TMI Blog2016 (9) TMI 1254X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings or in post survey proceedings. The documents found are only photocopies and no original documents were found. Therefore, photocopies of the documents would have little evidentiary value. No material have been brought on record if the assessee was connected with any deal as alleged in the photocopies of the agreement to sell. No details of any sale consideration or actual amount received or paid by the assessee have been brought on record. No evidence have been brought on record if agreements to sell in question were acted upon by the parties. The agreement to sell dated 29.1.2005 is not on any stamp paper. The Hon'ble Delhi High Court in the case of CIT Vs. Murti Devi (2010 (9) TMI 1208 - DELHI HIGH COURT) while dismissing departmental appeal referred to the findings of the Tribunal in which it was held that the photocopies of the documents have very little evidentiary value and in the absence of original documents, photocopies of the documents are not admissible and cannot be the basis for making addition. - Decided in favour of assessee - ITA No.664/Chd/2011 , ITA No.680/Chd/2011 - - - Dated:- 20-9-2016 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. ANNAPURNA GUPT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erns. During the course of survey, certain loose papers, photocopies of agreement and incriminating documents were found and impounded from the business premises of Chandigarh Overseas Private Limited and from the examination of these documents, it was found that the assessee was also party to various agreements found during the course of survey. The Assessing Officer made the above additions on the basis of photocopies of the agreement found from the premises of Chandigarh Overseas Private Limited. The details of documents have been mentioned in the impugned order as below : i) Agreement to sell dated 29.1.2005. ii) Backside of page 2 of the agreement to sell dated 29.1.2005. iii) Registered sale deed for 8 kanal 10 marlas. iv) Agreement to sell dated 19.4.2005. v) Agreement to sell dated 29.6.2005. 5. The ground No.1 raised by the Revenue is general and needs no adjudication. 6. On ground No.2, the Assessing Officer made addition of ₹ 1,12,04,166/-. 7. During the course of assessment proceedings the Assessing Officer observed that one of the impounded document is an agreement to sell dated 29.1.2005 executed between THE SELLERS 1. Smt.Pushpinder ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted to assessee and these were forged documents and the assessee has not executed document Nos.18 19. Moreover, from the perusal of photocopies of documents, it is clear that the agreement is not on stamp paper and signature of all parties to agreement are missing. We also submit that part of contents mentioned in page 33 of Annexure Bl has been copied on document No.19 of Annexure B2 and, therefore, it is clear that someone has forged the contents and prepared document Nos.18 19. Further, it was not found from the premises of the assessee. The Assessing Officer has not examined any party to the agreement and no enquiry has been conducted. Further the assessee and other buyers have purchased only 8 Kanal 3 Marlas out of total land measuring 25 Kanals 10 Marlas and assessee is not aware about the balance land sold by Mrs. Pushpinder others and consideration received by sellers. Further the Assessing Officer has not supplied the copies of returns of sellers. Further the assessee during the course of assessment proceedings has already explained that the assessee and other 2 persons, namely S/Shri Jagpal Singh and Bimal Suri had agreed to purchase 25 kanals 11 marlas Land for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sum as per terms of agreement and the seller agreed to sell l/3rd of land in the name of assessee as well as other persons to the agreement. So, the land consisting of 8 kanals 10 marlas was registered in the name of S/Shri Gulshan Rai, Jagpal Singh Bimal Suri (having 50% share) and Shri Shekhar Chawla (having 50% share) for the total sales consideration of ₹ 42,50,000/-. The registered sale deed for the same was executed as on 17.06.2005. The copy of the registration deed is enclosed herewith for your kind reference. The rest of area of land i.e. 2/3rd of the total land was not sold to assessee and the assessee is not aware of the facts to whom and at what rate the said rest of land was sold. The Assessing Officer mentioned that the sellers had filed their returns of Income with DCIT Jalandhar showing the sale consideration received by them at ₹ 3.76 crore. In this regard, this fact was never confronted to assessee during the course of assessment proceedings and moreover the assessee had purchased very small share in total land and was not aware about the rest of land sold by sellers and nowhere it is mentioned that the assessee has paid more amount than shown in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant. (b) The documents found are only photocopies no original documents were found as Supreme Court decision in case of Moosa S Madha Azam S Madha Vs CIT 89 ITR 65(Sc) the photocopies have little evidentiary value. (c) The survey team assessing officer has not made any enquiry from the sellers , buyers Pararsav Colonisers Consultant Limited Gee City Builders Pvt Limited with respect to purchase of any land from the appellant or from the original sellers directly and consideration paid by appellant other buyers simply recorded the statement of appellant during course of assessment proceedings . (d) The assessing officer relied on the return of income filed by the buyers there were no details with respect to sale consideration received from original buyers new buyers during the course of appellate proceedings no such returns were produced. (e) The appellant other buyers had not purchased the entire land as shown in agreement to sell dated 29-01-2005 even in registered sale deed 1/3 share of total land was purchased by original buyers other party therefore it is clear that they had not acted upon the agreement to sell dated 29-01-2005. ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eleted, allowing assessee's appeal on this ground. 16. On ground No.3, the Assessing Officer made addition of ₹ 1,44,50,000/-. The Assessing Officer also noticed that the document Nos.15 and 16 of Annexure B-2 is an agreement to sell dated 19.04.2005 of the same land i.e. 25 kanal 10 marlas and as per these documents, the land has been further agreed to be sold to M/s Parsav Colonisers and Consultants Pvt. Ltd. at a rate of 2,54,00,000/- per acre and also noticed that it is mentioned in the agreement that an amount of ₹ 75.00 lacs had been paid as advance money by Parsav Colonisers, Director Shri Shekher Chawla, which includes ₹ 3.00 lacs by cheque No.165251 of Andhra Bank and ₹ 72.00 lacs by cash. This is also mentioned that an amount of ₹ 25 lacs will be paid by 15.4.2005 and the date of registry had been fixed on 15.6.2005. 