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TMI Blog2021 (12) TMI 926X X X X Extracts X X X X X X X X Extracts X X X X ..... C read with section 153A of the Act is ab initio void, by applying on the ratio laid down by the Hon hie Jurisdictional High Court in the case of CIT Vs. M/s RRJ Securities Ltd. (2015) 62 taxmann.com 391 (Delhi) which has not been accepted by the department and appeal is pending before the Apex Court. Accordingly, appeal is recommended on this issue. 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 Rs. 39112550/- by relying on the ratio o f the judgement delivered by the Jurisdiction High Court in the case of CIT Vs. Kabul Chawla (2016) 380 ITR 573 which has not been accepted by the department and the appeal is pending before the Apex Court. 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 Rs. 88,71,950/- by relying on the documents furnished during the course of appellate proceedings, that were never produced before the AO so as to enable him an opportunity to examine the relevant documents filed by the assessee before the Ld. CIT(A). 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of appeal no. 1, the appellant has challenged the initiation and completion of assessment proceedings u/s 153C of the Act, for the six AYs 2005-06 to 2010-11 instead of the six AYs 2008-09 to 2013-14. It is contended that AYs 2005-06, 2006-07 and 2007-08 are beyond the limitation period of six years immediately preceding the assessment year relevant to the date of handing over/recording of satisfaction u/s 153C, as per proviso of sec. 153C(1) of the Act. The appellant has submitted that a search and seizure operation u/s 132 of the Act was carried out in the case of M/s SDS group of companies on 25.03.2011. During the search operation of the said third party, certain documents belonging to the appellant were found and seized. These documents pertain to alleged transactions of purchase ahd sale of land in District Jodhpur, Rajasthan. The AO of the searched person, vide letter dated 29.03.2013, handed over copies of the seized documents and statements recorded which were received by the AO of the appellant on 05.04.2013. In the assessment as well as in the appellate proceedings, the AR of the appellant contended that since the AO has received the satisfaction note of the AO of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f six years prescribed. Accordingly, ground of appeal No. 1 is allowed." 4.1 It is evident that Assessing Officer has considered six assessment years from 2005-06 to 2010-11 for assessment under section 153C of the Act corresponding to search period in the case of M/s SDS Group of Companies, i.e., six assessment years corresponding to the previous years immediately prior to the previous year in which search was conducted. Whereas, the Hon'ble Delhi High Court in the case of RRJ Securities Ltd. (supra) held that wherever seized documents belonging to third-party have been found during the course of the search, then for assessment under section 153C of the Act has to be taken for six assessment years corresponding to the previous years prior to the previous year in which such seized material/document along with satisfaction note of the Assessing Officer of the search person are received by the Assessing Officer of the assessee. In the case of the assessee, relevant seized document belonging to the assessee along with satisfaction note of the Assessing Officer of the searched person, have been received on 05/04/2013 and therefore assessment proceedings u/s 153C should have been initi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Developers Ltd. in the relevant year of sale. The Assessing Officer, however, is of the view, that assessee being registered owner of the land, it was required to declare profit on sale of such land in its return of income filed. Accordingly, he after verifying sales of developed plots, made addition for profit amounting to Rs. 1,87,19,545/-, which has been computed as under: "(viii) For the above reasons the contention of the assessee is not accepted and profit from sale of this land is computed in the hands of the assessee. The assessee had bought 47 bighas of land for a total price of Rs. 1,46,43,770/-. As per information gathered bigha of land consists of 3,020 sq. yds. Therefore, the cost per sq. yd. is computed below: Total no. of yds in 47 bighs -47 X 3025 = 1,42,175 Sq. yds Cost per sq. yd. -1,46,43,770/142175 = Rs. 103 per sq. yd. Total area of plots sold = 1,100 sq. yds. Total cost of plot sold 3600 X 103 = Rs. 370,800 As no evidence with regard to development cost has been brought on the record, Rs. 3,70,800/- is taken as the cost of sale. Profit from sale of land is computed below:- Sale consideration Rs. 190,90345 Less: Cost of sales Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The said land has continuously been shown as work in progress in the books of the appellant up until the AY 2012- 13. The appellant has affirmed that besides the said land admeasuring 47.01 bjghas, it has not purchased any other land, and also has not sold any land. The AIR information that has been received in respect of purchase and sale of land made in district Jodhpur, Rajasthan, for assessment year 2012-13 pertains to sale of plots by M/s Parsvnath Developers Ltd. 5.2. The AR has submitted that the appellant had entered into an agreement with M/s Parsvnath Developers Limited on 01.09.2006, as per which, M/s Parsvnath Developers Limited was to make an advance to the appellant company to purchase, or arrange to purchase land in village Bansi, Jodhpur. The appellant had accordingly purchased 47.01 bighas of land on behalf of M/s Parsvnath Developers Limited. The appellant, even though it was the registered owner" of the said land which was shown as stock in trade in its books of accounts, it was M/s Parsvnath Developers Ltd. which held all the rights to the said land, such as development, marketing and sale. 5.3. Moreover, it has been pointed out that the AO has made additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s per bigha on which profit of Rs. 17,04,84,330/- calculated and addition was made 07-08 - 47.01 bigha - - - 08-09 - 47.01 bigha - - - 09-10 47.01 bigha 31,06,700/- Purchase of 4700 sq yds 31,06,700/- 4700 sq yds 10-11 ' 47.01 bigha * 58,27,311/- 1100 sq yds 3600 sq yds 11-12 " 47.01 bigha - 3600 sq yds 12-13 ' 47.01 bigha " 1,87,19,545/- 3600 sq yds * 13-14 Trfr to PDL 1,46,43,770 47.01 bigha 58,78,13,030 Deemed profit on transfer of 47.01 bigha land held as WIP on 01.04.2012 16,10,237/- 370 sq yards (47.01) bigha 5.5. The appellant has reiterated that it has not sold any part of the land admeasuring 47.01 bighas which continued to be shown as WIP in the books of the appellant till the AY 2012-13. The AO has evidently failed to bring on record any evidence in support of his contention that the appellant had actually sold land of 3600 sq. yards and received the consideration of Rs. 1,90,90,345/-. Further, the AO has again made addition in the Assessment Year 2013-14 as mentioned above by consideri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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