9911796707
TMI Blog2015 (8) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to as the AO) in block assessment as undisclosed income of the assessee. 3. The brief facts of the case as brought out from the impugned order are as under: "Facts of the case are that action under section 132 of the Income Tax Act, 1961 was conducted at the residence and business premises of M/s. Keystone Realtors Pvt. Ltd. [KRPL] on 21-01-2003. In the said operation, a loose paper no. 31 of Annexure A-3 was seized from the office of KRIL which indicated transaction related to sale of flat along with furniture. According to AO, a total sale consideration shown in this paper is of R. 39 lacs out of which Rs. 18 lacs have been received through cheque and balance of Rs. 21 lacs has been received in cash. The transaction was related to Ms. Parin N. Sanajana, who was Mausi of one of the director of KRPL. Mr. Percy Choudhary disowned the paper and stated that said transaction is related to sale of flat by Ms. Parin N. Sanjana. During the course of assessment proceedings of KRPL for block assessment, summons were issued to the Secretary of the said Building. The Secretary replied that the flat No.304, 3rd floor, Plot No.666 in the new Orieng CHS Ltd., Jahangir Road, Parsi Col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from DCIT CC-10, AO held that he had recorded his satisfaction. Regarding assessee's contention that no addition can be made on the basis of Ioose paper only, AO observed that part of the paper has been accepted by the assessee that he has purchased the flat from Ms. Perin N. Sanjana and amount of consideration of Rs. 18 lacs was shown in cheque and further furniture was also sold along with the house. Therefore, it is established that the said paper is about the purchase of flat by the assessee only and all the contents of the said paper would have to be considered in toto. AO has also observed that market rates published by the Times of India, date Mar.9, 2002 in which property rates of Mumbai residential was given, also show that Dadar area rate was between 4500-8500 per sq. feet. On the basis of above (Rs.4500 per sq. feet) value of above flat of 918 sq. feet comes to Rs. 41,31,000/- which was nearly the same as shown in such paper i.e. Rs. 39 lacs. In view of above, AO held that assessee and his wife have purchased the above flat for which they have paid unaccounted cash of Rs. 21.45 lacs. AO therefore made addition of Rs. 10,72,500/- i.e. half of cash paid of Rs. 21.4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the disclaimer. Mr. Percy Choudhary filed an affidavit and got away with it. There is no other evidence to prove that what is stated by Mr. Percy Choudhary is true and correct. DCIT CC -10 has not confronted the material and affidavit of Mr. Percy Choudhary to the appellant before reaching the conclusion that document and entries made therein belong to the appellant. Even the details obtained from Secretary of the building do not help the case of AO. Secretary of the building replied that flat was sold by Ms. Perin N. Sanjana to Mr. Raymond Nariman Elavia and Mrs. Armenity Raymond Elavia at consideration of Rs. 18 lacs. Facts discussed above in my opinion do not conclusively prove that appellant has paid amount in cash and this was probably the reason that DCIT CC-10 in his letter dated 31-03-2005 has just requested the AO to examine the payment made as these two persons purchased the flat DCIT CC-10 as contended by the appellant has asked the ACIT 6(3) to make further investigations in the matter which cannot be construed as satisfaction as contemplated in the Act. The satisfaction is required to be preceded by the investigations and investigation is not required to be precede ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se paper is neither signed by M. Perin N. Sanjana nor by appellant and his wife nor is it in their handwriting. Further, there is no date mentioned on the paper. It is therefore, difficult to conclude that entries recorded on the paper really pertain to the flat purchased by the appellant and his wife. DCIT CC 10 and ACIT 6 (3) both have lead themselves into believing that above document pertain to sale of flat purchase by appellant and therefore cash paid of Rs. 21 lacs and further amount of Rs. 45,000/- mentioned against furniture is the undisclosed income of the appellant and his wife. I am afraid, conclusion of both the officers is not supported by any evidence except the affidavit of Mr. Percy Choudhary director of KRPL in whose case search was conducted and from whose possession the above paper was found and seized. As already discussed earlier in this order, loose paper was found in possession of KRPL and therefore its director Mr. Percy Choudhary has the larger onus to explain with evidence whatever he has said about above document. There is no evidence to prove the facts stated by Mr. Percy Choudhary. The statement of Secretary of the building also does not support the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concluded that appellant has made cash payment over and above the cheque payment. If that is so, then a question may arise whether in all cases of property transactions additions can be made on the basis of rates published in the newspaper. I am afraid, it cannot be so. Appellant has contended that stamp duty authority has accepted the figure of Rs. 18 lacs, hence same should be accepted. I tend to argue with the above contentions of the appellant. AO has not brought on record any other instance of sale of flat in that locality to prove the fact that appellant has actually purchased the flat for Rs. 39 lacs. Whether Ms. Perin N.Sanjana has paid capital gains tax on the basis of the sale price of Rs. 39 lacs. is also not proved by the AO. For the above reasons I am of the considered view that on the basis of the above document, it cannot be held that appellant and his wife have actually made cash payment of Rs. 21 lacs for the purchase of flat and Rs. 45,000/- for furniture and therefore no addition can be made on this account and consequently addition of Rs. 10,72,500/- made by the AO is deleted." Aggrieved by the order of the Ld. CIT(A), the assessee has come in appeal before us. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
