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TMI Blog2017 (3) TMI 1875X X X X Extracts X X X X X X X X Extracts X X X X ..... s not pressed. 4. The second effective ground is against in sustaining the addition of Rs. 28,65,000/- and Rs. 98,21,100/- respectively for both the years made by the AO on account of suppressed sales calculated @ 30% of the disclosed receipts. 5. Briefly stated the facts in this case are that the assessee is a partnership concern and doing the business of developers and builders. The assessee had acquired a land at Nanda Patkar Road for development of the plot namely Dhanlaxmi Vihar. The assessee is maintaining project completion method. The project Dhanlaxmi Vihar was started in the FY 2003-04 and was completed in the FY 2004-05. As per the facts sheet filed during the appellate proceedings, the revenues from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l information in regard to the report u/s 142(2A) were asked from the assessee which was filed on behalf of the assessee. Thereafter, the assessment u/s 153A r.w.s. 143(3) was completed for both the assessment years at Rs. 29,69,986/- and at Rs. 1,18,75,486/- respectively vide order dated 8.5.2007. 6. An addition of Rs. 28,69,986/- for AY 2004-05 and Rs. 98,21,100/- for AY 2005-06 was made on account of on money received by the assessee. An addition of Rs. 80,861/- was also made on account of disallowance of project expenses for AY 2005-06. Against these additions, the assessee preferred appeal before the CIT(A). 7. Regarding the addition on account of on money, it was submitted that there is no evidence/reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was further submitted that in respect to the four flats in Koteshwar Darshan, a project undertaken for development by Shri Pravin V Satra Prop. of Darshan Developers. The MoU was filed during the course of search. It was further submitted that in connection with the four MoUs in respect of the four flats of Koteshwar, it may, firstly, be pointed out that there has been no sale of the flat agreed to be sold to Achyut Godbole, as MBC has not granted permission for construction on 6th floor of that flat. 8.1. As regards to other agreements, the details of agreements accounted in the books of account and cash component in relation to MoU prepared with group were also filed. It was submitted that the AO relied upon the MoU related to Dharshan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e been reproduced by the CIT(A) at pages 4 to 7 of his order. 9. After considering the submissions and other material on record, the CIT(A) found that the AO had made the additions on the basis of statement of Shri Pravin Satra of Pravin Satra group concern, who had admitted that in his group, on money charged between 30% to 40% of the projects handled by Satra group. Since the statement has been given by a responsible person of Satra group; therefore, the AO was correct in estimating the addition on account of on money in the case of the assessee, who is partner of the Satra group. The decision relied upon by the assessee were distinguishable and accordingly, the CIT(A) has confirmed the action of the AO for both these y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of the assessee that any on money had been received; however, the addition had been made on the basis of the statement of Shri Pravin Satra. 11.1. The ld counsel of the assessee has stated that the assessee has agreed to make addition on account of profit only but not on account of on money. In this regard, reliance was placed on various decisions where similar views have been expressed by various Benches of the Tribunal. Though there is no evidence that the assessee had charged some on money on account of sale of flat or shop; however, a reasonable presumption can be done in the case of the assessee for the reason that one of the main persons of the group concern has admitted in having received on money. Therefore, we hold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... et Construction Ltd decided in 1759/Bom/1995 the Tribunal has held that 12% of the on money should be taken as profit of the assessee. This order was passed on 7.8.1995. 12.2 Similarly in the case of Mrs Mehroo J Irani decided in ITA no.1140/Bom/1989 vide order date4d 26.2.1991, the Tribunal has taken the net profit at 5% f the gross receipts on account of on money. 12.3 We further noted that in another group cases in the case of Kanakia constructions decided in IT(SS)14 to 31/Mum/1996 vide order dated 21.11.1997, the Tribunal has held that the AO was not justified in estimating 15% of the gross on money and restricted the on money @ 10%. 13 Similar views have been expressed by various Benches of the Tribunal relied upon by the ld counse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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