TMI Blog2012 (9) TMI 252X X X X Extracts X X X X X X X X Extracts X X X X ..... odd. However, as per certain seized documents, where figure of 400 was mentioned, the AO took this value as cost of investment in the property. Neither the AO could co-relate the figure of 22.5 mentioned in the column no. 1 nor the figure mentioned in column no. 3 as per books of account. Therefore, there cannot be a presumption that figure of 400 mentioned in column no. 4 is figure of cost of land purchased by assessee. There must be some corroborative evidence to hold that this figure is related to cost of the land purchased by the assessee. Neither these findings could be controverted nor any other material were brought on record which can be said that findings of Ld. CIT (A) are not correct. Therefore, no infirmity exists in order of CIT (A) deleting addition made u/s 69B – Decided in favor of assessee - ITA NO. 962/JP/2011 C.O. NO. 88/JP/2011 - - - Dated:- 22-6-2012 - SHRI R.K. GUPTA AND SHRI SANJAY ARORA JJ. Appellant by : Shri Sunil Mathur Respondent by : Shri Vijay Goyal ORDER PER R.K. GUPTA, J.M. This is an appeal by department against the order of Ld. CIT (A) relating to assessment year 2007-08, and the assessee has filed Cross Objection. 2. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a) Will executed by Smt. Pushpa Kedia in favor of its authorized person Shri Arun Lashkary. Copy placed at PB Page 144 to 146. b) The second co-owner in the land was Smt. Gulab Devi who expired on 21.02.2006. The copy of her death certificate is at PB Page 148. However, she left a will executed by her in favor of her sons Shri Hari Narayan and Shri Brij Kishore Sharma. The copy of will is at PB Page 147. Therefore the assessee got executed a Will from Shri Hari Narayan Sharma, Shri Brij Kishore Sharma and Smt. Triveni Sharma (legal heirs of Smt. Gulab Devi) in favor of its authorized person Shri Arun Lashkary. Copy of the said will is at PB Page 149 to 151. c) The power of attorney executed by Smt. Pushpa Kedia in favor of Shri Sher Singh Sunda was got cancelled on 03.01.2007. and fresh power of attorney in favor of its authorized person Shri Arun Lashkary was got executed from the legal owner of the land Smt. Pushpa Kedia, Shri Hari Narayan Sharma, Shri Brij Kishore Sharma and Smt. Triveni Sharma. Shri Arun Laskary, the authorized person of the assessee company having power of attorney of the legal owner of the land (Smt. Pushpa Kedia and others) transferred legal title/le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ree zeroes and it is the market rate of purchase/sale per bigha. The AO mentioned that upon verification, the statements of Shri Pawan Laskary turned out to be incorrect. As for column 1, it is seen that the coding is not three zeroes as by adding three zeroes, one does not arrive at either the purchase price per bigha or the market price/bigha. Take for instance the first property, i.e. Bhavgarh Banda in the case of Countrywide Buildestate, the present assessee, it was bought at Rs. 1.25 crores for 6.06 hectares and incurred further Rs. 1.25 crores for registration and others or for instance the case of the assessee who owns Pushp Garden property at Murlipura whose purchase rate/market rate is not 22.5 (omitting three zeroes). The purchase prices have been verified from the deeds lying under seizure with the department. The AO mentioned that the market value of the land as per the documents seized from the assessee at Ann A-24 is Rs 13000/sq yard. As for column three, there aren t any expenses that correspond to these figures in such land accounts on jambandi/conversion either before or after purchase and in none of the properties, these expenses match. As for column four, these a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 were exceptionally good for land prices. The email through which he has communicated for Joint Venture, the newspaper advertisements are all in the same year of 2007 and it just cannot be agreed that in the same year, there could be price variation of 4.00 crores and 22.79 crores. The AO mentioned that the assessee has time and again stressed that the JV papers were not prepared by him but by Chhabra Co. However the assessee has not proved this sufficiently. A mere statement does not rebut the presumption of s. 132 (4A) and as has been seen, the assessee is quite capable of changing his statements to suit his convenience. The AO mentioned that thus piecing together these important papers seized during search and the contradictory explanation of the assessee at various instances, one can safely arrive at the conclusion that the coding that the assessee had written as 400 in page 37 of Exhibit 57 is indeed 4.00 crores. But as stated by him it is not the market value but the actual expenses of the land which he has incurred because the market value as he himself has made is Rs 22.79 crores. The AO mentioned that the above said seized paper 37 of Exhibit 57 is not dumb paper as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment Order Facts mentioned in Assessment Order Correct facts 3 95 mentioned in column 1 of Table against Vatsalya. (The AO reproduced the copy of seized page 37 of Annexure A-57) Actually it is 45. The copy of seized page is at PB page 37. 