2023 (2) TMI 311 - AT - Income Tax

Reopening of assessment u/s 147 - deemed income u/s. 69A of the Act and taxed u/s. 115BBE - payment against the sale of 54 flats was received in cheques by the Assessee, on which the Assessee has not given any explanation regarding not mentioning of the transaction in the audit report - HELD THAT:- Since the Assessee did not ever present the cheque to the bank, there is no question of realization of the cheques. In the matter of mentioning of this amount in 3CD report, the cheques of this amount were taken as abundant precaution to secure the interests and not as advance/income and hence, the Assessee was not under obligation to report this alleged income in form 3CB and 3CD, as there is no appropriate column to disclose such cheques which are taken (to secure the interests) in lieu of incomplete and unfulfilled agreement.

Vide letter M/s. Shubhkamna Buildtech Pvt. Ltd. has asked for not depositing the issued cheques handed over vide agreement dated 04.03.2012 and to return the same. In this case, the argument of the ld. AR is understandable that if this income is considered as accrued, the claim of the Assessee is that the same became a bad debt and hence, needs to be allowed.

Assessee before us claimed that the cheques on the basis of which the addition has been made, were never presented in its bank account and the said company i.e., M/s. Shubhkamna Buildtech Pvt. Ltd. has also asked the Assessee to return unpresented cheques.

In our considered view as the parties also consented to, the following facts needs to be examined:

(i) Whether the Assessee has returned the cheques to the said company or not;

(ii) Whether the Assessee has taken any amount in lieu of returning the said cheques;

(iii) Whether the Assessee has taken any part payment on account of commission/brokerage in any other form.

We clarify that the primary onus would be on the Assessee , however the Assessing Officer will take appropriate action in accordance with law, to summon the said company, i.e., M/s. Shubhkamna Buildtech Pvt. Ltd. and/or any other person to unearth the real transactions. Appeal filed by the Revenue Department stands allowed for statistical purposes.