TMI Blog2022 (6) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... y other year s books. Further, Hon ble Andhra Pradesh High Court in CIT Vs Margadarsi Chit Funds (P) ltd [ 1984 (6) TMI 17 - ANDHRA PRADESH HIGH COURT] held that the Income Tax Officer is obliged to state the defects inherent in the method followed by the assessee and also to record a clear finding that system of accounting is such that correct profit cannot be deducted from the books before rejecting the books. We have noted that the AO has not pointed out any other serious mistake in the books of assessee. Moreover, the additional income of Rs. 1.50 Crore disclosed by the assessee was included in the profit and due tax has been paid thereon. Therefore, in our considered view the rejection of books of account by AO is not justified in absence of serious defects. Hence, the action of AO in rejecting the books of the assessee is set-aside. Estimation of income by the assessing officer on the basis of statement of Reetesh Accountant and the partner of the assessee - When the revenue authorities have not demonstrated from the material as to whether the assessee failed to co-operate, which is an eventuality where the income tax authority would required to record its reasons to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x(Appeal)- 4, Surat dated 15.02.2016, hereinafter called as ld CIT(A) . In all appeal, the parties have raised certain common grounds of appeal, facts in both the years are also common, therefore, with the consent of the parties, all the appeals were clubbed, heard together and are decided in consolidated order to avoid the conflicting decisions. For appreciation of facts, the facts in A.Y. 2010-11 is treated as lead case. The assessee in its appeal for the A.Y. 2010-11 has raised the following grounds of appeal: (1) The ld. CIT(A) has erred in law and on facts in confirming the action of the ld. A.O. of rejecting the books of account of and the books results u/s. 145(3) of the Act. It is, therefore, prayed that the above action of the ld. A.O. of rejecting books of accounts be quashed. (2) The ld. CIT(A) has erred in law and o facts in confirming the action of the ld. A.O. of making addition in the appellant s case on the basis of estimation of sale rate at Rs.1,500/- per square yard. It is, therefore, prayed that the above action of the ld. CIT (Appeals) be quashed. (3) The ld. CIT(Appeals) has erred in law and on facts in concluding and sustai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r sq. and also supported by Shri Gobarbhai, other working partner unequivocally who stated the rate was Rs.1500 per sq. 3. On the facts and in the circumstances of the case and in Law, the Ld. CIT(A) has not appreciated the fact that during the course of survey proceedings, there was pocket diaries found and impounded in which the entries recorded are related to M/s Raj Enterprise. 4. On the facts and in the circumstances of the case and in Law, the Ld. CIT(A) has considered extraneous circumstances while directing to consider expenses, which are not at all warranted while computing on-money income. 5. On the facts and in the circumstances of the case and in Law, the Ld.CIT(A), Surat ought to have upheld the order of the Assessing Officer. It is, therefore, prayed that the order of the Ld.CIT(A)-I Surat may be set-aside and that of the Assessing Officer s order may be restored. *(appeal of revenue for AY 2009-10 was dismissed due to low tax effect vide order dated 23.08.2019 in ITA No. 1163/Ahd/ 2016) 4. The learned Authorised Representative (ld.AR) for the assessee submits that he has filed application for admissions of additional grounds of appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f 1,40,032 sq.mtr. The assessee was asked to furnish the details of constructed bungalow, total number of units, area of each unit constructed, plots booked, sold and the explanation about the impounded material during the survey. The AO noted that assessee failed to provide required details. No closing stock and supporting evidence about the various information sought by the AO, was provided by the assessee. On the basis of aforesaid observation, the AO took his view that the book results are not complete and correct and not reliable and issued show cause notice dated 22.03.2013 to the assessee as to why books of accounts and result thereof should not be rejected. 6. The assessee filed its reply as recorded in para 5.2 of the assessment order. In the reply, the assessee stated that vide show cause notice dated 22.03.2013, the assessee was asked by referring the answer of question no.15 by partner that rate of sale of plot was Rs.1400 to 1500 per sq.yardand that there is no documentary evidence to prove the same. The assessee replied that there is nothing in response to the question no.15, it appears that instead of question no.13, the question/answer no.15 is referred. The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sal of rejection of books of account may be dropped. 