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2021 (10) TMI 452 - ITAT INDOREAssessment u/s 153A - undisclosed receipts of ‘on-money’ received from sale of flats - incriminating document pertaining to assessee was found from the premises of other concerns - Whether evidences brought into light by the A.O. during assessment proceeding? - HELD THAT:- Entire procedure of additions in assessee’s case was based on the documents found during search which related to other group companies named Silver Mansion, Silver Mansion Extension and have no any relevance or relation with the assessee co. as none of the concerns, belonging to Jhaveri Group, have the line of business in which the assessee company deals. As all the group concerns of Jhaveri Group are engaged in the business of development of land and sale thereof after plotting, whereas, the assessee company has not sold a single inch of land. It’s main and core business is to construct residential and commercial units. The units are in the shape of apartment, row houses, bungalows and shops. Assessee explained that the rate fixed for the purpose of sale is as per the deal struck by the assessee with the prospective buyer and which is in unit of per sq Feet and for the purpose of calculation of saleable area, ingredients of space utilized in the construction of common area, roads, clubs, gardens, staircases and parking etc. are apportioned in the number of unit. Resultantly, a customer is required to pay 30% more than the carpet area bought by him. AO wrongly estimated rate per square feet, by comparing the rates adopted in the adjoining township, ‘Silver Mansion’, is a project of Jhaveri Group, totally disjoint with the assessee company. Similarly, some enquires conducted in the cases of Shikharji, Ajitnath Reality Pvt. Ltd. and Padmaprabhu Infrastructure Pvt. Ltd. were irrelevant as is evident from the computation of income of the assessee. Even otherwise, the issue of M/s Shikharji is before the Settlement Commission and therefore, the comparing the case of Shikarji with that of assessee is unjustified. AO failed to pinpoint a single mistake in the books of accounts maintained by the assessee. He could not pin-point any enquiry made in the assessee’s case from which adverse inference could be drawn. He did not conduct any enquiry in the assessee’s case which is apparent from the fact that no such details of enquiry have been incorporated in the assessment order - assessee filed complete details before the Assessing Officer in respect of sale and also the details product-wise of Phase one & two.- assessee’s books of accounts are audited and no any incriminating document were found relating to the assessee company during the course of search and no any defect to the maintenance of the books of accounts were noticed by the search team and the AO during the course of Assessment proceedings . Therefore, we are of the view that the additions made were uncalled for. In respect of the summons issued to some Shri Ramesh Chandra Gupta, Garima Chelani and Kokila Chelani are concerned, we find that the Assessing Officer could not bring any cogent material to establish that the assessee has business transactions with these persons. Therefore, the observations are baseless. 51% shares are held by Jhaveris and 49% by Fire Capital Fund. The investment made by Fire Capital Fund is from US Investors routed through Mauritius. Therefore, the observations made by the Assessing Officer are not justified as the assessee co. does not belong to Jhaveri Group accordingly. As AO made the addition on the basis of the aforesaid seized document and the same has been owned up by Shri Mukesh Jhaveri and Shri Abhishek Jhaveri in 50:50 ratio and paid due taxes which has been accepted by the Settlement Commission vide order dated 22.8.2016. Therefore, the ld. CIT(A) had deleted the addition of ₹ 37,07,335/-. Thus, we find that the tax in respect of the seized document has been paid and the seized document has no relevance so far as the case of the present assessee is concerned. As no single incriminating document pertaining to assessee was found from the premises of other concerns as narrated above showing that any “on-money” was received by the assessee - the operation under section 132 was simultaneously carried out in the project office of the company and there also no incriminating document was found or seized as is evident from the contents of the Assessment Order itself which show no reference to incriminating documents or undisclosed assets before making any addition for alleged “on-money - Decided against revenue.
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