9911796707
TMI Blog2015 (3) TMI 362X X X X Extracts X X X X X X X X Extracts X X X X ..... ring copy of MOU obtained from the Assessing Officer, Mumbai. The law is also well settled that whatever an inference is drawn while deciding rights or liabilities of any person, it should be based on some evidence and not merely on presumptions and doubts. So far as M/s. Aanchal Properties Pvt. Ltd. is concerned the only reservation of the Assessing Officer is that the said company was not impleaded as a consenting party. In our opinion as the said company has not made any changes in the Revenue record after entering into agreement with the farmers, there was no necessity to implead said company as a consenting party. Same way so far as M/s. New Planet Trading Co. Pvt. Ltd. is concerned also there was no change in the Revenue record and hence there was no necessity to implead said company as a consenting party. We, accordingly, hold that in the case of M/s. Aanchal Properties Pvt. Ltd. the amount of compensation paid by the assessee to the said company is allowable expenditure in respect of M/s. New Planet Trading Co. Pvt. Ltd., we hold that so far as both the authorities below have not at all referred the documents to any expert for finding out whether any tampering is done by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee cannot be said to be contingent in nature as it is as per agreed terms of contract between the assessee and the farmers. At the same time we concur with the finding of the Ld. CIT(A) that the provision is excessive and no details are filed. We do not consider to interfere in the relief given by the Ld. CIT(A) by holding that the reasonable provision is to the extent of ₹ 90 Lakhs. In respect of addition sustained by the Ld. CIT(A) of ₹ 90 Lakhs, we consider it fit to remit this issue to the file of the Assessing Officer to decide whether the balance additional compensation of ₹ 90 Lakhs provided by the assessee is excessive - Decided in favour of assessee for statistical purposes. Development expenses disallowed - Held that:- We have to examine any claim of expenditure in the back drop of the commercial expediency. In this case the assessee is engaged in the aggregation of land and she has to deal with the many farmers and local villagers. It is not uncommon that even a single villager or farmers can create trouble for aggregation of land. The assessee has also produced the photographs in the Compilation. It is also notice that the assessee made t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rch 2008, 31st March 2009 31st March 2010, to that party through banking channel and that party had accepted the total amount as claimed by the appellant and this itself indicates that the claim of the appellant was genuine. e. Had the appellant agreed with new planet for ₹ 3,20,665/- per acre, the total consideration paid during Financial Year Ending 31st March 2008, 31st March 2009 31st March 2010, by the appellant was much more than the consideration for 84.20 acres of land arrived at ₹ 3,20,665/- per acre and which aspect itself proves that the claim of New Planet was wrong. f. If the consideration payable to Aanchal Properties Pvt. Ltd. (Aanchal) for surrendering their rights in the adjoining land was accepted and allowed in appeal @ ₹ 5.50 lakhs per acre, there was no reason to doubt the genuineness of the claim of the appellant as regards New Planet. 2] The learned CIT(A) erred in confirming the disallowance of ₹ 90 lakhs out of the additional consideration of ₹ 1.80 Crs. payable to the farmers for the lands acquired from them and claimed as a deduction in this year. 2.1] The learned CIT(A) failed to appreciate that - a. The c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and land owners directly negotiate deal with the assessee but final sale deed is made with original owners or farmers of the land. The assessee after notifying the area indulged into the land aggregation and after successful aggregation of land, it is stated that the assessee enters into an agreement with some corporate groups or big builders to sale the land. The assessee entered into an MOU with various farmers of the land at Navalkhumbre and the farmers in the said area agreed to sale land admeasuring 180 acres to her or her nominee. It is stated that as per MOU in case the assessee was able to get up to 110 acres of land, she would pay the farmers the rate of ₹ 25,25,000/- per acre and if she could get land admeasuring total of area more than 111 acres, she would pay to the farmers the price @ ₹ 25,50,000/- per acre. She, accordingly, entered into an agreement/MOU