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2021 (4) TMI 101 - AT - Income TaxAddition on the basis of cash found during the search accepted in his statements u/s 132(4) and statement u/s 131 - separate addition can be made while framing assessment u/s 153A allowed or not? - HELD THAT:- In the statement recorded u/s 132(4) of the Act, the assessee has stated that he was not maintaining books of accounts as income was being disclosed u/s 44AD which did not require maintenance of books of accounts - CIR(A) has further held that in the general analysis, if as per evidence found as a result of search, the total turnover is exceeding the limit prescribed u/s 44AD, the income has to be computed as per regular provision and not under presumptive scheme. If what is found is only relating to payments made which has nexus with the business of civil construction carried on and not in respect of any other activity, the payment will be merging into calculation of presumptive scheme and no separate addition can be made while framing assessment u/s 153A. The assessee has not been able to establish factually the presence of cash of ₹ 6,47,500/- and the ld. CIT(A) held that this cash is part of the turnover which is not disclosed by the assessee, therefore, the AO shall tax it at the rate of 8.04% in terms of section 44AD (8.04% declared by assessee). In view of the above facts and circumstances of the case, we find no infirmity in the order of the ld. CIT (A), the same is upheld. Ground no. 1 is allowed. Addition on account of interest payment on the loan taken on 25.05.2012 and returned on 12.01.2013 - AO made the addition of this amount on the ground that the same was not verifiable from the books of accounts - CIT(A) has deleted the addition under consideration by holding that the statement recorded u/s 132(4) of the Act, the assessee has categorically stated that he was not maintaining books of accounts as income was being disclosed u/s 44AD which did not require maintenance of books of account - HELD THAT:- . In view of this, the statement recorded u/s 132(4) would prevail over statement recorded u/s 131 - assessee has further quoted various board circulars decrying surrender in confessional statement. CIT(A) has in agreement with the submission of the assessee that when income was declared u/s 44AD and so accepted by the AO there was no case for making addition of the payment of interest on the ground that it was not verifiable. The assessee was not in a position to get the payment of interest verified with reference to books of accounts as no books of accounts has been maintained. In view of the above facts and circumstances of the case, we find no infirmity in the order of the ld. CIT (A), the same is upheld. Ground no. 2 is allowed. Unaccounted cash payment - AO made the addition on the basis of pages on the ground that the payment as unexplained and not verifiable - statement recorded u/ 131 ignoring the statement recorded under section 132(4) at the time of search on 24.05.2013 - HELD THAT:- AO has referred the statement of the appellant recorded u/s 131 on 16.07.2013 wherein assessee was made to accept the expenditure as unexplained as he was not in a position to get the same verified with reference to books of accounts as no books of accounts has been maintained. CIT(A) also held that the assessee has disclosed gross receipts of ₹ 56,40,320/- and on such gross receipts income of ₹ 4,53,640/- has been disclosed by way of rate application of 8.04%. Income was disclosed u/s 44AD and the same was accepted. In the statement recorded u/s 132(4) assessee has categorically stated that he was not maintaining books of accounts as income was being disclosed u/s 44AD which did not require maintenance of books of accounts. In view of this the statement recorded u/s 132(4) would prevail over statement recorded u/s 131, the ld. CIT(A) held that when income was declared u/s 44AD and so accepted by the Assessing Officer there was no case for making addition of the cash payment which stood covered by the deemed expenditure of ₹ 51,86,680/- -The order of the ld. CIT (A) is upheld. Ground No. 3 is allowed. Addition on account of unaccounted expenditure - AO made the addition on the basis that the assessee has failed to verify the expenditure from his books of accounts - CIT(A) has deleted the addition - HELD THAT:- AO has referred the statement of the assessee recorded u/s 131 on 16.07.2013 wherein assessee has accepted the expenditure as unexplained as he was not in a position to get the same verified with reference to books of accounts as no books of accounts has been maintained - CIT(A) has considered the reply of the assessee, wherein it has been stated that the above page itself discloses that it was an estimate of expected expenditure on construction at three sites. Further the assessee has submitted these construction work receipts stand disclosed in Assessment Year 2013-14 of ₹ 98,60,000/- and Assessment Year 2014-15 of ₹ 56,40,320/-. Considering the above facts and circumstances of the case as discussed by the ld. CIT (A), we find no infirmity in the order of the ld. CIT (A), the same is upheld. Addition based on the statement under section 131 on account of unaccounted expenditure - Addition based on seized paper - CIT(A) has deleted the addition under consideration by holding that in the statement recorded u/s 132(4) of the Act, the assessee has categorically stated that he was not maintaining books of accounts as income was being disclosed u/s 44AD which did not require maintenance of books of accounts - HELD THAT:- We find that the ld. CIT (A) after considering the facts of the case as well as the submissions of the assessee has rightly concluded there was no case for making addition of the cash payment which stood covered by the deemed expenditure of ₹ 51,86,680/-. Therefore we find no justification or relevance to interfere or deviate from the order passed by the ld. CIT (Appeals). Therefore, we upheld the order of ld. CIT (A) and delete the addition.
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