7. The assessee in its alternative and without prejudice submissions stated that if the AO is not convinced with the submission of assessee and decided to adopt the sale value of plot in Water World Project at Rs.1500/- per square yard, then such rate should be applied only to the sale of plots actually made during the year. As in real-estate, the real profit does not earn on the booking of plots (units) as certain bookings are cancelled due to various reasons and in case booking is cancelled and the profit which is already considered to have been earned by assessee would have to be reversed and tax collected on such income subsequently to reverse will have to be refunded and there is no provision in the Income Tax Act to reverse the income already considered having been earned by the assessee. The assessee given instances of 20 such cases wherein bookings of plots were cancelled and the assessee had to return the booking amount. The name of such person along with the date of booking, plot no, booking amount, date of cancellation and amount of refund was furnished. The assessee further explained that if booking is equated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Sale amount 2010-11 86 15,821 76,59,046 2011-12 62 10,988.93 52,46,874 2012-13 68 11,802.94 60,14,350 2013-14 33 5,715.12 32,39,123 Total 249 44,328.29 2,21,59,393 On perusal of details submitted by the assessee it is observed that the average area of each plot works out to 212.91 sq. yard. The working is shown as under - Total are of Plots Area of Each Plot (sq. Yard) 44328.29 Sq Meters = 44328.29 * 1.196 =53016.63 Sq. Yard 53016.63 /249 = 212.91 9. Further, as per average rate of registered sale consideration, the AO worked out rate in following manner: Total sales Amount (in Rs.) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the AO added unaccounted value of sales. The AO determined the value of sale at Rs.9,46,84,128/- total of which comes to Rs.10,57,64,793/- (1,10,80,665 + 9,46,84,128). The assessee has down Net Profit at Rs.1,61,21,860/-, if the unaccounted income determined by the AO is added,the total profit on sales comes to Rs.9,58,05,988/- (7,96,84,128 + 1,61,21,860), which is 90.58% of total sale. On the basis of aforesaid figure, the assessee submitted that as per the AO, the assessee earned the income @90.58% of sales. The presumptive income in the business of construction is at 8% of the gross profits, that too in cases on small contractor having turnover less than Rs.1.00 crore, surprisingly, the income of assessee estimated at 90.58% gross receipts which is around 11.50 times the rate provided under the Income Tax Act and prayed for deleting the addition, which is prima-facie unrealistic, unjustified impractical as no real-estate dealer can earn such rate of gross profit at Rs.91%. 13. The assessee further explained that a survey took place on 06.01.2010 during the assessment year under consideration. During survey, the assessee admitted additional unaccounted income of Rs.1.50 cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ots which were sold by the assessee. The assessee also submitted that it was impractical and inconsistent that the provision of Income Tax Act to charge the amount received on booking of plot as income which even when the sale deed is not executed in favour of purchaser, merely on the booking on receiving of part payment. The assessee submitted that they have been following Mercantile System of Accounting and has been offering income for taxation on sale of plots in the year in which sale deeds of plots were executed. The assessee also furnished the complete bifurcation of number of booking in F.Y. 2007-08, 2008-09 and 2009-10, number of bookings cancelled during the relevant years and net booking during the year and explained that only 80 plots were booked during the Financial Year 2009-10. 14. The ld. Additional CIT in its direction under section 144A directed the AO to consider 433 plots in Water World Project. However, the total number of plots booked by assessee in the project is 403 only. The ld. Addl.CIT erred in concluding that there are 433 plots in the project. The assessee furnished the original booking cancellation contract. Out of 403 bookings, the booking of 20 p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a contended that during the survey proceedings his statement on oath was recorded. While recording the statement, the diary impounded during the course of survey was shown to him and confronted with the entries made therein. After verification of the same, in question no.16 Rajeshbhai Pengawala stated that all the impounded diaries are related to Raj Enterprises and were made by Riteesh Gheewala, Accountant as per his direction or his father s direction who was specifically asked about the entries of the diary above Rs.3 lakhs and Rs.3.50 lakhs received on various dates in December, 2009. Shri Rajesh