with farmers by making the token payment of ₹ 1,11,000/- by cheque on 30-06-2007 to Shri Vikram Kadam (Group Leader) on signing of said MOU. The various farmers were also made parties with the said MOU. After signing the MOU with the farmers of Navalkhumbre, the assessee settled the deal with Helious ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operties) had already acquired the rights of those lands by paying token amounts to the farmers and hence, the assessee had to purchase the rights acquired by those two companies in the said lands and accordingly, the assessee paid ₹ 5,50,000/- per acre as the prices for acquiring the rights in the land, aggregating ₹ 8,03,96,000/-. Before the Assessing Officer the assessee filed the copy of MOU with M/s. New Planet and M/s. Aanchal Properties and both the MOUs were executed on 01-06-2007. The Assessing Officer has observed that on perusal of the copies of the agreement/MOUs the claim of the two entities namely M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. did not appear as a consenting party though, the assessee claimed that those parties had a interest in the land which were subject matter of deal with M/s. Helios Construction Pvt. Ltd. as the assessee claimed that she had paid ₹ 8,03,96,000/- to those two companies. The Assessing Officer raised the question mark why M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. were not made party to the final sale deed between M/s. Helios Construction Pvt. Ltd. and la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by SEBI from trading in share market vide Circular No. NSE/INV/2009/341 dt. 27-08-2009 as they were involved in some scam. In the opinion of the Assessing Officer the character of those two entities was doubtful and hence, there was a big question mark on the genuineness of assessee s transaction with those two entities. The Assessing Officer also noted that those two entities M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. are interrelated, and both were jointly involved in scam. 9. The Assessing Officer issued the show-cause notice to the assessee vide letter dated 22-12-2010, requiring the assessee to prove the genuineness of the amount paid towards cost of rights. The assessee personally appeared before the Assessing Officer on 24-12-2010 and submitted that she was shocked to know about the another agreement which was submitted by M/s. New Planet Trading Co. Pvt. Ltd. to its Assessing Officer. The assessee categorically denied that she has ever signed any such agreement mentioning the cost of rights acquired @ ₹ 3,20,000/- per acre. As required by the Assessing Officer the assessee submitted photo copies/print outs of MOUs entered by those t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2 acres. As per the terms of the MOU total compensation payable to M/s. New Planet @ ₹ 5,50,000/- per acre was worked out ₹ 4,63,23,750/-. As 84.20 acres of land was the part of the land sold to M/s. Helious Constructions Pvt. Ltd. in A.Y. 2008-09, the entire cost was claimed as an expenditure. In respect of copy of agreement/MOU obtained by the Assessing Officer from the Assessing Officer in Mumbai who was involved in completing the assessment of M/s. New Planet, the assessee stated that she has purchased two stamp papers as two copies of the MOUs were required to be prepared, one for the assessee and another for M/s. New Planet and the MOU was executed on the 01-06- 2007 only with M/s. New Planet and the copy of MOU produced by the assessee were the genuine copy and the copy of agreement filed by M/s. New Planet to its Assessing Officer is a tampered copy. Hence, there was difference in the date of execution as well as amount of compensation mentioned per acre. The assessee stated before Ld. CIT(A) that as per the agreed terms, the cost of acquiring the rights of the land from M/s. New Planet was determined at ₹ 5,50,000/- per acre and it is not correct to say ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e No. 4, Clause 2(a) Word 'only' is missing and word on is missing. Company Rubber stamp is no affixed Company Rubber stamp is affixed. Page Nos.1,3,4,5,6 7 Affixing the rubber stamp is an after thought 12. The assessee also stated before the Ld. CIT(A) that the assessee is not related to either M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. in any manner and the assessee also filed information in respect of the list of shareholder and the Directors of both the companies as per the annual return available on the Website of ROC. It was also stated by the assessee that both the companies are the third parties and