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TaxTMI 
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2022 (5) TMI 1711
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....case and in law, the Ld.CIT(A) has erred in deleting the addition of Rs.1,60,02,000/- without appreciating the fact that the Director of M/s. SDPL had admitted in his statement recorded u/s.132(4) of the Act, dated 01.12.2012 that the company has taken 'On Money' on account of sale of flats and such on money received has not been recorded in regular books of accounts of M/s. SDPL. 3 On the facts and circumstances of the case and in law, the LcI.CIT(A) has failed to appreciate the settled position of law that where direct evidences is not available or possible one has to fall back on the circumstantial evidence and apply the test of human probabilities. 4 On the facts and circumstances of the case and in law, the Ld.CIT(A) has failed to consider the provisions of the I.T. Act, 1961 that even under the Act, there is a presumption u/s.292C of the I.T. Act, 1961 that the contents of the books of account and other documents are true and such books of account/documents belongs to such person who is searched u/s,132 of the I.T. Act, 1961. 5 The appellant prays that the order of Ld.CTT(A)'s on the above ground be set aside and that of the Assessing Of....
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....se papers, Mr. Ashwin Sheth had admitted in his statement dated 01.12.2012 that these were on-money received from various clients in cash which was outside the books of accounts. On the basis of this evidence, the Assessing Officer made addition of Rs 1,60,02,0007- in the hands of the assessee. The appellant has booked two flats in the building 'Vasant Pearl' being no. 2302, 23rd Floor, Vasant Pearl and flat No. 2202, 22nd floor, Vasant Pearl, CIS No.- 104-A, Village- Dindoshi, A4-Plot, Malad (E), Mumbai. The appellant has submitted a copy of Allotment Letter dated 26.02.2010 for both the flats. A reference to the same would show that the assessee has booked such flat 2302 for Rs. 1,26,00,0007- (Rs. One Crore Twenty Six Lacs) and the assessee has booked fiat 2202 for Rs 1,26,00,000/- (Rs. One Crore Twenty Six Lacs). A perusal of the allotment letter shows that there is an earnest deposit of Rs 7,50,000/- required to be paid to the builder. The appellant has duly paid the amount of Rs 7,50,000/-. The payment was made by account payee cheque. The payment is reflected in the appellant's bank statement. The payment is reflected in the appellant's Balan....
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....y to notice u/s 133(6) of the Act, M/s Sheth Developers Pvt Ltd have nowhere admitted that they have received cash from the appellant. Further, coming to factual analysis of the issue, as per common practice followed in the market a nominal amount will be paid at the time of allotment and installments will be paid based on the progress of the work. Here, as per the Assessing Officer the appellant in addition to Rs. 7.5 lacs at also made huge payment which is almost equivalent to 75% of the total cost of the flat but, it has been submitted that no construction work was commenced at all, leave alone 75% of the work, which should have been completed to match the 75% of the amount which the appellant may have paid. Presuming that there was on many payments were involved, it would be in proportion to the payment. In the appellant's case as per A.O. the letter of allotment dated 26.02.2010 mentions that the installments shall be paid as per the schedule. It appears that the construction was not commenced, only the extent of amount alleged to have been give i.e. around 75% of the total agreement amount from the above finding also that is no justification from the amount that was paid.....
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.... laid down, the Court was of the opinion that the materials in question are not good enough to constitute offences to direct the registration of F.I.R. and investigation therein. The AR also submitted that, the case of ACIT v Ms. Katrina Rosemary Turcotte [2017] 87 taxmann.com 116 (Mumbai - Trib.), is applicable to the facts of the appellant's case the brief facts are, in the course of assessment proceedings, the Assessing Officer on the basis of material seized from a third party i.e., from the computer and mobile back up of Ms. Sandhya Ramchandran, was of the view that the assessee charges one and half times in cash over and above her remuneration in cheque. It was found that as per the evaluation sheet found from the computer of Ms. Sandhya Ramchandra, assessee is earning 28% of the reported income in cash. Accordingly, he made addition of Rs. 32,65,574. The CIT(A) deleted the addition. On Revenue's appeal, the assessee's Counsel argued that: * The said document was not found from the assessee. * The author of the document was not examined. * Ms. Sandhya Ramchandra, in the statement recorded from her expressed her unawareness with ....