Bhai Pengawala did not have any idea regarding the said entries and Ritesh Gheewala could not explain the same. When he was asked to explain as to whether the entries recorded in the diary were included in the regular books of accounts, he stated that he had no idea of asking about the specific name of Pravin Kapchi[B102], the partner stated that he know Pravin Kapchiwho was a supplier of Kapachi [stone brick] to the project. When he was asked about the payment against kapachi is reflected in the books of accounts, if yes, he was asked to produce the same. The partner stated that he ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut the same ? . Answer: yes, These diaries were found from my officer premises and all diaries were written by Riteesh Gheewala. I had signed these diaries during the course of survey proceedings. The assessee explained that in answer to question No.16, Rajesh Pengawala nowhere stated that impounded diaries were made by Riteesh Gheewala as per his directions or the direction of his father. The AO used the above statement to made huge unwarranted additions. The assessee further objected that Rajesh Pengawala admitted in his statement that he knew Praveen Kapchi and he supplied Kapchi in the water word project, he could not produce the books of accounts in support of his statement and therefore, rejected the books of accounts of assessee. The assessee explained that the perusal of copy of summon shows that the AO did not require Rajesh Pengawala to appeal with books of accounts of Raj Enterprises in response to summons issued to him. It was further explained that it is very obvious that one cannot show the details of Kapchi (gravel) purchased by the assessee-firm for project. The assessee produced the ledger accounts of Pravin Kapchi with copies of bills of purchases from Pravin Ka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey. The ld.CIT(A) held that Gobarbhai R. Gondaliahas given his statement voluntarily without coercion and not under duress. There was printed leaflet meant for advertisement for sale which were found during the survey and confronted to active partners Rajesh Bhai Pengawalain question no.17 of his statement. The offer rate asper leaflet was Rs.2500/- per square yard, which has not been disputed. The ld.CIT(A) further observed that by any stretch of imagination and human behaviour it cannot be accepted that plots which were from the office advertised and offered at Rs. 2500 per square meter were sold only for Rs. 420 per square yard as per assessee s claim. There is no discount offer in the leaflet. The partners claimed that the rate was for giving an idea to customers, what type of idea a customer will get if as per the assessee s contention, the land is purchased Rs.10 square yard and sold for 420 square yard and advertised per Rs.2500 square yard. The SMS on the mobile phone of Rajesh Bhai Pengawala was mentioning certain transactions, who was confronted with these question no.21 of his statement and was asked to explain whether these were recorded in the books of accounts who eva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enses have been inflated as the land cost was highly under reported. The assessee is mainly in the plotting scheme and development cost other than land is not much, therefore, looking into the entirety of facts, including the upholding of the additions on the basis of understatement of land cost directed to work out the addition @50% of addition. It was further directed that in case of working of undisclosed profit for the A.Y. 2010-11, comes out at less than Rs.1.50 crore, as directed, it is already accepted, declared by the assessee in the return of income and introduced in the accounts, then figures could be taken at Rs.1.50 crore for AY 2010-11. 24. Aggrieved by the order of ld.CIT(A), both the parties have filed their respective appeals. The Revenue has challenged the deleting of addition to the extent of Rs.4,00,29,713/-. And the assessee has basically challenged the sustaining of addition on the basis of unaccounted income at 50% of difference between Rs.1500/- per square yard. 25. We have heard the submission learned Authorised Representative (ld.AR) of the Assessee and the learned Commissioner of Income Tax- departmental representative (CIT-DR) for the Revenue an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e submits that assessee included the undisclosed income declares during the survey and duly accounted the said income which is appeared in profit and loss account and can be verified from the accounts. The relevant part of the accounts is placed on record as per page no. 107, 109 and 123 of paper book. The books of accounts are correct and were furnished during the course of assessment proceedings which cannot be said to be incorrect income. The ld. CIT(A) while confirming the action of Assessing Officer in rejection of books of accounts noted that expenditure of Rs.15,000/- was not found debited