4 Omitted by writing three zero sindicates purchase rate/market rate. The assessee stated in search statement that market rate of the land is mentioned in the column before the name of the land. The ld AO inserted the words purchase rate at her own without appreciating the search statement in this regard. 2.2 In para 3 of the Assessment Order the Ld. AO mentioned that Shri Pawan Lashkary the key person of the group has scribbled names of the properties owned by the companies in Lashkary group. Whereas the fact is that the Lashkary group owned about 40 properties in the group (List PB page 448 to 457) whereas names of only nine properties were listed in the impugned seized annexure page 37 of Annexure A-57. This shows that this paper was not prepared to jotting down the cost of the properties. If it was so, than all the properties under the group would have been listed - not f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent in answer to question No 10 over the said seized paper . The ld. AO herself has concluded that answer given Shri Pawan Lashkary in question No 10 of the statement of the assessee before the DDIT on 17.11.2008 is not reliable and she has rejected this statement in toto. Therefore, no inference should be drawn on the basis of rejected statement. 2.4 In para 6 of the assessment order the ld. AO mentioned that the market value of these lands as per the documents seized from the assesses at Annexure A-24 (PB Page 28 to 30 36) are Rs. 6000/- sq. yards and Rs. 13,000/- sq. yards. In this regard at the outset we object the observation of the ld AO that this document was seized from assessee. Factually, this paper was not seized from the possession of the assessee company. The registered address of the assessee company is B-304, Janta Colony, Jaipur whereas this paper (Annexure A-24 A-57) were seized from 73-74, Talkatora, Jaipur which is premises of M/s Pawan Enterprises. Secondly this paper does not show the market value of the property but it was an asking price from a particular prospective person who offered for joint venture. The person was totally unknown to the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Registration Expenses- Stamp Duty (On Power of attorney/sale deed and registration of JDA Patta) 13,55,503.00 Deposited in JDA against conversion etc 6314048.00 Construction for demarcation etc 2,53,824.00 Thus, the land cost was only 70.00 lacs whereon the expenses for JDA charges were Rs. 63.14 lacs. The question for matching the figure in column 3 does not arise because this represents an estimated figure of expenses to be incurred. 2.5 The ld. AO failed to appreciate the figures mentioned on seized annexure A-24 page 159 and 161 (Copy at PB Page 28 to 30). Ld. AO wrongly interpreted/concluded that market value of the land of the assessee was Rs. 22.79 crores. The assessee advertised in Newspaper for sale of the land (PB page 39). In response to this advertisement, several persons approached to the assessee by Email or on phone. The copy of some of the Emails are at PB Page 40-45. One of the Email was from G.K.Sharma. The assessee quoted him the market rate of Rs. 13000/- per SQ for outright sale (the value comes to Rs. 22.79 crores for the land of the assessee). The assessee quoted a very high rate far above from the market ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owned by the assessee which means that at the time of preparation of this chit of paper (Page 37 of Annexure A-57) the scheme has already progressed considerably. This is the same name used by the architect who has been communicating with the assessee in early 2007. In fact there was no progress in the scheme except taking JDA patta. It appears that the ld AO has confused over the name used Pushp Garden in both the seized Annexure i.e. A-24 and A-57. In regard, we submit that the name Pushp Garden was neither given by the assessee nor by the architect who have been communicating with the assessee. In fact the original owner of the land Smt. Pushpa Kedia and Smt. Gulab Devi submitted the plan in JDA in 2004 for approval of residential scheme in the name Pushp Garden . (Papers at PB Page 463) and this land was known as Pushp Garden before buying of this land by the assessee. 2.9 The addition is not based on material, but surmises, conjectures presumptions and assumptions purely on the basis of deaf and dumb documents. a) The ld AO wrongly concluded that the column 4 of the seized annexure A-57 page 37 represents to cost of land. Copy of said page is PB Page 37. The entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Show cause notice dated 30.11.2010 for proposed addition of Rs. 3,04,96,937/- on account of undisclosed expenditure in land The point to point reply of your notice is as under: - a) Page No. 159 of Annexure A-24 seized from 73-75, Talkatora, Jaipur (i) At the outset, we submit that the assessee did not have sufficient funds skill, and experience to carry out projects independently. So, the assessee s director advertised in news paper for sale of land approved/under approval for group housing/projects. The advertisement cutting of the news paper is also under seizure vide page 102 to 106 of Exhibit A-24 seized from 73-75 Talkatora, Jaipur. Alternatively, the assessee was thinking to carry out the projects on joint venture/ collaboration agreement/Partnership basis. The assessee group was approached by several parties for joint venture agreement. The print outs of several Emails are under seizure vide said Exhibit A-24. During the course of the