this is not disputed by the Assessing Officer also. The Ld. CIT(A) accepted the contention of the assessee in respect of the genuineness of the payments at entirety to M/s. Aanchal Properties Pvt. Ltd. i.e. ₹ 3,40,72,250/- and he deleted the addition. In respect of M/s. New Planet Trading Co. Pvt. Ltd. he sustained the addition to the extent of ₹ 1,93,23,750/- out of claim of ₹ 4,63,23,750/-. The reasons given by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r own business interest. It was also submitted that there is no statutory requirement to incorporate the name of all stake holders as consenting parties in the final deed. There is some truth in the contention of the appellant that by exposing the big corporate client she could have invited more and more bargaining. It is a common knowledge that in big transactions of land, the name of end user/ultimate buyer is not revealed till the last moment or till the deed is signed in order to avoid last minute bargaining or even hike in prices which could be offered by the competitors. This peculiar characteristic of the land dealing makes the business of aggregation of land dealing quite secretive. The mention of these two parties in the final sale deed as consenting parties could have brought more transparency in the transaction but not mentioning of the same, in itself cannot be the basis of disallowance as long as other direct and circumstantial evidences support the case of the appellant. 17. As far as forging of the agreement filed before the Assessing Officer of M/s. New Planet Trading Co. Pvt. Ltd, is concerned, it is seen that appellant is not disputing that the agreement is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oduce original MOD between farmers and the two parties during the course of assessment proceedings. In this regard one must appreciate that the appellant was not a signatory between the farmers the two companies and therefore, the original could have been produced only after obtaining the same either from the farmers or from the two parties. 20. To sum up it is seen that the fact that both the parties were not a consenting parties in the final deed signed between the farmers and the end user i.e. M/s. Helios Constructions Pvt. Ltd alone cannot be decisive factor m deciding the issue as long as other evidences support the claim of the appellant in this regard, in this case, it is seen that the claim of the appellant in respect of cost of rights in land is supported by payments through Bank. In respect of payment of ₹ 3,40,72,250/- to M/s. Aancha properties Pvt. Ltd., the disallowance has been made by the Assessing Officer primarily for the reason that it is an afterthought and the company was also banned by SEBI along with M/s. New Planet Trading Co. Pvt. Ltd. which are interrelated parties. I find that the addition of ₹ 3,40,72,250/- has been made on insufficient g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10 Copy of Form 20B Aanchal Properties Pvt. Ltd As on 31.03.2007 51 To 52 11 Copy of Annual Return of Aanchal Properties Pvt. Ltd A.Y. 2007-08 53 TO 59 12 Copy of Annual Return of Aansh Mercandise Pvt. Ltd. A.Y. 2009-10 60 T0 65 13 Copy of Memorandum of Understanding ( MOU ) Between Aanchal Farmers Dated 09.01.2007 66 TO 77 14 Copy of Letter from Aanchal Properties Pvt. Ltd for Additional Cost of Right dated 31.3.2008 78 15 Copy of Memorandum of Understanding ( MOU ) Between New Planet Farmers Dated 15.01.2007 79 TO 89 16 Memorandum of Understandings ( MOU ) Between Nirupa Kanitkar New Planet Trading Co Pvt. Ltd. Dated 03.06.2007 forwarded by ACIT-V(2),Mumbai 90 TO 96 17 Chart giving details of Area Reconciliation of Aanchal Properties Pvt. Ltd, New Planet Trading Co. Pvt. Ltd Ostawal Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opy of Index II- Dt. 19.10.2007 Runwal Farmers 192 TO 193 33 Copy of Statement of Additional Compensation To Farmers of A.Y. 2008-09 194 TO 196 34 Copy of Statement of Additional Compensation To Farmers of A.Y. 2009-10 197 TO 199 35 Copy of Ledger Abstract of Additional Cost Payable A/c In the Books of Nirupa Kanitkar from 01.04.2007 To 05.12.2011 along with Bank Statement 200 TO 208 36 Copy of List of Commission Disallowed By Assessing Officer for A Y 2008-09 Containg Gut no for which commission paid, PAN No, TDS, Gross Amount Date of Payment 209 TO 210 37 Copy of Ledger Abstract of Sand ( Land Development Expenses ) along with Bills Photocopies of cheques attested by Bank 211 To 221 38 Copy of Submission dt.08. 12.201 1 to CIT Appeal A.Y.2008-09 for Cost of Rights Acquired, Additional Compensation to Farmers and Commission Payment. 