TMI Blog2015 (11) TMI 437X X X X Extracts X X X X X X X X Extracts X X X X ..... y on account of sale of flat No.A-202 and since neither the statement of the owners of flat No.A-202 was provided to the assessee nor the request of the assessee to cross examine the owners of flat No.A-202 was provided despite repeated request during the assessment proceedings and since the entire addition is based on presumptions and surmises, therefore, we do not find any infirmity in the order of the Ld.CIT(A) deleting the addition of ₹ 50 lakhs made by the AO on account of on-money received in respect of flat No. A-202. In this view of the matter and in view of the detailed reasoning given by the Ld.CIT(A) deleting the addition, the same is upheld and the grounds raised by the Revenue are dismissed. - Decided in favour of assessee. - ITA No. 2190/PN/2013 - - - Dated:- 23-9-2015 - Shri R. K. Panda, AM And Shri Vikas Awasthy, JM For the Petitioner : Shri S.K. Rastogi, CIT For the Respondent : Shri Suhas P. Bora heeraj Jain ORDER Per R. K. Panda, AM This appeal filed by the Revenue is directed against the order dated 26-09-2013 of the CIT(A) Central, Pune relating to Assessment Year 2009-10. 2. Facts of the case, in brief, are that the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar to the other costing sheet retrieved from your laptop and the Agreement value. Thus it transpires that the difference between the costing count on such sheets and the Agreement value represents the cash amount received in addition to the admitted value. Please Explain Your Say. Ans. I agree that the actual costing sheet shown by you to me in relation to Flat No.A-202 in the case of Rajmani Shiley Singh is same in format as the sheets retrieved from my laptop. However I do not know as to how the differences between the costing as per this sheets and the agreement value is accounted for. Q.13 As shown to you earlier there are substantial differences in the per sq. ft. rates of flats sold during a particular period From the differences found between the actual cost and the agreement value, it transpires that the lower per sq. ft. rates represent that such Flats have actually been sold at the higher rate and the difference and it has been accepted in cash over and above the agreement value. Ans. Although there are substantial differences in per sq. ft. rates of the Flats sold during the same period, I do not know as to why there is such difference or as to how the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. It was explained by the assessee that there is no incriminating evidence found during the course of search from the premises of the assessee that assessee had charged any on-money in respect of the sale transaction with Ms. Shilpi Rajesh Singh. Therefore, the assessee requested the AO to provide the evidence, if any, with him for the said alleged on-money on the sale transaction so that the assessee can file its submissions on the same. Relying on various decisions it was submitted that additional income earned from sources like on-money cannot be added on its entirety and only the net profit thereon should be taxed. Subsequently it was reiterated that there is no incriminating documents found during the course of search accepting on-money by the assessee from any of the parties. 7. However, the AO was not satisfied with the explanation given by the assessee. He noted that Shri Sudhir Darode in his statement has stated that after verification of the relevant records and going through the statement of Ms. Chaitrali Shrikant Karkare, as a matter of principle they do not accept any on-money as alleged. However, the Director has offered an amount of ₹ 1.91 crores as add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at she was unable to explain the differences in figures pointed out to her by the officer recording her statement since she was not aware of the accounting side and only looked after customer care; that she was not in a position to explain the differences between the costing as per the sheets and the agreement value as she was not related to the accounting part ; that the rates are ultimately finalized by the directors themselves and therefore they only will be in a position to answer the query with regard to the alleged on money. ii. That in Q. No. 12 of the statement of the aforementioned employee, Ms. Karkare, it was stated by the officer that the owners of Flat No A-202 had admitted that they had paid an amount of ₹ 50,00,000/- in cash However, upon perusal of the assessment order, it does not does not appear as if the afore mentioned statement of the owners Itself was either confronted to the said employee or to Shri Sudhir Darode. Nor has the AO even relied upon the said statement while coming to his conclusions in the assessment order. It is noticed that the relevant portion of the statement has also not been reproduced in the order unlike the statements of Ms. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of which the addition was being proposed should be given to them. 7.8 After careful consideration of all the facts brought out in the preceding paragraphs, even without going into the legal precedents cited by the Ld. AR, I am of the view that there is no factual foundation for sustaining the addition of ₹ 50,00,000/- made by the Ld. AO. Accordingly, the said addition is hereby deleted. 8. Grounds No. 3 4: Ground No.3 is in the nature of a prayer wherein it is requested by the appellant that the amount of ₹ 50,00,000/- added by the Ld. AO on account of alleged on money be deleted; that alternatively, if at all any addition is to be made the same should be only to the extent of net profit and not of the gross receipt; that personal hearing may be granted, and that other relief as deemed fit may be granted. Under Ground No. 4, permission to add/alter/amend/modify/rectify/delete withdraw any grounds of appeal and to raise additional grounds of appeal if necessary, has been sought. 8.1 Under Ground No 2, I have already decided the substantive issue under contention in the appellant's favour. Further, no request has been made by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t that time and the sale price of the flats are more than the stamp duty rates which are one of the indicators of the market price. The entire sale proceeds have been recorded in the books of account and the sale value is fully evidenced and vouched and also verified by the auditors. He submitted that while selling the flats the assessee has to lower the rate than the rate quoted due to various factors such as locational factor, liquidity factor and the choice of the flat or the unit and also depend upon individual customers. He submitted that whenever the assessee has charged higher rate the same has been reflected in the books of account. Therefore, without any material in the possession of the department that the assessee has received any on-money no addition can be made. He accordingly submitted that the order of CIT(A) be upheld and the grounds raised by the Revenue be dismissed. 14. We have considered the rival arguments made by both the sides, perused the orders of the AO and the Ld.CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find during the course of search in the business premises of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee to cross examine the said person was provided with. We find the assessee has also clarified before the AO relating to the notings on page No.27 which reads as under : Q.116 This page is hand written entry in respect of certain flat No. where there is a difference in the value as per the agreement and the value as per sheet as mentioned therein. Please explain the entries in page. Ans. It is once again reiterated that the notings on the paper seized is not by any person from Darode Jog Group but is prepared by one of the Officers of Income Tax Department while conducting the search, but through oversight is included in the document seized along with the other documents seized during the course of search. It is submitted before your Honour that the notings are in respect of the flats at the Blossom Boulevard and we have already made a declaration u/s.132(4) amounting to ₹ 1.91 crores in respect of Blossom Boulevard Project which takes care of this difference. 17. We find Ms. Chaitrali S.Karkare in her statement recorded on 30-04-2009 u/s.132(4) in reply to Question No.6 has stated that the rates are ultimately finalized by the directors themselves a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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