discussion in respect of Joint Venture/Collaboration Agreement/Partnership with one of the prospective party ( i.e. Chhabra Co kindly see page 107-112 of Ann A-24), this paper was prepared by the representative of M/s Chhabra Co to w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75 Talkatora, Jaipur. Alternatively, we were thinking to develop schemes/group housing projects on various lands of our group on joint venture/ collaboration agreement/Partnership basis. We were approached by several parties for joint venture agreement. The print outs of several Emails are under seizure vide said Exhibit A-24. During the course of the discussion in respect of Joint Venture/Collaboration Agreement/Partnership with one of the prospective party, I prepared this paper for negotiation with the party. The contents of this seized page 37 of Exhibit A-57 are explained as under:- a) The offer against our share in profit/loss of joint venture was mentioned in Column 1 of the said seized paper. For example we offered our share of 26.66% in profit or loss; if joint venture in respect of Land at Bhavgarh Bandha is finalized. b) The particulars of the land proposed for joint venture/collaboration are mentioned in Column 2 of the said seized paper. c) At the time of said negotiation for the joint venture/collaboration, there was several pending work, in respect of conversion/approval of project and possession of land. The estimated expenses to be incurred further for conver ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not relevance for the case of the assessee because of the following reasons: - i) First of all the DLC rates are for Murlipura Area, Sikar Road, Jaipur while the land of the assessee is situated in Village Murlipura, Sanganer, Jaipur in Jagatpura, therefore these rates are not applicable for the assessee. ii) The assessee purchased the agriculture land and thereafter the land use was got converted from JDA, therefore the rate of residential plots cannot be applied on agriculture land. The assessee purchases this land in AY 2006-07 on agreement and the same registered during the year under consideration wherein the registrar adopted the value of this land Rs. 1,35,00,000/- for registration purpose and it is admitted facts that the registrar calculated the value at prevailing DLC rates. The copy of registry is enclosed herewith. d) In this para your honour concluded that the assessee made the undisclosed expenditure of Rs. 3,04,96,937/- in this land which is not correct because of above detailed submission and facts narrated as under: - i) The page No. 159 of Annexure 24 which is your primary basis of reaching in this conclusion is only projection of proposed group housi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 159 of annexure A-24. The assessee further filed detailed reply vide letter dated 11.12.2010 copy at PB Page 78 to 79. The explanation of the assessee was as under: - Reply to your Show cause query in order sheet for proposed addition of Rs. 3,22,64,977/- on account of unexplained expenditure in the land at Murlipura. In the show cause query your honour is also admitting that the Page No. 161 of Annexure A-24 is estimation of joint venture and the rate of Rs. 13000/- per SY mentioned at email printout seized vide page 142 of seized Annexure A-24 is asking price of the land if sold outright basis. The Page 159 of Ann A-24 is neither a separate estimate nor separate projection but connected working in connection with Page 161 of Ann A-24. These projections were prepared by the same person who offered the proposal of joint venture to the assessee. In the page 159 the projection is made monthly basis while in Page 161 is summary of page 159 which is explained as under: - Particulars Total of Amount as per Page 159 Total of Amount as per Page 161 Land Cost 4,55,88,400/- (This figure is 20% of total land value of Rs. 22,79,42,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od of completion of project, size of project, expected FAR from JDA, expected availability of height etc. Thus, the upfront price and sharing ratio may vary person to person and project to project. Therefore, till 11.12.2010, the ld. AO was of the opinion that seized annexure A-24 page 159 shows the cost of land and in her three repetitive show cause notices, she reiterated that the cost of the land was Rs. 4,55,88,400/- and seized paper 159 of Annexure A-24 shows the actual cost of the land. After seeing the detailed explanation of the assessee, she felt that the addition against cost of the land cannot be sustained on the basis of seized annexure A-24 page 159. Then, she changed her stand and held that column 4 of seized page 37 of Annexure A-57 shows the actual cost of the land. The finding of the AO is without basis. In fact no any clear and positive conclusion on the basis of figure noted on seized page 37 of annexure A-57 can be drawn. This is a dumb paper. 