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TMI Blog2022 (2) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... n taken for the assessment year 2009-10 will be applicable in the present group appeals as the same are also having identical facts and issue. Thus, we shall take up the case of Ajitnath Reality P. Ltd. for the assessment year 2009-10 to 2012-13 at first wherein, the Revenue has raised the grounds in the departmental appeals as under: Ajitnath Reality P. Ltd. Grounds of appeal in IT(SS)A No.14/Ind/2017 (A.Y. 2009-10) "1. On the facts and in the circumstances of the case the Ld. CIT(A) erred in deleting the addition of Rs. 42,75,63,950/- made by the AO on account of undisclosed sales from Silicon City Project without appreciating the facts and evidences brought into light by the A.O. during assessment proceeding. 2. On the facts and in the circumstances of the case the Ld. CIT(A) erred in allowing the appeals of assessee by accepting the additional evidences of affidavits for retraction of statements of purchaser of plot in Silicon City Project." Grounds of appeal in IT(SS)A No.15/Ind/2017 (A.Y. 2010-11) "1. On the facts and in the circumstances of the case the Ld. CIT(A) erred in deleting the addition of Rs. 86,76,80,515/- made by the AO on account of undisclosed sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 2,33,26,660/- 2011-12 07/09/2011 Rs. 2,63,64,810/- 2012-13 31/08/2012 Rs. 1,50,77,910/- Search and Seizure operations u/s 132 were carried out on the business as well as residential premises of the Jhaveri Group, Indore including the assessee along with other concerns/business associates on 21/09/2012. Notices u/s 153A were issued to the assessee and in compliance, the assessee filed returns of income declaring the same total income as filed in the original return. Notice u/s 143(2) was issued along with questionnaire u/s 142(1) and in response, the assessee from time to time furnished written submissions along with supporting documents. Subsequently, the assessment order was passed by Assessing Officer on 31/03/2015 by making following additions: Assessment Year Returned Income Total Additions to Income 2009-10 Rs. 21,71,160/- Rs. 42,75,63,950/- 2010-11 Rs. 2,33,26,660/- Rs. 86,76,80,515/- 2011-12 Rs. 2,63,64,810/- Rs. 14,06,73,816/- 2012-13 Rs. 1,50,77,910/- Rs. 11,96,12,576/- The Assessing Officer made the above additions on the basis of some letters received from four people namely Shri Dinesh Purohit, Smt. Manisha Patel, Shri Ankit Jain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record to justify the additions made by the Assessing Officer. We find that the ld. CIT(A) having gone through the material available on record, submissions and relevant judicial pronouncements deleted the additions by observing as under: "The assessing officer has relied on the statements of four persons to reach the conclusion that M/s Ajitnath Reality Pvt. Ltd., M/s Padamprabhu Infrastructure and Reality Pvt. Ltd. And M/s Venus Enterprises have accepted larger portion of the sale considerations in cash and the same was not accounted for by them. However, nothing has been brought on record whether the correctness or genuineness of the statements was investigated. The source of alleged on money paid to the appellant company has not been examined by the assessing officer. The4 customers who had given statements accepting the payment of on money have not been subjected to any query on the source of the investment regarding payment of the on money. This point becomes significant as it was brought up by the appellant in its submissions before the assessing officer. ....................... To sum up, the assessing officer has primarily made the addition on the basis of testimoni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ater, and this was not so in the present mater. Therefore, it cannot be termed as an additional evidence but as a supporting document. Further, we find that during the course of assessment proceedings, the assessee was not provided with the opportunity of cross-examination with the concerned persons on whose statements reliance was placed by the Assessing Officer. Thus, the Assessing Officer ignored the same leading to violations of principles of Natural Justice which is unjustified in view of the ratio laid down in the case of Andaman Timber Industries Vs CCE 281 CTR 241 (SC), wherein it was held as under:- "Not allowing assessee to cross-examine witness by Adjudication Authority through state men soft house witness were made abases impugned order amounted in serious flaw which making impugned order nullity a sit amounted to violation of principles of natural justice." The identical ratio was laid down in the following judicial pronouncements: I. Commissioner of Income-tax, Central, Jaipur v. Smt. Sunita Dhadda [2018] 100 taxmann.com 525 (Rajasthan) II. Smt. Manorama Singhal Indore V/s ITO-3(2), Indore [ITA NO. 130/IND/2020] [ INDORE ITAT BENCH] 8. We also find that duri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceeding. 