TMI Blog2020 (1) TMI 1033X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the searched person was Sri Lanka Anil Kumar, whereas Navaratna Estates is the assessee, a different partnership firm. Therefore, the material found during the course of search from the residence of Sri Lanka Anil Kumar cannot be attached with the assessee without having sufficient evidence. Though Sri Lanka Anil Kumar had stated that the material found during the course of search was relatable to the assessee he has not furnished the complete details with date of receipt whether it was over and above the registered price or not or whether the receipts mentioned on the reverse side of page No.6 was part of total sale consideration, registered consideration or over and above the registered sale consideration etc. In any case, the AO cannot solely depend on the material found from the residence of Sri Lanka Anil Kumar and loose sheets to make the addition of undisclosed income. In the instant case, the searched person was Sri Lanka Anil Kumar, whereas Navaratna Estates is the assessee, a different partnership firm. Therefore, the material found during the course of search from the residence of Sri Lanka Anil Kumar cannot be attached with the assessee without having sufficient e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into further details. Since the assessee had explained the deficit cash found during the survey, we do not see any reason to interfere with the order of the Ld.CIT(A) and the same is upheld. The appeal of the revenue is dismissed. Addition towards unaccounted sale of land - loose sheets found during the course of search in the residence of Shri Shyam - HELD THAT:- Documents are to be taken as a dumb documents which cannot be inferred against the assessee firm. With regard to the assessee firm, the assessee had explained that the transaction was related to the sale of land to Nageswara Rao and explained in the statement recorded on 13.01.2016 by Manchukonda Shyam that no excess money was received. No other evidence was brought on record by the AO to controvert the statement given by Shri Manchukonda Shyam. Since the document was found in the residence of Manchukonda Shyam, presumption is available to the department to hold that the contents of the document are related to Sri Manchukonda Shyam. The AO did not make any cross verification or enquiry to establish that Navaratna Estates had received on money. The voucher is generally used for payment but not for receipt. The voucher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... konda MouliKrishna. During the course of search and seizure operations conducted in the case of Shri Manchukonda Shyam, one of the partners of the assessee firm at his residence in 8-1-27/63/4, Nauka Nagar, Visakhapatnam, certain incriminating material was found and seized as Annexure MKS/1 MKS/2 evidencing the undisclosed income. Page No.6 of MKS/1, page Nos.12 to 14 and page No.20 of MKS/2 shows the land transactions of Navaratna Estates, Visakhapatnam made outside the books of accounts. As stated earlier, simultaneous survey u/s 133A was conducted in the business premises of the assessee firm on the same day i.e. on 24.11.2015, during the survey, loose sheets were found indicating the on money receipts on sale of Plots/villas. Since the conditions for issue of notice u/s 153C r.w.s. 153A of the Act were satisfied, the AO issued the notice u/s 153C of the Act to the assessee on 31.10.2016 calling for the return of income and the same was served on the assessee on 01.11.2016. In response to the notice issued, the assessee filed the return of income for the A.Y.2015-16 on 19.06.2017 admitting total income of ₹ 15,30,21,580/-. Subsequently, notice u/s 143(2) and 142(1) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the impugned assessment year, hence held that there is no case for initiation proceedings u/s 153C of the act. The Ld. CIT(A) relied on the decision of Hon ble Supreme Court in the case of CIT Vs. Sinhgad Technical Education Society in Civil Appeal Nos.1101 to 11083 of 2017 and the decision of this Tribunal in the case of Lalitha Devi Vs. Assistant Commissioner of Income Tax (2018) 52 CCH 0472 and held that invoking the provisions of section 153C without having incriminating material is bad in law, accordingly quashed the notice holding that the entire proceedings are void ab initio. Against which the department filed appeal before this Tribunal. 