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TMI Blog2015 (8) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... the return of income filed and the same being fair and reasonable in the facts and circumstances of the case, the Ld. CIT(A) held that there was no justification in making a further addition of ₹ 60 lakhs which would have given an unusual higher net profit rate of 34%. Having regard to all the facts of the case, we find no infirmity in the impugned order of the Ld. CIT(A), deleting the addition of ₹ 60 lakhs made by the A.O. merely on the basis of statement made by the assessee during the course of survey - Decided against revenue. Addition under section 40A(3) on account of cash payments exceeding ₹ 20,000 - CIT(A) deleted the addition - Held that:- . CIT(A) has deleted the said disallowance made by the A.O. on the gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judication. Grounds No. 2 to 4 involve an issue relating to addition of ₹ 60 lakhs made by A.O. on the basis of statement given by assessee at the time of survey which stands deleted by Ld. CIT(A). 4. The material facts relevant to this issue are that assessee is a partnership firm which is engaged in the business as a builder. A survey under section 133A was carried out in its case on 25.08.2008. During the course of survey, certain books of accounts, documents and loose sheets were impounded. During the course of survey, a statement of the assessee was recorded wherein he admitted additional income of ₹ 60 lakhs for A.Y. 2009-2010 to cover-up the deficiencies with regard to the expenditure incurred up to the date of survey. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch works out to 9% of the sales. In the light these facts and even after considering the information available from impounded materials, books of accounts and other relevant documents produced from time to time during the course of assessment proceedings there is no need in fact no scope to report/admit such a huge amount of ₹ 60,00,000/- in our return of income as additional income. As we have realized the status of sales by the last month of the F.Y. 2008-09, the same was intimated to the assessing officer and requested not to consider the said admission and there by not to deposit the post dated cheques issued for discharging the tax liability on the said income offered. 4.1. The explanation offered by assessee was not found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profit as per the P L A/c. of ₹ 20,81,256/- which is 9%. If the amount of ₹ 60,00,000 is added to ₹ 20,81,256/- the profit would be ₹ 80,81,256/- against the sale of flats of ₹ 2,31,25,068/- which would give a rate of 34% which is unusually higher. I find that 9% net profit admitted by the appellant is reasonable and considering the case of the appellant, I feel that the addition of ₹ 60,00,000/- is not justified and accordingly deleted. This ground of appeal is decided in favour of the appellant. 5. We have heard the arguments of both the sides on this issue and also perused relevant material on record. It is observed that although additional income of ₹ 60 lakhs was surrendered by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uphold the impugned order of the Ld. CIT(A) on this issue. Grounds No. 2 to 4 of the Revenue are accordingly dismissed. 6. Grounds No. 5 and 6 involve an issue relating to the addition of ₹ 13,49,252 made by the A.O. under section 40A(3) on account of cash payments exceeding ₹ 20,000 made by the assessee, which stands deleted by the Ld. CIT(A). 6.1. On verification of the books of accounts of the assessee, the A.O. found that expenditure aggregating to ₹ 13,49,252 was incurred by the assessee involving items for which payments were made in cash exceeding ₹ 20,000. He, therefore, invoked the provisions of section 40A(3) and made disallowance of ₹ 13,49,252. 6.2. On appeal, the Ld. CIT(A) deleted the di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the file of A.O. for deciding the same afresh, after verifying the stand of the assessee that the individual payments made in cash did not exceed ₹ 20,000 at a time. Grounds No. 5 and 6 of the Revenue s appeal are accordingly treated as allowed. 8. In the result, ITA.No.777/Hyd/2014 of the Revenue is partly allowed for statistical purposes. 9. Now, we shall take up the appeal of the Revenue being ITA.No.778/Hyd/2014 filed in the case of M/s. Srinilaya Projects which is directed against the Order of the Ld. CIT(A), Vijayawada dated 31.01.2014. 10. Grounds No. 1 and 7 are general in nature and therefore, do not require adjudication. 11. Grounds No. 2 to 4 involve a common issue relating the addition of ₹ 20 lakhs ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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