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TMI Blog2017 (2) TMI 1181X X X X Extracts X X X X X X X X Extracts X X X X ..... nity to prove the correctness or completeness of the return necessarily carry with it the right to examine the witnesses and that includes equally the right to cross – examine witnesses. The contentious issues in the instant appeal can be resolved by examining the flat buyers and granting an opportunity to the assessee to cross – examine them. Therefore, we set aside the order of the learned CIT(A) and restore the same to the file of the AO to make a fresh 8 assessment as per the provisions of the Act after examining the flat buyers and granting an opportunity to the assessee to cross – examine them - Decided n favour of assessee for statistical purpose. - ITA No. 4794/MUM/2014 - - - Dated:- 13-2-2017 - SHRI JOGINDER SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) For The Appellant : Dr. K. Shivaram Sr. Advocate For The Respondent : Shri Sushil Kumar Poddar, Sr.DR ORDER PER N.K. PRADHAN, AM This is an appeal filed by the assessee. The relevant assessment year is 2011-12. It is directed against the order of the Commissioner of Income Tax (Appeals)-25, Mumbai and arises out of the assessment u/s 143(3) of the Income Tax Act 1961 (the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocated and sold at short interval that there was a big difference between the sale considerations. The AO then asked the assessee to show cause as to why the highest sale consideration 3 received by the assessee based on the rate per sq. ft. should not be adopted based on the fact that sale was effected within a short period and the business prudence demands that the assessee must have negotiated at the highest price in order to get maximum gains. The assessee filed a reply before the AO. However, the AO was not convinced with the same. As per him, 2 BHK and 3 BHK are located on the same floor adjacently and there cannot be any reason for sharp variation in the sale consideration as these are having same quality of construction and kind of facility. The AO found it peculiar that the rate for flat no 101 worked out to ₹ 8722/- per sq. ft. (2 BHK) whereas the rate of flat no 102 was ₹ 11019/- (3 BHK) approximately, which are located on the same floor and sold within a interval of 2 days. Similar is the case in other flats such as 301 302, 601 602. The AO considered the normal practice prevailing in property market in Mumbai during the impugned assessment year i.e. (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2010 and advance payment of ₹ 23.50 lakhs was received, which booking was cancelled by the buyer and to return the advance payment received, it was necessary to sale the flat to the other party at discounted rate. The learned CIT(A) was not convinced with the above explanation of the assessee since this was the last flat sold at very discounted price. The assessee having sold all other flats would not be in such financial 5 difficulty that just for returning a sum of ₹ 23.50 lakhs, it would sell the flat at such a discounted rate. In view of the above, the learned CIT(A) did not find any infirmity in the order of the AO in bringing to tax the undisclosed income of ₹ 1,13,46,464/- and thus dismissed the appeal filed by the assessee. 5. Before us, the learned counsel of the assessee submits that Madhu Kutir (the impugned project) is the first project of the assessee. It is stated that the assessee sold 13 flats during the year at different stages of construction and on different payment terms to different unrelated buyers. Therefore, the consideration agreed with each of them was different. It is stated that the AO observed that there was difference in price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 401 9250 4th slab stage 13-Apr-10 302 8950 5th-6th slab stage 3-Jun-10 402 9640 5th-6th slab stage 14-Jun-10 202 9640 7th slab stage 23-Jun-10 601 9945 Referring to the above table, the learned DR strongly supports the order passed by the learned CIT(A). 7. We have heard the rival submissions and perused the relevant material on record. We find that the assessee in response to the show cause notice issued by the AO has submitted that he has given the address of the parties earlier and the AO may confirm with the parties by using the power vested in the Act. This has been 7 mentioned by the AO at para 9.3 (page 4-5) of the assessment order. It is also found that the assessee vide written submission dated 29.04.2014 has submitted before the learned CIT(A) that the name and address of the flat buyers were given to the AO as required [page 5 of the order of the CIT(A)] an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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