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TMI Blog2020 (9) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... ear. No reason worth the name has been assigned by the AO in this regard. This exactly weighed with the CIT (A) while partly allowing the appeal of the assessee. The Tribunal ultimately concurred with the findings recorded by the CIT(A) and dismissed the appeal preferred by the Revenue. We are at one with the Tribunal in taking the view that the AO wrongly determined the profit at the rate of 25%, without any basis or credible material. No questions of law as proposed by the Revenue - R/Tax Appeal No. 20 of 2020 - - - Dated:- 27-1-2020 - Mr. Justice J.B. Pardiwala And Mr. Justice Bhargav D. Karia For the Appellant(s) : Mrs Kalpanak Raval ORAL ORDER (PER : HONOURABLE MR.JUSTICE J.B.PARDIWALA) 1. This Tax Appeal un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 147 of the Act came to be completed on 31.03.2015 after making addition of ₹ 3,38,44,000/- on account of business profit estimated at the rate of 25% of the total receipts of ₹ 13,53,76,000/- and ₹ 3,76,496 on account of the disallowance under Section 40 A (3)of the Act. 4. The assessee being dissatisfied with the assessment order preferred a Appeal before the CIT(A). The CIT(A) allowed the Appeal in part. The CIT(A) deleted the addition made by the AO on the basis of estimated profit at the rate of 25% of the total receipts. The Revenue being dissatisfied with the order passed by the CIT(A), preferred cross-appeal before the Tribunal. 5. The Tribunal affirmed the findings recorded by the CIT (A) and dismissed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with M/s Pusti Enterprise Pvt. Ltd. for ₹ 16,73,50,400/- out of which ₹ 13,53,76,000/- was received as advance but the income was not disclosed @25% relying on the judgment of the IT AT Mumbai in the case of Param Anand Builders Pvt. Ltd. Vs. ITO 59 ITD 29. The AO held that as per the agreement the average cost of construction was fixed at ₹ 1000/per sq. feet and accordingly the appellant had received more than 80% of the total cost as advanced on 31.03.2008 and the property was to be handed over before 30.12.2008. But the property was not handed over on or before 30.12.2008 and the appellant had shown WIP in his balance sheet FY 2008-09, 2010-11 and 2011- 12. The AO held that the appellant was not following the accountin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2596548 2014-15 4274084 2015-16 7494113 6.2.3. The actual construction cost incurred during the year including the land cost as per the WIP was only 26% (43920677/167350400 * 100) of the value of property agreed to be sold. As per the agreement the appellant was required to give clear and complete title of the property after obtaining the BUC/any other certificate from the competent authority before the execution of the sale deed. The terms and conditions of the agreement clearly lays down that only on the execution of the sale deed on the completion of the projection the property was to be transferred to Pusti Enterprise P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sq, ft. for the total consideration of ₹ 11,76,70,000/- instead of the original amount of ₹ 16,73,50,400/-. The AO has arbitrarily determind the profit @25% of ₹ 13,53,76,000/-without any basis or material in possession. The AO's presumptive profit of ₹ 3,38,44,000/- cannot be sustained for the reasons discussed above and therefore, the ground of appeal are being allowed. 7. The Tribunal after referring to the aforesaid finding recorded by the CIT (A) ultimately held as under : After going through the finding given by the ld. First Appellate Authority on the issues involved in the Revenue appeal in which the ld. First Appellate Authority has deleted the addition in dispute, we are of the view that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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