TMI Blog2015 (1) TMI 655X X X X Extracts X X X X X X X X Extracts X X X X ..... OHAN GARG, JJ. For The Appellant : Shri K.Sampath, Adv., Raj Kumar, Adv. For The Respondent : Shri Gunjan Prashad, CIT DR ORDER PER CHANDRAMOHAN GARG, J.M. This appeal has been preferred by the assessee against the order of the CIT(A)-I, New Delhi dated 20.11.2008 in Appeal No. 106/07-08 for block period of assessment from 1.4.1996 to 20.9.2002. The assessee has raised following grounds in this appeal:- 1. That on the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in confirming the addition of ₹ 12,44,06,000/- on account of alleged unaccounted receipt on the allotment of plots in Ardee City, Gurgaon. 2. That on the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in confirming the order passed by the assessing authority which is bad in law on account of various legal infirmities. 2. Apropos aforementioned grounds of the assessee, we have heard arguments of both the sides and carefully perused the relevant material placed on record. Ld. Counsel appearing for the assessee submitted copies of ITAT E Bench, New Delhi in assessee s own cases for AY 1997-98 dated 30.5.2008 in ITA No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has also drawn our attention towards order of ITAT Chandigarh Bench B in the case of ACIT, Central Circle-I, Ludhiana vs Chavan Rishi International, New Delhi dated 9.11.2006 (supra) wherein it was held that when no addition has been made in the hands of the seller, then it cannot be presumed that the payment was to be made over and above the price quoted, that was to be made to the seller of the property but nothing had been brought on record that the same amount had been considered as income in the hands of seller of the property. Therefore, ITAT Chandigarh Bench B in the case of purchaser viz. Chavan Rishi International held that additions made by the AO and deleted by the CIT(A) are not sustainable and, therefore, the ITAT Chandigarh Bench B dismissed the appeal of the revenue by passing the order dated 9.11.2006 (supra). Ld. Counsel of the assessee finally prayed that when the additions made on the same issues during reassessment proceedings u/s 143(3) r/w section 147 of the Act in the case of seller i.e. the assessee M/s Ardee Infrastructure Pvt. Ltd. have not been found to be sustainable by ITAT E Bench New Delhi in assessee s appeals in ITA No. 937/Del/2006 order d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the market value and not the actual price. It is true that in the block assessment the additions can be made on the basis of document or material found during the course of search for which no plausible explanation is given by the concerned person, It is also true that the document should be considered as a whole and not in piece meal, in other words, the cognizance should be given to the document as a whole and not to the part of the document as per doctrine of Aprobate Reprobate , In the seized document, there were certain entries on one page which appears to be a page from some cash book since cash book is mentioned at the top of the page and the word payments had also been printed but that document page cannot be considered as cash book since in the cash book, receipts and payment both pages should be there and some opening balance along with closing balance should be reflected but in the document i.e. AI-5 neither the opening balance of cash is there nor closing balance and even the total has not been done but in the case of proper cash book_total of the receipts and the payments side is always equal since the balance between receipts and payments reflects the closing c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on'ble Gujarat High Court in the 'aforesaid referred to case, the Assessing Officer was not justified in accepting the entries mentioned in the document in part i.e. accepting part of the entries and rejecting the remaining entries. Therefore, the Id. CIT(A) was justified in his action while deleting the addition made by the AO. 10.2 From the above discussion although the case appears to be in favour of the assessee if legal aspect is to be seen but at this stage, we think it appropriate to discuss the issues in question of merit also. As we have already noted in the former part of this order that the AO considered the three figures as actual investment. Those entries pertained to investment in land situated at Ardee City, Sushant Lok- III, and M. Field. The AO worked out the value of investment in land in Ardee City @Rs. 4533/- per sq. yd. but no instance was quoted wherein the same rate was paid by any of the person. The excise done by the AO was based on a statement of Shri J.C. Malhotra who stated in his earlier statement that he along with his family members had paid ₹ 2000/- per sq. yd. over and above the documented price of the plot, if that statement was to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be a factor to deny