TMI Blog2021 (6) TMI 1030X X X X Extracts X X X X X X X X Extracts X X X X ..... d that such material was found. The onus is on the Revenue to substantiate their claim with the help of producing relevant incriminating material either before the Ld. CIT(A) or before the Tribunal. The Revenue cannot take shelter of the appraisal report, which is a confidential document between the Investigating Wing and the Assessing Officer and not a documentary evidence to be relied upon by the Appellate Authority. The second condition of the ratio of the decision in the case of Kabul Chawla [ 2015 (9) TMI 80 - DELHI HIGH COURT] is not satisfied in the facts of the instant case. The finding of the Ld. CIT(A) on the issue in dispute is well reasoned and accordingly, we uphold the same. The grounds raised by the Revenue are accordingly dismissed. - ITA No.7826/Del./2018 - - - Dated:- 28-6-2021 - Shri O.P. Kant, Accountant Member And Shri Kuldip Singh, Judicial Member For the Appellant : Sh. Sanjeev Sapra, CA For the Respondent : Sh. H.K. Chaudhary, CIT(DR) ORDER PER O.P. KANT, AM: This appeal by the Revenue is directed against order dated 27/09/2018 passed by the Learned Commissioner of Income Tax (Appeals)-24, New Delhi [in short the Ld. CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above discussion, it is clear that value of 5322 sqm of land transferred @ of ₹ 50,000/- sqm to Standard IT Web Solutions Pvt. Ltd. is excessive and should have been at 50% of the value rate adopted. Thus correct value of land works out to ₹ 13,30,50,000/- (5322 x 25,000) as against ₹ 26,61,00,000/- (5322 x 50,000) adopted by the valuer and the assessee. Excess value of land is not allowable as deduction as provided under the provisions of section 80IA (8) and 80IA (10) as discussed above. In view of above discussion, deduction claimed u/s 80IAB to the extent of ₹ 13,30,50,000/- is disallowed and added back to the income declared in the Return of Income. The undersigned is satisfied that the assessee has furnished inaccurate particulars of its income and is liable for penalty u/s 271(1 Me) of the Act Penalty proceedings u/s 271 (1)(c) are initiated separately. 2.1 On further appeal, the assessee challenged legality of assessment by way of additional ground and also challenged the addition on merit. According to the assessee, the part disallowance of deduction under section 80IAB is not based on any incriminating material found during the course of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (namely, i) M/s Standard IT Web Solutions Pvt. Ltd., ii) M/s Aachvis IT SEZ Infra (P) Ltd and iii) Three C Facility Management Ltd} are related as co-developers in SEZ and are actively involved in the business related to SEZ. First of all, it is a general information that the appellant and the entities (namely i) M/s Standard IT Web Solutions Pvt. Ltd., ii) M/s Aachvis IT SEZ Infra (P) Ltd. and iii) Three C Facility Management Ltd.} are related as codevelopers in SEZ and are actively involved in the business related to SEZ. This, by no stretch of imagination, can be said to be incriminating . This kind of information is, otherwise, freely available in the relevant business circle and cannot be said to be unearthed due to search. Secondly, the names of the employees whose statements are being referred to have not been specified. Nor specific contents of the statements have been mentioned. Certainty, the assessment order does not refer to any such statements. 4.9 A perusal of above reproduced para 7 of the notice dated 14.10.2015, in para 4.5 above, shows that till issue of this notice dated 14.10.2015, the department was only aware of said transfer but not of any further de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Z building at Plot No. 7, Sector 144, Noida, Uttar Pradesh, part of which is under progress. .. 3. Notes? i) in terms of Lease Deed dated 2st September, 2007, the New Okhla Industrial Authority (NOIDA Authority), the Lesser, vide letter dated 13/11/2006 has allotted 1,00,498 sdq. Metres of land Plot No. 7, Sector 144, Noida Uttar Pradesh ( the said plot ) for the purpose of developing, operating and maintain the sector specific Special Economic Zone for ITES/ITES sector and vide their approval letter dated 7th February 2008, the Company became entitled to hold such leasehold Land for a term of 90 years. Out of the total consideration for such leasehold land, the Company had made part payment was made before signing of the lease deed on 21st September, 2007 while, the balance consideration was payable in 16 half yearly installments (which commenced on 12th May, 2007) along with interest rate of 11 % p. a. on outstanding balance , NOIDA Authority has the first charge upon the demised promises for the amount of unpaid balance, charge, interest and other dues. ii) The Company has executed a Co-Development agreement dated 30th November 2009 read with suppleme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the assessments already made cannot be interfered with. The relevant portion of the judgment is reproduced below: 35. The AO of the person other than the one searched also, is not, at the stage of issuing notice under Section 153C/153A of the Act, required to conclude that the assets/documents handed over to him by the AO of the searched person represent or indicate any undisclosed income of the Assessee under his jurisdiction. As explained in SSP Aviation (supra), Section 1.53C only enables the AO of a person other than the one searched, to investigate into the documents seized and/or the assets seized