2026 (4) TMI 644

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....tion made by the AO of Rs. 3,88,09,174/- on account of on-money receipts by observing that only profit element of the gross on money receipts can be considered for taxation, without considering the facts that the assessee could not produce any documentary evidences regarding expenses incurred out of the on-money received during the year under consideration. [iii] Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in restricting the addition to Rs,1,28,50,000/- by ignoring the fact no separate addition was made on account of unexplained cash credit considering the fact that only a part of the on money was used for bringing the unaccounted on money into the books of accounts in the form of unsecured loans. [iv] It is, therefore, prayed that the order the Ld. CIT(A)-4, Surat may be set aside and that of the AO may be restored to the above extent. [v] The assessee craves leave to add, alter, amend and/or withdraw any ground(s) of appeal either before or during the course of hearing of the appeal." ITA No. 88/Srt/2022 A.Y. 2015-16 "1 The Ld CIT(A) has erred and was not just and proper on the facts of the ....

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....tiny vide order dated 14-12-2017. Notice u/s. 143(2) was issued on 29-08-2016 and 142(1) along with detailed questionnaire was issued on 16-01-2017 which was duly served upon the assessee. In response to the notices u/s. 143(2) and 142(1) of the Income Tax Act, the A.R. of the assessee attended the proceedings and filed details from time to time. The Assessing Officer observed that the assessee is a partnership firm in which Ketan M Patel and Mukesh J Patel are partners on 50:50 profit sharing ratio. During the course of search and survey at the residential related to Ketan M. Patel, it was found that Shri Bharati Developers has developed a project named Shree "Bharati Royal Residential Project". This project has both residential and commercial properties. The statement of Shri Ketan Mahadevbhai Patel was recorded on 18-04-2014 at Lajpore Jail, Surat. When he was arrested along with cash of Rs. 8.1 crores on charges of attempt to bribe. In the statement dated 18-04-2014, Nitin M. Patel stated that Rs. 7.0 crores belongs to him out of the cash seized by the Gujarat Police to Rs. 8.1 crores. Further, he admitted that the cash amount of Rs. 7.0 crore seized by Gujarat Police was gener....

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....rati Developers. The statement of Hemant Ratilal Chauhan, supervisor at Bharati Royal Residency was also recorded during the course of survey on 09-09-2015 wherein reply to question no. 5 admitted about sale of Bharati Royal Residency by Rs. 3500 per sq. ft. as well during the earlier year it was between Rs. 2800 to Rs. 3200 on super built up area. Shri Mukesh M. Patel in his statement recorded u/s. 132(4) dated 10-09-2015 in response to question no 17 stated that the difference between the actual sale price, the jantri rate was given by the prior in cash at the time of booking of flats whereas at the time of document payment made through cheques. The assessee in his statement dated 09-09- 2015 at premises to furnish details of shroff from whom entry are reflected in balance sheet of the firm but the same was not furnished before the Assessing Officer. From the perusal of tax report it was found that fresh loans have been availed from 23 depositors during the assessment year 2015-16 which was categorically mentioned at page 5 of the assessment order and total amount of loan/deposits taken/accepted amounted to Rs. 1,28,50,000/-. The Assessing Officer observed that that from the peru....

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.... could not produce any documentary evidences regarding the expenses incurred out of the on money received during the year under consideration. There was no separate addition made on account of unexplained cash credit considering the fact that only the part of the on money was received for bringing the unaccounted on money into the books of accounts in the firm of unsecured loans. The ld. D.R. relied upon the assessment order and further submitted that the Assessing Officer has categorically given the linkage of on money receipt from the sale of flats/shops by the assessee firm as well as the statement wherein the said cash generated was used to be given to local shop and get cheque in the name of the firm as mentioned in para 8 of the assessment order. Thus, the entire unsecured loans obtained during the year 2014-15 were computed by the Assessing Officer after taking into account the statement of Shri Mukesh J. Patel as well as the details of lenders who received the cash prior to lending the said amount to the assessee firm. 6. The ld. A.R. submitted that the CIT(A) has not accepted the fact that the assessee has already declared income of Rs. 2,70,00,000/- for the assessment ....