4. During the appeal hearing, the Ld.DR submitted that the assessment was not a concluded assessment and the time limit is available for the AO to issue notice u/s 143(2), therefore, argued that the AO has rightly issued the notice u/s 153C of the Act. The Ld.DR further submitted that there was an amendment to section 153C of the Act w.e.f. 01.06.2015, where the words belongs to were substituted by pertains to which has wider connotation than belongs to and hence argued that the case law relied upon by the Ld.CIT(A) i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two separate satisfaction notes are to be recorded, one by the AO of the searched person and the other by the AO of the person whose documents were found in the case of searched person. From the satisfaction notes furnished by the Ld.CIT(A) in the case of respondent, both the satisfaction notes were recorded by the AO of the assessee, but not by the AO of the searched person. The AO also did not explain as to why the two satisfaction notes were recorded by the AO of the assessee. In the instant case, search u/s 132 was conducted in the case of Sri Manchukonda Shyam and initiation of proceedings u/s 153C were consequent to the documents seized from Sri Manchukonda Shyam in Annexure MKS/1 and MKS/2 and the AO of Sri Manchukonda Shyam required to be satisfied that the documents found in the residence pertained/belonged to the assessee, but there was no such satisfaction was recorded in the case of Sri Manchukonda Shyam, hence, argued that the additional ground raised by the assessee goes to the root of the assessment and requested to admit the additional ground and adjudicate the same. The assessee also enclosed the order sheet copies of Navaratna Estates dated 24.11.2015 and 15.09.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the AO initiated proceedings u/s 153C of the Act. The seized material found during the course of search was marked as Annexure MKS/1 and MKS/2. Page No.6 of MKS/1 and page No.12 to 14 and page No.20 of MKS/2 stated to be relating to the transactions pertaining to the assessee with regard to the monies collected outside the books of accounts. As per the provisions of 153C of the Act, money, bullion, jewellery found during the course of search pertaining or related to any other person other than the searched person, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and the AO of the other person shall proceed to issue notice in the case of such other person. For this purpose, the AO of the searched person required to be satisfied that the material found during the course of search was not pertaining/belonging to the searched person and identify the correct person to whom the material is belonged to or pertained to. As per section 132(4A)/292C of the act, presumption is available to the AO of the searched person that money, bullion, jewellery books of accounts and docum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidence to show that satisfaction was recorded in the case of searched person, R.Venktramaiah, while transferring the incriminating material. As observed from the CBDT Circular No.24/2015 dated 31.12.2015 which is placed in page No.98 of the paper book , the CBDT has given guidelines to all the AOs to record satisfaction even if the AO of the searched person and the other person is one and the same. For the sake of clarity and convenience, we extract para No.4 and 5 of the Circular which reads as under : 4. The guidelines of the Hon ble Supreme Court as referred to in para 2 above, with regard to recording of satisfaction note, may be brought to the notice of all for strict compliance. It is further clarified that even if the AO of the searched person and the other person is one and the same, then also he is required to record his satisfaction as has been held by the Courts. 5. In view of the above, filing of appeals on the issue of recording of satisfaction note should also be decided in the light of the above judgement. Accordingly, the Board hereby directs that pending litigation with regard to recording of satisfaction note under section 158B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action of the Seizing Officer. In other words it is not an automatic action. We find satisfaction of two officers is missing. In this connection we set out the text of the order of the Assessing Officer which is as follows: A search and seizure operation u/s. 132 was carried out in the group ease of Dr. T. Yadhaiah Goud and others on 25.3.2010. During the course of search operation documents belonging to SHETTY PHARMACEUTICALS BIOLOGICAL LTD., has been seized. Hence it is considered to initiate proceedings u/s. 153C of the I.T. Act.' 7. The aforesaid Section mandates recording of satisfaction of the Assessing Officer(s) is a pre-condition for invoking jurisdiction and it is not a mere formality because recording of satisfaction postulates application of mind consciously as the documents seized must be belonging to the any other person other than the person referred to in Section 153-A of the Act It is contended that the same Assessing Officer is involved in the matter. This fact does not dispense with above requirement. It is settled position of law that when a thing is to be done in one particular manner under law this has to be done in that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the ITAT since there is no discussion on whether the documents referred to in the ITAT s order in fact incriminating and the AO of the searched person has recorded the satisfaction that the seized documents belonged to the assessee. The decision of Hon ble High Court of Delhi in the case of Ganapati Fincap Services Pvt. Ltd. Vs. CIT (supra) is against the writ petition and the facts of the assessee s case are distinguishable, therefore, the case laws relied upon by the Ld.DR are not applicable in the assessee s case. 11. In this connection, it is pertinent to mention section 292C of the Act places presumption that the material found during the