TMI Blog2022 (8) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... cified time the AO cannot take cognizance of the same and proceeded with the assessment considering the notices issued u/sec. 143(2) 142(1) of the Act on 07-08-2012. Therefore, the contention of Ld. AR that no notice u/s. 143(2) issued subsequent to the letter dated 18-01-2014 is not acceptable and rejected. Thus, the additional ground No. 1 raised by the assessee is dismissed. Addition on account of alleged cash receipts on sale of land - addition based on loose papers - HELD THAT:- There had been no corroborative evidence and no adverse inference could be drawn against the assessee in terms of alleged entries of loose papers. Unless it is established on record that as a matter of fact the cash payment as alleged by the respondent-revenue did pass to the assessee from M/s. Krupa Land Pvt. Ltd. it cannot be said respondent-revenue had any right to make any addition. On perusal of the statement of Dilip Dherai no conclusion can be drawn that the entries in loose papers belongs to assessee representing cash payment. Even the CIT(A) clearly held in the impugned order AO squarely failed to carry out necessary investigation/enquiries from the buyer M/s. Krupa Land, meaning t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.Y. 2008-09. 4. The Ld. AR, Smt. Hiral Sejpal submits that the assessee raised additional ground No. 1 questioning the validity of reassessment u/s. 147 of the Act is invalid for non-issuance of notice u/s. 143(2) of the Act. She submits that the said additional ground purely raises a question of law and no facts are requires to be brought on record and prayed to admit the same and adjudicate the additional ground of appeal as preliminary issue and placed reliance in the case of National Thermal Power Corporation Vs. CIT. reported in 229 ITR 383 (SC). Upon hearing both the parties and as no objection as reported by the Ld. DR, we proceed to adjudicate the additional ground raised by the assessee as preliminary issue. 5. The Ld. AR drew our attention to the paper book containing 99 pages and submits that the assessee filed return of income on 27-12-2008 and the same was processed u/s. 143(1) of the Act vide intimation dated 15-02-2010. The Ld. AR drew our attention to the Page Nos. 32 and 34 of the paper book and argued that the AO issued the said notices both dated 01-05-2013 and no notice issued subsequent to the letter dated 18-01-2014 filed by the assessee requesting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e u/s. 148 beyond 30 days, the AO has to treat that no ROI filed. The Ld. DR drew our attention to the letter dated 18-01-2014 and argued that the assessee requested the AO to treat the original ROI dated 30-12-2008 to be the ROI in response to notice u/s. 148 of the Act which is beyond 30 days from the date of service of notice u/s. 148 of the Act and no requirement of issuance of notice u/s. 143(2) of the Act is required in response to such letter dt. 18-01-2014, the assessee is not entitled to raise non-issuance of notice u/s. 143(2) of the Act. The Ld. DR placed reliance on the order of Delhi Tribunal in the case of Rakesh Aggarwal Vs. ITO in MA 249/DEL/2020 in ITA No. 2461/DEL/2019 for A.Y. 2010-11 vide order dated 15-12-2020 and a decision of Hon'ble High Court of Madras in the case of Home Finders Housing Ltd. Vs. ITO reported in 404 ITR 611 (Mad.). 7. Heard both the parties and perused the material available on record. We note that the assessee filed return of income u/s. 139(1) of the Act on 30-12-2008 which was processed u/s. 143(1) of the Act vide order dt. 15-02-2010. Thereafter, on receipt of information the AO reopened the assessment by issuing notice u/s. 148 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO, plethora of incriminating evidences were gathered during search operations on many places and at the residence of Mr. Dilip Dherai. M/s. Krupa Land Ltd. is belonged to Jai Corp Group. The said company had purchased various lands from the assessee in Nevali village, the details of which mentioned here under: Sr. No. Area Date of agreement AY 1 8.70 acre 06-11-2007 2008-09 2 3.79 acre 06-11-2007 2008-09 3 4.4225 acre 16-07-2008 2009-10 10. On perusal of the above chart, we are concerned with item's 1 2 involving A.Y. 08-09 involving 8.70 3.79 acres, both deeds dt. 06-11-2007. 