9911796707
TMI Blog2023 (8) TMI 1525X X X X Extracts X X X X X X X X Extracts X X X X ..... venue has raised following grounds of appeal: "1. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has erred in restricting the addition of Rs. 2,22,48,040/- made by the Assessing Officer under Sec. 69 of the Act to brokerage income of Rs. 4,44,961/- being 2% of Rs. 2,22,48,040/-. 2. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has erred in not appreciating the findings made by the Assessing Officer in the assessment order after analysis of the contents of the Satakhat and circumstantial evidences in the form of Bank Account and Balance Sheet which clearly proved the unaccounted investments made by the assessee for the purchase of properties in question. 3. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has erred in directing the AO to estimate 2% brokerage on the transactions of Rs. 2,22,48,040/- even though there are sufficient evidences to substantiate the unaccounted investment made by the assessee. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in directing the AO to restrict addition @ 2% as brokerage on the transaction of Rs. 2,22,48,040/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the date of Satakat. The assessee in the show cause notice was asked to file copy of all agreements with regard to purchase of land at R.S. No. 221 and 321 of area admeasuring 1416 and 708 square meter with details of payment, name and amount. If any sale deed was registered /transferred/notarized in assessees name, if so details with evidence or the deed was cancelled, if cancelled, filed cancellation deed, terms and conditions of cancellation, details of receipt back of money, full address of seller and broker. The Assessing Officer recorded that the assessee was asked to file reply on or before 04/03/2015 and to explain as to why Rs. 2.24 crores should not be treated as unexplained investment as per copy of impounded satakat. Copy of seized Satakat was enclosed with the show cause notice. 3. The Assessing Officer recorded that the assessee filed his reply on 13/03/2015. The contents of reply of assessee is recorded in sub-para (E) of para 4.1 of assessment order. In the reply, the assessee stated that the assessee has already given detailed explanation with evidence in his submission dated 20/08/2014 and once again request to consider such fact in proper perspective. The asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsaction of land of land with assessee or his brother or his family members. The advance payment made by assessee is to the original land owner are still recoverable from them. Due to dispute amongst the owners, they have not yet repaid the advance amount. 4. The reply of assessee was not accepted by Assessing Officer, the Assessing Officer recorded that the impounded Satakat dated 28/02/2007 is executed by Piyush R Patel as purchaser and Maganbhai Gandabhai, Chimanbhai Gandabhai and six other family members for sale of land at R.S./Block No. 321 having area of 1416 square meter and R.S./Block No. 221 having area of 708 square meter both situated in village Gaviyar. The assessee has made payment of Rs. 5.00 lacs to various sellers on the basis of which and the facts gathered and the circumstances clearly proved that the assessee and Vimal Patel has entered into transaction with seller party with Gandabhai & Company. The Assessing Officer recorded that the assessee has merely denied the transaction and not appreciated the factual evidence. The Assessing officer recorded that a general practice of land dealing in Surat and noted that investor invests small amount in cheque and huge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premises and concluded on 29/12/2012. During search, various documents/material, statement/ statement of accounts was seized. The statement of assessee was also recorded. In post search verification, his statement was recorded. He always complied on summons and directions and gave cogent and authentic evidence in the compliance to various queries raised by Assessing Officer. No discrepancies were pointed out and no defect was shown the assessee in his books of account and record perused before him. The Assessing Officer made addition of Rs. 2.22 crores on account of alleged unexplained investment under Section 69 on the basis of certain paper from the premises of Advocate Shri Tarnish B Kania. No corroborative evidence was seized from the residence of assessee. The papers which was considered as Satakat was found from the third party. The assessee specifically against the addition of Rs. 2.22 crores submitted that the said addition was made on account of alleged unexplained investment for the purchase of agricultural land at R.S. No. 221 and 321, Mauza-Gaviyar, District-Surat. The assessee explained that in the post search action in his office and residential premises, no incrimina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s paid