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....by him, viz. Flat no. 2501 in "Somerset" building from Lakeview Developers (a Hiranandani group concern), however, the same would not conclusively prove suppression of investment and payment of "on money" by the assessee for purchase of the property under consideration. We find that the information as emerges from the print out of the pen drive falls short of certain material facts, viz. date and mode of receipts of 'on money1, who had paid the money, to whom the money was paid, date of agreement and who had prepared the details, as a result whereof the adverse inferences as regards payment of "on money" by the assessee for purchase of the property under consideration remain uncorroborated. We further find that what was the source from where the information was received in the pen drive also remains a mystery till date. We find that Sh. Niranjan Hiranandani in the course of his cross-examination had clearly stated that neither he was aware of the person who had made the entry in the pen drive, nor had with him any evidence that the assessee had paid any cash towards purchase of flat. We have deliberated on the fact that Sh. Niranjan Hiranandani in his statement recorded on oath....
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....e based on of premature observations of the A.O, which in the absence of any clinching evidence cannot be sustained, we thus are unable to subscribe to the view of the lower authorities and set aside the order of the CIT(A) sustaining the addition of Rs. 2.23 crores in the hands of the assessee. 15. The appeal of the assessee is allowed". As per the above, the Hon jurisdictional Mumbai Tribunal in the case of Anil Jaggi vs ACIT 89 taxmann.com 266 (Mum) have held that genesis of conclusion of Assessing Officer that assessee had paid 'on money' for purchase of property under consideration was based on contents of pen drive which was seized from residence of an ex-employee of Hiranandani group. Whether mere admission of amounts recorded in pen drive as additional income by falling short of any such material which would inextricably evidence payment of 'on money' by assessee would not lead to drawing of adverse inference as regards unexplained investment made by assessee for purchase of property. Also in the case of ACIT vs Ms. Katrina Rosemary Turcotte 87 taxmann.com 116 (Mum) have held that Assessing Officer on basis of documents seized in course of search ca....
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....ed to the assessee nor the cross examination was provided to the assessee. All these facts were discussed in the finding of the ld. CIT(A) as reproduced supra in this order. The assessee has also filed copy of allotment letter in the paper book furnished during the course of appellate proceedings. In the allotment letter it is specifically mentioned at serial No. 2 that assessee has to pay Rs.7,50,000/- being the earnest money and to pay the remaining amount of Rs.1,26,00,000/- for flat No. 2202 at different stages of construction of the property i.e Plinth Podium1, P-2 Slab to 25 slab then top slab, plaster, flooring & possession etc, in the same manner the payment schedule is also given for another flat No. 2302 in the allotment letter totaling to Rs.1,26,00,000/-. The assessee has also submitted along with documentary evidences that construction work was stopped on the direction of the Hon'ble Bombay High Court. Due to stoppage of work the agreement with the builder was not registered. The assessee has placed copies of supporting documents in the paper book. The assesse has also filed valuation report showing that the total cost price of the flat was more than the value determin....
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....am Trib). 8. Heard both the sides and perused the material on record. The case of the assessee was reopened on the basis of information received from DCIT,CC-4(2), Mumbai as discussed supra in this order. The A.O has recorded reason to believe that amount of Rs.1,60,02,000/- has escaped assessment within the meaning of provision of Sec. 147 of the Act. It is noticed that pursuant to search conducted at premises of M/s Sheth Developer Pvt. Ltd. no seized materials was handed over to the A.O of the assessee by the A.O of M/s Sheth Developer Pvt. Ltd. The Hon'ble High Court of Madras in the case of Karti P. Chidambaram V. Pr. DIT(Inv.) vide 128 taxmann.com 116 (Madras) held that since initially only information about search was provided to jurisdictional A.O, action under section 153C could not be initiated as procedure mandates handing over all the seized material to the A.O. In the light of the above facts and findings we do not find merit in this ground of cross objection of the assessee, therefore, the same stand dismissed. Ground No. 2 & 3 of Cross Objection: 9. It is reported in the assessment order that notice u/s 148 of the I.T. Act was issued to the assessee on 30.03....