TMI Blog2023 (8) TMI 1180X X X X Extracts X X X X X X X X Extracts X X X X ..... TMI 373 - SC ORDER] In this decision, Hon ble Court followed its earlier decision rendered in Pr. CIT vs. Abhisar Buildwell Pvt. Ltd. [ 2023 (4) TMI 1056 - SUPREME COURT] and held that where no incriminating material was found in case of any of assessee either from assessee or from third party, High Court rightly set aside assessment order passed under section 153C. In the present case, the facts are similar. There is nothing on record which would show that any incriminating material was found during search operation which would show that the agricultural income belonged to the assessee instead of HUF. Therefore, we would hold that the aforesaid agricultural income is not to be considered in the hands of the assessee. The corresponding grounds raised by the assessee stand allowed. The addition on account of gift to wife has already been deleted in the impugned order. Assessee appeal partly allowed. - Hon ble Shri Mahavir Singh, VP And Hon ble Shri Manoj Kumar Aggarwal, AM For the Appellant : Shri V. Padmanabhan (CA) And Shri R. Venkat Raman (CA) Ld.ARs For the Respondent : Shri S. Senthil Kumaran (CIT)- Ld. DR ORDER MANOJ KUMAR AGGARWAL ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as called for by Ld. AO. 3.3 The loose sheets were seized vide annexure ANN/KAR/PAR/LS/PAGES 1-254 dated 21.02.2019. The page nos. 222 to 248 of the said seized material was a set of sale agreement executed on 04.02.2016 and the same contained the details of advance paid by the assessee to the tune of Rs. 200 Lacs for purchase of certain property situated at Survey no. 15/94, VGP Golden Beach Part-1. Post search, the same was confronted to the assessee u/s 131(1A) of the Act on 03.07.2019 and the assessee was directed to explain the source of the payment. The reply of the assessee was under: - A8. During the financial year 2015-16, I proposed to purchase this property. The sellers were known to me through my personal friend Mr. Ashok Kumar. Hence, I do not verify authenticity of the seller and based on oral agreement and trust I gave an token advance of Rs. 5 lakh. Subsequently when I verified original documents I came to know that sellers were not genuine and in fact has forged the original document. When l tried to contact the seller, I came to know that they have vacated their premises and were absconding. I did not have any proof to establish that I had given Rs. 5 lakh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the interest of the assessee, he not only complained to the police but also gave title deed of property. The assessee made sure that Shri A.M. Jinna shall repay the advance of Rs. 200 Lacs to the assessee in the form of promissory note reconfirming that the assessee had invested Rs. 200 Lacs for purchase of property at VGP Golden Beach. Accordingly, Ld. AO treated the amount of Rs. 200 Lacs as unexplained investment u/s 69 and added the same to the income of the assessee. Agricultural Income 3.6 It transpired that the assessee claimed agricultural income of Rs. 10 Lacs in hands of HUF entity. It was explained by the assessee that HUF was formed amongst family members for agricultural operations only. The agricultural land was inherited property by way of settlement deed. Since the income of HUF was less than taxable limit, no return of income was filed for HUF and there was no necessity to obtain PAN for HUF. The assessee acquired the property in 2011 through family settlement. However, rejecting the same Ld. AO held that there was no HUF and accordingly, the income of Rs. 10 Lacs pertaining to this year was treated as unaccounted income u/s 68 and added to the income of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it offered income on presumptive basis u/s 44AE and therefore, there exist no Profit Loss account claiming this amount to be expenditure u/s 37(1). Concurring with the same, this addition was deleted by Ld. CIT(A) in para 5.7 of the order. Accordingly, the appeal was partly allowed against which the assessee is in further appeal before us. Our findings and Adjudication 5. From the fact, it emerges that during search operation on assessee, certain material was found and seized. The material include a sale agreement dated 04.02.2016 which, inter-alia, contain the details of advance paid by the assessee to the tune of Rs. 200 Lacs for purchase of certain property situated at Survey no. 15/94, VGP Golden Beach Part-1. The property was proposed to be purchased for Rs. 420 Lacs. The translated version of the same has been placed on page nos. 1 to 6 of the paper-book. We have gone through the same. During the course of assessment proceedings, it was submitted by the assessee that he proposed to purchase the said property under oral agreement since the seller was known to a personal friend. The assessee did not verify the authenticity of the seller and based on oral agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which supports the case of the assessee. This decision has also been rendered on similar circumstances. 7. In the light of above stated facts and circumstances, the impugned addition, in our considered opinion, is not sustainable to full extent of Rs. 200 Lacs. It is admitted fact by the assessee that it has paid only sum of Rs. 5 Lacs to the sellers and therefore, the investment, to that extent, could be considered as undisclosed investment by the assessee. Accordingly, the impugned addition stand restricted to the extent of Rs. 5 Lacs. We order so. The corresponding grounds stand partly allowed. 8. So far as the addition of agricultural income is concerned, we find that the assessee has been searched on 21.02.2019. It is undisputed fact that on the date of search, no assessment proceedings were pending against the assessee for the year under consideration. Therefore, this is a year of unabated assessment. We also find that the impugned addition is not based on any incriminating material as found by the department during the curse of search proceedings. In such a case, no addition could have been made by revenue in terms of the recent decision of Hon ble Apex Court in DCIT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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