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TMI Blog2014 (12) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... rs is for and on behalf of the VEPL – the land was purchased and sold by the assessee and two other co-owners for and on behalf of VEPL - Therefore, the income was not liable to be assessed in the hands of the assessee – thus, the order of the CIT(A) is upheld – Decided against revenue. - ITA No. 1166/PN/2012 - - - Dated:- 25-7-2014 - Shri G. S. Pannu And Shri R. S. Padvekar,JJ. For the Petitioner : Mrs. S. Pr aveena For the Respondent : Mr. V. L. Jain ORDER Per G. S. Pannu, AM The captioned appeal by the Revenue is directed against an order of the Commissioner of Income Tax (Appeals)-I, Thane dated 28.02.2012 which, in turn, has arisen from an order dated 24.12.2010 passed by the Assessing Officer u/s 143(3) r.w.s. 147 of the Income-tax Act, 1961 (in short the Act ) pertaining to the assessment year 2004-05. 2. In this appeal, the Revenue has raised the following Grounds of Appeal :- 1. On the facts and circumstances of the case, the CIT(A) has erred in holding that the income arisen from sale of land in question is not assessable in the hands of the assessee without appreciating the fact that the land in question in respect of which income ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Survey No.21/1B 23/1B Deolali, District- Nashik from Dhirajlal Chimanlal Shah others and Shishir Govardhandas Shah others for a total consideration of ₹ 18,00,000/-. On 21.08.2000, VEPL entered into a MOU with assessee and two others, namely S/Shri Sampurnanad Keshav Gavande and Shri Bharat V. Shah whereby assessee and the other two persons were to develop the property for consideration payable to VEPL and in terms of the said MOU, the final conveyance deed of the said property was to be directly made in the names of assessee and the other two persons, namely, S/Shri Sampurnanad Keshav Gavande and Shri Bharat V. Shah. On 16.09.2000 by way of a sale-deed one group of the original owners, i.e. Shishir Govardhandas Shah others executed the sale deed of a part of the property in the names of assessee and S/Shri Sampurnanad Keshav Gavande. On 16.12.2000, the second set of original owners, i.e. Dhirajlal Chimanlal Shah others executed the sale deed of the remaining portion of the property in the name of assessee and two others, namely, S/Shri Sampurnanad Keshav Gavande and Shri Bharat V. Shah. On 02.02.2002, the MOU dated 21.08.2000 entered by assessee and two others with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee. 10. We have carefully considered the rival submissions. The crux of the dispute is as to whether the income arising as a result of the Development Agreement dated 30.12.2003 executed by assessee and two others with Shri Rajesh Patharkar is liable to be assessed in the hands of the assessee or not. The case setup by the assessee is that the said transaction does not belong to him. In this context, we find that the CIT(A) in the course of appellate proceedings before him called for a remand report from the Assessing Officer. In terms of his communication, the CIT(A) required the Assessing Officer to verify from the records/documents as to whether (i) payments for purchase of land are made by VEPL; (ii) sale proceeds are received by VEPL; (iii) income is disclosed by VEPL; and, (iv) all the transactions are recorded in the books of account of VEPL. The CIT(A) categorically records that vide a report dated 18.01.2012, the Assessing Officer reported that the land in question was purchased by M/s VEPL and the payment was also made by them . Thereafter, the CIT(A) perused other documentary evidences furnished by the assessee, such as, Bank Statement, Ledger Account, Audited Balanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 38.71 crores recorded in the Books of account and Balance Sheet as on 31.03.2006 of M/s. Viraj Estate Pvt. Ltd. Therefore, it is clearly established by the appellant with the help of documentary evidences that the purchase of land by the appellant and two other co-owners was made for and on behalf of M/s. Viraj Estate Pvt. Ltd. 4.2 Now, coming to the sale of the said land vide a Development Agreement dt. 31.12.2003, it is noticed that the appellant and two other coowners have agreed to transfer the development rights in the said land to Shri. Rajesh Arun Patharkar for consideration of ₹ 38,00,000/-. The Earnest Money of ₹ 3,51,000/- by cheques has been received and balance amount was to be received later on. The receipt of Earnest Money at ₹ 3,51,000/- is also duly reflected in the books of account of M/s. Viraj Estate Pvt. Ltd. Final sale deed has been executed by Rajesh Arun Patharkar and Ors. to Shrine of Infant Jesus Trust on 19/01/2007 and M/s. Viraj Estate Pvt. Ltd. got its balance consideration of ₹ 30,00,000/- on 14.02.2007 from Shri. Rajesh A. Patharkar. This amount is found credited in the bank account of M/s. Viraj Estate Pvt. Ltd. with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at assessee and two other co-owners were nominees of VEPL and VEPL had signed the deeds as a confirming party. Apart therefrom, it is also asserted by the CIT(A) that in the Balance-Sheet of VEPL, the transaction in question has been reflected as advances against purchase of land. On the basis of the said documentary evidence, the CIT(A) has concluded that purchase of land by the assessee and two other co-owners is for and on behalf of the VEPL. We hereby affirm the findings of the CIT(A) as nothing to the contrary has been lead before us by the Revenue. 13. In the same manner, the CIT(A) also examined the impugned Development Agreement dated 30.12.2003 and noticed that consideration thereon has been credited in the books of account of VEPL. The CIT(A) also records that the profits on sale of such land have also been credited in the Profit Loss Account of VEPL, as a part of business profit. 14. In the face of the aforesaid factual appreciation of the matter, the CIT(A) reached an inescapable conclusion that the land in question was indeed purchased and sold by the assessee and two other co-owners for and on behalf of VEPL. Therefore, the income thereof was not liable to be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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