TaxTMI 
TaxTMI 
2022 (1) TMI 1473
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....rves to be cancelled. 2.1 Without prejudice to the above, there is no justification to issue the warrant to search the premises of the appellant as the conditions specified in terms of Sec. 132[1] of the Act did not exist and therefore the search action illegal and consequently the impugned assessment order founded thereon deserves to be cancelled. 3. Without prejudice to the above, the learned CIT[A] is not justified in sustaining the addition of Rs. 1,01,34,000/- b~~ "n the alleged unexplained expenditure u/s. 69B of the Act, incurred by the appellant in respect of the lands purchased from Smt. Rekha Venugopal and Shri G.N. Venugopal, without appreciating that the appellant had explained the circumstances under which the seized sale agreement showing a higher consideration payable for the purchase of land was shown in the seized sale agreement, which has been unreasonably disbelieved and rejected under the facts and in the circumstances of the appellant's case. 3.1 The learned CIT[A] ought to have appreciated that factually there was no such payments made by the appellant as per the seized sale agreement and- in excess of the sale consideration as per the regist....
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....f the case, the Ld. CIT (A) erred in relying on the letter of Superintendent Engineer, Operations, APSPDCL, Ananthpur, who is no way connected with the transaction of supply of power to worker's colony as the supply was not passed through Electricity grid? 4. Whether on the facts and in the circumstances of the case, the Ld. CIT(A) also failed to appreciate the fact that M/s EMMVEE Photovoltaic Pvt. Ltd. to whom the assessee claims to have supplied power from 30.03.20 13 to 22.04.20 13 is also its own contractor who erected the solar plant and fact that the bills are raised for F.Y. 2012- 13 only and not for F.Y. 2013-14 itself proves that the invoices raised are self serving documents which cannot be held to be evidence of having asset put to use before 31.03.2013." ITA No. 2070/Bang/2017 (Assessee's appeal) 4. In assessee's appeal, ground No. 1 is general in nature which does not require any adjudication. 5. The assessee has not pressed ground Nos. 2 and 2.1 before us and accordingly dismissed as not pressed. 6. Ground Nos. 3 to 3.3 is with regard to sustaining of addition of Rs. 1,01,34,000/- as unexplained expenditure. The assessee entered ....
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....greement. - The A.O. has rejected the aforesaid contentions advanced by the assessee on the ground that the sale instances furnished by the assessee was more than one and half years prior to the date on which the appellant acquired lands and hence, the same was not comparable. Furthermore, the A.O. has also observed that the Vendors Sri G.N. Venugopal and Smt. Rekha Venugopal, were also subject to search and seizure action and were assessed by her. In course of the assessment proceedings of Sri G.N. Venugopal, it was found that he had sold lands to M/s. Emmvee Energy Ltd., at the rate of Rs. 5,00,000 per acre. Hence, the A.O. held that it was difficult to believe that the assessee purchased the said lands at Rs. 50,000 per acre from the said vendors. In this view of the matter, the A.O. proceeded to make the impugned addition based on the extent of land of 22.52 Acres purchased by the assessee from the aforesaid persons by taking the sale value at Rs. 5,00,000/- per acre and deducting therefrom the sale consideration paid by the assessee in the sale deed executed by the Vendors. - It is submitted that the impugned addition made is opposed to law and facts of the ....
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....eal consideration. Further, it was observed that Shri Rekha Venugopal and Shri G.N Venugopal are land lords holding more than 100 acres of land and they sold similar lands to M/s Emmevee Energy Ltd., during the year under consideration for Rs. 5 lakh per acre. Considering the comparable cases, the AO was justified in referring the value mentioned in sale agreement at Rs. 5 lakh per acre and brining the difference mentioned in sale agreement and sale deed as unexplained investment and sustained the addition. Against this, the assessee is in appeal before us. Before us, the ld.AR submitted that in the course of search, an agreement to sell dated 29/11/2012 entered into by the assessee with the aforesaid Smt. Rekha Venugopal was found and seized. As per this seized agreement to sell, the assessee had agreed to purchase agricultural lands at the rate of Rs. 5,00,000/- per acre under the circumstances that have already been explained. The assessee had purchased 11 Acres 63 cents of agricultural lands from the aforesaid Smt. Rekha Venugopal under the sale deed dated 17/12/2012. It is submitted that the correct sale consideration for the purchase of agricultural lands was m....
