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TMI Blog2018 (11) TMI 996X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. failed to pay the balance sale consideration, resulting in the assessee and her husband forfeiting the advance amount and appropriating Rs. 1.25 crore each. Subsequently under sale deed dated 21st of March 2012, the property was sold to Mr Anuj Ahuja, Rita Ahuja and Vinod Ahuja (for short "Ahujas") for a sale consideration of Rs. 1.72 Crs. 3. Assessee filed her return of income on 30.03.2013, for the assessment year 2012-13, declaring an income of Rs. 38,71,122/-. She had declared her share of total amount of sale consideration received as Rs. 4.22 crore which includes Rs. 2.5 crores forfeited advance sale consideration received from M/s Pranav Sports Academy Pvt. Ltd. and the sale consideration of Rs. 1.72 crores received from Ahujas. By way of order dated 18.12.2014 u/s 143(3) of the Act, the ld. Assessing Officer accepted the same. 4. Subsequently, the Pr. Commissioner of Income-tax (PCIT), vide order dated 23.06.2015, observed, inter alia, that there was no verification on the part of the ld. A.O. as to the genuineness, credit worthiness and identity of M/s Pranav Sports Academy Pvt. Ltd. whose money was said to have been forfeited by the assessee and her huband. Furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee contended that section 68 had no application to the facts of the case inasmuch as the sustained addition does not emanate from the books of account of the assessee. Revenue, taking note of the same, had preferred cross appeal in ITA No.6035/Del/2018 contending that the addition of Rs. 1.25 Cr made u/s 68 of the Act cannot be challenged merely on technical ground that it shouldnot have been made u/s 69 of the Act, instead. 8. Contention of the ld. AR before us is four-fold. Firstly, he contends that there is no doubt as to the quantum of sale consideration being Rs. 4.22 crore as has been found by the authorities below and, since the assessee has offered the entire Rs. 4.22 crore to tax, there is no justification to make any addition in the hands of the assessee. 9. Secondly, Section 68 of the Act has no application to the facts of the case because the income of the assessee is from salary and house property, and there is no income from business for which any books of account are maintained, therefore, no question of Rs. 1.25 crore being found credited in any books of account of the assessee. It is further contended that the bank passbook in relation to the account o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spects and, then, should have decided the issue. For violation of this principle of natural justice, the ld. AR contends that the assessment order is bad in law. 12. In respect of the comment of the authorities below that M/s Pranav Sports Academy had only a meager income and with such income how and by such company allowed the assessee to forfeit Rs. 2.5 crores, ld. AR firstly contended that the financials of M/s Pranav Sports Academy were not supplied to them and such details are collected behind the back of the assessee and they cannot be used against the assessee without confronting the same to the assessee. Secondly he contends that the proviso to section 68 has been introduced by the Finance Act, 2012 w.e.f. 01.04.2013 and it has been held so by the Hon'ble Bombay High Court in CIT vs. Gagandeep Infrastructure (P) Ltd., 394 ITR 680 (Bom.) and it has no application to the assessment year under consideration. On this premise, the ld. AR submitted that since M/s Pranav Sports Academy is also an assessee and has been filing returns of income as is evident from page Nos.21 and 22 of the paper book, the identity of such an entity is beyond reasonable doubt and, in such a situa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the quantum of total sale consideration, or in respect of the sum that was received by the assessee and her husband in the above stated transaction. Assessee declared the entire sale consideration that was received from Mr. Anuj Ahuja and others as well as the forfeited amount of Rs. 2.5 crores in the computation of her income. Whereas the sale consideration that was agreed between the assessee and M/s Pranav Sports was Rs. 4.22 crores, on the 2nd occasion the assessee sold the property to Ahujas only Rs. 1.72 crore on 21.03.2012. Unless and until the forfeited amount of Rs. 2.5 crores was taken into consideration at the time of sale and 21/03/2012, it was not possible for the assessee to sell the property at Rs. 1.72 cross thereby making the sum total of the sale consideration and the forfeited amount exactly at Rs. 4.22 crores which matches the value of the property as decided by the parties in the 1st instance. Otherwise, is not possible to conclude a sale price at an amount which was almost ½ of the advance amount that was forfeited. There is no wonder that this anomalous situation caused the authorities to raise their eyebrows. 16. The authorities below doubted the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... axable income, it cannot be said that the assessee stood to gain in this transaction. However at the same time we find it difficult to brush aside the apprehension of the revenue that the assessee routed her own unaccounted money through this transaction or accommodated either M/s Pranav sports or Ahuja's to bring a unaccounted money to circulation through this transaction. It is because all does not appear to be well. Generally without there being any premeditation between the parties, a person who knows the value of their property as Rs. 4.22 crores and as a matter of fact offered the same at such price will not sell it to the strangers at a price which is almost one 3rd of such value. Further the financial status of M/s Pranav sports as discussed by the authorities below also does not inspire confidence in our mind to believe that M/s Pranav stores parted with such use amount as Rs. 2.50 crores and allowed it to be forfeited without rising hue and cry. The total amount received by the assessee under these 2 transactions, namely, the forfeiture of the advance amount and the sale consideration received from Ahujas is exactly the same as the value of the property that was originall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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