TaxTMI 
TaxTMI 
2026 (6) TMI 926
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....d 21.12.2019 passed u/s. 143(3) of the Income-tax Act, 1961 [hereinafter referred to as "the Act"] by the Deputy Commissioner of Income Tax, Non Corporate Circle 19(1), Chennai [hereinafter referred to as "the AO"] pertaining to the Assessment Year (A.Y) 2017-18. 2. The brief facts of the case are that the assessee is an individual engaged in the business of real estate development and construction under the name and style of M/s.Guru Builders. For the A.Y 2017-18, the assessee filed the return of income declaring total income of Rs. 93,19,310/-. A survey u/s. 133A of the Act was conducted at the business premises of the assessee on 24.01.2018. During the course of survey, a statement u/s. 131 of the Act was recorded from the assessee. S....
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....eements and observed that in one case the difference in construction cost was Rs. 30,00,000/- and in another case the difference was Rs. 10,09,756/-. During the survey proceedings, the assessee admitted the aggregate differential amount as additional income. Based on such admission, the AO treated a sum of Rs. 40,09,756/- as undisclosed income of the assessee. 7. During assessment proceedings, the assessee explained that the variation in construction cost was attributable to fluctuations in market conditions, increase in labour and material costs and negotiations with individual customers. The AO rejected the explanation on the ground that no supporting evidence was produced and accordingly made the addition. 8. The Ld.CIT(A), while a....
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....on being charged from different purchasers even in the same project. Merely because two flats of similar area have been sold at different prices, it cannot automatically be inferred that the higher price represents the true market value and the difference in the lower-priced transaction constitutes undisclosed income. 10. The AO has not conducted any enquiry with the purchasers nor gathered any evidence to establish that the assessee received any amount in cash over and above the consideration recorded in the agreements. The addition has been sustained merely because the assessee had made an admission during the survey proceedings. It is well settled that an admission, though relevant, is not conclusive and must be supported by independe....
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.... the assessee to substantiate the claim. The assessee submitted copies of sale documents and explained that the payments were made in accordance with the arrangement reflected therein. 14. The AO, however, held that no documentary evidence was produced to establish the nature of services rendered by M/s.Vetri Reals and consequently disallowed the amount of Rs. 24,44,375/-. The Ld.CIT(A) confirmed the disallowance on the ground that the assessee failed to furnish sufficient proof regarding the marketing and development activities allegedly undertaken by M/s.Vetri Reals. 15. After carefully examining the material available on record, we find that there is no dispute regarding the factum of payment. The payment has been reflected in the ....
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.... viewpoint of the Revenue authorities. Unless the expenditure is shown to be bogus or not incurred for business purposes, the same cannot be disallowed merely because the AO is not fully satisfied about the manner in which the services were rendered. In the present case, no adverse material has been brought on record to discredit the genuineness of the payment. The disallowance has thus been made on conjectures and surmises. We therefore hold that the Ld.CIT(A) was not justified in sustaining the addition. Accordingly, the addition of Rs. 24,44,375/- is directed to be deleted. This ground of appeal is allowed. Issue No.3: Addition of Rs. 12,61,220/- under section 43CA of the Act: 19. During assessment proceedings, the AO examined cert....
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.... establish that the stamp duty value was excessive or that any statutory exception available u/s. 43CA of the Act was applicable. 23. The only explanation advanced by the assessee is that there was recession in the real estate sector. Such a contention, though commercially plausible, cannot override the specific statutory mandate contained in section 43CA. Once the conditions prescribed in the section stand fulfilled, the AO is bound to adopt the stamp duty value as the deemed consideration unless the assessee demonstrates circumstances warranting departure from the statutory prescription. 24. The assessee has neither challenged the stamp duty valuation before the competent authority 3nor sought any valuation exercise contemplated und....