TMI Blog2004 (10) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... d as the Managing Director of the assessee company held 50 per cent. of the shares and the remaining 50 per cent. of the shares was shared by Subba Reddy (Individual) designated as the Director of the Company, Subba Reddy (HUF) and Rajini Reddy, wife of Subba Reddy. 3. There was a search in the premises of the assessee under Section132 of the Income Tax Act, 1961 on February 23, 1996. In the course of the search the following documents were seized : (i) Statement of accounts prepared by one V.C. Gupta, Executive Director (Finance) of the company, relating to the settlement of accounts to the outgoing Director Subba Reddy and his group; (ii) Work Sheet prepared by Chartered Accountants Giri and Prabhakar, which was taken into consideration for settling the accounts of the outgoing Director Subba Reddy and his Group ; (iii) Paper showing negotiation with buyers for purchase of flats. 4. Concededly, except the three documents referred to above, there was no other seizure of cash, bullion, jewellery or other articles or things of value during the time of search. 5. Based on the above materials, the Assessing Officer, gave due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the entire value of the project; and therefore, the said documents would not themselves be considered as a conclusive evidence that the assessee had received the entire sale consideration from the purchasers. 9. According to the assessee, the Assessing Officer ought to have taken all relevant factors into consideration, namely, the actual receipts of sale consideration from the purchasers by way of cheques or cash before the date of search as well as the amount received as income generated by such sale subsequent to the date of search, which were in fact shown in the returns duly filed by the assessee as well as the tax paid for the same for the subsequent period. 10. The assessee referring to the fact that except the three documents referred to above, there was no other seizure of cash or bullion, jewellery or other articles or things of value during the time of search, contends that the conclusion of the assessing officer that there is undisclosed income is without any basis. Such conclusion as to the undisclosed income is solely based on the documents referred to above, which was intended to settle their shares payable t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances of the case, the Tribunal ought to have clarified that the amount of Rs.385.00 lakhs constitute the total profit before tax out of the project during the block period and the profits already offered by the appellant should have been excluded ? (vi) Whether on the facts and in the circumstances of the case the Tribunal ought to have taken into account the profit already offered by the appellant in the said project over various years?" 14. The substantial questions of law raised by the Revenue in T. C (A) No.10 of 2000 are as follows : "1. Whether on the facts and in the circumstances of the case and having regard to various seized materials placed, the Appellate Tribunal is right in law in allowing a margin of 40 per cent. on Rs.642.00 lakhs on the profit earned on Kences Enclave Project? 2. Was the Tribunal right in granting 100 per cent. depreciation even if it held that the production started on September 30, 1985 and not on October 25, 1985 and that has it ignored the provisions of Section 32(1) 2nd proviso and Section 158(B) (definition of block period) of the Income Tax Act?" 15. Mrs. Pushya Sitaraman, learned standing counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for estimating the undisclosed income. 18. We have given careful consideration to the submissions made by either side. 19. Regarding the second substantial question of law raised by the Revenue in T. C. (A) No.10 of 2000, namely, was the Tribunal right in granting 100 per cent. depreciation even if it held that the production started on September 30, 1995 and not on October 25, 1995 and that has it ignored the provisions of Section 32(1) 2nd proviso and Section 158(B) (definition of block period) of the Income Tax Act?", since the wind mill installed by the assessee got commissioned on September 30, 1985, as certified by the Electricity Board, the entitlement of the assessee for 100 per cent. depreciation with respect to their investment in the installation of the wind mill cannot be disputed and, therefore, this issue is decided in favour of the assessee and against the Revenue. 20. The centripetal force behind the substantial questions of law raised by the assessee in TC(A) No.47 of 2000 and the first substantial question of law raised by the Revenue in TC(A) No.10 of 2000 revolves around the materials available for estimating ..... X X X X Extracts X X X X X X X X Extracts X X X X
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