AI Drafter 
TaxTMI 
TaxTMI 
2025 (8) TMI 743
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....als], as against the loss returned and reported by the appellant of Rs. 9,40,050/-, on the facts and circumstances of the case. 3. The learned Commissioner of Income-tax [Appeals] is not justified in confirming the addition made by the learned assessing officer amounting to Rs. 4,42,71,506/- as unexplained investment under section 69 of the Act, on the facts and circumstances of the case. 4. The leaned Commissioner of Income-tax [Appeals] failed to appreciate that the appellant in its books has shown the said property on the asset side of its balance sheet since and the partner's capital account has been credited in the books, the source for investment in the property is duly explained and consequently the question of treating the same as unexplained investment under section 69 of the Act does not arise and the addition made on a wrong premise by the learned assessing officer and confirmed by the learned Commissioner of Income -tax [Appeals], requires to be deleted, on the facts and circumstances of the case. 5. The learned Commissioner of Income-tax [Appeals] failed to appreciate that the provisions of section 69 of the Act is not applicable to the i....
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....lore East Taluk was classified as Rajakaluve / Ditch Kharab Land and therefore the said lands belonged to the Government. On that basis, the Tahsildar directed the removal of the unauthorized encroachment made in the said survey numbers. Since the property purchased by the assessee falls in the survey no. 57 of Kasavanahalli Village, Varthur Hobli, Bangalore East Taluk the partner of the assessee had requested their bankers not to pass the cheques issued to the seller. Even though the partner had given the cheques for effecting the sale deed, in view of the dispute about the title of the land, the assessee was not interested in that property and therefore they have not made the payment by passing the cheques given in the name of the seller. Before that, the assessee while finalizing the accounts, had shown the said property as intangible assets in the balance sheet and credited the partners capital account since the partner had given his personal cheques. But the fact remains that there is no transfer of property by way of the above said sale deed dated 22/06/2016 and the physical possession of the property was not handed over by the seller and also not received by the purchaser th....
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....e consideration of Rs. 4,42,71,506/- and to that effect, they also executed the sale deed on 22/06/2016. In the said sale deed, it was clearly averred that the sale consideration is to be paid in the following manner. 6. Therefore the sale consideration was paid by way of four cheques drawn on Union Bank of India, Jayanagar Branch, Bangalore dated 22/06/2016. Only on the basis of the said sale consideration, the sale deed was registered by the authority. We have also perused the order passed by the Tahsildar, Bangalore East Taluk, Krishnarajapuram, Bangalore - 560 036 in Case No: N.C.R/CR/.03/14-15 dated 07/11/2014 in which the Tahsildar had adjudicated that the lands in question in Survey Numbers 51,57 & 63/2 of Kasavanahalli Village are Rajakaluve Kharab land which is the Government land and therefore ordered to vacate the unauthorized encroachment on the said lands. Hence it is clear that the lands involved in the sale deed are the Government lands and on that basis, the Tahsildar had ordered to remove the encroachment in the said lands. We have also perused the schedule of the property mentioned in the said sale deed dated 22/06/2016 which is as follows: 7. When we compar....
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....operty situated at Sy.No. 57, Plot 3, 4 and 5, Shubh Enclave, Kasavanahalli Village, Varthur Hobli, Bangalore and therefore the addition made u/s. 69 of the Act is not warranted. Merely, based on the entries in the accounts, when there are other records available to show that the entries are wrong, the addition u/s. 69 could not be made. Admittedly, in this case, there is no investment as alleged by the authorities and also there is no unexplained source towards the same. Further, section 69 of the Act makes it clear that in order to attract the said provision, the following ingredients has to be satisfied. 1) The assessee should make the investments or incur expenses that are not recorded in the books of accounts. 2) The source of the funds used for this investments or expenses is not explained. 3) If the above two ingredients are satisfied, then only the addition u/s. 69 can be made. 10. In the present case, there is no dispute that the investments are recorded in the books of accounts and the assessee also offered the explanation based on the documents and therefore the invoking of section 69 to the facts and circumstances of the case is not correct....
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....question whether the parties intended that transfer of the ownership should be merely by execution and registration of the deed or whether they intended the transfer of the property to take place, only after receipt of the entire consideration, would depend on the intention of the parties. Such intention is primarily to be gathered and determined from the recitals of the sale deed. When the recitals are insufficient or ambiguous the surrounding circumstances and conduct of parties can be looked into for ascertaining the intention, subject to the limitations placed by Section 92 of Evidence Act." 12. Similarly, in the second judgment, the Hon'ble Supreme Court had observed as follows: "15. Section 54 of the Transfer of Property Act, 1882 (for short "the TP Act") reads thus: "54. "Sale" defined.-"Sale" is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised. Sale how made.-Such transfer, in the case of tangible immoveable property of the value of one hundred rupees and upwards, or in the case of a reversion or other intangible thing, can be made only by a registered instrument. In the case of tangible i....
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....addition made u/s. 69 of the Act . 15. In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 06th January, 2025 ============= Document 1 *1036 /2016-17 /7-13 G. Relying on the aforesaid representations of the Vendor, the Purchaser has agreed to purchase the Schedule Property for a total sale consideration of Rs.4,47,18,706/- (Rupees Four Crore Forty Seven Lakhs Eighty Seven Thousand Seven Hundred and Six only); NOW THEREFORE IN CONSIDERATION HEREINBEFORE MENTIONED, THIS DEED OF SALE WITNESSETH AS FOLLOWS: - 1. That in pursuance of the aforesaid Agreement and in total consideration Rs.4,47,18,706/- (Rupees Four Crore Forty Seven Lakhs Eighty Seven Thousand Seven Hundred and Six only); and Rs.4,47,200/- (Rupees Four Lakths Forty Seven Thousand and Two Hundred only) (i.c, 1% TDS] deducted from the total consideration and the same has been remitted to the bank by the purchasers towards TDS on immovable property under section 194LA and remaining consideration of the payment of the sale price of Rs.4,42,71,506/- (Rupees Four Crore Forty Two Lakhs Seventy One Thousand Five Hundred and Six only) paid by the Purchaser to the Se....