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TaxTMI 
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2024 (8) TMI 526
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....cumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 4,12,50,000/- made by the Assessing Officer on account of unexplained money u/s. 69A of the I.T. Act without appreciating the fact that the addition was made on the basis of incriminating documents seized during the course of search proceedings in the form of notarized satakhat. (ii) In addition to ground No. 1, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 4,12,50,000/- made by the Assessing Officer on the basis that the said satakhat is incomplete document as all the co-owners or parties have not signed the document, despite the fact that the satakhat is a notarized document before the Registered Notary and the notary has clearly mentioned that one person was absent on the date of notarization of the document which is totally ignored by the ld. CIT(A) while deciding the issue. (iii) In addition to Ground No. 1 & 2, on the facts and circumstances of the case and in law, the ld. CIT(A) has erred in not appreciating the fact that the land deal done on the basis of satakhat that to which is notarized is only registe....
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....s view, issued a show cause notice to the assessee on 04/12/2021. In the show cause notice, the Assessing Officer apart from the aforesaid narration, mentioned that during the course of search proceeding, statement of father of assessee (Shanker Nebulal Uttamchandani) was recorded, who was specifically asked to explain the contents of seized Satakhat. In response to such question, he explained that one of the seller Balubhai Laxmanbhai not signed the said Satakhat who was the main person, so deal was not materialized. When such fact was confronted that Satakhat disclosed the value of land at Rs. 16.50 crores and 25% thereof was mentioned as received in cash on 01/03/2016, the father of assessee stated that as Balubhai Laxmanbhai not signed the Satakhat nor the person mentioned at serial No. 9,10 and 13 have revenue stamp against their signature. Further public notice was to be given (published), which was not issued, as land deal not materialized. Further, father of assessee has also stated that his son (assessee) to explain the payment of cash mentioned on the Satakhat. The assessee was also confronted with the statement of his father and the contents of Satakhat. The assessee als....
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....nce about the payment made to the land owner. During the search, no evidence was found that any payment was made by assessee in cash. The assessee on the question of availability of cash on the date of Satakhat submitted that they filed application for settlement before Settlement Commission, Mumbai on 31/01/2017 and disclosed total income of Rs. 22.09 crores in the hands of his father Shanker Nebubhai Uttamchandani up to A.Y. 2016-17 and the availability of cash was fully justified while making disclosure of Rs. 22.09 crores which has been accepted and no adverse inference can be taken in this regard. The assessee further reiterated that the cash was not paid by them due to dispute of title amongst the co-owners. The reply of assessee was not accepted by Assessing Officer. The Assessing Officer on the basis of contents of Satakhat added Rs. 4.12 crores in the hands of assessee. 4. Aggrieved by the additions in the assessment order, the assessee filed appeal before the ld. CIT(A). Before the ld. CIT(A), the assessee filed detailed written submission. The submission of assessee is recorded in para 6.1 of order of ld. CIT(A). The assessee in his submission, reiterated similar submis....
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....n cannot be sustained. On the basis of aforesaid observation, the ld. CIT(A) deleted the addition. Aggrieved by the order of ld. CIT(A), the revenue has filed present appeal before this Tribunal. 6. We have heard the submissions of learned Commissioner of Income Tax- Departmental Representative (ld. CIT-DR) for the revenue and the learned Authorised Representative (ld. AR) of the assessee. The ld. CIT-DR for the revenue supported the order of Assessing Officer. The ld. CIT- DR for the revenue submits that during the course of search action on Kuberji group, the assessee being a part of said group was covered. During search action at the residence of the assessee, Satakhat was found which relates to R.S. No. 275 of village Jivav, Surat. As per details on Satakhat, it is clearly discernable that the assessee made payment of Rs. 4.12 crores in cash, which was 25% of total sale consideration. During the assessment, the assessee simply denied that no such payment was made. The ld. CIT(A) deleted the addition without appreciating the fact that the document was found and impounded from the residence of assessee. The ld. CIT(A) deleted the addition merely by accepting the submission of as....
