2024 (12) TMI 1423

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....his is a bunch of six appeals, wherein common issue is involved except for variation in the amount of addition made in each of the years. Since common issue is involved, we take up all these appeals together for adjudication by passing this consolidated order. The lead case for appreciating facts is taken as ITA No.5510/Mum/2024 for AY 2014-15. The common issue involved is in respect of addition made u/s. 69C for expenditure incurred in cash based on certain entries appearing in loose paper, rough diaries, sheets, etc., referred to as seized material found during the course of search at the premises of one of the group company of the assessee. Assessee in the present case is "other person" as referred to in section 153C and the impugned assessments have been completed by passing orders u/s. 153C r.w.s. 143(3) of the Act. 3. Brief facts of the case are that, assessee filed its original return of income on 24.09.2014 reporting total income at Rs. 30,08,290/-. Subsequently, a search and seizure action was undertaken on 20.08.2019 u/s. 132 of the Act in the case of Oberoi Realty Ltd. and its related/associated entities commonly referred to as Oberoi Realty Group. Owing to this searc....

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....ash Payments Similar to the approach adopted for cash receipts, only data entries of cash transactions which were treated as 'originals were considered while those treated as 'duplicates were 'not-considered in final summation process. Also, these data entries could also be classified into the following heads' for each financial year - a. Project Expenses/Payments b. Personal Expenses c. Vikas Oberoi Expenses d. Gayatri Oberoi Expenses e. Bindu Oberoi Expenses f. Santosh Oberoi Expenses 10.8 Quantification of Cash Transaction Entries The quantification of cash transactions has been done, on the basis of cash transaction entries which were found recorded on the identified 27 CTEBs as well as statements of various persons recorded during search/survey proceedings, broadly under the head - cash receipts and cash payments. 10.9 Cash Payments The cash payments have been bifurcated into two heads-one those relating to business entities of Oberoi Realty Group and the other relating to the personal expenses of the members of Shri Vikas Oberoi, promoter-director of ORL ....

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....g to him since assessee had failed to explain the nature and character of the said payments, the said sum of Rs. 44,76,800/- was treated as unexplained expenditure u/s. 69C and was added to the total income of the assessee. Aggrieved, assessee went in appeal before the ld. CIT(A). 4. Before CIT(A), it was submitted that, subsequent to the impugned assessment order, Interim Board for Settlement (IBS, erstwhile Settlement Commission) had passed a settlement order, dated 28.04.2023, wherein notings made against the assessee were considered. To demonstrate its case, references were made to the application along with annexures thereto, made before the Settlement Commission by Mr. Vikas Oberoi, details of which are elaborated below: i) Mr. Vikas Oberoi is the Managing Director/Director in the following Oberoi Realty Group of companies which also includes the assessee company wherein he is a Director and holds 99.01% shares. Sr. No. Name of Entity Designation % of shareholding 1 Oberoi Realty Limited Managing Director 58.54 2 Expressions Realty Private Limited Director -   Kingston Property Services Limited Direclol - 4 ....

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.... 66,12,800 3,63,500 1,08,72,400 9 2018-19 - 1,35,800 17,15,400 27,46,300 8,00,000 53,97,500 10 2019-20 - 12,28,500 19,51,000 36,42,700 67,00,000 1,35,22,200 11 2020-21 - 1,01,900 9,03,000 8,62,300 11,20,000 29,87,200   Total 10,15,500 2,53,90,500 2,73,85,600 6,34,73,700 2,46,46,800 14,19,12,100 iv) In the above table, column "BPPL" represents the cash payments in respect of the assessee and for items at Sr. No.5 to 10 for AY 2014-15 to 2019-20 represents that of the assessee in appeal before the Tribunal. In this respect, summary of cash flow for each of the Assessment was also furnished, one for AY 2014-15 is reproduced as under: A.Y. 2014-2015 (From 01-04-2013 To 31-03-2014) Receipts Payments Particulars Amount (Rs.) Amount (Rs.) Particulars Amount {Rs.} Amount (Rs.) Opening Balance   2,60,20,500                   On Money     Expenditure   - Oberoi Realty Limited   30,00,000 Project Expenditure 13,15....

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....expenditure does not apply on it to delete the addition made by the ld. Assessing Officer. He thus, sustained the addition so made. Aggrieved, assessee is in appeal before the Tribunal. 5. Before us, ld. Counsel for the assessee reiterated the facts discussed in detail as stated above and therefore not repeated for the sake of brevity. Admittedly, it is a fact on record that the alleged cash expenditure added in the hands of the assessee have been considered by ld. IBS while accepting the application made by Mr. Vikas Oberoi, who is a Director of assessee company, holding 99.01% shares. In the order so passed by the ld. IBS, specific mention of the assessee company is stated in respect of alleged cash expenditure transactions taken from the notings of loose papers, diaries, etc., found and seized in the course of search of Oberoi Realty Group. Also, it is a fact on record that the classification of notings from the seized material to arrive at the alleged cash payments and receipts for making the addition was done by the Department on its own analysis, which was put up before the assessee for explanation as to its nature and source. Commonality of the source was explained by the....

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.... substantial share holder of the assessee company as held in the settlement order. The notings of undisclosed expenditure had been fully explained by furnishing the cash flow statement which has been accepted by the ld. IBS. Thus, we note that cash receipt was offered to tax and out of that cash receipt, cash expenditure was noted. Addition of such cash expenditure in the hands of the assessee would tantamount to double taxation, firstly as cash income in the hands of Mr. Vikas Oberoi in the settlement proceedings and again in the hands of the assessee as cash expenditure. We are of considered view that, once the source of cash is taxed, it cannot be further taxed as unexplained cash expenditure. The issue regarding addition of unexplained expenditure in the hands of assessee is squarely covered and considered by the order of ld. IBS while disposing the settlement application of Mr. Vikas Oberoil wherein ld. IBS has accepted the explanation on the source of unexplained expenditure. 8.1. Considering the facts and circumstance of the case and the discussion made above, we delete the addition made in the hands of the assessee u/s. 69C for cash payments, treated by the ld. Assessing....