and ascertain that the same do not reflect any undisclosed income of the Assessee (i.e a person other than the one searched) for the relevant assessment years. If the seized money, bullion, jewellery or other valuable article or thing seized as handed over to the AO of the Assessee, are duly disclosed and reflected in the returns filed by the Assessee, no further interference would be called for. Similarly, if the books of accounts/documents seized do not reflect any undisclosed income, the assessments already made cannot be interfered with. Merely because valuable articles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roved valuer Sh. B.P. Singh was not a fresh evidence. It was available with the AO. The Form 0-1 of the valuation report is reproduced below: 4.17 It can be seen from column 14 and 15 of the above reproduced From 0-1 that in response to a question, Is it free hold or lease hold land/ , the valuer did not say that it was freehold land. The valuer has stated, as per deed . In view of this documentary evidence, it is clear that the valuer was already aware that the land was leasehold land. Therefore, it is difficult to brush aside the argument of the AR that the fact of land being leasehold was not unearthed as a result of search and the statement of Sh. B.P. Singh does not come in the gory of incriminating material emanating from the search. 4.18 In case of statement recorded u/s 132(4) {which is recorded during the search and can be argued to be emanating from the search} Hon ble Delhi High Court while delivering judgment in case of Best Infrastructure (India) (P.) Ltd. Vs. Pr. CIT, Delhi-2 [2017] 84 taxmann.com 287 (Delhi) referred to another judgment of Hon ble Delhi High Court in case of CIT v. Harjeev Aggarwal [2016] 70 taxmann.com 95/241 Taxman 199 (Delhi) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer on the basis of the statement of the Valuer, Sh. BP Singh i.e. the property transferred was leasehold property. He submitted that Ld. CIT(A) has already dealt this issue and held that the statement was recorded in post search proceeding and not in the nature of incriminating material found during the course of the search, and therefore Ld. CIT(A) is justified in holding that no addition could have been made in case of 153A proceeding in absence of an incriminating material. 3.3 We have heard rival submission of the parties and perused the relevant material on record. In the instant case, the only legal issue before us, is that whether the ratio of the Hon ble Delhi High Court in the case of CIT Vs Kabul Chawla, (2016) 380 ITR 573 (Del) is applicable of the facts of the case of the assessee. In the case of Kabul Chawal (supra) Hon ble High Court has held that addition could be made under section 153A proceedings, if following two conditions are satisfied: (a) assessment was pending as on the date of the search for the relevant assessment year (b) incriminating material was found during the course of the search qua the addition/disallowance made. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered or by an amount equal of fifty percent of the value of the property as so determined, whichever is less, as if the property had been transferred on the valuation date. Explanation. For the purpose of this rule, unearned increase means the difference between the value of such land on the valuation date as determined by the Government or such authority for the purpose of calculating such increase and the amount of the premium paid or payable to the Government or such authority for the lease of the land. 3.7 It is noted from the .reply that the assessee has merely stated that the above rule is not applicable for valuation of its land. It was not stated as to how then valuation is to be done and on the basisof which rule. Further, a valuer is an expert in his field and his opinion and basis of valuation cannot be rejected without any plausible reasons, the valuation has to be done on the basis of above rule and. the rule was-incorrectly applied by the valuer as he was not aware of the fact that the land was a leasehold land. Thus, assessee s submission regarding non-application of above rule is not acceptable. Further, the assessee has contended that under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ably deemed to have been derived therefore. 3.5 On perusal of the above paragraph of the assessment order, we find that basis of reducing the rate of transfer of land to M/s standard IT Web Solutions Private Limited, is statement of the Valuer Sh. B. P. Singh. The Ld. CIT(A) in the impugned order has dealt this issue and held that statement of the BP Singh has been recorded in post search proceeding. The fact that statement of the Sh. B.P. Singh was recorded in post search proceeding, has been mentioned by the Assessing Officer himself in para 3.2 of the assessment order. For ready reference, relevant paragraph is reproduced as under: 3.2 It is seen from the above table that the major part of the profit has been generated on account of sale of land part, which is not the actual business of the SEZ. Further, during the pose search proceedings, the assessee was asked the rationale of valuing one piece of land at ₹ 27,500/-sqm and another piece of land at ₹ 50,000/-sqm while they were in the same plot. The assessee stated that the plot valued at ₹ 27500/-sqm had a FAR of 2 while the other block had a FAR of 3.8. (2,21,000 (actual built area)/ 1,14,529 (as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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