2018 (6) TMI 1110 - AT - Income Tax

Addition as profit from sale of flats in a housing projects - Held that - There is categorical finding of the learned Commissioner (Appeals) that occupation certificates have not only been issued by the local authorities in respect of the flats on 20th June 2008, but the flat owners and housing society have also stated in response to the notices issued under section 133(6) of the Act that no advance relating to them is pending with the assessee. It has also been noticed by the Departmental Authorities that the assessee has entered into registered sale agreement with the flat buyers between in the years 2002 and 2007. The assessee has neither appeared before us nor has furnished any documentary evidence to controvert the factual findings of the Departmental Authorities. In view of the above, we do not find any infirmity in the order of the learned Commissioner (Appeals) in sustaining the addition Inclusion of certain loans and advances in the addition made by the Assessing Officer on account of profits from sale of flats - Held that - On a perusal of the impugned order of the learned Commissioner (Appeals) it is seen that the aforesaid claim of the assessee was duly verified not only by him but also by the Assessing Officer in remand and it was found that such amount represents sale consideration of flats, hence, part of the profit earned by the assessee. Of course, as regards assessee s claim that a part of the amount was offered as income in assessment year 2013 14, the learned Commissioner (Appeals) has observed that the assessee may make a suitable claim before the Assessing Officer for assessment year 2013 14 and which would be dealt with by the Assessing Officer in accordance with the provisions of law. No infirmity in the aforesaid findings / observations of the learned Commissioner (Appeals) - assessee appeal dismissed.

Summary

Issues:
1. Ex-parte disposal of appeal due to non-appearance of the assessee.
2. Addition of profit from the sale of flats in a housing project.
3. Inclusion of loans and advances in the profit from the sale of flats.

Ex-parte Disposal of Appeal:
The appeal was disposed of ex-parte as the assessee failed to appear despite notice and no application for adjournment was made. The history of seeking adjournments or absence indicated lack of diligence. The Tribunal proceeded to hear the Departmental Representative and based its decision on the material on record.

Addition of Profit from Sale of Flats:
The dispute revolved around the addition of ?2,63,05,675 as profit from the sale of flats in a housing project. The Assessing Officer found discrepancies in the details provided by the assessee regarding sales of flats. Upon investigation, it was revealed that the buildings were completed, flats were sold, and advances received were treated as sale consideration. The Commissioner (Appeals) upheld the addition based on evidence from the housing society and flat purchasers.

Inclusion of Loans and Advances in Profit:
The assessee contested the inclusion of loans and advances in the profit from the sale of flats. The Tribunal noted that the amounts in question were verified by the Commissioner (Appeals) and the Assessing Officer, confirming them as part of the profit earned. The claim regarding a loan offered as income in a subsequent assessment year was advised to be addressed separately.

The Tribunal dismissed the appeal, upholding the decisions regarding the profit from the sale of flats and the treatment of loans and advances. The order was pronounced on 20.06.2018.