TMI Blog2024 (2) TMI 926X X X X Extracts X X X X X X X X Extracts X X X X ..... ss the method adopted in manufacturing activities. Therefore the claim of the assessee that net profit is to be adopted in the land development transactions, wherein on-money was received by the assessee is legally not tenable. Assessee failed to disclose the proper details of expenses, development charges, etc. before the lower authorities even in the second round also. Therefore the claim made by the assessee to adopt net profit method on the on-money received by it, in real estate transaction is hereby rejected and the case laws relied before us are clearly distinguishable, which are not relating to development of plots. Decided against assessee. - SMT. ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SHRI T.R. SENTHIL KUMAR, JUDICIAL MEMBER For the Appellant : Shri Vijay H. Patel, A.R. For the Respondent : Shri Sudhendu Das, CIT-DR ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:- These appeals are filed by the Assessee and the Revenue as against the different appellate orders dated 22-04-2019, 03-06- 2019 and 27-08-2019 passed by the Commissioner of Income Tax (Appeals)-11, Ahmedabad arising out of the respective assessment orders passed under secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... firms of the group and thereby he declared this as the unaccounted income of the entire Shreem Group. 2.2. Thereafter another statement was recorded on 12-08-2013 vide answer to question no. 19, the Director submitted that the cash receipts admitted by him of Rs. 16.42 crores as follows: (a) Cash receipts from Anand Dreams Project Rs. 1.42 crores (b) Sale of Plot No. 76 77 at Anand Dreams Rs. 20.40 lakhs (c) Cash received from booking of Plot No. 6 of Anand Aksha Schemes. There were no retraction statement by the Director to the above statements recorded by the department. 2.3. During the assessment proceedings, the assessee failed to appear in spite of notices and failed to substantiate the correct details before the Assessing Officer. Therefore the claim of the assessee that the disclosure of Rs. 16.42 crores which includes the total income of the group was not accepted by the Ld. A.O. Since each individual and group concern had made disclosure on the basis of evidences found in their respective cases. Secondly, the evidence found shows the details of income and the evidences found in respect of group concerns also shows details of receipt of income. Hence, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... furnish necessary details and substantiate its claim before the Assessing Officer. 5. During the set aside proceedings, the assessee was given opportunity to explain the case by the A.O. After perusing the assessee s reply, the Ld. A.O. held as follows: 5.1 I have perused and verified the assessment orders of the group concerns and the members of the Shreem Group given in the disclosure chart offered by the assessee subsequent to the search. The associate concerns of Shreem Group have shown the income as admitted however those income offered by them are based on independent evidences like cash and jewellery seized and seized documents showing various unaccounted transactions. Further, the assessee has not correlated the source of income generated in its case to the application of income in the other group concerns and individuals of this group. From the group disclosure chart it is seen that there has been a disclosure in the hands of Shreem Developers for F.Y. 10-11 and 11-12 but as per the disclosure the generation of income in the hands of Shreem Soil Development P. Ltd. starts from F.Y. 12-13 onwards. So if assessee's claim of generation of Rs. 16.42 crores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osition to comment upon assessee's fresh stand taken vide its submission dated 26.12.2018 as discussed above. 5.4 The addition of Rs. 16.42 crores for A.Y. 13-14 vide order dated. 29.03.2016 u/s 143(3) R.W.S. 153A is based on the incriminating evidence discussed in the said assessment order. As this addition is distinct from the disclosure amount offered for the year, no interference in respect of the earlier addition requires to be made. 5.5 Furthermore it is seen that the assessee has neither filed the return of income for AY. 13-14 and A.Y. 14-15 nor paid the taxes in respect of the disclosure of Rs. 1.4 crores and 2.4 crores offered for both the assessment years. Even otherwise, as the assessee has failed to pay even the taxes in respect of the disclosure amount, there is no question of application thereof Subject to the discussion above and the specific directions of the Tribunal vide order dated. 