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2016 (5) TMI 534 - ITAT PUNEUnexplained investment - assessment in the hands of AOP - purchase of the property - shares of individual co-purchasers of AOP - Held that:- The land was acquired by 16 members of the family who combined together for a common purpose and common action in their own volition with a view to commercially exploit the land acquired by resale thereof at profits. It is evident that soon after purchase deed was registered, the same was handed over to the builder for development and prior thereto also the members of Khatib family were negotiating various builders for the disposal of the land. Therefore, intention of acquisition of land was to sale the same with a clear motive to make business profit. In these circumstances, the conclusion of the CIT(A) that the members of Khatib family who came together to acquire the land with intention to make profit by sale thereof as a business deal is required to be taxed in the hands of the joint owners as an AOP can not be faulted. We thus find no infirmity in the action of the CIT(A) in upholding the action of the AO exerting jurisdiction over assessee in the status of AOP. Therefore, acquisition of land and sale thereof subsequently has been rightly assessed in the hands of the AOP. Therefore, the objection of the assessee in this regard fails. We also find that the claim of the assessee that AOP family members owned the land and received the benefit/income since 1985-86 is in contradiction to the information recorded in 7/12 extracts as reproduced in para 19 of the CIT(A) order. The 7/12 extracts demonstrates that the members of the AOP were in possession of land from 1994-95 and also a part of land remain vacant and office were constructed on it. It is also clear that they were no fruit garden at though on a part of land, some seasonal crop have grown up. The situs of the land is within the municipal limits of Nasik and an urban land at the time of its sale. Therefore, it is clear in the prevailing circumstances that all the members of the AOP had combined together to purchase land with a pre-conceived idea to commercially exploit the property and make profits by immediate sale thereof as a business adventure. In totality, the circumstances are weighed against the assessee when tested on the touchstone of preponderance of probabilities. Therefore, We see no error in the action of the revenue in treating the investment in purchase of land as unexplained investment under S. 69 for the relevant assessment year 1993-94 which is rightly assessed in the hands of the AOP. We also do not find any fault in treating the transaction of purchase and sale as a part of business deal.
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