TaxTMI 
TaxTMI 
2015 (4) TMI 717
X X X X Extracts X X X X
X X X X Extracts X X X X
....nbsp; 2. That without prejudice to the above, no mandatory condition of recording the satisfaction required to be recorded in writing has been fulfilled before issue of notice under section 153 of the Income-tax Act, 1961. 3. That without prejudice to the above grounds of the appeal, the learned Commissioner of Income-tax (Appeals) has erred in upholding the addition of Rs. 70 lakhs to the income of the assessee under section 69A without considering that it was never established that the assessee-company was found to be the owner of any such money, bullion, jewellery or other valuable articles. 4. That the learned Commissioner of Income-tax (Appeals) has erred in not considering that the addition of Rs. 70 lakhs has been made by the Assessing Officer on the basis of proposed agreement which was never executed and which was not a valid agreement in the eye of law. 5. That the learned Commissioner of Income-tax (Appeals) has erred in not considering that the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....come as enhanced by the learned Commissioner of Income-tax (Appeals) has been made against the facts and circumstances of the case on assumptions without any evidence on record and then no notice of enhancement has been given by the learned Commissioner of Income-tax (Appeals) before making the addition. 13. That the appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed of." 2. As regards grounds Nos. 1 and 2, we have gone through the order of the learned Commissioner of Income-tax (Appeals) and we find no decision of such grounds, which though were raised by the assessee before him. However, being the legal grounds, we proceed to decide the said grounds as under. 3. The brief facts of the case are that the assessee-company has filed its return for the abovementioned assessment year at nil showing carried forward loss of Rs. 17,68,144 which was processed under section 143(1). Later on, during the course of requisitioning proceedings under section 132A by the Additional Director of Income-tax, Ludhiana, in the case of Sh. Vipin Verma S/o Sh. Om Parkash, r/o K-7, Auna Ngr. Civil ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....icer, he categorically denied any agreement finalised with M/s. Splender Land Base Ltd. by stating that the agreement was in process of finalisation but the other party did not agree to the terms of the assessee-company. The assessee was supplied copies of statement of Sh.Maninder Singh Hira, its managing director recorded before the Additional Director of Income-tax, Amritsar as well as copies of registries done by Splender Land Base Co. with the farmers. As per copies of the registries average rate of sale of land is shown at Rs. 60 lakhs per acre. However, as per copy of agreement requisitioned by the Additional Director of Income- tax, Ludhiana from Sh. Vipin Verma, the land is to be sold at Rs. 81 lakhs per acre from which it was safely transpired by the Assessing Officer that the assessee was to receive Rs. 21 lakhs per acre as profit from sale of land. This shows that the payments were unaccounted in the hands of M/s. Splender Land Base Ltd., New Delhi as well as in the hands of M/s. V. M. Reality P. Ltd. Under the circumstances, it is confirmed and established both concerns are in the habit of receipt and payment of unaccounted money outside the books of account. Later on, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he assessee are dismissed. 7. As regards grounds Nos. 3 to 12 addition of Rs. 70 lakhs and enhancement of Rs. 8,60,000 of addition has been made on the assessee on the basis of one agreement, which is placed at paper books 12 to 15, which was seized from the premises of Sh. Vipin Verma. It is not in dispute that the agreement has been signed on behalf of the assessee, but there is no signature of other party. The claim of the assessee that this is not a valid document, since the same has been denied by the managing director of the assessee-company, Sh. Maninder Singh in the statement recorded by the Additional Director of Income-tax, Amritsar and also by the Assessing Officer in the assessment proceedings. Copies of the statements are placed on record at paper books 22 to 33 and 34 to 43. Statement of the person concerned of Splender Land Base Ltd. has also been denied having made any payment by cash is a matter of record. Affidavit duly notorised from the notary has been furnished by the assessee, which is placed at paper book 21. The claim of the assessee is that a middleman/broker and audited balance sheet has been placed on record, which shows the amount received from M/s. Spl....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of Rs. 4.30 crores has been considered belonging to M/s. Splender Land Base Ltd. and only Rs. 70 lakhs has been considered belonging to the assessee. On the other hand, the learned Commissioner of Income-tax (Appeals), on one hand, has admitted that the assessee is maintaining accounts on mercantile system basis and on the other hand has enhanced the income at 2 per cent. on Rs. 4.30 crores in spite of the explanation submitted before him that none of the deal has been finalised. It was also submitted that while framing assessment of the assessee-company for the following year, i.e., 2008-09 the returned income was accepted, which was based on the commission earned on procurement of lands including M/s. Splender Base Ltd. Learned counsel for the assessee relied upon the decisions of various courts of law in this regard as under : (i) Smt. Panna Devi Chowdhary v. CIT [1994] 208 ITR 849 (Bom) ; (ii) Rajender Kumar Garg v. Deputy CIT [2000] 67 TTJ (Delhi) 347 ; (iii) Smt. Saroj Kumari v. Asst. CIT [2004] 91 TTJ (Amritsar) 733 ; (iv) D. A. Patel v. Deputy CIT [2001] 70 TTJ (Mum) 969 ; (v) Amarjit Singh Bakshi (HUF) v. Asst. CIT [2003] 263 ITR (AT) 75 (Delhi) ; (vi) M. M. Financi....