9911796707
TMI Blog2019 (10) TMI 632X X X X Extracts X X X X X X X X Extracts X X X X ..... only the profit element embedded in the transaction. In so far as the assessee s own transactions are concerned, apart from profit element, there will be certain capital investment also going into the purchase of said pieces of land, which would also require addition. Total income for the years under consideration to be added on the basis of the unrecorded cash receipts found during the course of search is in three parts, viz., the first, being, the maximum cash balance of 28,71,458/- and 5,64,910/- for the years in appeal; the second, being, the part of profit element of 55,06,787/- on sale of plots amounting to 8.09 crore as relating to the two years under consideration, in addition to 1,52,969/- for the A.Y.2008-09 being extra profit sustained in the first appeal; and the third, being, profit of 14.07 lakh on remaining amounts of entries at Rs. 2.07 crore in the ratio of receipts of 2.08 crore and 7.95 crore for the A.Ys. 2007-08 and 2008-09 respectively. We, therefore, set-aside the impugned orders and remit the matter to the file of AO for examining and ensuring that these three elements are duly taxed in the total income of the assessee for the years under consideration. To ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed cash book and ledger written up to the date of search and it was submitted that all the transactions and advances received and paid on account of sale and purchase of land, noted in the diaries and loose papers, were reflected in such books of account prepared after the date of search. The AO noticed that the assessee credited total cash of ₹ 10,16,66,535/- on account of cash received as per the seized documents giving the specifications of seized documents only. Name of the persons from whom cash was received were not mentioned in certain cases by the assessee in such cash book. Similarly name of persons to whom such cash was paid were also not mentioned in certain cases. Total of such cash paid over the period 01-04-2001 to 08-02-2008 was to the tune of ₹ 10,16,60,973/-. Total cash credited for the A.Y. 2007-08 stood at ₹ 2,08,43,767/- and for the A.Y. 2008-09 at ₹ 7,94,96,368/-. The AO required the assessee to substantiate the receipts of cash by supplying name of the persons from whom it was received on account of purchase of land and name of the persons to whom such cash was paid. The assessee submitted that the cash book was prepared from the mate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wrongly invoked section 69A instead of section 68. The ld. CIT(A) noticed that the assessee offered total income of ₹ 55,06,787/-, being, profit from sale and purchase of lands over the period. Apart from that, he also took note of peak balance liability to be taxed. In this way, he reduced the addition to ₹ 7,17,879/- and further telescoped the addition of ₹ 5,64,910/- into such amount computed by him at ₹ 7.17 lakh and finally sustained the addition at ₹ 1,52,969/- for the A.Y. 2008-09. For the A.Y. 2007-08, the ld. CIT(A) reduced the addition to ₹ 28,71,458/- and allowed relief for the remaining amount of ₹ 1.79 crore. The Revenue is aggrieved by the reduction in the amount of additions made for the years under consideration. 4. We have heard both the sides and perused the relevant material on record. During the course of search, certain incriminating material in the form of diaries etc., was found evidencing the receipts and payments of money. In the statement u/s. 132(4), the assessee submitted that these amounts were received towards purchase of land for certain customers which amounts were given to the sellers and the payments refle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ld. DR before us. The assessee has also produced a summarised statement of the cash book before us. On going through the cash book, it is found that the assessee has recorded certain amounts with dates mentioning the name of the persons from whom cash was received. The assessee's case is that he received cash from prospective buyers of land and thereafter negotiated with the prospective sellers with a view to earn commission income. In addition to that, there are certain transactions of cash received which did not bear any name. Such transactions will have to be presumed as done by the assessee for his own purpose. Once the assessee has purchased and sold certain pieces of land for outside customers, it is only the profit element in such transactions which can be charged to tax. If certain amount of cash is received from buyers which is then handed over to sellers, it is not the amount of receipt which can be added to the assessee's total income but only the profit element embedded in the transaction. In so far as the assessee's own transactions are concerned, apart from profit element, there will be certain capital investment also going into the purchase of said pieces of land, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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