TMI Blog2012 (7) TMI 308X X X X Extracts X X X X X X X X Extracts X X X X ..... in this behalf and mere narration of facts in statement of facts will not suffice inasmuch as the law provides that the CIT(A) shall decide the appeal on the grounds raised by the assessee. Advances received from ATS held to be business transaction- CIT(A) has not recorded any specific finding about the aspect of MOU being genuine or otherwise. In the absence of a clear finding about the genuineness of the MOU, reference to business customs and usages are not decisive. Unexplained gifts - Ignoring the importance of relationship, occasion of gift and human probabilities in case of gift from unrelated persons, the issue is decided solely on the basis of confirmations and gift deeds - set aside the appeals back to the file of CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) Deletion of addition of Rs. 6,02,000/- made by Assessing Officer on account of deemed dividend. A.Y. 2004-05: (1) Deletion of addition of Rs. 5,12,000/- made on account of unexplained loan u/s 68. (2) Deletion of addition of Rs. 5,00,000/- made on account of unexplained gift from Shri Sanjay Mohan Agarwal. A.Y. 2005-06: (1) Deletion of addition of Rs. 25,00,000/- made on account of unexplained loan /s 68. (2) Deletion of addition of Rs. 65,00,000/- made on account of deemed dividend. A.Y. 2006-07: (1) Deletion of addition of Rs. 70,25,000/- made on account of deemed dividend. (2) Deletion of addition of Rs. 28,04,022/- made on account of unexplained loan u/s 68. A.Y. 2007-08: (1) Deletion of add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereafter, the amount of advance was returned to assessee. 4.2. Assessing Officer observed that the assessee s proposition was not convincing and devoid of any merit. In case of breach of contract, the amount of advance was liable to be forfeited, which condition was conveniently missing in the alleged agreement between assessee and ATS. Since the assessee s proposition amounted to cover up the loan transaction, which were clearly hit by sec. 2(22)(e), the additions were made. 4.3. In respect of other credits and gifts the assessee could not file proper evidence. It is evident from the record that sufficient opportunity was given to assessee to submit necessary documents. In these circumstances, there was desirability for CIT(A) to admi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... genuineness of MOU, which is refuted by Assessing Officer . The assessee being a major share holder, was well aware of financial position of the ATS; assessee is nothing but the ATS itself, therefore, the theory of agreement to sell the property and subsequent default and lapses of ATS, without any penalty clause in MOU and refund of the amount to assessee are attempts to get out from the clutches of sec. 2(22)(e) of the Act. Thus, in the absence of specific ground about the admission of additional evidence and action being in violation of Rule 46A, the appeals of the assessee should have been heard by CIT(A) rejecting the additional evidence which would have led to confirmation of additions instead of deletion. Reliance is placed on the H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cy of time on every level of proceedings. Therefore, the admission of additional evidence was justified. 6. We have heard rival contentions and gone through the relevant material available on record. In our considered view the admission of additional evidence has to be in terms of Hon ble Delhi High Court judgment in the case of Manish Build Well Pvt. Ltd. (supra), which mandates that when the Assessing Officer has objected to the admission of additional evidence, then the issue should be decided first and thereafter the Assessing Officer may be asked to furnish the remand report. We are inclined to set aside the appeals back to the file of CIT(A) on following reasons: (i) Admission of additional evidence in terms of sec. 46A has not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration as the part consideration is made only on execution of agreement/ purchase deed which is not the case here. It cannot be accepted that before executing any purchase deed, any company or businessmen would give part consideration and therefore, the theory given by the assessee is not convincing. Even if, it is presumed that the said amount was not in the nature of loan, even then, it constituted nature of Advance as defined in Sec. 2(22)(e) of the IT Act as this amount was given before execution of purchase deed. All this description shows that the explanation furnished is just after thought after receipt of show cause notice in respect of deemed dividend. Therefore, it is clear that this explanation is nothing but to cover up th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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