course of search belongs to the searched person and the contents of such books of account and other documents are true. So it is the obligation of the AO as well as the searched person to prove that the incriminating material found during the course of search in fact does not belong to the searched person, but belonged to the other person. Therefore, unless there is satisfaction recorded with valid reasons it cannot be simply presumed that the seized material does not belong to the searched person, but in fact belonged to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich belongs to the assessee. In the assessment order the Assessing Officer has mentioned that in the laptop of Shri Rameshbhai B. Shah the data pertaining to the assessee were found and on that basis notices u/s 153C have been issued. However, in the notice u/s 153C, wherein the Assessing Officer is claimed to have been recorded the satisfaction for issue of the notice, there is no mention about such laptop or the alleged data in such laptop which is claimed to be belonged to the assessee. In view of above, we have no hesitation to hold that the basic condition for issue of notice u/s153C has not been satisfied. 14. The departmental circular dated 31.12.2015 also directed the AO to record the satisfaction, even if the AO of the searched person and the other person is one and the same and the Circular is binding on the assessing officers. Non recording of satisfaction of the assessing officer of the searched person renders the assessment proceedings u/s 153C as invalid. This view is supported by the decision of Hon ble High court of Delhi in Pepsi Foods (P.) Ltd.v. Assistant Commissioner of Income-tax, [2014] 52 taxmann.com 220 (Delhi).Hon ble High court of Delhi h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issuance of a notice under Section 153C, there is nothing which would indicate as to how the presumptions which are to be normally raised as indicated above, have been rebutted by the Assessing Officer. Mere use or mention of the word satisfaction or the words I am satisfied in the order or the note would not meet the requirement of the concept of satisfaction as used in Section 153C of the said Act. The satisfaction note itself must display the reasons or basis for the conclusion that the Assessing Officer of the searched person is satisfied that the seized documents belong to a person other than the searched person. We are afraid, that going through the contents of the satisfaction note, we are unable to discern any satisfaction of the kind required under Section 153C of the said Act. 12. This being the position the very first step prior to the issuance of a notice under Section153C of the said Act has not been fulfilled. Inasmuch as this condition precedent has not been met, the notices under Section 153C are liable to be quashed. It is ordered accordingly. Hon ble Supreme Court dismissed the SLP filed by the revenue against decision of Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdiction wrongly without having satisfaction, we consider it is not necessary to adjudicate the other grounds raised by the revenue in the appeal. 11. In the result the appeal of the revenue is dismissed and the cross objections of the assessee are partly allowed. I.T.A. 612/Viz/2018, A.Y.2016-17 12. This appeal is related to the A.Y.2016-17. Ground No.(xvi), (xvii) and (xviii) are general in nature and no separate adjudication is considered necessary. 13. Ground No. (i) to (viii) are related to the addition made by the AO in respect of Blue Marino project amounting to ₹ 5,00,37,000/- from sale of 40 villas. Brief facts of the case are that a search u/s 132 was conducted in the case of SVBC Gold Group and simultaneously survey u/s 133A of the Act was conducted in the case of M/s Navaratna Estates. During the course of search, certain incriminating material was found in the residence of Sri Manchukonda Shyam, one of the partners of the firm. Search u/s 132 was also conducted in the case of Sri Lanka Anil Kumar, Marketing Executive of the assessee firm simultaneously and found certain incriminating material evide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13.1. Similarly, the AO has referred another loose sheet in page No.48 of the impounded material in A/NRE/Survey/Buss/01 which was also the schedule of payment for total consideration of ₹ 53.00 lacs for sale of each villa. The survey team seized the copy of hard drives from the business premises of the assessee from which the certain emails were also extracted. From the impounded material and the Email sent from Navaratna Estates to Kalyanisuri@yahoomail.com, the AO observed that villa Nos.83 and 95 were vacant at that time and out of which villa No.83 was sold to Suri Radhika Kalyani vide document No.4819/2014 dated 26.09.2014 and registered at SRO, Bheemili for a consideration of ₹ 36,25,000/- against the quoted rate of ₹ 53.00 lacs as per the impounded material in page No.54 of Annexure-A/NRE/01. Hence, the AO was of the view that the assessee had understated the sale consideration and shown the registered price of ₹ 36.25 lakhs in the books against the actual sale consideration of ₹ 53.00 lakhs. The AO further examined the impounded material in Annexure A/NRE/Survey/Buss/6, the mail sent from email id navaratnaestates@gmail.com to the email id of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso did not make addition as proposed in show cause notice dt.02.11.2017 and at the end the said proposed addition was dropped. 