17. During the course of assessment proceedings, information was called under section 133(6) of the Act from Andhra Bank, Sector 34-A, Chandigarh branch. It was confirmed from the information received that the Ch. No.165251 had been issued in favour of Smt.Pushpinder Kaur (seller) by debit to the account of M/s Parsav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithout prejudice to aforesaid submissions, the assessee submitted that the profit on sale of land can only be determined after completion of sale transaction and not only on the basis of advance. Further the Assessing Officer relied upon the payment received from the Parshav colonizers Consultants Private Limited and there is no relation between payment received and terms condition of agreement relied by the Assessing Officer. The Assessing Officer relied upon photocopy of forged bogus documents which do not relate to assessee and not executed by assessee and which were collected at the back of assesse from the premises of third parties not related to assessee. Further the Assessing Officer had not made any inquiry from original sellers, buyers companies to know the truth. Further the Assessing Officer has not made any enquiry from parshav Coloniser consultants Private Limited to know the truth and purchase consideration paid if any to assessee and other alleged owners. The assessee has not sold any land to Parshav Colonisers Consultants Private Limited and, therefore, question of profit does not arise. 21. The learned CIT (Appeals), however, deleted the entire addition. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sferred on the same rate i.e. ₹ 3.65 lac per acre and get it registered in the name of party No.3 within six months irrespective of the rate at which the land is arranged from the original owner. This additional land is adjoining to the main land purchased by party No.3. After that additional payment of ₹ 1.59 lacs will be made by party No.3 as party payment within seven days from the date of execution of sale deed pertaining to land measuring 2500 square yards. The agreement dated 29.6.2005 with Gee City Consultant Pvt. Ld. extremely important and can be taken as true and one that was acted upon. Its authenticity is proved by the following facts:- This agreement contains reference to the original agreement to sell dated 29.01.2005 and its terms and conditions that the buyers S/Shri Gulshan Rai, Jagpal Singh Bimal Suri can have the land registered in their own name or in any other name. This indeed was the intention of the buyers, the assessee being one of them, to further sell the land at profit without getting it registered in its own name. This was a common occurrence around the period when prices of real estate were escalating by the day in the areas around ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, it was held that Assessing Officer did not recover the documents from the possession of assessee nor the assessee confronted with the seized material. 26. The learned CIT (Appeals), however, deleted the entire addition. His findings in paras 28 and 29 of his order are reproduced as under : 28. In view of above discussion Judgement given by Kerala High court reported at 128 Taxman 848. Amount stated in the sale deed can not be ignored on the basis of agreement of sale unless it is proved that the agreement of sale was acted upon and the amount stated in the agreement was actually paid. On the basis of agreement to sell it can not be concluded that the price mentioned in the sale deed is not correct also placed reliance on judgement given by Madras High Court in case of CIT Vs P.V. Kalyana Sundaram, 282 ITR 259 ( affirmed By Supreme Court) concluded that in absence of any independent enquiry, AO was not justified in making addition on account of profit on sale of land to M/S Gee City Builders Private Limited. 29. In view of the above discussion, the plea on this ground is accepted, deleting the addition so made. 27. We have heard the learned representatives o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er concerns and during the course of survey, certain loose papers including copies of agreement to sell in question were impounded. Thus, no agreement to sell or any incriminating documents were found from the possession of the assessee. There is no recovery of any incriminating document from the power and possession of the assessee. The Assessing Officer has not brought any material on record to prove any connection of the assessee with these documents/agreement to sell. The Assessing Officer wanted to rely upon the photocopies of the agreement to sell in question. Therefore, the onus would be upon the Assessing Officer to prove that the documents found during the course of survey from third party, belonged to the assessee. The original of the photocopies were never recovered in survey proceedings or in post survey proceedings. The documents found are only photocopies and no original documents were found. Therefore, photocopies of the documents would have little evidentiary value. It is also admitted fact that the survey party as well as Assessing Officer has not made any enquiry from any seller or buyer, M/s Parsav Colonisers and Consultants Private Limited and M/s Gee City Build ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same is accordingly, dismissed on all the grounds. 32. The departmental appeal is dismissed. ITA No.680/Chd/2011(Shekhar Chawla): 33. This appeal has been filed by the Revenue on the following identical grounds : 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing appeal of the assessee without appreciating the facts of the case. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of ₹ 41,43,750/- on account of alleged payment made in purchase of land. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of ₹ 1,31,21,875/- on account of alleged amount earned over and above the amount mentioned in registered deed.. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of ₹ 3,87,05,500/- on the basis of certain documents found during the course of survey. As the assessee was one of the party in the transactions and had not disclosed anything except showing ignorance. 34. The learned representatives ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