the claim of the assessee which was substantiated by the registration deed, confirmation by the seller and the fact that the payments were made through banking channels. Moreover, no evidence was brought on record to establish that the assessee was in a position to spend more since no evidence about excess withdrawal from bank or from any other source, was brought on record or was discovered during the course of search. It is true that the apparent whatsoever strong, cannot replace the actual. In the present case the AO made the additions on the basis of presumption. He presumed that the entries mentioned in the seized document A-I page 5 reflected actual cost against the claim of the assessee that it was market price. The AO while treating the entries noted in seized document as actual cost. ignored the vital fact that for some other entries noted on the same paper, it had been considered that the value was not actual but the market value. The instances were of investment in HUDA, Agra property and value of shares FDRs. In view of the above discussion, we do not see any infirmity in the order of the ld. CIT(A) on this issue. 10. From the above observ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Jagdish Chander Malhotra has noted that Shri Malhotra in the statement recorded during search had admitted that he had made an unaccounted investment of ₹ 73,50,000/- in those plots in the Ardee City Gurga6n. Shri Malhotra and his family members, however, retracted from this statement later on, on the ground that the same was recorded under coercion. After considering the entire facts and details the Settlement Commission has concluded in para 17 as under:- We have taken note of the arguments of the Ld. A.R. We agree with him that in the absence of any evidence collected in the course of search from the premises of the applicant no adverse inference about un-disclosed income can be drawn in an assessment u/s. 158BC. On merits also the ITA T's decision goes in favour of the appellant. No cognizance can be taken up the confession of applicant/ which is not corroborated. We hold that the offer made before us does not require any change on this basis. 7. Thus, the Settlement Commission has held that the addition in the case of Mr. J.C. Malhotra of ₹ 73.50 lacs on the basis of statement which was subsequently retracted was not tenable. Since the addition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me or not u/s 69 has to be considered in the light of the facts of each case. In other words, a discretion has been conferred on the ITO u/s 69 of Act to treat the source of investment as the income of the assessee if the explanation offered by the assessee is not found satisfactory and the said discretion has to be exercised keeping in view the facts and circumstances of the particular case In the present case the Assessing Officer had not given any independent and separate findings while making the addition by estimating the market value of the investment in M. Field / Uppal property. He only mentioned that the assessee purchased this land by applying the method of investor s agreement as applied in Ardee city and as the addition had been made for the property situated at M Filed /Uppal. So, in view of the ratio laid down by Hon ble Supreme Court in the aforesaid referred to case, this addition was not called for particularly when the assessee had given the explanation that the value mentioned in the seized document was the market value and not the actual value. The actual value was supported by the registered deed and had been confirmed by the seller of the property. No addi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion was to be made on this account. The observations of the order of the Settlement Commission dated 25.8.2008(supra) in relevant operative para 17 reads as under:- 17. We have taken note of the arguments of the ld. AR. We agree with him that in the absence of any evidence collected in the course of search from the premises of the applicant no adverse inference about undisclosed income can be drawn in an assessment u/s 158BC. On merits, also the ITAT s decision goes in favour of the applicant. No cognizance can be taken up the confession of applicant, which is not corroborated. We hold that the offer made before us does not require any change on this basis. 11. In view of above set of facts and circumstances and orders of the Tribunal in ITA No. 937/D/2006 (supra), ITA No.739/D/2006 (supra), order of Hon ble High Court of Delhi in ITA No. 412/2009 dated 4.4.2011 (supra) and also order of the Tribunal in the case of purchaser Chavan Rishi International in ITA No. 39, 38, 40/Chandi/2005 (supra), we are inclined to accept the contentions of the ld. Counsel of the assessee that while passing impugned order, the CIT(A) did not pay heed to the then existent order of the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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