13.3. A search u/s 132 was also conducted in the case of Sri Lanka Anil Kumar, a key employee of the assessee firm who is stated to be the authorized person to deal with all the affairs of marketing. During the course of search on 24.11.2015 in the residence of Sri Lanka Anil Kumar, incriminating material was found and seized as Annexure LAK/01 and a statement was also recorded from Sri Lanka Anil Kumar on the said date. Sri Lanka Anil Kumar with regard to page No.6, 7 and 8 of Annexure LAK/01 stated that the details are related to the amounts due from the customers of Blue Marino project of M/s Navaratna Estates and the same were taken from the books of accounts of the firm. The reverse side of page No.6 contain the details of villa no, sale amount, total amount and the amount paid and outstanding etc.. which reads as under : IMAGES 1 Front side page number 6 contain the hand written notings with villa no., abbreviated name, amount paid and the amount due. Against some cases lumpsum amount was written as 43.50/40. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were related to Navaratna Estates and he further submitted that the statement given by Sri Lanka Anil Kumar has no relevance to Navaratna Estates and whatever he told was wrong to the extent of Navaratna Estates. Sri Suresh Kumar Jain further stated, the statement recorded u/s 131(1) from Sri Subrahmanyam cannot be taken into cognizance since he was not in good health at the time of giving the statement, The AO found from the seized documents of Anil Kumar that the entries made in the notings of page No.6, 7 and 8 of Annexure LAK/01 were matching with the sale of villas with villa number, customer name and the total sale amount accounted for in the books of accounts except on money received outside the books of accounts. The AO viewed that Sri Suresh Kumar Jain is pretending as if he was not aware of the notings in page No.6 to 8 to avoid the income tax on unaccounted sale consideration, hence, held that the notings made in the loose sheets were correct which shows the actual sale consideration in respect of villas including the on money received, hence, the excess amount collected over and above the registered value as recorded in page No.6 to 8 of LAK/01 required to be brought to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the actual value of ₹ 53,00,000/- as found in the impounded material in Annexure/NRE/Survey/Buss/01. The Ld.DR further argued that the other loose sheets also shows that the assessee had sold the villas for ₹ 50 lakhs and above, however, registered at ₹ 36,25,000/- undervaluing the actual sale price of the villa. In the Email sent to Kalyan Mannuru on 10.11.2014 in Annexure- A/NRE/Survey/Buss/6 and Anil Kumar Lanka s communication requesting M/s Brick and Mortar to change the price of Blue Marino to ₹ 54 lakhs establishes that the sale consideration was not less than 50.00 lacs for each villa. Further during the course of survey u/s 133A, bundle of loose sheets were found and seized as Annexure BMHP/133A/Navaratna. On perusal of the page No.50, it is found that out of 110 acres of lay out, 40 villas were sold @₹ 50 lakhs per villa and 100 villas were sold at ₹ 60 lakhs and 23 villas were available. The entire material seized during the course of search and impounded during the survey clearly shows that the assessee has sold the villas with 150 sq.yds of site and built up area of 1850 sq.ft., duplex villas in the price range of ₹ 50 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar on 10.11.2014 and the loose sheets found during the course of survey in Chepaluppada marked as BMHP/133A/Navratna and other evidences found during the course of search and survey in the business premises of the assessee as well as in the residential premises of the partners, but made the addition basing on the seized material found during the course of search from the residence of Sri Lanka Anil Kumar marked as LAK/01 in page No.6, 7 and 8. Therefore, Ld.A.R argued that the other material found during the course of survey or search in the business premises or in the residence of partner has no relevance to the assessment and should not be taken cognizance of. The Ld.AR further stated that the AO had issued show cause notice dt. 02.11.2017 and there was no mention of LAK/01 seized from Lanka Anil Kumar in the show cause notice. Assessee has objected for the proposed addition of ₹ 3.66 crores, out of total sum of ₹ 9.84 crores estimated as total unaccounted sale consideration and the AO did not proceed further hence argued that the said material is not relevant. Hence, submitted that the issue needs to be decided basing on the evidence relied upon by the AO i.e. LAK/01 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t higher than the registered price and same is case with page No.50/BMHP/133/Navaratha, therefore, argued that none of the seized material or the impounded material shows that the assessee