2.12 The AO herself in her show cause notice dated 06.12.2010 (copy PB Page 72) mentioned as under: - Had this paper been the only seized documents that indicate this figure it would have been a dumb paper as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... int outs of several Emails are under seizure vide said Exhibit A-24. During the course of the discussion in respect of Joint Venture/Collaboration Agreement/Partnership with one of the prospective party, I prepared this paper for negotiation with the party. The contents of this seized page 37 of Exhibit A-57 are explained as under:- a) The offer against our share in profit/loss of joint venture was mentioned in Column 1 of the said seized paper. For example we offered our share of 26.66% in profit or loss; if joint venture in respect of Land at Bhavgarh Bandha is finalized. b) The particulars of the land proposed for joint venture/collaboration are mentioned in Column 2 of the said seized paper. c) At the time of said negotiation for the joint venture/collaboration, there was several pending work, in respect of conversion/approval of project and possession of land. The estimated expenses to be incurred further for conversion, approval and possession of the land for scheme/housing projects was mentioned in column no. 3 of the said seized paper. The figure is written in short at the time of negotiation by omitting five zero. For example 666 indicates that the estimated amount f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /collaboration is made on the sharing basis mentioned in column no. 1. The upfront price and sharing ratio depends on several factors such as reputation of developer, nature and quality of development work to be carried out by the developer, involvement of investment by developer, expected profit from the share received by the owner in the built up area, period of completion of project, size of project, expected FAR from JDA, expected availability of height etc. Thus, the upfront price and sharing ratio may vary person to person and project to project. Therefore the figure 400 should not be read in context with 22.79 crore but it should be read in context with 4.55 crore. The seized paper 159 of annexure A-24 which is proposal of a joint venture shows the payment against the land to the assessee is 4.55 crore not 22.79 crore. 2.16 The ld. AO in para 12 mentioned that these papers are not dumb papers because the scribbling in the seized paper are corroborated with the books maintained by the assessee. In fact none of the jotting on the seized paper A-24, A-40 and A-57 was corroborated with entries of the books of accounts. The ld AO has made wrong and perverse finding in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... JDA. ii) Similar conditions were for Pusph Garden . The land in question was proceeded u/s 90B but the issue of Patta by JDA was pending. Under the proposal the assessee company would get 22.50% share in the built-up area and Shri Pawan Lashkary would get 15% in the built-up area against the working in JDA for issue of the Patta and day to day construction activities. iii) The sharing ratio of 50% 40% 60% 60% and 45% was offered for Mahal Road, Dabla Khurd, Chaksu, Gunsi and Vatsalya project respectively looking to the reputation of the builder and quantum of investment to be made by the builder/developer and built up area to be constructed by the prospective builder. iv) 18.75% mentioned against sports city may certainly create a suspicion. But the fact remains, that the land was under river and for no use for any viable project. It was a wrong decision of the company in purchasing of this land and it was not worthwhile at all. This land was purchased on 1.6.2005 by registered sale deed (Copy at PB page 370-388) and no person in market was ready to buy it even at cost price paid by the assessee company because no any commercial or residential proposal was viable on this lan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vit of Pawan Lashkary filed before her, even than what is left behind is the dumb document bereft of any details without there being any enquiry by the AO to correlate the same with other documents seized, regular books of accounts, records kept by outside agencies or statements of concerned parties The four essential components of s. 4 of Income Tax Act, viz., the taxable event, the person chargeable, the assessment year in which charge is leviable and the total income are absent in this case. 2.19 The assessee made specific request vide letter dated 08.12.2010 (copy PB Page 76) that in case of doubt, direct verification can be made from the seller or comparison should be made with the other sale transaction of the land made by the other parties in the same area and in same period and for this purpose necessary details can be obtained from the office of Registrar and the assessee is ready to pay cost of evidence in this regard. The assessee s request was turned down and without making any inquiry the undisclosed/unexplained investment in the land was concluded by the ld. AO merely on the basis of a non-speaking document. 2.20 The ld. AO presumed that the so called unexplained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar 94 ITR 616,644 (Bom). Kindly see observations in the dissenting judgment of Mukhi, J. in It is to be noticed that section 69 and section 69A do statutorily place a burden on the assessee to explain the source of investment or the source of the acquisition of the gold, but that burden can only arise after the initial burden on the taxing authorities of proving the factum of investment or the factum of ownership has been discharged. Sections 69 and 69A can be said to be in the nature of penal or at least onerous provisions and the burden lies on the revenue to prove that the condition precedent laid down, therefore, is satisfied before any order including the value thereof in the assessment can be made. iii) Lal Chand Agarwal Vs ACIT 21 Taxworld 213;231 ITAT Jaipur Bench The initial burden u/s 69 of Income Tax Act is on department to prove the investment has been made by the assessee. 