222 To 228 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd sold to M/s. Helios Constructions Pvt. Ltd., Mumbai and she was the consenting party for land deal. He submits that in the aggregation process there are number of farmers and other parties who are having the interest in the small pieces of land. He submits that aggregation of land is very tedious job and the assesse requires to take the help of the agents as well as the local people who liaison with the farmers. He submits that the assessee entered into an agreement with M/s. Helios Constructions Pvt. Ltd. for selling the land @ 37 lakhs per acre whereas she has settled the deal with the farmers at Navalkhumbre @ ₹ 25,50,000/- per acre. He referred to copy of MOU with M/s. Helios Constructions Pvt. Ltd. which is placed at Page Nos. 161-175 of P/B. He referred to the copy of MOU with the farmers (Page Nos. 7-13 and English translation at Page Nos. 14 and 15 of P/B) and submits that if she was able to get the total land up to 110 acres in aggregation from the farmers then she had agreed to pay to the farmers rate of ₹ 25,25,000/- per acre and if she would get the more than 111 acres then she agreed to pay to the farmers the price of ₹ 25,50,000/- per acre. He arg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 3,20,665/- per acre as against ₹ 5,50,000/- per acre paid by the assessee. He submits that the entire payment is made through the banking channel via RTGS and the said proof was filed before the Assessing Officer as well as the Ld. CIT(A). He argues that so far as the another company is concerned i.e. M/s. Aanchal Properties, the only reservation of the Assessing Officer is in respect of the final sale deed between the farmers and M/s. Helios Construction as the assessee is not made a consenting party. He argues that the assessee has already acquired the rights of M/s. Aanchal Properties prior to the MOU with M/s. Helios Construction Pvt. Ltd. and the said company was not shown as a consenting party. He submits that in the case of M/s. New Planet also as the assessee has acquired the rights much more prior before an agreement with M/s. Helios Constructions hence, the said company was not impleaded as a consenting party in the final sale deed. He submits that nothing is there on record or otherwise also to show that the assessee has any interest or any relation with those two companies. He submits that the list of the Directors and shareholders of those two companies is al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of rights to M/s. New Planet. 17. Per contra, the Ld. CIT (DR) submits that the entire transaction of alleged acquisition of rights by the assessee with M/s. Aanchal Properties as well as M/s. New Planet prima-facie are arranged transactions. He submits that if those companies had any interest in the said land then why those two companies were not made consenting party to the final sale deed between M/s. Helios Constructions and the farmers and the owners of the land. He submits that as per the information collected by the Assessing Officer from the Assessing Officer, Mumbai who has having the jurisdiction over M/s. New Planet, it is proved that there were two different agreements and this fact has not been disputed. He also referred to copy of the agreement obtained by the Assessing Officer from the Assessing Officer, Mumbai submits that there are two different agreements/MOUs executed on different dates i.e. 01-06-2007 and 03-06-2007. Moreover, the amount of the compensation mentioned also varies. So far as the agreement produced by the assessee is concerned, the amount of compensation is shown @ ₹ 5,50,000/- but in the copy of obtained from the Assessing Officer, Mumbai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uyer of the land i.e. M/s. Helios Properties and the farmers and owners. The assessee joined the sale deed as a consenting party. In this case it is seen that the assessee also entered into that agreement with M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. and agreed to pay them the compensation which copies are placed at Page Nos. 16 to 23 and 33 to 39 of the Compilation. 