had received on money for sale of villas. The quotations and rates quoted by the assessee cannot be taken as a conclusive proof for receipt of consideration when there is registered document showing the sale price of villas before Sub Registrar Office, Bheemili. Hence, argued that the actual sale price is as per the registered document and there is no on money received by the assessee, hence requested to delete the addition made by the AO instead of confirming the addition partly. The Ld.AR further submitted that the facts of the case law relied upon by the AO as well as the Ld.DR in the case of H.M.Esufali H.M.Abdulali are completely different and distinguishable and has no application in assessee s case. Accordingly, the Ld.A.R requested to set aside the order of the Ld.CIT(A) and dismiss the appeal of the revenue and allow the cross objections filed by the assessee. 17. We have heard both the parties and perused the material placed on record. The AO has taken reference to seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome. Different amounts were mentioned in the material found during the course of search regarding the sale price of the villas. One quotation shows 53.00 lacs and another document shows at ₹ 50 lakhs and 60 lakhs. At the end the AO also did not place reliance on the above documents for arriving at the undisclosed income. During the appeal hearing also the department could not place any evidence to controvert the finding of the Ld.CIT(A). We also observe from the seized material or impounded material marked as Annexure NRE/Survey/buss/01 , BMHP/133A/Navaratna, page No.50 and other email correspondence that there was no indication or evidence to support the receipt of on money by the assessee. Therefore, we do not find any reason to disagree with the Ld.CIT(A). With regard to seized or impounded documents mentioned in para No.17 of this order, the Department also did not place any material to controvert the findings of Ld.CIT(A) on this issue. Further though the AO referred the above impounded or seized material and ultimately dropped the proposal and relied on page No.6 to 8 of LAK/01 found and seized from the residence of Sri Lanka Anil Kumar for assessment of undisclosed i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... corded on page No.6 of the seized material which was found from the residence of Sri Lanka Anil Kumar marked as LAK/01. During the course of statement recorded from Sri Lanka Anil Kumar, he had stated that page No.6 to 8 related to the information of villa of buyers and major part of the amounts were collected. Sri Suresh Kumar Jain in the statement, confronted with him, completely denied having received any on money and stated that statement given by Anil kumar has no relevance to affairs of the firm and whatever stated by Lanka Anil Kumar was wrong. The AO did not make any cross verification of the statement given by Sri Suresh Kumar Jain with Sri Lanka Anil Kumar or with any of the buyers of the villas to ascertain the receipt of on money. The above scribbling found and seized as annexure LAK/01 does not indicate any on money except giving leads to consider the total sale consideration could be ₹ 52.00 lacs in case of Villa No.122 and ₹ 44.25 lacs in the case of villa No.139. Since the material was found in the residence of Lanka Anil Kumar the presumption is not available to hold that contents were related to the assessee firm unless it is established by the revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich was found at the premises of CRK. It does not contain either date of payment or name of the person who has made the payment. According to the Department, CRK denotes C. Radha Krishna Kumar and KRK denotes K. Rajani Kumari. However, no name of the assessee was found in the louse sheet. The property was purchased from P w/o CRK for a disclosed consideration of ₹ 65 lakhs by the assessee. The property has been registered and the sale deed was executed for a consideration of ₹ 65 lakhs on 21st Aug., 2006 which consideration has been accepted by the State registration authorities. Further nothing was brought on record to show that there was any invoking of s. 50C while completing the assessment in the case of the seller. There is no evidence other than the seized material marked as A/CRK/104' where relevant entries are made at ₹ 1,65,00,000. The seized material was not found at the premises of the assessee and there is no corroborative material to suggest that the assessee has actually paid ₹ 1.65 crores towards purchase consideration of the property. The assessee and her brother categorically denied the payment of any money over and above ₹ 65 la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he property. The Department has not brought on record the date on which the payment was made and the source from which it is paid and/or any details of bank account from where the cash was withdrawn. Without any of these details, the Department has taken a view that the assessee has paid ₹ 165 lakhs for purchase of the property. The Department cannot draw inference on the basis of suspicion, conjectures and surmises. Suspicion, however strong cannot take place of material in support of the finding from