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2015 (7) TMI 167 - ITAT DELHI

2015 (7) TMI 167 - ITAT DELHI - TMI - Unsecured loans - Held that:- Clear evidence and reasons to believe that the assessee's efforts to take over GBES along with land did not materialize. The assessee has received back all the payments made towards membership and also loan to GBES are returned by cheque and recorded in the books of the assessee. Therefore, the contention of the assessee having received cash also in the books on cancellation cannot be rejected. Also scrutinizing the loan confirm .....

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red in making this addition.

The evidence pointed out to the fact there was a negotiation and certain payment for transfer of GB Educational Society to the assessee and that the transaction could not be completed and under those circumstances the finding of the first appellate authority have to be upheld. - Decided against revenue. - I.T.A. No. 2732/Del/2010,C.O. No. 227/Del/2010 - Dated:- 29-6-2015 - Shri I. C. Sudhir and Shri J. S. Reddy, JJ. For the Petitioner : Shri Vivek Wadekar, .....

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1961 on 30.12.2008 determined the total income at ₹ 11,85,86,805/- by making the following additions; a) ₹ 5,34,20,400/- on the grounds that the payment is made by the assessee for taking over G.B. Educational Society based on an MOU dated 27.6.2005. b) An addition of ₹ 1,28,53,800/- u/s 68 of the IT Act 1961. c) An amount of ₹ 1,20,00,000/- on the grounds that number of persons have given unsecured loan to G.B.E.S and as the assessee has taken over G.B.E.S, loan also be .....

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h are extracted from Para 5.5 page 11 of the CIT order: 5.5 Now the issue to be decided is....... a) Whether there was takeover of M/s G B Educational Society (regd) along with 24282 Sq Mts of land allotted to it by M/s Lovely Bal Shiksha Parishad (regd) through its President Shri R.P. Malik i.e. the assessee? b) If so, what is the amount of unexplained investment made by the assessee for the said takeover to be assessed u/s 68 of the IT Act? 5. In the various reasons given in his order, the fir .....

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isions of section 292C(1) of Income-tax Act, 1961. 3. On the facts and circumstances of the case, the Ld. CIT (A) has erred in law and facts of the case in deleting the addition of ₹ 1,28,53,000/- on account of loans from GBES repaid back and unexplained investment in Lord Tirupati Educational Society while dis-believing impounded documents and ignoring the provisions of section 292C(1) of Income-tax Act, 1961. 4. On the facts and circumstances of the case, the Ld. CIT (A) has erred in law .....

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of ₹ 11,85,86, 805/- on 30.12.2008. 3) That the assessing authority made the following addition as per Asstt. Order:- 1) Payment to G.B. Educational Society (Item 13) Rs.53420400/- 2) Payment to G.B. Educational Society (Item 14) Rs.12853800/- 3) Unsecured loan to G.B. Educational Society (Item 15) Rs.12000000/- 4) Receipt of cash from Sh. Bhupinder Singh (Item 16) Rs.5000000/- 5) Payment to S. Raja Singh & Others (Item 17) Rs.2500000 6) Sale of 4 Flats (Item 18) Rs.600000 4) That the .....

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t Ld. Dy. Commissioner of Income Tax, Circle-20, New Delhi filed an appeal before your goodself against the appellate order of Ld. CIT(Appeals-1) New Delhi on 04.06.2010. 7) That the respondent object in respect of the appeal filed by Ld. Dy. CIT, Central Circle-20, New Delhi. Moreover, the appellant has not filed any ground to substantiate their claim in favour of appeal. 8) That the respondent further submits to stand by the submission made at time of hearings in appeal before Ld. CIT(Appeals- .....

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relief. He argued that the land in question is held by the society and it is this land which is targeted for acquisition by the assessee who is in the business of purchase and sale of Real Estate. He submitted that this is basically a real estate transaction which the assessee sought to enter and gain from. He pointed out that the land allotted to GB Educational Society by M/s Greater Noida Industrial Development Authority was measuring 24,282 sq. mtrs. He argued that memorandum of understanding .....

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tional Bank. He further referred to Para 5.6 of the ld. CIT(A) s order and disputed the same. On grounds No. 3 & 4 he submitted that this is linked with the decisions that would be taken by the Bench on the first ground and hence no separate arguments were advanced. 11. The ld. counsel for the assessee Shri V.P.Gupta, Advocate on the other hand submitted that the transactions had not materialized and in the MOU did not get acted upon. He filed written submissions and relied on the orders of .....

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onsideration of the facts and circumstances of the case and a perusal of the papers on record and the orders of the authorities below, we hold as follows; 14. The facts that emerge are that there was a proposal for takeover of GB Educational Society. During the impugned assessment year, the payment of ₹ 30 lacs and ₹ 63,13,320/- aggregating to ₹ 93,13,320/- were made by way of cheques to GB Educational Society and to Greater Noida Industrial Authority respectively. 15. Further .....

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in the list of members of the Society. Copies of the letter are at page nos. 110 to 114 of the paper book. Punjab National Bank confirmed that Mr. R.P. Malik and others were Joint Secretaries between 16.07.2005 to 1.03.2007 and that the account has been closed on 11.08.2008. The AO made reference of hand written slips, a copy of which are at pages 94 & 95 of the paper book. A perusal of the same demonstrates that only payments which are appearing on records are mentioned herein. 18. With thi .....

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ith them. b) Shri Satish Chandra Goel in his sworn statement, stated that the MOU is a waste paper which was neither framed nor signed by him. However, he I.T.A. No. 2732/Del/2010 & C.O. No.227/Del/2010 9 confirmed the clauses 1, 2, 3 and 6, and further denied clause nos. 4, 5 & 8 clause no. 2 of the MOU reads as follows: 2. That party of the second part shall pay ₹ 31,56,660/- (Rupees thirty one lac fifty thousand six hundred and sixty six only) and ₹ 55,00,000/- (Rupees fif .....

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memorandum of M/s GB Educational Society, the Society cannot be taken over unless and until majority of the members are inducted from another group. As per these clauses, at least 12 members should be inducted by the assessee s group, which has not taken place. When the same members of the society continue, it cannot be said that there was a takeover of GBES. 20. Regarding authorization to operate corporation bank account, this is limited authorization and is not conclusive proof that the trans .....

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as to be refunded with interest of 2% per month to the party, by GB Educational Society. Thus the assessee s claim that the deal was cancelled and the amount paid to GB Educational Society and the amount got deposited with intermediary was returned, cannot be rejected without contrary proof. 22. At Para 5.6 of the order of ld. CIT(A) held as follows: 5.6 I have examined the documentary evidence produced by the assessee and also the basis on which the AO has made additions. In my opinion the stan .....

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rs or the executive council ever since the date of incorporation to the date of reporting which confirms the fact that the assessee has not taken over neither the society nor the land. The AO himself has rectified the order by allowing payments verified by him in the books of accounts of ₹ 93, 13,320/- and ₹ 1 ,28,53,400/-. Further the GNIDA allotment letter shows that still a sum of ₹ 1, 1 0,48,310/- was not due for payment at all and that the AO has not established proof of p .....

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e in law. I have clear evidence and reasons to believe that the assessee's efforts to take over GBES along with land did not materialize. The assessee has received back all the payments made towards membership and also loan to GBES are returned by cheque and recorded in the books of the assessee. Therefore, the contention of the assessee having received cash also in the books on cancellation cannot be rejected. I have scrutinized the loan confirmation letters from the various parties to GBES .....

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