2024 (11) TMI 914

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....t of the order dated 28.12.2019 u/s 147 read with section 143(3) of the Income-tax Act, 1961 (hereinafter referred as the "Act"), passed by the Income Tax Officer,Ward-2(1), Faridabad (hereinafter referred in short as "Ld. AO"). 2. On hearing both the sides it comes up that case was reopened u/s 147 of the Act to enquire the source of investment for purchase of immovable property of Rs. 80,00,000/-. Assessee had not filed the return for the year under consideration and subsequently in response to the notice u/s 148 of the Act assessee filed the return. During the course of assessment proceedings it came up that assessee claimed to be not engaged in any business activities and had purchased two residential properties of Rs. 40,00,000/- ea....

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....tal gain and added back to the total income of the assessee. I am satisfied that the assessee has concealed his income by furnishing inaccurate particulars of his income in respect of the amount as discussed above, in terms of section 271(1)(c) of the Act, penalty notice u/s 274 r.w.s. u/s 271(1)(c) of the Act, is being separately issued to the assessee. (Addition of Rs. 21,36,483/-)" 2.1 Secondly, the AO had examined the cash/credit entries in the bank account of the assessee with Union Bank of India and the basis of the number of transactions concluded that assessee was engaged in some kind of business activities. The relevant observations of the AO in para 8.1 to 8.3 are reproduced below: "8.1 The aforementioned tabular detai....

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....to furnish his return of income u/s 139 of the Act, even than the turnover is evident from the material available on records which is Rs. 1,18,33,000/-. The present section 44AD of the Act, also provided for a rate of 8% only for turnover upto 60 lacs (increased to Rs. 1 crore w.e.f. A.Y. 2013-14). In view of the above facts and discussed remarks the net profit at a rate of 12% (Rs.1,18,33,000/- @ 12%) comes to Rs. 14,19,960/- on the receipts of the business declared in ITR and on undisclosed turnover of Rs. 1,18,33,000/-, appears to me a fair assessment of Income in the present case after considering circumstances of the case. Since the assessee has failed to declare his actual income in his return of Income, I am satisfied that the assess....

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....nly in respect of one floor and before us several decisions have been referred to by learned AR wherein it is settled that the expression "a residential house" in section 54F(1) has to be understood in the sense that the building should be of residential nature and "a" should not be understood to indicate a singular number. Thus, even in case of purchases of two residential flats assessee is entitled to exemption u/s 54F. Reliance in this regard can be placed on the following judgments: - Judgment of Hon'ble Andhra High Court dated 20.12.2012 in ITTA no. 410 of 2012 -The Commissioner of Income Tax v. Syed Ali Adil ; - K.G. Vyas v. Seventh Income-Tax Officer [1986] 16 ITD 195 (MUM); - Judgment of Hon'ble Delhi High....

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....on was made by the learned AO on the basis of profit work out @ 12% of the cash/credit entries of Rs. 1,18,33,000/-. Thus, we find substance in ground no. 3 as raised before us wherein assessee has alleged that it was for the first time only in assessment order that the assessee was confronted by the opinion of AO discarding the claim of assessee that he was not engaged in any business activity. 5. Then before us learned AR has pointed out following details of the deposits: (a) Credit of Cheques return 5,72,500 (b) Cash deposit in Bank 7,38,000 (c) Receipt from brother of assessee 35,50,000 (d) Share of Ancestral Agriculture Land from govt 14,02,500 (e) Credit of Repayment of Loan from friends & ....