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2016 (5) TMI 46 - ITAT AHMEDABAD

2016 (5) TMI 46 - ITAT AHMEDABAD - TMI - Addition on account of undisclosed net profit - difference in sales turnover - Assessment u/s 153C - Held that:- There was a bonafide mistake committed by the assessee in filing the original return of income of AY 2008-09 filed on 27.07.2009 which was rectified by it by filing revised return on 30.09.2009 even before receiving the notice u/s 153C dated 18.01.2010. Return of Income for AY 2009-10 declaring a total income of ₹ 4,75,47,402/- was filed .....

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ame amount of income relatable to same sales proceeds.

In view of above, the Assessing Officer was not justified in making addition of to the total income of the assessee for the year under consideration on account of difference in sales turnover in unaudited accounts and audited accounts, particularly when the assessee had already offered corresponding income in AY 2009-10 and assessed u/s 143(3) r.w.s. 153C by the same Assessing Officer. Thus, the addition was rightly deleted by the .....

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Ahmedabad, dated 27.08.2012 for Assessment Year 2008-09, on the following grounds:- 1) The Ld. CIT(A) erred in law and on facts in admitting additional evidences such as reconciliation and detailed break-up of total constructed areas for R.Y. 2007-08 and 2008-09 and closing stock as on 31.03.2008 and 31.09.2009 without giving the AO opportunity to offer his comments, in contravention to the provisions of Rule 46A of the I.T. Rules. 2) The Ld. CIT(A) has further erred in law and on facts in delet .....

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veloper. During the year under consideration, the assessee was engaged in the business of redevelopment of slum under the Special Act of the Govt. of Maharashtra. The scheme was administered through the Slum Development Authority, under which the dwellers were provided houses free of cost by the developer and the assessee was entitled to specified FSI, which could be utilized for the construction of residential /commercial building for sale in open market. The assessee constructed a commercial b .....

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for the year under consideration on 23.04.2010, declaring a total Income at ₹ 3,58,17,705/- along with audited Balance Sheet and Profit & Loss a/c. The assessee had not filed any Return of Income up to the date of search, i.e. 16.07.2009 for the Assessment Year 2008-09. The assessee e-filed its first return of income declaring income of ₹ 11,20,22,235/- for the Assessment Year 2008-09 on 27.07.2009. Thereafter, realising some mistake in considering the turnover figure, the retur .....

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ns for making the addition of ₹ 7,62,04,530/-, which read as under:- 10. During the assessment proceedings, the assessee has produced books of account for FY 2007-08 and FY 2008-09 for verification which are placed on record. However the contention of the assessee is not acceptable for the reasons that: 1) ASSESSEE has confirmed the disclosure of ₹ 11,20,22,235/- in the statement recorded u/s 132(4) at the time of SEARCH. 2) The Assessee itself has filed Return of Income u/s 139(1) i .....

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4) is true and correct income and therefore the difference of ₹ 7,62,04,530/- is added to the income returned u/s 153C of the Act. 2.1 Matter was carried before the First Appellate Authority, wherein various contentions were raised on behalf of the assessee and having considered the same, the CIT(A) granted relief to the assessee and the same has been opposed by the Revenue, inter alia, submitting that the CIT(A) has erred in admitting the additional evidences such as reconciliation and de .....

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ordingly, pleaded that the order of the CIT(A) be set aside and that of the Assessing Officer be restored. On the other hand, ld. Authorized Representative for the assessee supported the order of the CIT(A). 3. We have heard the rival contentions and perused the material on record. We find that that the Assessing Officer had nowhere found fault in the books of accounts and the audited statements of the assessee. He has simply relied on the statement recorded u/s 132(4) during the search and the .....

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tion of 9th and 11th floor was also included in the closing stock of 31.03.2008; so, on the credit side, same area was accounted for twice. 3.1 Sales proceeds of office premises of 9th and 11th floor were received in FY 2008-09, i.e., June 2008 onwards and the same was rightly considered and offered as turnover of FY 2008-09 relevant to AY 2009-10. For the AY 2009-10, the Income of ₹ 4,75,45,402/- was offered and assessed u/s. 153C r.w.s. 143(3) as against net profit of ₹ 14,85,419/- .....

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ordingly, in the net profit for the year under consideration, without affecting any amount or modification in the closing stock. Thus the figures related to sale of offices at 9th and 11th floor were considered as part of sales and closing stock as well. Therefore, this mistake was rectified by the assessee by filing revised return of income much before the receipt of notice u/s 153C of the Act. In this background, the CIT(A) rightly found that the mistake was genuine and the figures corroborate .....

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see page no 304 of file annexure BS-8, wherein you have worked out the income at ₹ 11,20,22,240/- for Divine Developers. Similarly for Dev Developers at page no 180 of File Annexure BS-9, total income is worked out at ₹ 1,83,34,410/-. Please state why the amount of ₹ 13,03,56,650/- should not be treated as undisclosed income. Ans: The Income and receipts are shown in the books and tax is due to be paid. The same is being offered to tax. The above statement does not speak of an .....

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to ₹ 18,48,52,500/- and the same was reflected in the audited accounts of the assessee. The sales proceeds of 9th and 11th floor was received by BCPL in FY 2008-09, which is clearly established from the copy of accounts of the purchasers of 9th and 11th floor in the books of BCPL. The books of account of BCPL were audited on 20.05.2008, which was more than one year prior to the date of search, i.e., 16.07.2009. This also establishes that the sales figures of 9th and 11th floor was wrongly .....

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rder for AY 2008-09. Thus, it was evident from the record that the Assessing Officer himself has assessed the income relevant to 9th and 11 floor in both the Assessment Years, i.e. AY 2008-09 and 2009- 10 and the same was not found justified. The closing stock of FY 2007-08 was sold during FY 2008-09 and was rightly reflected in the audited accounts of that year. It is matter of record. 3.4 From the above, it is clear that there was a bonafide mistake committed by the assessee in filing the orig .....

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