AO dismissing appeal of the assessee." 14. On the other hand, Learned Departmental Representative (Ld. DR) for the Revenue submitted that survey was conducted on the premises of the assessee and from whom the incriminating documents were found relating to the assessee. There was a detail in the computer about the incriminating material. In addition to these, the assessee was associated with his advocate, and the computer CD also found in the possession of the assessee's advocate and notary has made entry in his register. The ld CIT(A) has mentioned in para no. 19 in his finding t....