18.1 As per the MOU dated 01-06-2007 between the assessee and M/s. Aanchal Properties Pvt. Ltd. the assessee agreed to acquire the rights of those companies in the lands by payment of ₹ 5,50,000/- per acre. The MOU with both the companies i.e. M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. are entered into on 01-06-2007. It is also not in dispute that the entire payment of the agreed compensation to those two companies was made by the assessee through the banking channel adopting the RTGS transfer. The Assessing Officer had reservation mainly on two reasons - (i) in case of M/s. New Planet Trading Co. Pvt. Ltd. as per the copy obtained from the Assessing Officer, Mumbai from the assessment record of M/s. New Planet Trading Co. Pvt. Ltd., there was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here was no transaction at or there was no agreement at all and then to proceed to examine how much payment is made. 20. During the course of hearing the Ld. AR produced the original copy of MOU dated 01-06-2007 entered into with M/s. New Planet Trading Co. Pvt. Ltd. He also explained that the second copy which is obtained from the Assessing Officer, Mumbai is tampered. We have examined the original agreement with the copy obtained from the Assessing Officer, Mumbai and prima-facie we agree that there is no tampering in the copy of agreement produced by the assessee after comparing copy of MOU obtained from the Assessing Officer, Mumbai. The law is also well settled that whatever an inference is drawn while deciding rights or liabilities of any person, it should be based on some evidence and not merely on presumptions and doubts. So far as M/s. Aanchal Properties Pvt. Ltd. is concerned the only reservation of the Assessing Officer is that the said company was not impleaded as a consenting party. In our opinion as the said company has not made any changes in the Revenue record after entering into agreement with the farmers, there was no necessity to implead said company as a cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onclusion drawn by both the authorities below is only on the presumption that there is a forgery or tampering in the contents of the MOU by the assessee. We, accordingly, allow the claim of the assessee at entirety. In the result, the grounds taken by the assessee are allowed on the issue of compensation paid to M/s. New Planet Trading Co. Pvt. Ltd. and M/s. Aanchal Properties Pvt. Ltd. and grounds taken by the Revenue are dismissed. 21. The next issue is the additional consideration paid by the assessee to the farmers to the extent of ₹ 1.80 Crores which was disallowed by the Assessing Officer and Ld. CIT(A) sustained the disallowance to the extent of 50% of the said amount i.e. ₹ 90 Lakhs and this issue arises from Ground No. 2. It was noticed by the Assessing Officer that the assessee has claimed the payment of additional compensation of ₹ 1,80,00,000/- in lump sum to the farmers over and above the agreed price of ₹ 25,50,000/- per acre. It appears that only the provision was made and actual payment was not made. The Assessing Officer disallowed the claim of additional compensation by giving the reason that the assessee could not furnish any proof in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not executed in time, the farmers will have right to demand additional compensation. Both the parties have to decide this additional compensation mutually, but it will not exceed ₹ 2 lakhs per acre. However, Mrs. Nirupa Suhas Kanitkar is not bound to pay for those pieces of land where I got disputes and conflicts have not been resolved in time by the farmers. 27. On the basis of the above clause No. 4, the appellant and Shri Vikram Kadarn representative of the farmers decided that the additional compensation should be ₹ 1.70 lacs per acre. Accordingly, provisions for ₹ 1.80 crores was made however, no payment was made during the previous year and even till now ₹ 31,61,000/- has been paid by the appellant to the farmers on this account, It is also seen that in A.Y. 2009-10, the Assessing Officer had disallowed 50% of additional compensation of ₹ 66,64,000/- claimed on similar grounds which was calculated at ₹ 33.32,000/-. I find that the provision is quite excessive in the sense that out of provision of ₹ 1,80,00,000/-, till date payment has been made at ₹ 31,61,000/- only. In land deals normally entire payment is made at the tim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to be allowed. We have also heard the Ld. DR. 23. The main contention of the Ld. AR is that the provisions for payment of additional compensation of ₹ 1,80,00,000/- was based on the terms of MOU between the assessee and the farmers. The assessee could not complete the sale deed within 30 days and hence, as per the terms of MOU with the farmers there was liability of additional compensation to the assessee. The assessee has stated that initially the assessee entered into an MOU for sale of said lands with M/s. Amrut Runwal Multi Housing Pvt. Ltd. but at the said deal could not be materialized and hence, the assessee was required to pay the additional compensation. The assessee, accordingly, made the provisions of ₹ 1,80,00,000/- but no payment was made during the year. The claim of the assessee is based on the foundation that she is following the mercantile system of accounting. When the matter reached before the Ld. CIT(A), he restricted the claim to 50%. He expressed the opinion that the provisions of ₹ 1,80,00,000/- is quite excessive. 