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2016 (5) TMI 877

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..... /- in A.Y. 2007-08 are unwarranted and unjustified Allowance of telescopic benefit - Held that:- As find from the record that the learned CIT(A) after factually examining the claims of the assessee, and the findings of the AO has correctly upheld the AO’s action in treating the proportionate sale proceeds of ₹ 36,81,818/-, including ₹ 26.40 lakhs said to have been received from Shri Nazar, as income of the assessee for A.Y. 2006-07 and at the same time allowing the assessee’s plea that telescoping is to be allowed in respect of income of ₹ 26.40 lakhs admitted by the assessee in A.Y. 2007-08, on account of sale consideration received from Shri Nazar from out of the addition of ₹ 36,81,818/- under section 68 of the Act in A.Y. 2006-07. We find that apart from raising the above grounds, the learned D.R. for Revenue has not been able to bring on record any material evidence to controvert the above findings of the learned CIT(A), and with which we concur. In this factual matrix of the case, as discussed above, we find no reason to interfere with or deviate from the factual findings recorded by the learned CIT(A) and therefore uphold his order allowing telesco .....

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..... 1, Thane, has preferred appeals for both assessment years 2006-07 and 2007-08 before the Tribunal. We now proceed to dispose off these appeals in seriatum hereunder. Revenue appeal in ITA No. 1720/Mum/2010 for A.Y. 2006-07 4. The ground raised by Revenue in this appeal are as under: - 01. On the facts circumstances of the case the Ld. CIT(A)-I, Thane erred in allowing relief of R.s.54,63,230/- to the assessee. 02. On the facts circumstances of the case the Ld. CIT(A)-I, Thane failed to appreciate the fact that the entries in the diary which undisputedly belong to Shri Narendra Jain, partner and was be utilized for recording sale transactions of land at Kellambakkam cannot represents any unreal or fictitious transactions but are real monetary transactions. 03. On the facts circumstances of the case the Ld. CIT(A)-I, Thane failed to appreciate the fact that Shri Narendra Jain, partner had admitted to striking out the three entries himself, thereby confirming that he was well aware about the transactions contained therein. 04. On the facts circumstances of the case the Ld. CIT(A)-I, Thane failed to appreciate the fact that on top of these three ent .....

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..... for A.Y. 2006-07 and ₹ 9,17,200/- for A.Y. 2007-08. It is contended that the learned CIT(A) failed to appreciate the fact that the entries in the diary which undisputedly belonged to Shri Narendra Jain, partner in the assessee firm, was utilized for recording sale transactions of land at Kellambakkam represent real monetary transactions and the noting of cash written on the top of these entries indicate that these transactions are cash receipts which were not recorded in the assessee s books of account. It was argued that the learned CIT(A) failed to appreciate that Shri Narendra Jain, partner in the assessee firm, had admitted to striking out these entries, which are in respect of the aforesaid additions, which confirms that he was well aware about the transaction contained therein. The learned D.R. for Revenue was heard and placed strong reliance on the grounds raised and supported the findings of the AO in making the aforesaid additions in respect of undisclosed cash receipts of ₹ 54,63,230/- and ₹ 9,17,200/- on sale of Kellambakkam land in assessment years 2006-07 and 2007-08 respectively. 6.2 Per contra, the learned A.R. for the assessee supported the f .....

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..... . 2007-08. On appeal, the learned CIT(A) deleted the aforesaid additions for assessment years 2006-07 and 2007-08 as being unwarranted and unjustified as he was of the view that the adverse inferences drawn by the AO on the entries of the seized diary were erroneous as the relevant entries on which the aforesaid additions were made, were not in the handwriting of the assessee, who denied knowledge of their context, but in the handwriting of the assessee s former employee Shri Kartik (site supervisor) who has not been examined and also since the said entries in the diary had been stuck off. 6.3.2 An appreciation of the facts on record reveal that the additions made to the assessee s income were on the basis of struck off entries made in the said seized diary, i.e. ₹ 54,63,230/- for A.Y. 2006-07 and ₹ 9,17,200/- for A.Y. 2007-08. In this regard, a statement of Shri Narendra Jain, partner of the assessee firm, was recorded on 26.12.2008. As per the relevant portion of this statement, which is extracted in the impugned order, it is seen that Shri Jain while admitting the diary belonged to him, has stated that the said scored out entries on the right side of the diary wer .....

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..... to 4 of Revenue appeal for A.Y. 2006-07 and grounds 1 to 4 in A.Y. 2007-08 are dismissed. 7. Ground Nos. 5 to 7 (for A.Y. 2006-07 only) 7.1 In these grounds, the Revenue assails the learned CIT(A) in allowing the assessee telescopic benefit to the extent of ₹ 26.40 lakhs for A.Y. 2007- 08 as this will reduce the income of A.Y. 2007-08 below the returned income for that year without bringing any evidence on record. The learned D.R. was heard in support of the grounds raised. 7.2.1 We have heard the rival contentions of the learned D.R. in support of the grounds raised and of the learned A.R. for the assessee in support of the impugned order of the learned CIT(A) on this issue. On an appreciation of the facts on record, it is seen that in the course of assessment proceedings the AO noticed that 18 plots had been sold by Shri Narendra Jain during the year under consideration. On being required by the AO, the assessee furnished details thereof, including the names and addresses of persons to whom plots had been sold and details of amounts received with cheque numbers. Shri Narendra Jain submitted that one entry of cash of ₹ 26.40 lakhs received from one Shri Nazar .....

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..... in the profit and loss account of the assessee for the year ending 31.03.2007, it constituted income of the assessee for A.Y. 2007-08 and therefore the AO ought to have deducted this amount of ₹ 26.40 lakhs while making the addition of ₹ 36,81,818/- for A.Y. 2006-07, as the same income which was offered to tax in A.Y. 2007- 08, cannot be added once again in the assessee s income for A.Y. 2006-07, since this would amount to double taxation of the same income in two different assessment years. 7.2.3 We find from the record that the learned CIT(A) after factually examining the claims of the assessee, and the findings of the AO has correctly upheld the AO s action in treating the proportionate sale proceeds of ₹ 36,81,818/-, including ₹ 26.40 lakhs said to have been received from Shri Nazar, as income of the assessee for A.Y. 2006-07 and at the same time allowing the assessee s plea that telescoping is to be allowed in respect of income of ₹ 26.40 lakhs admitted by the assessee in A.Y. 2007-08, on account of sale consideration received from Shri Nazar from out of the addition of ₹ 36,81,818/- under section 68 of the Act in A.Y. 2006-07. We find t .....

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