in the books. The ld. AR for the assessee submits that the small expenditure of Rs.15,000/- being not found debited from books showing turn over from amount of Rs.1.10 crores and income of Rs.1.16 crore cannot be ground for rejection of books of accounts. The books of accounts were audited and the auditors have not given any adverse findings/ qualification. To support his submission, the ld. AR relied upon the following decision: CIT Vs Padamchand Ramgopal (1970) 76 ITR 719 (SC). CIT Vs Margadarsi Chit Funds (P) Ltd. (1985) 44 CTR (AP) 5 B. F. Varghese Vs State of Kerala ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when the statement was retracted by the deponent. To support his submission, ld. AR relied upon the following decisions: CIT vs S. Khader Khan Son (2012) 254 CTR 228 (SC) CIT vs Golden Finance (2013) 40 Taxman.com 329 (Guj.) M/s Sashi Wines vs ITO (ITA No. 882/AHD/2017) CIT vs Digambar Kumar Jain (HUF) (2013) 84 DTR 365 (MP) CIT vs Dhingra Metal Works (2010) 236 CTR 621 (Del) CIT vs P. Balasubramanian (2013) 354 ITR 116 (Mad) ITO vs Vijay Kumar Kesar (2010) 231 CTR 165 (Chattisgarh) CIT vs S. Khader Khan Son (2008) 214 CTR 589 (Mad.) 32. The ld. AR submits that statement of Shri Ritesh Gheewala was recorded on oath whereas the provisions of section 133A(3)(iii) do not permit the recording of his statement on oath during survey proceedings, thus, the statement of Shri Ritesh Gheewala is illegally and invalidly recorded. As provisions of section 133(1), the record to provisions of section 133A of the Act can be had only concerned refuses to have his statement recorded or does not cooperate in recording the statement during the survey proceedings. There is no such claim of non-cooperation recorded by survey team; therefore the course ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contrary, he categorically submitted before survey team that rate of sale and plot in the project were Rs.470/- per sq. yard. The ld. CIT(A) erred in relying misleading and incorrect observation of Assessing Officer, though this statement was available with him, even otherwise the statement of Mr. Rajesh recorded during survey proceeding does not for any evidential record as argued earlier. Further, from the statement of Mr. Rajesh, it emerges said statement was recorded on oath whereas the provisions of section 133A(3)(iii) do not permit the recording of statement on oath during survey proceedings. Thus, the statement of Mr. Rajesh was not claim of Revenue s answers are that this statement was recorded under section 131(1) then also the statement of Mr. Rajesh is illegal and invalid as the provisions of section 133A(6), the recourse to provisions of section 131(1) of the Act can be held only one person concerned refuses to have his statement recorded or does not cooperate in recording his statement during the survey. There is no such reference recorded by survey team. Therefore, recourse to section 131(1) for recording statement on oath is invalid and illegal on the basis of vari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fered rate. For the purpose that the plots were sold at Rs.1,500/- per square yard, the Assessing Officer has to brought evidence on record. Similarly, the rate quoted in the leaflet cannot be considered to be the rate realized by the assessee. 38. On the specific identification of property no. A-306 and B-102, the ld. AR submits that the entries related to such properties were not related to the projects of assessee, which pertains to different project known as Shivalik Heights constructed by some other firm M/s Shivalik Enterprises. In Shivalik Enterprises, none of the partners of assessee were partners. The assessee clarified these facts that Accountant to Shivalik Enterprises and of assessee firm is common, the above diaries maintained by the common accountant of both the firms were found from the assessee s premises. To prove his submission, the ld. AR of the assessee submits that copy of sale deed of flat no. B-102 in Shivalik Heights is placed on record and the particulars of properties, sale and seller and purchases are clearly discernable which altogether different project is. Similarly, for flat no. A-306 which was purchased by Rajubhai in Shivalik Heights , the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ooked) 4,50,65,595 (6) Total income from the project as per the order of the ld. CIT(A) (4 + 5) 6,11,87,455 (7) Percentage of net profit in relation to the sales [(6) * 100/ (3)] i.e., 6,11,87,455 * 100/10,57,64,793 57.85% 40. On the basis of aforesaid working, the ld. CIT(A) concluded that on the business of selling of building, assessee would earn the rate of around 58% worth presumptive income directed to be accepted by Income Tax Act itself as per provisions of section 44AD. The Ld. A R for the assessee submits that Ld. CIT(A) grossly erred in estimating the net income in assessee s case at 50% of difference between the alleged sale rate of Rs. 1500/- per square yard and the average rate of Rs. 470/- per square yard recorded in the books of the assessee. The estimation of profit element in estimated sale is required to be made in assessee s case, such estimate cannot be in any case exceed 8% percent of the sale rate in view of the provisions of section 44AD. