TMI Blog2012 (8) TMI 485X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee by inflating its purchase price of TDR. As decided in CIT Vs. Indo Saudi Services (Travel) Pvt. Ltd. [2008 (8) TMI 208 - BOMBAY HIGH COURT] if sister concern with whom transaction was entered was also assessed to tax in such situation no disallowance has to be made u/s. 40A(2) in respect of the payment made to the relatives and sister concern where there was no attempt to evade tax - in favour of assessee. - ITA NO. 232/PN/2011 - - - Dated:- 28-6-2012 - Shri Shailendra Kumar And Shri R.K. Panda JJ. Appellant by : Sri V.L. Jain Respondent by : Sri R. M. Madhavi ORDER PER SHAILENDRA KUMAR YADAV, JM : This appeal filed by the assessee is directed the confirmation of disallowance of Rs. 78, 75,000/- by CIT(A)-I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on received was shows at Rs. 96,25,000/-. On being asked to explain as to how purchase consideration of TDR was claimed at Rs. 1,75,00,000/- when the power of attorney show only Rs. 96,25,000/- it was submitted by assessee before the Assessing Officer that TDR was originally purchased by Kasturi Housing Pvt. Ltd., from M/s. Shatmurti Realty Pvt. Ltd. for consideration of Rs. 96,25,000/- which was later on purchased by assessee from Kasturi Housing Pvt. Ltd. for consideration of Rs. 1,75,00,000/-. However, the power of attorney was directly executed by M/s. Shatmurti Realty Pvt. Ltd. in favour of assessee on 31-08-2006. In this regard an advance payment of Rs. 96,25,000/- was already made by Kasturi Housing Pvt. Ltd. in respect of purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- and accordingly M/s. Kasturi Housing Pvt. Ltd., who had merely made the payment to Shatmurti Realty Pvt. Ltd. on behalf of assessee was brought into picture as seller of the TDR to assessee for a consideration of Rs. 1,75,00,000/- when infact the actual consideration paid was only Rs. 96,25,000/-. The Assessing Officer observed that payment made by Kasturi Housing Pvt. Ltd. to M/s. Shatmurti Realty Pvt. Ltd., on behalf of assessee are at best be considered as advance given to the assessee. Thus Assessing Officer rejected the claim of assessee of having purchased the subject TDR in question from Kasturi Housing Pvt. Ltd., for a consideration of Rs. 1,75,00,000/- and held transaction is a colourable device resorted to by the assessee in c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sentative KHPL has purchased TDR from Shatmurti Realty Pvt. Ltd. original vendor at price of Rs. 96,25,000/-for which payment was made on 19-04-2006 and sold to the assessee for Rs. 1,75,00,000/- with payment received on 10-01-2006 and 12-12-2006. KPHL claimed to have paid tax @30% on profit from the transaction. The original vendor M/s. Shatmurti Realty Pvt. Ltd. had directly executed a power of attorney in the name of the assessee the payment of Rs. 96,25,000/- made by KHPL to M/s. Shatmurti Realty Pvt. Ltd. original vendor for purchase of TDR. In turn said KHPL sold the same to assessee for consideration of Rs. 1,75,00,000/-. In respect of profit on this transaction KHPL has paid tax so there is no tax loss to revenue. The Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction which has not been disputed on behalf of revenue before us. In case KHPL has suffered tax, then it cannot be said that tax planning device adopted by assessee by inflating its purchase price of TDR. We are aware that Hon ble Bombay High Court in the case of CIT Vs. Indo Saudi Services (Travel) Pvt. Ltd., 2009 reported in 310 ITR 306 (Bom.) has held that sister concern with whom transaction was entered was also assessed to tax. In such situation no disallowance has to be made u/s. 40A(2) in respect of the payment made to the relatives and sister concern where there was no attempt to evade tax . As emerged from above facts that M/s. Kasturi Housing Pvt. Ltd., has paid the tax with regard to the transaction in question no disallo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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