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TMI Blog2014 (8) TMI 156X X X X Extracts X X X X X X X X Extracts X X X X ..... ot actually been paid but is to be paid subsequently – there was no reason to make the addition by invoking section 69C of Act – Decided in favour of Assessee. - ITA Nos. 4187 & 4188/Mum/2010 - - - Dated:- 23-7-2014 - D. Karunakar Rao And Dr. S. T. M. Pavalan,JJ. For the Petitioner : Shri Vijay Mehta For the Respondent : Smt. S. Padmaja ORDER Per Dr. STM Pavalan, JM: These appeals filed by the Assessee are directed against the orders of the Ld.CIT(A)-41, Mumbai both dated 29.03.2010 for the Assessment Years 2005-06 and 2007-08 respectively. Both the appeal are heard together and disposed off by this common order. 2. In the appeal for the assessment year 2005-06, the assessee has agitated the decision of the Ld.CIT(A) confirming the addition of ₹ 20,00,000/- on substantive basis holding that the assessee had made unaccounted payment of ₹ 20,00,000/- for Boricha Land at the time of entry into deed of assignment on 18.03.2005. 2.1 The relevant facts are that the AO, in his assessment order had observed that the assessee has filed its return of income on 30.10.2007 declaring a total income of ₹ 22,64,000/-. A search and seizure oper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 377; 51 lakhs and the deed of assignment as well as transfer deed entered subsequently entered was only for the same amount. But in the seized papers, the value of land of ₹ 51 lakh and also the subsequent expenditure estimated at ₹ 20 lakh had been shown in the estimated cost of the boricha land. Accordingly, it was the contention of the assessee that ₹ 51+20 appearing in the seized papers denotes the budgeted outflow on account of Boricha land in the form of estimates and the assessee continued to do so up to the end of the project and the said budget estimates continued to be part of the budgeted figures for all comparative statements that were forwarded to all the estate holders/co-venture of the company. However, the said contention was not accepted by the AO and the AO held that the seized papers show the budgeted as well as the actual amount spent in relation to the project. Accordingly, the AO added the amount of ₹ 20 lakhs as un disclosed investment in the land by invoking section 69 of the Act. The AO made the impugned addition on protective basis during the year under consideration and the same on substantive basis for the year 2006-07. On appeal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard, the assessee company has given submission that ₹ 386 lakhs are estimates of payments that would have to be made to Yawalkar on account of the above project. However, the agreement has been subsequently finalized for only 376 lakhs. Here, the AO has not disputed that a figure of 386 has been written but the agreement is only for only 376 lakhs, so that the difference must be on account of unaccounted investment. The AO has accepted the assessee company s contention that the figure merely represented a rough estimate. Thirdly, Page no. 79 of the seized paper dated 16.05.2006 shows the budgeted as well as the actual amount spent in relation to the Tulsiwadi project. In terms of date, this is the latest paper in relation to all the other seized papers. This paper also clearly indicates that the amount of 71 is shown under the head Budgeted . Further, as against the budgeted amount, only an amount of ₹ 5 lacs is shown as paid . Thus if the seized paper itself shown an amount of ₹ 5,00,000/- paid, then the inference which is drawn by the AO regarding the payment of ₹ 20,00,000 is totally incorrect. If the AO accepts one part of the seized paper as true, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yments as shown on seized paper 82 with the books of account as on 30.04.2006. While reconciling the amounts, a difference of ₹ 51 lakhs has been found under the head construction expenses. The seized papers have shown an amount of 431 lakhs, while the books of accounts showed only 380 lakhs. Thus, the AO added the difference of ₹ 51 lakhs as unexplained expenditure u/s 69C on the reasoning that the amount is actually paid and the same has been confirmed by the Ld.CIT(A). In this connection, it is pertinent to mention that the Tulsiwadi project is a rehabilitation project, which has three principal stake holders, namely, (i) DLF Group which is the financial co-venturer, (ii) Shapoorji Palloonji group which is the original co-developer (iii) Co-venturer of the project, and Akruti Group which is the working co-venturer and in the course of construction of its above project at Tulsiwadi keeps requiring funds from the stake holders. The assessee company incurs the expenses through its own resources or thorough its operating co-venturer, M/s. Akruit Nirman Ltd. which are then refunded by its financial partner as per the understanding between the co-venturers. Considering t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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