2.22 The ld AO concluded on presumption, probabilities and possibilities that column 4 of the seized paper page 37 of Ann. A33 57 shows the investment in land. But she failed to explain and correlate the figure mentioned in column 1 and 3. If the figure of 400 in column 4 against the Pushp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jahan 237 ITR 570 (SC) and CIT Vs Bharat Engineering and Construction Co. (1972) 83 ITR 187 (SC) 2.25 The Ld AO has relied upon the decision of Mahavir Wollen Mills Vs CIT (Del) 245 ITR 297 (2000). The ld AO misplaced the reliance on this decision as the facts of this case are totally different. In this case during the course of search and seizure proceedings certain slips were found, which, the AO concluded, contained details of payment beyond those which were made by cheques and drafts and were duly reflected in the books of accounts. The assessee s stand before the Tribunal was that the documents were "dumb documents" which did not contain full details about the dates of payment and its contents were not corroborated by any material and could not be relied upon and made basis of an addition. Tribunal considered this aspect and observed that on comparison of the seized documents and ledger accounts of the parties, seized documents could not be regarded as dumb document . Basis for coming to such a conclusion was that some of the entries reflected in the seized document tallied with the entries in the ledger accounts maintained by the assessee. But in the case of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings of fact recorded by both the authorities i.e. CIT(A) and the Tribunal. 15. Similarly, in the present case, as already held above, the documents recovered during the course of search from the assessee are dumb documents and there are concurrent findings of CIT(A) and the Tribunal to this effect. Since the conclusions are essentially factual, no substantial question of law arises for consideration . 2) Commissioner Of Income Tax Vs. Girish Chaudhary (2008) 296 ITR 619 (Del) Premises of M/s I.G. Builders Promoters (P) Ltd. in which the assessee is a Director and of the assessee were searched on 18th Jan., 2000 and a document marked as Annex. A-37 was found and seized. The said document contained the following entries : Annexure A-37 (Page 13) "Cash RB 31.50 Ch. 9.50 41.00 16.50 57.50 31.50 16.50 48.00" The Tribunal hold this document as dumb document. The relevant findings of the Tribunal as mentioned in the above order is as under:- "In the present case, the Revenue has used its longest arm of search available to the Revenue to unearth unaccounted money or evidence thereof. Having taken above step and as per law, it has to be pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Plot No. B-4, Govind Marg, Jaipur was made by the AO. This plot B-4, Govind Marg, Jaipur, has been purchased jointly by Dr. Tomar, Dr. Mrs. Tomar and B.S. Tomar, HUF. Held that no addition on account of entries on a piece of paper which is claimed to have been found at the time of search, can be made, treating the figures as investment for purchase of plot No. B-4, Govind Marg, Jaipur in the hands of Dr. Tomar, Dr. Mrs. Tomar and B.S. Tomar HUF. 4) ) MAHAAN FOODS LTD. vs. DEPUTY COMMISSIONER OF INCOME TAX (2010) 123 lTD 590 (Delhi C Bench Held that although the contents of the relevant seized documents show that the amounts mentioned therein relate to some expenditure, in the absence of any other evidence found during the course of search or brought on record by the AO to show that the said expenditure was actually incurred by the assessee, the same cannot be added to the undisclosed income of the assessee by invoking the provisions of s. 69C Assessee explained that the said entries represented estimates made by its employees in respect of proposed expenditure There is no evidence on record to rebut/controvert the said explanation- Additions not sustainable 5) ASSISTA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate or the year against the entries written therein. It does not show whether the assessee has made or received any payment. It also cannot be deciphered from the said documents that the entries therein pertain to the block period. The AO also did not bring on record any material to show that any investment has been made by the assessee in any chit fund company or otherwise. The document found and seized might raise strong suspicion, but it could not be held as conclusive evidence without bringing some corroborative material on record. The document contained only the rough calculations and was silent about any investment. On the basis of such a dumb document, it cannot be said that there were investments made in fact by the assessee. Heavy onus lay upon the Revenue to prove that the document gives rise to undisclosed investment by the assessee. This onus has not been discharged. Accordingly no addition of undisclosed income could be made on the basis of such a document. Such a view has also been entertained by the Hon ble Allahabad High Court in CIT vs. Dayachand Jain Vaidya (1975) 98 ITR 280 (All). The addition so made, therefore, is directed to be deleted. 