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TMI Blog2015 (6) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... G.D. AGRAWAL AND SHRI S. S. GODARA, JJ. For the Appellant : Shri O.P. Vaishnav, CIT-DR For the Respondent : Shri S.D. Chheda, AR ORDER PER G.D. AGRAWAL, VICE PRESIDENT: This is an appeal filed by the Revenue and the Cross-Objection filed by the assessee, both against the order of the Commissioner of Income Tax (Appeals)-II, Ahmedabad dated 23.05.2011, pertaining to Assessment Year 2006-07. IT(SS)A No. 493/Ahd/2011 (Revenue s Appeal) : AY: 2006-07 2. In this appeal by the Revenue, following grounds were raised:- 1. The Ld. CIT(A) has erred in law and on facts in holding that the addition on account of determined suppression of unaccounted on-money income was erroneous. 2. The Ld. CIT(A) has erred in law and on facts in dismissing the relevant facts regarding the unaccounted income as collected and seized during search action and placed on record. 3. The Ld. CIT(A) has erred in law and on facts in relying on irrelevant materials, theoretical premises, surmises and conjectures regarding the on money receipts and commission payments made by the assessee concern. 4. The Ld. CIT(A) has erred in law and on facts in law in making erroneou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1% of the sale value but the rate of sale of flats was same in A.Y.2005-06, 2006-07 and 2007-08 as mentioned in the table above. It is interesting to note that the Assessing Officer has made the addition of ₹ 2,42,24,700/- without making any enquiry from the purchasers or without any finding or any kind of evidence of receipt of 'on money' either during the course of search proceedings or post search enquiries. In the statement of Shri Atul P. Malde and Shri Bharat Malde, the main person of the group, there is not a single question on rate of sales of flat in any of the projects in which the flats have been sold through Shri Atul P. Malde. The pocket diary impounded from the office premises of the assessee does not contain any details of 'on money collection on the projects developed and sold by the assessee company through Shri Atul P.Malde. No defect or mistake in the books is pointed out by the Assessing Officer and the books of accounts have not been rejected for applying the comparative G.P. of another project. The Assessing Officer, without any basis, has doubled out the sale value of the flats on the basis of commission payment to Shri Atul P. Malde. At t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation of income and assessment order of Shri Atul P. Malde for Assessment Year 2006-07 which was completed u/s 143(3) before the search. He pointed out that the search in the assessee s group was conducted on 24.09.2008 while Shri Atul P. Malde filed his return of income for computation of income, Shri Atul P. Malde has clearly shown that out of the brokerage received at ₹ 4,84,610/-, the brokerage paid by him was ₹ 2,39,250/- and net brokerage received was only ₹ 2,45,360/-. The above return of income was scrutinized u/s 143(3) and the Assessing Officer vide order dated 08.04.2008 completed the assessment at ₹ 2,72,280/ - by making the addition of ₹ 20,000/- on account of low household withdrawal. Thus, the brokerage paid by Shri Atul P. Malde to other brokers was disclosed by him prior to the search and was also accepted in the order passed u/s 143(3). He also referred to the statement of Shri Bharat Malde dated 24.12.2008 in which Shri Bharat Malde has clarified that the commission paid to Shri Atul P. Malde was 2% and out of which he passed on 1% to other sub-brokers. Therefore, what he stated is the net commission. It was also submitted by the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d made the huge addition relying upon the statement of Shri Atul P. Malde which was not only recorded behind the back of the assessee but was retracted by Shri Atul P. Malde. In the Return of Income for Assessment Year 2006-07 filed by Shri Atul P. Malde prior to the date of search, he has disclosed the brokerage received by him and the brokerage paid to subbrokers. These facts also affirmed the explanation of Shri Bharat Malde that the commission paid to Shri Atul P. Malde was about 2% out of which 1% was passed on by Shri Atul P. Malde to other brokers. The CIT(A) at page No.4 of his order has given the comparative rate for sale of flat in preceding and subsequent year. For ready reference the same is reproduced below:- Rate/Project A.Y. 2005-06 A.Y. 2006-07 A.Y. 2007-08 Om Kewal (Res.) -- 500 Sai Kewal (Res.) 500 per sq. ft. 500 500 Shubh Kewal (Res.) 400 400 400 Sh. Kewal (Res.) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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