through account payee cheque in the alleged Satakhat. There is no reference of total payment in cash as well on 28/02/2007, thus all the circumstantial inference drawn by Assessing Officer is totally baseless, imaginary and unwarranted. The assessee also explained that in the registered sale deed of land by real owner, there is no reference/clause that the assessee or his family member acted as a confirming party. On the basis of such written submission, the assessee prayed for deleting the entire addition. The assessee also relied on certain case laws. To support the contention that such document cannot be used as evidence, relied upon the decision of Hon'ble Supreme Court in Common Cause (Registered Society) and Others Vs Union of India and others in Writ Petition (civil) No. 505 of 2015 and V.C. Shukla 1998 (3) SCC 410 and Ahmedabad Tribunal in ITA No. 1502/Ahd/2015 dated 14/02/2017. 6. The ld. CIT(A) after considering the submission of assessee and the contents of assessment order, recorded that it is not in dispute that the assessee and his brother intending to purchase the impugned land from Maganbhai Patel family. The said land belongs to eight co-owners. There was d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee as purchaser containing complete details of sellers and the assessee and his brother. The impugned satakat contains the complete details of the property under transaction and the details of the advance payment made by assessee by way of cheques to the owners. The ld CIT-DR for the revenue submits that there is practice in the Surat by land dealers first to enter in to agreement with owner and to make some advance and after finding suitable purchaser to sale to land directly to the subsequent purchaser. The seized documents were duly corroborated by the facts that the assessee has made advance payment which is not disputed by the assessee in his statement, which is clear and clinching evidence for making additions. The ld CIT(A) converted the into a commissions income without any basis of submissions of the assessee in this regards. The ld CIT-DR for the revenue prayed for reversal of the finding of the ld CIT(A) and to restore the order of assessing officer. 8. On the other hand, the ld. AR for the assessee supported the order of ld. CIT(A). The ld. AR for the assessee submits that he is individual, engaged in the business of real estate and regularly assessed to tax from so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confirmation of the original land owners namely Tejal Kumar M Patel and other co-owners, copy of land record and copy of statement of Tanish Kania and Mrs Tanish Kania. The ld. AR for the assessee finally submits that no addition can be made in absence of independent material. To support such contention, the ld. Sr. Counsel for the assessee also relied upon the following decisions: (i) Common Cause Vs Union of India (2017) taxamann.com 245 (SC), (ii) CBI Vs V. C. Shukla & others (1998) 1998 taxmann.com 2155(SC), (iii) PCIT Vs Devangi (2017) 88taxmann.com 610(Guj), (iv) CIT Vs Sant Lal (2020) 118 taxmann.com 423 (Delhi), (v) Alpesh Babu Bhai Patel Vs ITO ITA No. 2078/Ahd/2016, (vi) Amit Bhai Manubhai Kachadia Vs DCIT (2019) 105 taxmann.com 341(Surat-Trib) and (vi) PCIT Vs Delhi International Airport (P) Ltd 443 ITR 382(Knt) 10. We have considered the rival submissions of both the parties and with their active assistance has gone through the orders of lower authorities carefully. We have also deliberated on various case laws relied by ld. AR for the assessee. We find that the revenue has raised multiple grounds of appeal. However, the substantial grounds of appeal rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Tanish B Kania, Advocate. During the search at the residence of assessee, no evidence was found regarding purchase of land by assessee. The ld. CIT(A) recorded that the assessee has given advance for purchase of said land/plots. The ld. CIT(A) on the basis of such circumstances, noted that once the assessee has given advance, getting commission on such land cannot be ruled out, thus the addition if any can be restricted to the brokerage transaction and not to the transaction of sale and purchase of land. The ld. CIT(A) held that Satakhat relied and referred by Assessing Officer was never executed as seen from the seized material. There is no other evidence relating to the transaction, found during the course of search either at the premises of assessee or from Mr. Tarnish B Kania. On the basis of such observation, the ld. CIT(A) held that the transaction of investment in the lands is not proved. However, on the same time, the circumstances suggest that the assessee has taken brokerage. On such observation, the ld. CIT(A) estimated 2% of brokerage on the transaction of Rs. 2.22 crores, accordingly restricted the addition to the extent of Rs. 4,44,961/- thereby granted substantial ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