8) JAGDAMBA RICE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvanced by the Revenue that the figures written on the right side of the slip represent incomes earned by the assessee. It was conceded that no such evidence has been brought on record. Further, the Revenue has given no adjustment to the entries on the left side of the slip. Therefore, the slip in question did not indicate that the figures represents receipt of income to that extent by the assessee and it was not permissible to the Revenue without procuring any evidence to support such a hypothesis that the entries record the income of the assessee and to presume such assumed narration of the entries to be true. Therefore, the additions cannot be sustained and they are hereby deleted. 10) ASSISTANT COMMISSIONER OF INCOME TAX vs. ASHOK KUMAR VIG (2007) 106 TTJ (Ranchi) 422 Held : The AO has made the additions of Rs. 67,01,380 and Rs. 77,02,747 for the asst. yr. 2001-02 and 2002-03 on the basis of a diary marked PKC-60 , seized from the office of the assessee in the premises of MDSS, a propriety concern of the assessee s sisterin- law. The assessee has explained to AO that the diary belonged to his employee, who was working in the office located in the said service sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f provisions of s. 132(4A), the assessee has explained the circumstances under which his employee maintained these documents in the premises of MDSS. Thus, the ownership is not disputed. However, there is no presumption about the earning of income. The assessment is made under Chapter XIV-B. The AO cannot make addition on the basis of incomplete entries. The onus rests on the Revenue to establish that the assessee was in receipt of money then the onus would automatically be shifted to the assessee to prove that the money has been disclosed in the account or the same is not liable to tax. In the present case in hand, the AO has not been able to demonstrate with adequate evidence that the assessee received the amounts in two years as alleged. These entries as recorded in PKC-60" do not clearly reveal that the assessee has earned income. The assessment of undisclosed income is under Chapter XIV-B and there is no scope of assumption or presumption while making assessment under this chapter. They are dumb documents on which reliance cannot be placed, unless they are corroborated with other evidences. There is no infirmity in the order of CIT(A) in deleting the additions 11) CHANDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut making any inquiry and investigation and without examining the assessee. 17) Moonga Metals Pvt. Ltd., Vs. ACIT (All.) 67 TTJ 247 Burden is on the revenue to establish that figures appearing on loose papers found represent undisclosed investment of the Assessee. 4.5. The detailed written submissions filed before Ld. CIT (A) was sent to the Assessing Officer for his comments. The comments were received from the Assessing Officer and copy of the same was given to Ld. A/R for his re-joinder. The reply received from Assessing Officer and re-joinder received from Ld. Counsel of the assessee have been reproduced in the order of Ld. CIT (A) at pages 36 to 42 as under :- Para 1: needs no comments as they are reiteration of facts. Para 2.00: Ground No 1 and 2: At the outset, it may be taken on record that the assessee/his authorized representative duly signed as Vijay Goyal, CA has no work ethic or professionalism as is seen by the language in the submissions wherein he has stated that the AO has come to the conclusion which no judicial person duly instructed in the discipline of law and accounts would come to. From the way they both have behaved since 2008 with the departmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e zeroes. This is expressly contradictory to his earlier stand that column 4 represented the total area owned by the group and the column three were written omitting two zeroes. In the affidavit the assessee has admitted three things: 1. That his coding was by omitting five zeroes (in 2008, he said two zeroes) 2. That contents of column 4 represent proposed market value (in 2008, total area in sq yards) 3. That column one represents share in joint venture (in 2008, he said purchase rate/bigha) The assessee and his written submission before the CIT (A) vide para 2.2 and thereafter stinks of inconsistency and convenience whereby he changes his stand as and when it pleases. At the core of the assessment are seized papers which make perfect sense when read together and which shatters the explanation offered by the assessee from time to time. It was only when confronted with the emails and the show cause that the assessee chose to submit an affidavit dated 06.01.2010 after twelve months in December on his grand plans of joint venture where in one property he is choosing to give 26.66%, in another 60 and in another 80. of course, while the wisdom or the business sense of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PB Page 50) wherein he stated that the market rate of the land is mentioned in the column before the name of land. The relevant statement is reproduced as under:- From the plain reading of answer as whole one can easily conclude that the assessee has stated the market rate of the land not his cost or purchase rate of the land. 3. In the para 3 of submission, the AO is completely silent on the issue that if this