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.... Vs Fairdeal Textile Park (P) Ltd. (2014) 43 taxmann.com 393 (Guj) wherein it was held that no addition could be made only on the basis of agreement to sell found in search, which was not at all implemented. The ld.AR of the assessee further relied on the decision of Hon'ble Apex Court in the case of CIT Vs. Ved Prakash Chaudhary (2010) 3 taxmann.com 785 (SC), Delhi High Court decision in CIT Vs Gian Gupta (2014) 46 taxmann.com 372 (Delhi). The ld. AR of the assessee further reiterated that in absence of any corroborative evidence to prove the authenticity of papers/documents seized, the Assessee could not make any addition only on the basis of noting's. The ld. AR of the assessee also relied upon the following case laws: * Common Cause Vs UOI (2017) 394 ITR 220 (SC) * Sunil Kumar Sharma Vs DCIT (2022) 448 ITR 485 (Kar) * Nishant Construction Pvt. Ltd. Vs ACIT ITA No. 1502/Ahd/2015 * PCIT Vs Nishant Construction Pvt. Ltd. (2001) 101 taxmann.com 180 (SC) and 101 taxmann.com 179 (Guj) * CIT Vs Maulik Kumar K Shah (2008) 307 ITR 137 (Guj) * CIT Vs Ravi Kumar (2007) 294 ITR 78 (P&H) * Smt. Harmohinder Kaur Vs DCIT (2021) 187 ITD 289 (Amrt Trib) * DCIT Vs Tulsibhai M....
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.... the present case. On perusal of contents of Satakhat, we find that it contains the photograph and signature of several sellers, however, the part of acknowledgement/receipt of payment is blank. Moreover, the said Satakhat is not signed by seven persons as seen on page No. 12 of assessment order. We also find that the Assessing Officer has not made any independent investigation of fact, when the assessee right from the beginning was claiming that Satakhat was not materialized. The sellers were the best persons to strengthen the case of Assessing officer, who were not examined by Assessing Officer for the reasons best known to him. The Hon'ble Jurisdictional High Court in the case of CIT Vs Fairdeal Textile Park (P) Ltd. (supra) held that no addition could be made only on the basis of agreement to sell, found during the search which was not at all implemented. In view of the aforesaid factual and legal discussion, we do not find any reason to interfere with the order of ld. CIT(A) which we affirm with our additional observation. In the result, grounds of appeal raised by the revenue are dismissed. 10. In the result, this appeal of revenue is dismissed. ITA No. 323/Srt/2022 for....
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....i) It is, therefore, prayed that the order the Ld. CIT(A)-4, Surat may be set aside and that of the AO may be restored to the above extent. (vii) The appellant craves leave to add, alter, amend and/or withdraw any ground(s) of appeal either before or during the course of hearing of the appeal." 12. Facts related to the grounds of appeal raised by the revenue are that during the search action on 06/02/2020, a Pen drive of digital device was found from the residence of assessee wherein there was writing relating to transaction of land in the form of Sauda Chitthi dated 03/07/2014 for land bearing R.S. No. 506/68/6, Abhwa having area of 28000 Vaar. The rate of land is mentioned at Rs. 5220/-. The extract of such digital image was extracted on page No. 3 and 4 of assessment order. The Assessing Officer on going through various details on the image, was of the view that the purchaser name is Shanker N. Uttamchandani and seller is Kedar Jagirdar. As per terms of payment, 33% was to be paid within 30 days of Satakhat, second 33% by 03/12/2014 and remaining 34% was to be paid by 03/04/2015. The said Sauda Chitthi was duly signed by seller and purchaser. The Assessing Officer further n....
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....5 years from different persons namely Nitinkumar Chhaganbhai Patel and that the assessee made unaccounted investment in the land as per Sauda Chithi which is absolutely baseless and without any evidence. The assessee further explained that the said Sauda Chithi was executed by his father prior to demonetization when market rate of land outside the City was very high and it was executed on assumption that the land was marketable and its title was clear but it was otherwise. Secondly, it may be noted that the ledger account reflects payment of Rs. 10.90 crores as made by his father against the agreed price of Rs. 14.61 crores and the said Sauda Chithi, payment of Rs. 10.90 crores made by my father which is covered in his hand in the disclosure made before the Settlement Commission. Further as stated in the show cause notice, as per Government Website, the said land, after cancellation of deal with my father, due to title issue, subsequently sold by original owner to Shri Nitinkumar Chhaganbhai Patel on 29/04/2016 and thus it is not the case that after cancellation of deal, my father either purchased the said land. The assessee has purchased the land after a gap of five years from the....