23.1 The assessee has filed the confirmation from the farmers. As per the MOU dated 30-06-2007 with the farmers there is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rties Pvt. Ltd and to M/s. Ostwal Trading Co. Pvt. Ltd were genuine, when the genuineness of the above said entities was itself doubtful. 26. We first take the Revenue s appeal for the A.Y. 2009-10 for decision. In the A.Y. 2009-10 the assessee had claimed the expenses of ₹ 4,67,83,000/- as cost of rights acquired and the breakup of the said cost of rights acquired as under: 1. Payment of right acquired for 47.1 acres of land at the rate of ₹ 5.50 lacs per acre to Aanchal Properties Pvt. Ltd. Total Payment ₹ 2,58,96,750/-. 2. Payment of right acquired for 37.975 acres of land at the rate of ₹ 5.50 lacs per acre to Ostwal Trading Company Pvt. Ltd. Total Payment ₹ 2,08,86,250/-. 27. So far as the payment made to M/s. Aanchal Properties Pvt. Ltd. is concerned, the identical issue had come for the consideration before us for the A.Y. 2008-09. In this year the Assessing Officer issued summons to M/s. Aanchal Properties Pvt. Ltd. which was returned undelivered. As noted by the Assessing Officer, the assessee produced one of the Directors of M/s. Aanchal Properties Pvt. Ltd. who appeared before the Assessing Officer on 23-12-2011 and he was examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fees to Mr. Chokhani. Q. 11 What are the details of payments made to the farmers by the company? Ans. We have paid ₹ 5,51,000/- in cash to Mr. Shankarrao and Chokhani for the payment to farmers. Mr. Chokhani had brought Shankarrao before me and told that he is the person who will look after the work of getting signature from the farmers. Q. 12 At the time of given ₹ 5,51,000/- as above, were you sure as to how the money is to be distributed among farmers? Ans. I do not have any idea because everything was done through the mediator. Q.I3 What are the other companies who have entered in to deal with Mrs. Nirupa Suhas Kanitkar in respect of the land at Navlakumbhare? Ans. I am not sure as to what other companies have entered in to deal with Mrs. Nirupa Suhas Kanitkar. Q.I4 What is the amount of money your company has received in connection with sale of land at Navlakumbhare to Mrs. Nirupa Suhas Kanitkar? Ans. We have received about ₹ 6 crores approx in 2 years. Q. 15 What was the rate per acres of land that you were required to pay to the farmers? Ans. ₹ 22,00,000/- per acre approximately. Q. 16 Do you think for such a high val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... independent of each other i.e. M/s. New Planet Trading Co. Pvt. Ltd., M/s. Aanchal Properties Pvt. Ltd. and M/s. Otswal Trading Co. Pvt. Ltd. He expressed doubt that how those three companies would enter the scene in a concerted manner and take a share of the land pie which was going to be sold to subsequent purchasers. The Assessing Officer also raised the question mark that when three companies desired to purchase the land why they should come to put their stake in one place only which was very unlikely. The other reasons given by the Assessing Officer are identical as in the A.Y. 2008-09. The Assessing Officer disallowed the amount paid by the assessee to M/s. Aanchal Properties Pvt. Ltd as compensation towards acquiring it s rights in lands. The Assessing Officer has also given the reference in the A.Y. 2008-09. The Assessing Officer, therefore, disallowed the amount of ₹ 2,58,96,750/- paid by the assessee to M/s. Aanchal Properties Pvt. Ltd. In respect of M/s. Otswal Trading Co. Pvt. Ltd. also the Assessing Officer made the entire disallowance of claim towards cost incurred for acquiring rights from M/s. Otswal Trading Co. Pvt. Ltd. We find that in the assessment order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entity of Mumbai and she was not willing to expose the name of the party to all the stake holders as they could have started bargaining more and more. Besides this she was responsible for giving a clear land for which necessary steps were required to be taken while protecting her own business interest. It was also submitted that there is no statutory requirement to incorporate the