the A0. The A0 should act in a judicial manner, proceed with judicial spirit and come to a judicial conclusion. The A0 is required to act fairly as a reasonable person and not arbitrarily and capriciously. The assessment made should have enough material and it should stand on its own legs. The basis for addition cannot be only the loose sheet or a third party statement. In the absence of corroborative material, and/or circumstantial evidence, the addition cannot be sustained. Thus, no addition can be made on a dumb document and noting on loose sheet. It should be supported by the evidence on record and the evidence on record is not sufficient to support the Revenue's action ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iwala Vs. ITO reported in (2010) 128 TI] 36, wherein under similar set of facts, the Hon'ble ITAT decided the issue in favour of the assessee as under: The assessee has claimed to have made payment of ₹ 1,01,687/- only upto 31st March, 1999 and has consistently taken the stand that it has not paid balance amount of ₹ 3,81,414/- as stated in the seized document. No evidence could be brought on record by the Revenue to show that in fact the assessee had paid the amount of ₹ 3,81,414/- to OD. No document containing signature of the assessee or handwriting of the assessee to corroborate the above making of payment by the assessee was found during the course of the search. Even at time of cross examination by the assessee the partner of OD could not produce any evidence that the amount written in the seized document was in fact received from the assessee. As the assessee has categorically denied to have made any payment in excess of ₹ 1,01,687/- upto 31st March, 1999 in respect of purchase of flat the said denial cannot be brushed aside without bringing any positive material on record. Merely recording made by a third party or statement of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... py of sale agreement, there is no other evidence on record found as a result of search or brought on record on the basis of enquiry conducted by the AO which could establish the fact that the actual consideration passed between the parties is not as mentioned in the registered sale deed but as per the sale agreement found during search operation. It is also an interesting fact to note that in the statement recorded from the assessee u/s 132(4) the revenue authorities have not put any question with regard to the sale agreement seized at the time of search and seizure operations. Smt. P. Nalini Devi also in her statement further clearly stated that the property was sold at ₹ 23.50 lakhs and not at the rate of ₹ 1.68 crores. The Hon 'ble Supreme Court in the case of K.P. Verghese reported in 131 ITR 597 has held that onus is on the department to prove that the assessee has understated the value of the property and has paid more than what is mentioned in the registered sale deed. The Hon'ble Supreme Court in the case of Moosa S. Madha and Azam S. Madha vs. CIT( 89 ITR 65) has held that photo copies have little evidentiary value. Therefore, photocopies of any documen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Supreme Court and Hon'ble High Courts which are cited before him. We therefore find no necessity to interfere with the finding of the CIT (A) on this issue. Hence the grounds raised by the revenue for the years under consideration are dismissed. 22. The Hon'ble A.P. High Court in ITA No.232 of 2013 in the case of CIT Vs. Smt. R. Nalini Devi has upheld the order of the ITAT Hyderabad Bench. The Hon'ble High Court while, considering the issue held as under: We have heard the learned counsel for the appellant and gone through the impugned judgement and order of the learned Tribunal. It appears, the Assessing Officer had relied on a photocopy of an unsigned sale agreement in order to find that consideration amount has been paid at ₹ 1,68,00,000/-. Therefore, this amount was not disclosed. The learned Tribunal has correctly concluded that unsigned photocopy of the agreement for purchase of the property cannot be a material to rely on, when the registered sale deed has been produced and the same shows that the property was purchased at a price of ₹ 23,50,000/-. This registered sale deed was disclosed at the time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ird person and also admission by a third person. To sustain the addition, the A.O. should have conducted an independent enquiry about the value of the property and ascertain whether any under valuation is done, if so what is the correct value of the property. Further, the A.O. did not brought on record any evidence to support his contention to say that there is on money exchanged between the parties. In the absence of proper enquiry and sufficient evidences, we find no reason to confirm the addition made by the A.O. Therefore, we reverse the CIT(A) order and direct the Assessing Officer to delete the addition. 17.6. Though the above decisions are rendered in respect of on money payment, the same findings and observations are equally applicable for on money receipts also. In 15 villas, which were neither sold nor registered, there is no case for addition of undisclosed income, hence the same required to be deleted. In the remaining 25 villas there is no evidence brought on record to show that the assessee has received on money except the scribbling paper seized or impounded at the time of survey or the loose sheets seized from third party, Sri Lanka Anil Kumar. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.Y.2016-17. 18.2. During the appeal hearing, the Ld.DR submitted that evidence was found in respect of plot No.63 which was adjoining plot of Sea Peal project indicating that plot of 500 sq.yds was sold at ₹ 65 lakhs @ 13,000/- per sq.yd. The plot was located at northwest corner of project Sea Pearl. The statement was recorded from Sri M.Y. Subrahmanyam, wherein he has stated that they have purchased four plots from SVR Township at Chepaluppada, marked as plot Nos.61 to 64 near the villas with LP No.57/2007. The total area of the plots acquired was 2000 sq.yds consisting four plots and they have sold 1750 sq.yds @13,000/- per sq.yd and registered at ₹ 6,000/- per sq.yd reflecting in the books of accounts and the difference amount of ₹ 7,000/- per sq.yd amounting to ₹ 1,22,50,000/- was admitted as undisclosed income for the financial year 2014-15 and there was no dispute. The said plot No.61 to 64 are in the vicinity of Sea Pearl Project, therefore, argued that the AO extended the sale price of ₹ 13,000/- per sq.yd to the Sea Pearl project also and estimated the unaccounted income which is fair and reasonable. The Ld.DR submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k of plots to M/s Kranthi Properties @4000/- per sq.yd and any amount received over and above the agreed rate would accrue to Kranthi Properties, but not to the assessee. The assessee placed copy of MoU reached between the assessee and the Kranthi Properties in page No.190 to 192 of the paper book. No other evidence was brought on record by the department to controvert the finding of the Ld.CIT(A) or to controvert the contents of MoU between the assessee and the Kranthi properties dated 25.07.2013. Therefore, we do not find any infirmity in the order of the Ld.CIT(A) and the same is upheld. The appeal of the revenue is dismissed and the cross objections filed by the assessee becomes infructuos on this issue, hence dismissed. 21. Ground No.12 and 13 are related to the addition of ₹ 2,69,314/- on account of unaccounted cash. During the course of survey, against the book balance of ₹ 10,03,364/-, the AO found the physical cash of ₹ 7,34,050/- resulting in deficit cash of ₹ 2,69,314/-. During the course of survey, in the statement recorded u/s 131(1), Sri M.Y.Subrahmanyam, Managing partner of the assessee firm had stated that he had withdrawn cash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 14/1 were found seized as page No.12 to 14 of Annexure MKS/2. The AO found that name appearing in the voucher sri Nageswara Raio was the same person to whom the land was sold on 14.07.2015 by Navaratna estates. Therefore, the AO viewed that the vouchers were related to the sale of land of Navaratna Estates on 14.07.2015. The AO issued summons to Manchukonda Shyam to explain the transactions. In his reply, Sri Shyam stated that the vouchers were related to the transactions of Sri Nageswara Rao and he further stated that sale consideration was ₹ 50,00,000/- was received by cheque and the registration charges were ₹ 4,50,100/- and other charges were borne by the purchaser. He also stated that the stamp duty and registration charges were collected by them from the customer to pay on his behalf for the purpose of registration. He also stated that no unaccounted money was involved in this transaction. The AO observed that there was inconsistency in the statement given by Sri Manchukonda Shyam and hence inferred that the vouchers were related to the sale transaction mentioned in the sale deed of Sri Nageswara Rao on 14.07.2015 pertaining to Navaratna Estates. Thus, held th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucher No.14 dated 14/1 which was dumb document and not having the signature of the recipient and without the date. Vouchers are used for the payment, but not for receipt of cash. The Ld.AR further submitted that the voucher prima facie does not indicate whether it was related to Navaratna Estates or some other firm. It does not bear the signature, the date except indication for directing the drawer to make the payment to Nageswara Rao KK land sum of ₹ 51,75,000/-. Since the voucher does not indicate any of the information, the same cannot be inferred to be related to M/s Navaratna Estates to draw adverse inference. The Ld.AR further submitted that Sri Manchukonda Shyam has already explained in the statement recorded on 13.01.2016 in question No.3 that the document was related to 0.80 cents of land at Nidigattu, Ramajogi Agraharam to Sri Nageswara Rao by Navaratna Estates. The cost of land per acre was ₹ 70,00,000/- hence the cost of 80 cents of land comes to approximately ₹ 50,00,000/- and the remaining was collected for payment of stamp duty and other expenses. Therefore, argued that since the contents of the voucher were explained and no evidence is brought on r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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