2013 (2) TMI 894 - HC - Income Tax

Summary

Issues involved:
The issues involved in the judgment are:
1. Whether the Appellate Tribunal was right in confirming the deletion of addition of Rs. 1,42,00,000/- u/s 260A of the Income-tax Act, 1961, on account of unexplained investment in purchase of land?
2. Whether the Appellate Tribunal was right in confirming the deletion of the addition of Rs. 36,52,656/- made by the Assessing Officer being unaccounted profit on sale of the land, without considering the provisions of Section 53A of the Transfer of Property Act?

Issue 1:
The first question pertains to the deletion of addition of Rs. 1,42,00,000/-. A search conducted at the premises revealed an agreement to sale for the purchase of land. The Assessing Officer added the amount towards unexplained investment. The CIT(A) partly allowed the appeal challenging this order. The Tribunal confirmed the findings that the payment made by the assessee-respondent was from the sale consideration received from M/s. Trimurti Associates. The Tribunal concluded that the assessee had successfully established the nexus between the amounts received and the payments made for land purchase. The Tribunal found no reason to interfere with the factual findings of the CIT(A) and thus deleted the addition. The Tribunal's decision was based on material evidence presented, confirming the connection between the sale and purchase transactions.

Issue 2:
Regarding the second question, concerning the deletion of Rs. 36,52,656/- made by the Assessing Officer as unaccounted profit on the sale of land, the Tribunal noted that the possession of the land was handed over after a civil suit was filed and later compromised. The compromise indicated that the land was transferred only after the settlement. As no transfer took place during the block period, the profit was not taxable. The Tribunal upheld the CIT(A)'s decision, stating that the profit was declared in the assessment year 2003-2004, in line with the legal provisions. The Tribunal dismissed the Revenue's grounds, emphasizing that the profit was rightly deleted as there was no transfer within the meaning of the law. The decision was based on the available material and interpretation in accordance with the law.

In conclusion, the Tax Appeal was dismissed as the Tribunal found no further consideration necessary based on the discussions and findings presented in the judgment.