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....before the Sub-Registrar-8, Surat on 19/11/2019 by showing sale consideration at Rs. 65.00 lacs. The sub- Registrar accepted the valuation as per Stamp Duty valuation fixed by State Government on explaining various facts before him. Thus, the Deputy Collector, Stamp Duty Valuation, Surat has accepted the value of land at Rs. 65.00 lacs and collected stamp duty applicable @ 4.9% amounting to Rs. 3,18,500/-. 16. The ld. CIT(A) on considering the assessment order, submission of assessee held that the Assessing Officer made addition of unexplained investment on the basis of Sauda Chitthi executed by father of assessee in 2014. There is no other evidence of payment of on-money for purchase of land in question. The Assessing Officer presumed that the land was agreed to be purchased for Rs. 14.6 crores in 2014 and then how it could be sold merely for Rs. 65.00 lacs in 2019. The ld. CIT(A) recorded fivefold contention of assessee i.e. (i) original Sauda Chitthi between his father and Kedar Jagirdar not executed as Kedar Jagirdar was not the actual owner. The actual land owner was Mrs. Arunaben Patel and her family. The title of land was not clear, the assessee's father received back the a....
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....luation of land for collection of stamp duty at Rs. 65.00 lacs. The ld CIT(A) also held that there is no direct evidence found during the search that any on money was paid. The addition cannot be made merely relying on old Sauda Chithi. The Assessing Officer or the search party has not examined the seller or any other related person to verify whether on money was really paid. On the basis of such observation and finding, the ld. CIT(A) deleted the addition of Rs. 13.96 crores. Aggrieved by the order of ld. CIT(A), the revenue has filed present appeal before this Tribunal. 17. We have heard the submissions of the parties have gone through the order of lower authorities carefully. The ld. CIT-DR for the revenue in his submissions supported the order of Assessing Officer and would submit that the facts and circumstances of the case clearly suggests that the assessee has purchased the same land for which father of assessee has entered into transaction. The assessee has not disputed that initially Sauda Chithi was executed. The assessee is taking shelter of proceeding before Settlement Commission that income on such undisclosed amount as per the contents of Sauda Chithi was offered and....
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....2019 on a sale consideration of Rs. 65.00 lacs. During the search action, no incriminating material found during the search action showing unaccounted payment to Nitinkumar Chhaganbhai Patel or any other person with regard to purchase of land. There is no independent evidence or corroborative statement to support the case of Assessing Officer. The Assessing Officer merely acted on presumption that the assessee used Sauda Chithi and purchased the same land by making unaccounted payment. The action of Assessing Officer is merely based on surmises and conjectures, no independent or corroborative evidence was brought by Assessing Officer on record to make such addition. The ld. AR of the assessee submits that he relied on the same case laws as relied for A.Y. 2016-17. 19. We have considered the submissions of both the parties and have gone through the orders of the lower authorities carefully. The assessing officer made addition by taking view that in the search action a pen drive was found at the residence of the assessee, which contained a Sauda Chitthi Sauda Chitthi dated 03/07/2014 for land bearing R.S. No. 506/68/6, Abhwa having area of 28000 Vaar. The rate of land is mentioned a....
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....nd Kedar Jagirdar not executed as Kedar Jagirdar was not the actual owner. The actual land owner was Mrs. Arunaben Patel and her family. The title of land was not clear, the assessee's father received back the advance of Rs. 10.90 crores paid to Kedar Jagirdar. The said amount of Rs. 10.90 crore has been explained by his father before Settlement Commission, Mumbai and offered 10% profit thereon. (ii) The said land was purchased by Nitinkumar Chhaganbhai Patel from Mrs. Arunaben Patel and her family on 29/04/2016 for a consideration of Rs. 59.00 lacs. Nitinkumar Chhaganbhai Patel who purchased the land is not related with the assessee. The land was purchased by assessee from Nitinkumar Chhaganbhai Patel. (iii) The land was purchased by assessee from Nitinkumar Chhaganbhai Patel for a consideration of Rs. 65.00 lacs which was proved by Sub-Registrar after valuation by Deputy Collector of Stamp valuation dated 18/12/2019. The Deputy Collector, Stamp Duty valued the land at Rs. 65.00 lacs with detailed reasoning in his order which is a part of sale deed. (iv) The basic contention of assessee related to the issue is that the Assessing Officer relied upon the Sauda Chitthi and have not e....