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Mr. Rajkumar Aswani Versus The Dy. Commissioner of Income Tax, Central Circle 1 (1) , Pune

Addition u/s. 69B - unexplained investment in residential bungalows - Held that:- Admittedly, the Assessing Officer has not rejected the books of account in the case of assessee though the Assessing Officer notes that the cost of construction is reflected in the books of account. In this regard, we find support from the ratio laid down by the Hon’ble Delhi High Court in CIT Vs. Bajranglal Bansal reported (2010 (8) TMI 65 - DELHI HIGH COURT) for the proposition that the opinion of the DVO per se .....

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heeraj Kumar Jain ORDER PER SUSHMA CHOWLA, JM: This appeal filed by the assessee is against the order of CIT(A)-I, Pune, dated 15.12.2011 relating to assessment year 2009-10 against order passed under section 143(3) of the Income-tax Act, 1961 (in short the Act ). 2. The assessee has raised the following grounds of appeal:- 1. On facts and circumstances prevailing in the case and as per provisions of the Act it be held that, the addition made of ₹ 12,25,142/- & 69,32,586/- u/s. 69B of .....

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₹ 69,32,586/- under section 69B of the Act on account of unexplained investment in residential properties. 4. Briefly, in the facts of the present case, search action under section 132 of the Act was conducted on group of cases of the assessee on 13.08.2009. The assessee furnished the return of income for the current year on 15.10.2010 disclosing total income of ₹ 78,10,630/-. The case of the assessee was picked up for scrutiny and a questionnaire along with requisite notice was iss .....

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erty at ₹ 3,26,10,000/-. The Assessing Officer thereafter, issued show cause notice to the assessee as to why the excess investment of ₹ 12,25,142/- should not be added in the hands of the assessee. In response, the assessee contended that the difference in value done by the DVO and as accounted for in the books of account was 4%, which would be due to calculation and purchasing difference of the material. The Assessing Officer rejecting the explanation of the assessee, added sum of .....

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further sum of ₹ 10,36,909/- was expended on this account by M/s. Aswani Associates. The plea of the assessee was rejected by the Assessing Officer and sum of ₹ 60,32,586/- was considered as unexplained investment under section 69B of the Act. 5. The CIT(A) upheld the order of Assessing Officer. The plea raised by the assessee before the CIT(A) was that no document / evidence of suppression was found in respect of investment in the said properties. It was further contended by the ass .....

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ssment and where the assessee and his group was engaged in suppression of transactions, therefore, the books of account regularly maintained were established to be unreliable. Where the return was not a regular return based on the books maintained in the regular course of business, the same were not required to be first rejected before resorting to the services of the DVO. Reliance placed upon by the assessee in this regard was held to be not applicable to the facts of the case and the addition .....

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at page 26 of the Paper Book, wherein the details of the construction account are maintained in the books of account. He thus, contented that where no incriminating material was found during the course of search, there was no merit in any addition in the hands of the assessee. An alternate plea was raised by the learned Authorized Representative for the assessee that whether in the case of search or otherwise, the law is settled by the Hon ble High Court of Karnataka in CIT Vs. Vasudev Construc .....

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ch is placed at pages 27 to 32 of Paper Book. The perusal of the said report of DVO reflects the commercial building at S.P. Heights, to be constructed during the period 2004-05 to 2006-07. Further, the DVO report in respect of the building at Pimpri reflects the period of construction to be 2006-07 to 2007-08. The learned Authorized Representative for the assessee thus, contended even assuming that the addition is to be made in the hands of assessee, then there is no reason why the addition was .....

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30/-. The assessee had received remuneration from the partnership concern. In addition the assessee had recorded construction cost of bungalow at Pimpri at ₹ 3,13,84,858/- in the books of account and had also shown the construction cost of commercial building at S.P. Heights, Mumbai -Pune Road, at 54,32,505/- in the books of account. The assessee was maintaining books of account regularly. The Assessing Officer in the assessment order has also noted that the cost of construction was debite .....

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mpri was during 2006-07 to 2007-08. Both the properties were admittedly, constructed by the assessee in the period prior to the year under consideration i.e. assessment year 2009-10. In the first instance, where the cost of construction has been incurred by the assessee in the period prior to the year under appeal, then no addition can be made in the hands of the assessee on this account for the instant assessment year. We further find that the Assessing Officer vide para 3 has noted that certai .....

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