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om 578 (All), CIT Vs UP State Food Essential Commodities (ITA No. 64 of 2008). 43. On additional ground No. 2 the Ld. AR for the assessee submits that the assessee admitted undisclosed income of Rs. 1.50 Crore during the survey. The Ld. CIT(A) erred in not directing the A.O. to give setoff of undisclosed income admitted during the survey against the undisclosed income finally getting determined in assessee s case to avoid double taxation. 44. The assessee also filed the following documents on record: Sr. No. Particulars Pages 1 Written submissions before CIT(A) date 05.06.2014 01-71 2 Impounded material:- Diaries B1 to B5 72-99 3 Notarized affidavit of Mr Ritesh Gheewala dated 18.06.2014 100-104 4 Notarized affidavit of MrParvinVirash dated 18.06.2014 105-106 5 Audit Report along with annexure for the year ending 31.03.2010 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings certain incriminating documents found in impounded. The survey team recorded the statement of partners of assessee Shri Rajesh Pengawala and Shri Gobarbhai Gondalia. In the statement, the partners admitted unaccounted income of Rs.1.50 crores during the AY.2010-11. During the course of survey proceeding, five pocket diaries were found and impounded and were seized vide Annexure- BI-1, BI-2, BI-3, BI-4 and BI-5. This diary contents various entries some of which date-wise records of cash receipts and payments relating to Water World Project. On considering such evidence, it indicates the rate of plot @ 1,500/- per sq. yard. The Assessing Officer adopted the same rate of plot which was most reasonable and minimum possible rate. Both the partners in their statement also admitted the same rate. The average area of the plots is 212.91 Square yard. The average rate of registered sale consideration per square yard works out by assessee is Rs.417.97 per square yard. Thus, unaccounted income of the assessee was worked out at Rs. 1082.03 (1500- 417) per square yard. For AY 2009-10, the AO worked out addition of Rs. 56,68,250/- ( 1082.03 x 22 x 417.97) and for AY 2010-11, worked out at R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant thereto which throw light on the issue in dispute are substantive evidence. To support his submission, the ld. CIT-DR relied on the decision of Supreme Court in the case of Thiru Jon vs Returning Officer, AIR 1977 SC-1724. In the present case there is no allegation of coercion. The superior courts have held that the confession need not be ruled out merely because of allegation of coercion. The confessions are to be considered as a whole and not in any undivided form. In the case of assessee, there is no allegation of coercion. The ld. CIT-DR submits that even retracted confession was held be binding. To support his submission, the ld. CIT-DR relied on the decision in Surjit Singh Chhabra (1997) ISCC 508, 509 (SC) and State of UP Vs Boota Singh, AIR 1978 SC 1770. The ld. CIT-DR further submits that the Hon ble Supreme Court in the case of Pullangode Rubber Produce Co. Ltd. Vs State of Kerala (1973) 91 ITR 18 held that admission is an extremely important piece of evidence though it is not conclusive. The statement made voluntarily by the assessee could form the basis of assessment. The mere fact that the assessee retraced the statement could not make the statement unacceptable. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by Pune Tribunal in the case of Chander Mohan Mehra Vs ACIT (Inv.) (1999) 65 TTJ 327 (Pune). The claims of assessee are baseless as no offer was made by assessee to inform instances during post-survey enquiry which shows assessee is taken a plea to get away from his voluntary statement is on afterthought story. The ld. AR submits that belated retraction would following the category of afterthought instead of being retracted as held by Gujarat High Court in the case of Council of Institute of Chartered Accountant of India Vs Mukesh R. Shah (2004) 186 CTR 579 (Guj.). The ld. CIT-DR for revenue further submits that from the facts of the present case it emerges that retraction was made after a period of one month, it was never communicated to the Departmental Authority. From the record, it is impossible to hold that any threat, coercion has been exerted during the recording of confession statement of assessee. The statement was voluntarily; therefore the action of Assessing Officer is to be confirmed. 