TMI Blog2023 (10) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... a well established and accepted principal of tax jurisprudence that the right income should be taxed in the right hands, under right head of income in the right year of assessment. Undisputedly, in the present case the transaction of sale of property was undertaken by the assessee during FY 2006-07 pertaining to AY 2007-08 but the assessee did not recorded the entry in the books of accounts and continuously shown the property in the balance sheet till AY 2012-13. Hence, the books of accounts of assessee were not revealing correct factual position of properties owned by assessee till 2012-13. As noted that as per assessee during assessment proceedings of AY 2012-13 AO issued notice u/s. 133(6) to the purchaser and in response to said noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds raised by the assessee are as under:- 1. That the Learned CIT(A), on the facts and circumstances of the case, erred in assessing the income of the Appellant at Rs. 1,06,70,000/ - as income from undisclosed sources against returned income of Rs. 28,85,510/-arbitrarily without appreciating the Appellate submissions and evidences brought on record. 2. That the Learned CIT(A) did not appreciate the facts of the case raised in additional legal grounds that even income returned of Rs. 28,85,510/-cannot be assessed in the year under appeal as the said income accrued in A. Y. 2007-08 on the basis of registered Sale Deed of the Land(s) sold by the Appellant and the Appellant erroneously offered the same as income of the year under appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding the contention of the Assessing Officer that sale proceeds of land(s) shown at Rs. 1,06,70,000/ - as Prior Period Income shall be chargeable to tax in the year under appeal and cost of land(s) sold amounting to Rs. 76,91,060/- shall not be allowed against the sale consideration, for arriving the profit on sale of land(s) arbitrarily. 4. Reiterating written submissions precisely as above, the ld. AR has also placed reliance on the judgment of High Court of Delhi in the case of CIT vs. Bharat General Reinsurance Comp. Ltd. 81 ITR 303 (Del) and submitted that the income accrued to the assessee should be taxed in the year of accrual of income and not in the other year as per choice of Assessing Officer. Therefore he finally prayed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l consideration of Rs. 1,06,70,000/- vide sale deeds dated 21.03.2007 but did not account for the transaction in the FY ending 31.03.2007. The appellant has submitted that it has not received the payment from the purchaser therefore it has not offered the same as income during the year of sale. It has received cheques against the sale but not deposited as the instruments were misplaced and purchaser did not issue any another cheques / pay orders. These facts come into the notice of the management in the FY 2011-12 and accordingly the sale transactions were accounted in the books of account and in final accounts under the head 'prior period income' i.e. Rs. 1,06,70,000/- and 'prior period expense' i.e. Rs. 76,91,960/- and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e transaction in the year when it is actually carried out. Income has to be offered in the year when it has accrued / received to the appellant. Thus considering all the facts, in the case of the appellant A is justified in treating the income credited during the year as income from unexplained sources and addition made by the AQ at Rs. 1,06,70,000/- is hereby confirmed. 7. On careful consideration of above rival submissions, orders of the authorities below and facts and circumstances of the case we note that the appellant has credited an amount of Rs. 1,06,70,000/- and claimed expenses at Rs. 76,91,960/- disclosing profit at Rs. 29,48,895/-. The authorities below noted that the assessee has sold land situated in village Murti at Noorna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P L account as income from other sources. The contention of appellant that cheques were misplaced and entire facts of non receipt of consideration came to the notice of management during FY 2011-12 therefore the transaction was not recorded in the FY 2006-07 were dismissed by the ld. CIT(A) by observing that the appellant has sold property during FY 2006-07 and as per sale deed it has received consideration also. 9. First of all we may point out that it is trite law that entries in the books of accounts are not determinative of true nature of transaction and nature of income as per preposition rendered by Hon ble Supreme Court in the case of Kedarnath Jute Mfg. Co. Ltd. vs CIT 82 ITR 363 (SC). It is also a well established and accepted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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