paper shows the cost of properties why only 9 properties mentioned on this paper as against 40 properties owned by assessee group. The AO mentioned in this para that: - a) The persons who wrote the same can better explain this. Admittedly Shri Pawan Lashkary can better explain this paper because this paper was written by him and he explained the same. But the Ld AO rejected the explanation without having any positive evidence against the explanation. She rejected the explanation merely on surmises and conjectures. No any evidence was brought on record to show that the explanation of the assessee is wrong. b) Further, the ld AO has presumed that the 4th column of this papers shows the cost of properties as on 31.03.2007 but if the last column of seized papers is cost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paper 73 to 76 of Annexure A-42 (PB Page 27 to 31) is also in respect of joint venture for the same land which also proves that the assessee group was also interested in joint venture. All these materials prove that the assessee group was interested in joint venture also on the same land and the same supports the explanation given by assessee regarding the seized paper under question. 4.4. In para 4 the AO commented regarding statement recorded at the time of search. In this regard this is to submit that the statement in question was recorded on 17.11.2006 by DDIT-III, Jaipur during post search investigation where no panches/witness were available. Further Shri Pawan Lashkary never claimed that the statement was given under pressure. He simply said that at the time he was confused over the contents of the seized papers because the seized paper is not a speaking paper and he was not given the photocopy of all the seized documents and due to this he could not recollect his memory and corrects facts could not be stated before the DDIT. Further most, the assessing office as well as the assessee both are admitting that the statement before the DDIT over this seized paper was not corre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd from another prospective buyer. As regard big difference in the upfont price of Rs. 7,41,39,600/- mentioned on the seized page 74 (PB page 30) and figure 330 mentioned on seized page 37 (PB page 36) in respect of Bhavgarh, we submit that upfront price of Rs. 7,41,39,600/- was calculated for the whole land i.e. 61783 SY Yards (which includes the land under internal roads) as clear from the calculation given on seized paper 77 (PB page 27), whereas this scheme consists three plots Viz plot No 1 measuring 23217.53 SY plot No 2 measuring 32436.84 SY and Plot No 3 measuring 2987.41 SY. The offer from the buyer (under email) was for the whole land whereas the offer from another buyer (figure written in seized paper page 37) was only for one plot measuring 23217.53. This was the reason of big difference in between 74139600 and 330 4.6. In the para 6 the ld AO mentioned that the case law cited in written submission of Assessee are mounted on different facts and circumstances which are wholly different from those of the instant case of the assessee company and such ratio not apply in the instant case. In this regard we submit that the ld AO has not differentiated the assessee s case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is generally known that buyer pays over and above the amount recorded in the books of account to the seller. Therefore, this is not a case that assessee has not paid any amount over and above to the seller in the present case. 6. The Ld. Counsel of the assessee, on the other hand, firstly placed reliance on the order of Ld. CIT (A). It was further submitted that Ld. CIT D/R has not stated any new thing as he has offered the explanation which have already been considered by Ld. CIT (A) at great length. Therefore, he placed reliance on the order of Ld. CIT (A). Further, a copy of written submissions was also filed which he placed on record. 7. After going through the written submissions filed on behalf of the assessee, we noted that the written submissions filed here before the Tribunal are almost similar to the written submissions filed before Ld. CIT (A). The Ld. CIT (A) has reproduced the written submissions filed before him in his order which has been incorporated in this order also. We have also taken into consideration the order of Assessing Officer, order of Ld. CIT (A) and argument of Ld. CIT D/R and found that Ld. CIT (A) has given a detailed reasoning for deleting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned the above referred seized page 37 of A-57. No narration is mentioned over this seized page to ascertain whether cost is mentioned or market value is mentioned or some other value is mentioned. Any date or even the month or even the year is not at all mentioned so as to arrive at the definite conclusion whether it is cost or market value or some other value on particular date/month/time. The AO has tried to negate the argument of A.R. by observing that the market value is not mentioned in the column 4 of the impugned seized paper, therefore, as per the A.O., cost must have been mentioned, but A.O. failed to prove by positive evidence that the cost is mentioned in column 4 of the seized paper. Further, the AO failed to explain the nexus of the figures mentioned in column 1 and 3 with reference to figure of the alleged cost mentioned in column 4 