47. We have considered the rival submission of both the parties and gone through the order passed by the lower authorities carefully. We have also gone through the order of lower aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osed income which is duly accounted while preparing profit and loss account and which can be verified from the accounts. The books of accounts are correct and were furnished during the course of assessment proceedings which cannot be said to be incorrect income, the small expenditure of Rs.15,000/- being not found debited from books showing turn over from amount of Rs.1.10 crores and income of Rs.1.16 crore cannot be ground for rejection of books of accounts. Further the books of accounts were audited and the auditors have not given any adverse findings/ qualification. With regards to alleged entries in the seized diaries about Plot No. B-102 and A- 306, the ld. AR for the assessee submitted that the said transactions are not related with the assessee. Further, the statement of Reetesh Gheewala was recorded illegally and invalidly, as the process of recording statement under section 133A can be had only when, when he refuse to give his statement or does not co-operate in recording statement during survey and there is no such non-cooperation recorded by survey team. 49. Now let us advert to examine the factual submission placed by ld. AR for the assessee. There is no dispute th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The relevant question and answers are extracted as under; Question No. 13: during the course of survey proceedings, you have informed that sale of some of your plots is made at Rs. 1,400/- to 1500/- per Square yard, kindly therefore, informs as per your sale register which plot were sold at rate of Rs.1400/- to Rs.1500/- per Sq Yd. Answer-13 I do not have any record, accounting books or other material on the basis of which I can reply to your question. Question No.17: A leaflet of NRI investor is being shown to you in respect of your project Water World, Ubhrat, wherein the rate of Rs.2,500/sq. ft. is shown. Therefore, please inform that as to why your advertisement is misleading to the customers and is false and also inform whether the said rate of Rs.2,500/sq. ft. is correct or not? Answer No.17: The said project s leaflet is of our firm and of our project namely Water World at Ubhrat. Therein the rate of Rs.2,500/sq. ft. described is to give an idea to the customers. Besides this, I would like to inform that I have not made any sales of the plot at this rate. Question No.18: Today, during the course of survey proceedings, 5 different small ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid statement of Reetesh Accountant and Rajesh Pengawala recorded by survey team on 06.01.2010, it cannot be inferred that they admitted the rate of plots at Rs. 1400/- or Rs. 1500/- per square yard. Rather by bringing the sufficient material on record the assessee has proved that the alleged entry in the seized material / diaries are no where related with the plot No. A-306 or B-102 of water word project developed by the assessee. Therefore, the first basis of rejection of books of account has no leg to stand. 52. The second ground of rejection of the books of accounts was non-recording the commissions payment of Rs.15,000/-. As noted above that the ld AR for the assessee vehemently argued that a small expenditure not found debited in the books when the assessee has shown turnover of more than Rs. 1.10 Crore and income of Rs. 1.61 Crore cannot be a ground of rejection of books of accounts. We find that Hon ble Supreme Court in CIT Vs Padam Chand Ram Gopal (supra) held that insignificant mistake noticed in one year cannot be a ground of rejection of books of accounts, when no other mistake was found in any other year s books. Further, Hon ble Andhra Pradesh High Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the process and that such violation is fatal which can turn draconian to inherent safe guard of at least recording of such reason and satisfaction of non-cooperation to resort to other coercive steps needs to be set clearly by the income tax authority. 54. We further find that the AO has not investigated in the facts, either by examining the purchaser in the project of the assessee-firm nor collected any evidence from the officer of sub-registrar about the rate of sale of the various plots. No adverse material collected by AO except rely of the statement recorded during the survey. It is settled law that the statement recorded during the survey is not admissible in evidence unless it is corroborated with the material evidences. The AO worked out average rate of all the plots in the project. It is a matter of general practice that no uniform rate of sale is applicable in the private projects, the rate may vary depending on various factors like size, location, time of booking and number of bookings. So uniform rate is not applicable is such private project. 55. In view of the aforesaid legal position, we also held that the recording of the statement by survey team under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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