name of all stake holders as consenting parties in the final deed. There is some truth in the contention of the appellant that by exposing the big corporate client she could have invited more and more bargaining. It is a common knowledge that in big transactions of land, the name of end user/ultimate buyer is not revealed till the last moment or till the deed is signed in order to avoid last minute bargaining or even hike in prices which could be offered by the competitors. This peculiar characteristic of the land dealing makes the business of aggregation of land dealing quite secretive. The mention of these two parties in the final sale deed as consenting parties could have brought more transparency in the transaction but not mentioning of the same, in itself cannot be the basis of disallowance as long ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed from M/s Ostwal Trading company Pvt. Ltd. is concerned it is seen that the facts are identical. Therefore, it is held that the Assessing Officer was not justified in disallowing payment of ₹ 2,08,86,250/- to M/s. Ostwal trading co. Pvt. Ltd. Accordingly the A.O is directed to delete the addition of ₹ 2,08,86,250/- pertaining to M/s Ostwal Trading Co. Pvt. Ltd. Thus, the appellant gets relief of ₹ 4,67,83,000 and the ground is accordingly allowed. 29. We have heard the parties and perused the record. So far as the issue of payment to M/s. Aanchal Properties Pvt. Ltd. of ₹ 2,58,96,750/- is concerned, we have already decided identical issue in the case of same entity in the A.Y. 2008-09. Hence, to avoid repetition on the discussion and reasons on the issue, we following our reasons in the A.Y. 2008-09 for confirming the order of Ld. CIT(A) on this issue in the said year, we hold that the Assessing Officer was not justified in disallowing the expenditure incurred by the assessee for acquiring the cost of rights in land from M/s. Aanchal Properties Pvt. Ltd. We, accordingly, confirm the decision of Ld. CIT(A) allowing the expenditure in respect of payment t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a variation in the Revenue s record then only for protecting the interest of the buyer, the entity which names in the revenue records appear is normally impleaded. After giving our anxious consideration to the evidence before us and considering the doubt raised by the Assessing Officer for making the disallowance, in our opinion the Assessing Officer was not justified disallowing the said expenditure. We, accordingly, confirm the order of the Ld. CIT(A) on our above reasons. Accordingly, the ground taken by the Revenue is dismissed. 31. Now, we take up the assessee s appeal for the A.Y. 2009-10. The first issue is in respect of the payment of additional consideration to the farmers. In fact, the identical issue has come for adjudication before us in the A.Y. 2008-09. In this year the Assessing Officer has observed that the assessee has claimed the expenditure under the nomenclature of additional cost payable to the farmers of ₹ 66.64 Lakhs. The assessee explained that it is a provision made in respect of the additional compensation required to be paid due to the delay in the execution of final sale deed but no payment was made during the year. The assessee filed the copy o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said village was lacking in basic infrastructure like road, culverts etc. and as per the demand of the villagers, the assessee incurred the expenditure for maintaining good relations with local from her business point of view. The Ld. AR referred to the Paper Book where the photocopies of the culverts are placed. He submits that the assessee needed whole hearted cooperation from the villagers as she had to acquire a contiguous land of more than 150 acres for selling the same to M/s. Helios Properties Pvt. Ltd. The Ld. AR submits that the said expenditure is to be looked into from the commercial point of view as in the process of acquiring the lands in piecemeal the relations with the local villagers had to be maintained at the most cordial level. He submits that the assessee produced the bills of the sand and stones for land filling in area. The assessee also produced the bank account to support the claim but that was not accepted. He submits that the expenditure was on account of commercial expediency as acquiring the different pieces of land which is a very big task and cooperation of the local people villagers is very much important. We also heard the Ld. DR. 35. We find ..... X X X X Extracts X X X X X X X X Extracts X X X X
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