of the impugned seized paper. In column 1, the figure 22.50 is mentioned and figure 169 is mentioned in column 3 against Pushp Garden. The AO herself has held that figure 22.50 does not indicate cost or market value per bigha of the land. However, the figure 22.50 cannot be a meaningless figure, particularly when it is written with referen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the post search inquiry have been rightly rejected by the AO and are of no help for the assessing officer. During the course of the assessment, the assessee filed sworn affidavit of Shri Pawan Lashkary and relevant para of the affidavit is as under:- We purchased the agricultural land and made further exercise for 90B proceedings, conversion and approval of the projects. This and time-span resulted substantial increase in the market rate of the land. We estimated the market rate of each developed land (offered for negotiation for joint venture/ collaboration) at the time of negotiation and such estimated market value of the land was mentioned in column no 4 of the said seized paper. We offered the prospective party that our capital account should be credited by this amount against the capital contribution of land for the joint venture/collaboration, if the joint venture/collaboration is materialized. The figure is written in short at the time of negotiation by omitting five zero . 5.4 From the above affidavit, the assessee wanted to explain that market value of the land was estimated for the joint venture and such joint venture share being estimated upfront amount of ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that amount of Rs. 4.55 crore ( more particularly Rs. 4,55,88,400/-) is not the cost of the land to the assessee but it is the 20% upfront charges of the estimated proposed value of land amounting to Rs. 22,79,42,000/- as estimated by some developer for the proposed project of joint venture on this land of the appellant. The A.O. has mentioned this fact of contention of the assessee on this issue being correct at para 8 of the assessment order. (However, simultaneously, the A.O. has stated that it shatters the explanation of the assessee regarding page 37 of Ann. A-57 given during the course of search that in column no.4 coding was done in two zeros and the figure represented the land area in sq. yd. This observation of A.O. is correct.). 5.6 It was only at the last i.e at the time of fourth opportunity/ show cause that the A.O., on 13.12.10 has now proposed different amount namely Rs 4.00 crore as investment in purchase of land on the basis of the entry at column no. 4 of page 37 of Ann A-57 namely 400 and after being not satisfied with the explanation, in the final assessment order, the A.O. has held Rs. 4.00 crore as total purchase cost. However, on perusal of the reply of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to be noted is that the appellant has also given explanation of entries in column no. 1 of page 37 of A-57 during the course of assessment proceedings that the same is the percentage sharing in the proposed joint venture. The A.O. has disbelieved the explanation of the appellant on the ground that the joint venture sharing is found to be highly varying. However, the A.R. has even given explanation of these varying % also particularly regarding joint sharing being only 18.75% in Sports City, which is on account of the fact that the said land was quite uneconomical having low value as the same was under river bed which is clear from the Jambandi , wherein the land was shown as Khatali which means the land near river bed as is clear from the definition of the khatali furnished by the A.R. in the written submission. Similarly, for high sharing ratio of 80% in R.R. Farm, the A.R. has explained that this was the joint venture of the farmhouse wherein not much of investment is required by the developer and it is mainly the value of the land and accordingly land owner would have the main and major share. These explanations so given by the A.R. cannot be just rejected and are rather ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner Of Income Tax Vs. Girish Chuddar (2008) 296 ITR 619 (Del) and other decisions of the various ITAT cited by the assessee support the case of the assessee. In view of the above facts and circumstances, it is held that A.O. has not been successful in proving that column no. 4 of seized page 37 of Ann. A-57 reflects the cost/purchase price of the land and on the other hand explanation of appellant on this issue can not be considered to be incorrect and is rather same is found to be plausible and accordingly addition of Rs. 2,61,66,611/- so made by A.O., holding Rs. 4.00 crore to be purchase price of land, is hereby deleted. Thus, the ground No 1, 2 and 3 are decided in favour of the assessee. 8. As stated above, neither these findings could be controverted nor any other material were brought on record which can be said that findings of Ld. CIT (A) are not correct. The Ld. CIT (A) has taken into consideration the aspect that firstly the Assessing Officer s view was that the cost of land was Rs. 4.55 crore or odd. Three show cause notices were given to the assessee for explaining that why the cost of the land be not taken at Rs. 4.50 crore or odd. All the three times, the explana ..... X X X X Extracts X X X X X X X X Extracts X X X X
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