11. We note that the AO observed at para 6.1, there is a clear mention of payment of Rs. 2 crore to assessee for Nevali village on 15-10-2008 and 20-10-2008 by Krupa Land Pvt. Ltd. and also cash receipts duly signed by the assessee for a sum of Rs. 20,00,000/-. Further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said Dilip Dherai and loose papers found at his premises. She also drew our attention to Q. No. 4 and submits that the said Dilip Dherai clearly admitted that he was a Consultant for RIL and not an employee of Jai Corp Group. He also denied involvement of cash payment vide search to Q. Nos. 8 and 12. 13. Smt. Sezpal argued that the AO failed to examine the transaction with M/s. Krupa Land Pvt. Ltd. to substantiate his stand or to ascertain whether the cash payments were made or not. The AO did not examine the said Dilip Dherai on his retraction and did not provide opportunity for cross-examination. She referred to Annexure 2 of paper book filed by the Revenue and submits that the said piece of loose papers containing certain notings represents rough estimates or scribbling which is to be regarded as dumb documents. The AO did not make any effort to obtain any evidence to substantiate the notings in the said dumb documents. The said Annexure 2 is alleged cash flow statement and no reference as to assessee nor the period of transaction is reflected. Further, she referred to Annexure 3 at Page Nos. 2 and 3 which is considered by the Mumbai Tribunal in the batch of cases, lead case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... She submits that the Mumbai Tribunal already adjudicated the validity of statement of Dilip Dherai in connected cases wherein the assessee is the alleged to have addressed as one of the parties and the Mumbai Tribunal held the action of AO was not justified in such circumstances. Therefore, the statement of Dilip Dherai on the basis of which the additions made in the hands of the assessee is to be discredited and the addition made by the AO and to the extent confirmed by the CIT-A is to be deleted and prayed to allow the grounds Nos. 1 to 3 raised by the assessee and dismiss grounds raised by Revenue. 15. The Ld. DR, Sri S.S. Meena submits that the AO analyzed the seized documents of Annexures 1 and 2 and rightly made additions in the hands of the assessee and referred to Para No. 3 of the AO. The assessee simply denied and no evidence was furnished for non-receipt of cash payments. Page Nos. 1 and 2 of Annexure 4 clearly shows the receipt of cash payment by the assessee which supports the view of AO. The Ld. DR drew our attention to the signature on Page No. 1 of Annexure 4 an amount of Rs. 20,00,000/- paid to the assessee. He referred to Page No. 2 of Annexure 4 and submits th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 05-03-2009. In answer to Q. No. 2 in his statement, said that, he is a Chemical Engineer and Consultant to many entities. In Q. No. 4 he denied, that he is an employee of Jai Corp Group. About his primary portfolio in terms of function, he said basically a project execution man mainly for cross country pipeline/Petroleum/Gas, setting of infrastructure like pipelines etc. Further handling land acquisition by land acquisition act process in reply to Q. No. 5. In reply to Q. Nos. 9 and 12 as rightly pointed by the Ld. AR, he said no, I am not aware in response to question as any cash element involved in the purchases made under MSEZ. Further, in Q. No. 18 he replied these cash payments are given to the agents in lieu of land to be procured against the security. Further, in reply to Q. Nos. 24 and 27 he said the total amounts disbursed for purchase of land through cheque along with payments made through cash disbursed through Jai corp. Office and the said transaction could not be materialized as such a heavy cash was demanded by the land owners. 18. In view of the above, let us examine the seized documents, i.e. annexures 1 to 4 consisting of 7 pages at pages 34 to 40 of Revenues ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, it is unascertainable to what the '100-00' '90-00' stands for. Therefore, we could not assume that annexure No. 2 is related to AY:08-09 and thus, we hold annexure No. 2 could not support the view of Ld. DR and is rejected. In the case of Shailesh S. Shah (supra) held addition to assessee's income on basis of loose papers seized under section 132 proceedings, the Assessing Officer neither mentioned any material or evidence to show on what basis figures came to be worked out nor sections 69 and 69D were invoked, nor did he discharge burden to prove that alleged receipts were assessee's income, addition being merely on basis of suspicion, could not be sustained. 