TMI Blog2014 (10) TMI 326X X X X Extracts X X X X X X X X Extracts X X X X ..... us Rochem Separation Systems India (P) Ltd. & others [2011 (5) TMI 370 - ITAT, Mumbai] - an addition made on mere statement of the purchaser, i.e. K.K. Goel, HUF, cannot stand - the order passed by the CIT(A) is upheld – Decided against revenue. - ITA No. 5040/Mum/2009 - - - Dated:- 8-10-2014 - Shri D. Manmohan And Shri B. R. Baskaran,JJ. For the Appellant : Shri Santosh Kumar For the Respondent : Shri Ajay R. Singh ORDER Per D. Manmohan, V. P. This appeal by the Revenue is directed against the order passed by CIT(A), Central VIII, Mumbai and it pertains to A.Y. 2003-04. 2. The following grounds were urged before us: - 1. On the facts and in the circumstances of the case and in law, the Id. CIT(A) was not justified in deleting the addition of on-money received by the assessee outside the books of accounts without appreciating the statement on oath of Shri K.K. Goel recorded u/s 132(4) of the IT Act, supported by the documents seized in course of search and action. 2. On the facts and in the circumstances of the case and in law, the Id. CIT(A) was not justified in deleting the addition of on-money received by the recipient assessee fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was issued. It deserves to be noticed that the ACIT, Central 10, Mumbai seized certain documents on 04.09.2007 which shows that the assessee sold a residential flat in the building known Dheeraj Dhan to Shri K.K. Goel and others for a consideration of ₹ 72,00,000/- vide sale agreement dated 24.07.2002 whereas search and seizure action carried out by the Revenue in the case of Shri K.K. Goel and M/s. Rochem Separation System (I) Pvt. Ltd. and consequent statement of Shri K.K. Goel shows that on purchase of the aforementioned flat Shri K.K. Goel has paid cash of ₹ 46,00,000/- as onmoney to the assessee. In the opinion of the AO the on-money receipt deserves to be added as undisclosed income of the assessee. 4. On the other hand, the case of the assessee is that the statement made by the said purchaser, during the course of search proceedings, is not supplied to the assessee till date. Even otherwise no corroborative material was found during the course of search whereby it can be conclusively proved that the assessee received on-money from the said purchaser. It was also submitted that neither the DDI who has conducted the search nor the AO of the said purchaser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Directors of the company. A photocopy of the said resolution was also enclosed. It was, thus, strongly submitted that the alleged payment of on-money by K.K. Goel, HUF is not proved by the Revenue. 6. The learned CIT(A) considered the issue exhaustively and extracted the reply, given by M/s. Vinodkumar Bindal Co., Chartered Accountants in response to the summons issued to the purchaser, to notice that the group company incurred a sum of ₹ 46,00,000/- towards interior work in the said flat and there is no other evidence to prove to the contrary. In this regard the learned CIT(A) observed as under: - 3.9 Perusal of the above reply, shows that it is categorically stated that the total consideration was paid of ₹ 72,00,000/- for which an agreement between the assessee and builder was made on 24.07.2002. The said consideration was paid to the assessee through the bank account which however stated in relation to total consideration of ₹ 72,00,000/-. M/s. Rochem Separation System (I) Pvt. Ltd. a group company incurred a sum of ₹ 46,00,000/- towards the interior work in the said flat as per the Resolution of the Board of Directors of the company. This am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the papers seized from a third party, his statement (which was subsequently retracted) the forced statement of which was also retracted. Therefore addition cannot be upheld. 8. Aggrieved, Revenue is in appeal before us. The learned D.R. strongly relied upon the order passed by the AO and submitted that the purchaser admitted to have paid on-money and the assessee did not bring any material to prove to the contrary. 9. On the other hand, the learned counsel for the assessee submitted that Shri K.K. Goel, HUF purchased another piece of property from M/s. Housing Development Infrastructure Ltd. and on behalf of the HUF he gave a similar statement i.e., he paid on-money to the seller, but when the matter came up before the Appellate Tribunal, the ITAT H Bench, Mumbai (ITA No. 4979/Mum/2009 dated 24.07.2013) set aside the addition on the ground that the addition was made in violation of the principles of natural justice. Following observations are relevant in this context : - 8. We have considered the rival submissions, perused the orders of the lower authorities and the material evidences brought on record. The undisputed facts emerging out of the assessment record show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... UF claimed in its return that a sum of ₹ 46,00,000/- was incurred on interior and other works in the said flat and this aspect was accepted by the Tribunal. Similarly, the addition made in the case of M/s. Rochem Separation System (I) Pvt. Ltd. was also accepted by the Tribunal. It was thus submitted that the learned CIT(A) was justified in deleting the addition in the facts and circumstances of the case. 10. We have heard the rival submissions and carefully perused the record. The assessment in this case was made on 13.06.2008 whereas Shri K.K. Goel expired in May, 2008 and thus the assessee could not get opportunity to cross examine the person concerned. At any rate, representative of Shri K.K. Goel, i.e. M/s. Vinodkumar Bindal Co., Chartered Accountants, in response to the summons issued by AO, appeared and stated that the purchaser never paid any on-money to the assessee and the same was spent towards interior work in the said flat as per the resolution of the Board of Directors of the company. This aspect was also considered by the ITAT in the case of M/s. Rochem Separation System (I) Pvt. Ltd. as well as Shri K.K. Goel, HUF. In fact, under identical circumstances t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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