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TMI Blog2015 (2) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... tside the books of account." 3. Facts of the case in brief are that the assessee filed the return of income on 16.09.2008 declaring an income of Rs. 34,861/-. Later on, the case was selected for scrutiny. The assessee was engaged in the business of development, construction and marketing of real projects for commercial & residential use. A search & seizure operation was carried out on BPTP Ltd. and some of its group companies on 15.11.2007, the assessee company belonged to the said group. On the basis of the post search enquiries made, it was established that the group company BPTP were following a business model as a part of which only part payments of the sale consideration in respect of the land purchased were paid at the time of execut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of consideration specified in the PDC, is agreed to by the buyer, there is no question of payment of any interest for post dated cheques so issued. We deny that we have paid any interest against the post dated cheques.... It is emphasized that it is not the total consideration but only part consideration which is covered by the PDCs. It must be appreciated that part of sale consideration has already been given and recorded in the books. Human conduct shows that a builder, when he acquires such stock-in-trade would not pay the entire amount in one go. Rather he would depend upon receiving consideration from the customer, as and when it is received and then pay towards his liability for land and that is exactly what we have done. The sale b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bilateral agreement depends entirely upon commercial understanding between buyer and seller and the same cannot be questioned by the assessing officer. In our case the farmers have clearly agreed for accepting payments through post dated cheques. Hence, there is no question of payment of any interest." 4. The AO did not find merit in the submissions of the assessee and made the addition of Rs. 20,05,346/- by observing in paras 2.6 and 2.7 of the assessment order dated 28.12.2010 as under: "2.6 So keeping in view the business model/modus operandi of the BPTP Group, as is clear from the seized material as already discussed supra, it is proved beyond any iota of doubt that the assessee has also paid interest in cash to the vendor(s) on the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erest claimed by seller for putting up before senior management does not appear to be convincing. In case of claim, the receiver will not sign the voucher as recipient. Amounts are specific and calculation is 15% per annum. Therefore, Ld. AR without conceding that the interest is paid on PDCs has taken the stand that in none of the seized material, i.e. even in receipt seized, the interest is from date of issue of PDCs. Now issue arises whether interest on PDCs are paid from date of issue or for extension of PDCs. Documents discussed above where there is clear evidence of receipt of interest is for extension of period of PDCs. Ld. AR's arguments that calculation of interest on PDCs are extended, the recipient will definitely ask and settle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ters Ltd. or in stray case by some other companies. Assessing Officer has applied the case of Eusuf Ali for applying interest on PDCs for all companies of BPTP Group for all Assessment Year under consideration. Ld. AR has tried to differentiate the above cited case on facts. In my view, as interest payment on extension of period of PDCs are established on numerous seized documents. A trend is established for the group as the overall management is controlled by one person Sh. Kabul Chawla and activities of all companies are interrelated. If it is not possible to work out the extension of PDCs in each case then AO is directed to recompute interest on PDCs after six months from date of issue of PDCs i.e. date of sale, as six months is taken a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 31.10.2014 the ITAT Bench 'C', New Delhi in ITA Nos. 1674/Del/2013 & 1765/Del/2013 for the assessment year 2008-09 observed in para 5 as under: "5. We have heard the arguments of both the sides and perused relevant material placed before us. At the outset, the ground raised by the Revenue is misconceived because learned CIT(A) has not deleted the addition of Rs. 5,06,625/- but has only directed to recalculate the interest. We have carefully gone through the order of the learned CIT(A) and also the submissions of both the parties and we do not find any infirmity in the order of the learned CIT(A). After examining the loose papers seized at the time of search at the assessee's premises, it was noticed that interest is paid on the PDCs o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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