20. Coming to page 1 of Annexure No. 3 dt. 29-08-2008 at page 35, requires no clarification, the fact remains undisputed, stamp duty registration value for 3.79 8.70 acres are Rs. 1,51,60,000/- and Rs. 3,48,00,000/- respectively as the negotiated price is evidenced by the conveyance deeds, both, dated 06-11-2007 at pages 41 to 118. We note that the name of Krupa Land Pvt. Ltd. is mentioned and no where we find the name of assessee. We are not able to understand how this computer gene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year under consideration. In the case of Omar Salay Mohmad Sait (supra) held findings cannot be based on suspicions, conjectures, or surmises. In the case of Ms. Katrina Rosemary Turcotte (supra) held in order to make addition on account of cash component, it was the duty of AO to bring on record corroborative evidence to establish the fact that entries made in evaluation sheet were correct. 22. We are satisfied that in the instant case, the addition was made by the AO merely on the basis of presumption, surmises and conjectures. Therefore, no addition can be made on the basis of presumption in such cases. The respondent-revenue i.e. AO has made no inquiry whether any cash payment was received from M/s. Krupa Land Pvt. Ltd. or from any other source, but no material was brought on record to prove that the assessee has received cash payment and no chance was given to confront Dilip Dherai on whose statement the addition was made. Further, we find the said Dilip Dherai never stated of having cash payment to the assessee, therefore, in this circumstances, we find no addition is maintainable much less ratio of 40:60 adopted by the CIT(A). It is clear the AO made addition in a summar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the hands of the assessee. We may note that there was no opportunity for the assessee to cross-examine the said Dilip Dherai and in our opinion; it would not be safe to rely on the statement of the said Dilip Dherai which was retracted at page Nos. 142-145 and was not subjected to cross-examination. This position clearly appears established from the record. Therefore, the respondent-revenue did not make out a case against the assessee about the receipt of cash payment. 25. Further, scrutiny of entries of seized loose papers reveals that the transactions noted thereon were not genuine and have no evidentiary value for the reason no clear details concerning the AY consideration are ascertainable as rightly pointed by the Ld. AR as it establishes estimations only. This is apparent from the impugned order that the CIT(A) recorded a finding that the transaction noted in the seized papers as relied on by the AO were not genuine. Therefore, in our opinion, there was no document to show the payment of such a huge cash payment of Rs. 34,36,00,000/- and the evidence of a third party which was retracted is clearly inadmissible and insufficient to prove any such huge cash payment. Coming ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der to come to conclusion for adopting 40:60 ratio, squarely relied on Annexure 4 consisting of two pages. Regarding the same we discussed at para No. 21 of assessee's appeal and held that page 1 dated 30.12.2008 of Annexure 4 is not relevant to the year under consideration. In respect of page No. 2 of Annexure 4 we held that no date and indication of nature of transaction with reference to figures mentioned therein is reflected. Further, the AO in his order at para No. 6.1 observed that the assessee received payment on 15.10.2008 and 20.10.2008 which supports the view taken by us that the Annexure 4 is not relevant to the year under consideration. Further in para 7.1 and 7.2 the AO refers to Annexure 4 and held the last six figures of Rs. 9,28,72,500/- is matching with the amount of Rs. 78,72,500/- basing on which the CIT-A in the impugned order at para No. 3.11 at page No. 20 held that the assessee admitted to have been received 40% of cash amount amounting to Rs. 3,33,06,667/- which is very close to the figures of Rs. 20 lac plus Rs. 78,72,500/-, in our opinion, have no basis in view of his further observation that the AO squarely failed to carry out necessary investigation/ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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