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....t. Rekha Venugopal, who had executed the agreement to sell dated 29/11/2012 stated that the agreement was entered into to solely to assist the appellant to obtain a higher bank loan. 12. Thus, the ld.AR reiterated that the seized sale agreement dated 29/11/2012 was not acted upon and that there was no justification to make any addition on this score presuming that the assessee has paid consideration on the basis of the aforesaid seized sale agreement. 13. The A.O. has rejected the aforesaid contentions on the ground that the sale instances furnished by the assessee was more than one and half years prior to the date on which the assessee acquired lands and hence, the same was not comparable. Furthermore, the A.O. has also observed that the Vendors Sri G.N. Venugopal and Smt.Rekha Venugopal, were also subject to search and seizure action and were assessed by her. In course of the assessment proceedings of Sri G.N. Venugopal, it was found that he had sold lands to M/s. Emmvee Energy Ltd., at the rate of Rs. 5,00,000 per acre. Hence, the learned A.O. held that it was difficult to believe that the assessee purchased the said lands at Rs. 50,000 per acre from the said vendors....
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.... be upheld having regard to the ratio of the following decisions and it is also prayed that the same needs to be deleted: [1] ANDAMAN TIMBER INDUSTRIES reported in 127 DTR 241 [SC] [2] KISHINCHAND CHELLARAM reported in 125 ITR 713 [SC] [3] Colonisers reported in 41 ITD 57 [Hyd] [SB] [4] H.R. MEHTA reported in 138 DTR 217 [Bom] 16. The ld.AR mentioned that without prejudice to the above, it is submitted that the assessee is unable to state whether the lands sold by the aforesaid Sri G.N. Venugopal are comparable and whether the lands are located in the same vicinity as well. It is submitted that there is always a difference in the transaction costs between corporate and individuals and merely because the lands were sold to the aforesaid company at Rs. 5,00,000/- per acre does not warrant the presumption that the assessee also acquired the lands at that rate. 17. In this view of the matter also, it is submitted that the impugned addition made is opposed to law and facts of the assessee's case and consequently, the ld.AR urged that the assessee's case may please be considered for favorably. 18. On the other hand, ld.DR relied on the order of the CIT(A). 19. We have he....
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....,229/- 23. The assessee had claimed depreciation on the Solar Plant that was installed during the year. The A.O. has denied the depreciation so claimed by the assessee taking the view that the aforesaid asset was not put to use during the year under appeal. The following table shows chronology of events is relevant for appreciation of the contentions of the assessee :- Date Event Remarks Remarks Appellant entered into a Contract with the EPC Contractor for setting up the Solar Plant 110 days time was envisaged under the contract for completion of the works 19/03/2013 & 20/03/2013 Final bills were raised by the EPC contractor on the appellant after completion of the works Appellant has recognized the completion of the works by capitalizing the Solar Plant in the books of accounts based on the aforesaid bills issued. 20/03/2013 The Solar plant installed by the appellant started generating power, which was supplied to the workers colony locally The same is evidenced by the mention made in the letter of Superintending Engineer Operations, APSPDCL in No. 2711 of 2016 dated 18/11/2016. Enclosed to the appellant's submission dated 24/11/2016 29/03/2013 Completion cer....
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....he grid on 22/04/2013. In coming to the aforesaid conclusion, the A.O. has considered both the letters of the Superintending Engineer, Operations, dated 19/03/2013 and 27/04/2013 referred to above. According to the A.O., the assessee had complied with the IREDA guidelines and connected the Solar Plant to the grid on 22/04/2013 and this means that the Solar Plant was put to use by the assessee only on 22/04/2013. 25. It is relevant at this stage to set out the meaning of the term "synchronization", as has been clarified in the letter of the Superintending Engineer, Operations, dated 27/04/2015. The aforesaid term means to operate with exact co-incidence with time or rate. The term "commissioning" is also defined in the said letter of being in good working order and ready for operation. Thus, "synchronization" of the Solar Plant with the grid results in the production of the power being evacuated to the grid and the grid is able to receive the power. However, the fact that the Solar Plant is not yet connected to the grid does not mean that the aforesaid asset has not been put to use by the appellant as it is not necessary that the appellant must necessarily connect to the grid as th....