TMI Blog2018 (9) TMI 1755X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee nor the AO has collected the details of date wise payments from the Vizag Profiles Ltd. Even there the AO has not ascertained in the statement with regard to the unaccounted payment made by the assessee in the statement. Though the Managing Director has given general statement or the practice of the company with regard to the acceptance of cash component of 25% to 40% , the general statements and the observations cannot be inferred adversely against the third party without the specific information and the relevant evidence. The department has no material to hold that the assessee had made the payment of ₹ 91,27,000/- to the VGP and to make the addition of ₹ 91,27,000/- as unaccounted consideration. Accordingly we set aside the orders of the lower authorities and delete the addition made by the AO and allow the appeal of the assessee on this ground. With regard to the difference in sale consideration in the registered sale deed the Ld.CIT(A) did not make any addition since at the end of the F.Y. the consideration recorded in sale deed, the assessee’s books are reconciled with the VGP’ s books. The department also did not place any evidence to show that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in granting liberty to the assessing officer to consider the balance cash payments of ₹ 25,00,017/- and ₹ 12,81,183/- for addition for the assessment years 2010-11 and 2011-12 as such direction is beyond the scope of appeal before him. 5. Any other ground that may be urged at the time of appeal hearing. We have heard both parties and admit the revised grounds for adjudication. 3. Ground No.1 and 6 are general in nature which does not require specific adjudication. 4. Ground No.2 is related to the validity of issue of notice u/s 148. The Ld.AR argued that the Ld.CIT(A) ought not to have upheld the notice issued u/s 148 which is void ab initio. We have gone through the Ld.CIT(A) s order and grounds of appeal filed before the Ld.CIT(A) in form No.35. The assessee has not raised the grounds relating to the issue of notice u/s 148 either in the form 35 i.e. memo of appeal or before the Ld.CIT(A) or in a separate petition for admission of additional ground with regard to validity of issue of notice u/s 148. . However, the Ld.CIT(A) has made a passing remark with regard to the validity of initiation of proceedings u/s 147 of the Income Tax Act (hereinafter called as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Registered Land Value Cash Cash portion received in FY 2008-09 4. M.Annapurna, 93 94 88,00,000/- 28,22,400/- 14,14,000/- 45,63,600 2800034 5. M.Annapurna, 91 92 88,00,000/- 28,22,400/- 14,14,000/- 45,63,600 1999961 Basing on the information received from the investigation wing, the AO had issued the notice u/s 148 and taken up the case for assessment. The AO issued notice to the assessee directing him to explain the sources for investment made. The assessee explained that she had not made any payment over and above the registered sale deed of ₹ 84,74,000/- (excluding the stamp duty) and actual payment up to 31.03.2009 was ₹ 72,88,905/- and further stated that stamp duty of ₹ 4,89,900/- was paid directly and not included in the above sums. Not being convinced with the explanation of the assessee the AO held that the assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er and above the actual payment. Further the Ld.CIT(A) observed that the total payment made by the assessee was ₹ 67,99,005/- for the F.Y 2008-09. Since there was difference in actual payment and the payment registered sale deed, the Ld. CIT(A) presumed that that the assessee has paid the consideration over and above the sale price recorded in the sale deed in cash and did not believe the contention of the assessee that the payments were made subsequent to the registration and accordingly directed the AO to make the addition of ₹ 47,99,995/-i.e (28,00,034+19,99,961) as noted in Annexure-II page No.49 of paper book seized in the premises of the searched person. For ready reference, we extract relevant part of the order of the Ld.CIT(A) which reads as under : 6.2 1 find that as per the registered sale deeds dated 28.2.2008 documented consideration for both properties aggregating to ₹ 51,52,000/- was paid already before the date of registration. But as per the information furnished by the assessee, only an amount of ₹ 9 lakhs was paid In June, 2008 in cheque and all other payments were made subsequent to the date of registration. It is quiet improbable tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n appeal before this Tribunal. During the appeal hearing, the Ld.AR argued that the Ld.CIT(A) misdirected himself to confirm the addition of ₹ 47,99,995/- by relying on the payments recorded in the registered sale deeds as well as the subsequent additional construction agreements dated 23.03.2010 under which the assessee is required to pay a sum of ₹ 32,32,000/-@16,16,000/- each for extra work. The issue involved in this appeal is unaccounted investment made by the assessee amounting to ₹ 91,27,200/-. The Ld.AR argued that the Ld.CIT(A) directed the AO to make the addition of ₹ 47,99,995/- for the financial year 2008-09 without considering the material available on record. In this regard, the Ld.AR argued that though the amount was recorded in the registered sale deed @ ₹ 51,52,000/- as on 28.07.2008 the assessee made the payment of ₹ 9 lakhs and subsequently made the balance amount as per the details furnished and the payment schedule of the assessee is in synch with the Vizag Profiles Group account. The Ld.AR further submitted that the entire payment of ₹ 67,99,005/- was paid during the F.Y.2008-09. The Ld.AR has given reconciliation stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd seizure operation dt.03.04.2012, you were asked to submit the details of purchase and sale of green city project. However, no information has been produced till date. Please produce the same. A. We will produce the details of purchase and sale of Green City Project by Monday i.e. 23.04.2012 along with copies of documents. Q. Please mention the percentage of payments received in cheque and cash against sale of flats and villas in Green City Project? What percentage of receipts are entered in your regular books of account? A. 60% to 75% of the sale receipts are received in cheque and the rest in cash. The element of cash receipt is not entered in the regular books of account. Q. Depending upon the number of villas/flats sold, can you quantify the cash component, which is received against sale of flats / villas in Green City Project for various years? A. I will quantify the amount of cash component which are not entered in the regular books of account and submit the same on 23.04.2012 along with other information. 9.1. On the basis of the above information, the AO concluded that the assessee had paid the unaccounted cash towards purchase of the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the department has no material to hold that the assessee had made the payment of ₹ 91,27,000/- to the VGP and to make the addition of ₹ 91,27,000/- as unaccounted consideration. Accordingly we set aside the orders of the lower authorities and delete the addition made by the AO and allow the appeal of the assessee on this ground. 9.2. With regard to the difference in sale consideration in the registered sale deed the Ld.CIT(A) did not make any addition since at the end of the F.Y. the consideration recorded in sale deed, the assessee s books are reconciled with the VGP s books. The department also did not place any evidence to show that the assessee has made over and above the consideration recorded in the books of account during the year. Therefore we do not see any reason to interfere with the order of the Ld.CIT(A) on this issue. 10. Ground No.4 is related to the direction given by the Ld.CIT(A) to consider the cash payments of ₹ 25,00,017/- and ₹ 12,81,183/- as addition for the assessment years 2010-11 and 2011-12, the same is not related to the impugned appeal under consideration. Therefore, this ground is infructuous for the year under con ..... 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