20.12.2017 the total assessed income remains the same as assessed vide order u/s 143(3) r.w.s. 153A dated 29.03.2016 at Rs. 16,42,51,000/-. 6. Total assessed income as per above discussion is Rs. 16,42,51,000/- .Penalty Proceedings u/s. 271AAB has been initiat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of income filed for these years:- Sr. No. A.Y. Amount disclosed (Rs.) Amount returned in the return filed i) 2010-11 72,00,000 1,19,88,517 (including disclosure of Rs. 72 lakhs) ii) 2011-12 1,62,00,000 1,87,81,881 )including disclosure of Rs. 1.62 crore) iii) 2012-13 18,00,000 33,73,600 (including disclosure of Rs. 18 lakh) iv) 2013-14 2,58,00,000 2,68,97,300 (including disclosure of Rs. 2.58 crore) V) 2014-15 4,02,07,400 3,77,47,600 {AO made additions of Rs. 29,55,600/- to determine Income of Rs. 4,02,07,400 Total 9,12,07,400 9,87,88,898 The above chart shows that the appellant has returned income of Rs. 9,87,88,898/- against the disclosure of Rs. 9,12,07,400/- in all these years in the name of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosure of on-money of Rs. 1,40,00,000/- in place of profit @ 8% embedded therein. The Assessing Officer may please be directed to adopt 8% profit of the on-money in place of full amount of On-Money received. 3. The appellant Company craves leave to add, alter, amend any ground/s of an appeal on or before hearing of the appeal. 8. Ld. Counsel Shri Vijay H. Patel appearing for the assessee in support of its grounds submitted that the entire on-money is taxed by the Ld. Assessing Officer whereas the profit element at 8% embedded therein is only taxable in the hands of the assessee and relied upon following case laws: (i) CIT vs. Balchand Ajit Kumar reported in 263 ITR 610 (MP) (ii) CIT vs. Samir Synthetics Mill (Guj.) reported in LAWS(GJH)- 2008-1-225 (iii) DCIT vs. Panna Corporation in Tax Appeal No. 323 of 2000 vide judgment dated 16.06.2012 (Guj.) (iv) CIT vs. Abhishek Corporation LAWS(GJH)-2014-11-28 (Guj.) (v) Sampada Homes Vs. ACIT in ITA No. 95 to 97/Hyd/2018 dated 07.09.2018 (ITAT Hyderabad) (vi) Sri Sri Estates vs. ACIT in ITA No. 2242/Hyd/2017 and Ors. dated 25.07.2018 10. Per contra Ld. CIT-DR Shri Sudhendu Das appearing for the Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore the lower authorities even in the second round also. Therefore the claim made by the assessee to adopt net profit method on the on-money received by it, in real estate transaction is hereby rejected and the case laws relied before us are clearly distinguishable, which are not relating to development of plots. 12. In the result, the appeal filed by the Assessee is hereby dismissed. IT(SS)A Nos. 345, 397 ITA No. 1557/Ahd/2019 (Assessee s Appeals for A.Y. 2011-12, 2012-13 2014-15) 13. The only effective ground is to adopt net profit of 8% on the on- money received by the assessee for the above Assessment Years 2011-12, 2012-13 and 2014-15. For the detailed reasons adduced in Paragraph No. 11 of this order in IT(SS)A No. 489/Ahd/2019 relating to the Assessment Year 2013-14 is squarely applicable to the facts of the above three appeals. Respectfully following the same, the appeals filed by the assessee are devoid of merits. Therefore the same are hereby dismissed. IT(SS)A No. 512/Ahd/2019 (Revenue Appeal for A.Y. 2013-14) 14. The Grounds of Appeal raised by the Revenue reads as under: Grounds of appeal: 1. Whether on the facts and circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,667/- seized during the course of search. 5. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in not appreciating the fact that the assessee suo-moto offered a disclosure chart apportioning this disclosure amount against its various concerns wherein there were separate cash and Jewellery seizures and accounted income and the same have been considered in their respective assessments. 6. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) ought to have upheld the order of the A.O. 7. It is, therefore, prayed that the order of the Ld. CIT(A) be set aside and that of the A.O. be restored to the above extent. 15. From the reading of above Grounds of Appeal, we do not find any infirmity in the order passed by the Ld. CIT(A) which is already extracted in Paragraph No. 6 of this order. Further the Ld. CIT-DR could not place on record to make the entire addition of Rs. 16.42 crores as the income of the assessee and also could not sight any error in the findings of the Ld. CIT(A). Therefore the Grounds of Appeal raised by the Revenue are devoid of merits and the same are liable to be dismissed. 16. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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