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TMI Blog2023 (12) TMI 809X X X X Extracts X X X X X X X X Extracts X X X X ..... e Orders of the Ld.CIT(A). 2. The common grounds of appeal taken in captioned appeals by the Revenue as well as the grounds of cross objections (except variance of the figure) are as under: Common Grounds of Appeal of the Revenue (except variance of the figure): "1 The order of Ld. CIT(A) is not correct in law and facts. 2. On the facts and circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs.7,87,79,900/- made by the AO on account of cash payments/investment by the assessee company in the properties. 3. The appellant craves leave to add, amend any/all grounds of appeal before or during the course of hearing of the appeal." Common Grounds of Cross Objection filed by the Assessee "1. That the disallowance of Business loss of Rs. 28,352/- claimed by the Assessee in its Return of Income is illegal unjustified and ought to be deleted. 2. That no show cause notice or any other notice with respect to any adverse interference drawn by the Assessing Officer for making any addition of any nature whatsoever for the year under consideration was ever served upon the assessee and, therefore, the consequential assessment order is illegal and void ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peals are as under: Assessee AY Sale/purchase Amount of addition on sale/purchase in Rs. Value as per conveyance deed Value as per Circle rate Amount of addition made by AO u/s 69 (Rs.) Ms. Anju Gupta 2005-06 Purchase 6,47,10,000 11,86,250 11,86,250 7,63,56,520 Ms. Anju Gupta 2005-06 Purchase 1,16,46,520 19,10,000 19,10,000 Ms. Anju Gupta 2006-07 Purchase 3,40,81,932 48,92,000 48,92,000 4,17,36,271 Ms. Anju Gupta 2006-07 Sale 76,54,339 1,12,54,339 1,12,54,339 Ms. Anju Gupta 2010-11 Purchase 11,49,14,970 66,00,000 45,50,500 11,49,14,970 Ms. Anju Gupta 2010-11 Sale 60,00,000 58,88,624 Ms. Anju Gupta 2011-12 Sale 4,61,67,000 75,00,000 48,50,500 4,61,67,000 Smt. Usha Gupta 2006-07 Purchase 14,09,72,818 1,83,50,000 1,83,50,000 14,09,72,818 M/s. Satya Realtors Pvt. Ltd. 2011-12 Purchase 7,87,79,900 75,00,000 75,00,000 7,87,79,900 6. Aggrieved by the assessment orders, the assessee filed appeal before ld. CIT(A) challenging the additions which have been deleted by CIT(A). As against the deletion of the additions, the Revenue is in appeal before us in above appeals. The Assessees herein have also filed the Cross obj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her's Group must have indulged in on-money transactions in respect of every property purchased or sold by them during the relevant period. b) The market values of the properties in Delhi were much higher than the value determined as per prescribed circle rates. c) There is a guaranteed return of 15% in investments in properties. d) The average rate of inflation in India was 8% during the relevant period. e) The market value of the property can be arrived at by taking the value as per circle rate as on 01.01.2012 as base and reducing 15% from the same every year. 8.2 Regarding validity of the assumptions, the ld. A.R. submitted that the ld. CIT(A) held in para No.4.3.1 to 4.3.11 at page No.43-53 and para No.5.2.2 - 5.2.8 at page Nos.66 - 70 of his order that: a) AO has not considered that the properties purchased or sold by one member of the M/s. Satya Prakash & Brother's Group could be completely different in its location, size, shape, quality of title, nature of ownership (lease hold or freehold), neighborhood, proximity to various amenities, etc. One can go on listing the various factors that could affect the value of any immovable property. Therefore, there ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of Hon'ble High Court of Delhi in the case of CIT vs. Dinesh Jain HUF (2013) 352 ITR 629, CIT(A) held that the AO cannot take judicial notice of certain information available in the property websites or in the so called reports without there being any specific and positive evidence of cash transaction in the property under reference. Thus, various assumptions made by the AO do not find support of the law. 8.3. With regard to Calculation of FMV without Rejection of books of accounts, the ld. A.R. submitted that the ld. CIT(A) has held that :- a) The A.O. has not rejected the books of account before resorting to estimate the fair market value. b) AO cannot resort to the valuation of fair market value of an immovable property unless he rejects the books of accounts. The CIT (A) has placed reliance upon various judgments i.e., Asst. CIT vs. Dhariya Construction co. (2010) 236 CTR (SC) 226, ITO vs. Arasen Subiah (2009) 20 DTR (Mad) 113, CIT vs. Partap Singh Amro Rajinder Singh (1993) 200 ITR 788 (Raj.), CIT vs. and Bajrang Ram Bansal (2011) 335 ITR 572. c) The Hon'ble Court in the said case of CIT vs. Bajrang Ran Bansal (Supra) has also quoted the decision of Hon&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been established beyond doubt. In such circumstances, the seized material cannot be used against the assessee. d) CIT(A) has referred to the decision of Hon'ble Delhi High Court in the case of CIT v. Lachman Das Bhatia (ITA No. 1731, 1733, 1734/2010), wherein the Hon'ble jurisdictional High Court of Delhi laid down that the search on the assessee did not yield any incriminating material on the basis of which it can be said that the assessee was indulging in under-invoicing or suppression of sales. The documents on which the Assessing Officer has placed reliance, were seized from a different person and not from the assessee and that no nexus between that person and the assessee has been established beyond doubt. Further, the documents upon which the Assessing Officer placed reliance relate to a subsequent period and not to the year under consideration. In such circumstances, it has been held that the seized material cannot be used against the assessee. 8.6. The ld. A.R. submitted that no power bestowed by legislature upon AO to calculate FMV without finding any direct positive evidence of understatement of consideration by assessee, and Sec. 69B of the Act and Sec. 45 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f understatement of amount; rather it requires AO to exactly point out the precise amount paid or received. AO is not only required to prove understatement of purchase price, but also to show precise extent of the understatement. There is no authority given by the section to adopt some reasonable yardstick to measure the extent of understatement. f) In the absence of any direct evidence to the effect that the price settled between the parties is anything other than the agreed consideration as appearing on the sale documents or any other instrument, "full value of consideration" or "cost of investment" cannot be substituted by the fair market value, except in the case falling within the purview of Sec. 50C and Sec. 56(l)(vi)/(vii), which lays down the statutory fiction that the circle rate of property shall be substituted for the recorded transaction if the former is found to be more than the latter; however, in this case, the consideration as per registered conveyance deeds is invariably higher than valuation as per circle rate. AO has not brought on record any evidence which would allow him to substitute the recorded consideration by any other figure as permitted under the law, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the circle rate notified by the Government. 8.8. The ld. A.R. submitted that complete assessment cannot be disturbed without any nexus with seized material: a) The CIT(A) relied upon the decision of the Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla (2015] 61 Taxmann 412 (Delhi) dated 28.08.2015, in which Hon'ble Court held that completed assessment can be interfered with by the Assessing officer while making the assessment under section 153A only on the basis of incriminating material pertaining to the person searched upon unearthed during the course of search or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment. b) CIT(A) held that there is no incriminating documents relating to the impugned Assessees which has been unearthed by the department during the search and seizure action. c) Pertinently, the above order in the case of Kabul Chawla (supra) has been affirmed by Hon'ble Supreme Court in PCIT v. Abhisar Buildwell Pvt. Ltd. (Civil Appeal No. 6580 of 2021). 8.9. Finally, the ld. A.R. submitted that the ld. CIT(A) held that it is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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