2. On the facts and in the circumstances of the case the Ld. CIT(A) erred in allowing the appeals of assessee by accepting the additional evidences of affidavits for retraction of statements of purchaser of plot in Silicon City Project. 3. On the facts and in the circumstances of the case the Ld. CIT(A) erred in deleting the addition of Rs. 58,50,000/- made by AO on account of deemed dividend u/s2(22)(e) of the Act without appreciating the facts and evidences brought into light by the A.O. during assessment proceedings." Grounds of appeal in IT(SS)A No.21/Ind/2017 (A.Y. 2012-13) "1. On the facts and in the circumstances of the case the Ld. CIT(A) erred in deleting the addition of Rs. 76,06,744/- made by the AO on account of undisclosed sales from Silicon City Project without appreciating the facts and evidences brought into light by the A.O. during assessment proceeding. 2. On the facts and in the circumstances of the case the Ld. CIT(A) erred in allowing the appeals of assessee by accepting the additional evidences of affidavits for retraction of statements of purchaser of plot in Silicon City Project. 3. On the facts and in the circumstances of the case t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h. Therefore, our above decision given in the case of M/s Ajitnath Reality Pvt. Ltd. shall prevail in the case of the Padamprabhu Infrastructure and Reality P Ltd. Following the same decision above, we do not find any infirmity in the order of the ld. CIT(A) on ground nos.1 & 2. Accordingly, ground nos.1 & 2 of the departmental appeals in case of Padamprabhu Infrastructure and Reality P Ltd. for both the assessment years i.e. 2011-12 & 2012-13 are dismissed. GroundNo.3: 12. So far as ground no.3 with regard to deletion of addition made by AO on account of deemed dividend u/s2(22)(e) of the Act is concerned, the facts as culled out from the record are that the assessee co. had received unsecured loan from M/s Ajitnath Reality Pvt. Ltd. in the assessment years 2011-12 & 2012-13. Mr. Mukesh Jhaveri and Mr. Abhishek Jhaveri hold 50% shares each of the assessee co. and more than 20% shares in M/s Ajitnath Reality Pvt. Ltd. The Assessing Officer did not agree with the contention of the assessee that the amounts received from M/s Ajitnath Reality Pvt. Ltd. were in the nature of business receipts and only classified as unsecured loan in the balance-sheet and accordingly, the Assessing Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licable. In the instant case, since the assessee co. is not a registered holder of shares of M/s Ajitnath Reality Pvt. Ltd., we are of the view that ld. CIT(A) has rightly deleted the additions following the relevant judicial pronouncement. Therefore, we confirm the findings of the ld. CIT(A) on this issue. Accordingly, ground no.3 raised in the departmental appeals of Padamprabhu Infrastructure and Reality P Ltd. are dismissed for both the present assessment years. Thus, both the appeals filed by the department in the case of Padamprabhu Infrastructure and Reality P Ltd. are dismissed. M/s. Venus Enterprises 18. Now, we shall take up the departmental appeals in case of M/s. Venus Enterprises wherein the Revenue has raised the following grounds in departmental appeals: - Grounds of appeal in ITA No.127/Ind/2017 (A.Y. 2012-13) "1. On the facts and in the circumstances of the case the Ld. CIT(A) erred in deleting the addition of Rs. 9,24,40,503/- made by the AO on account of undisclosed sales from Silicon City Project without appreciating the facts and evidences brought into light by the A.O. during assessment proceeding. 2. On the facts and in the circumstances of the case t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... formed reasons to believe that the assessee firm has escaped assessment within the meaning of section147 of the Income Tax Act, 1961. Accordingly, notice u/s 148 was issued and duly served to the assessee firm. In response to the notice, the assessee vide letter dated 11.03.2015 stated that the return filed u/s 139(1) may be treated as return filed u/s 148 of the Act. Subsequently, the Assessing Officer u/s143(3) r.w.s. 147 of the Income Tax Act,1961 passed assessment order dated 25.02.2016 for AY 2011-12 and for AY 2012-13 passed assessment order u/s 143(3) on 31.03.2015 making additions to the returned income on account of undisclosed receipts and assessed the total income as follows: Assessment Year Returned Income Total Additions to Income Assessed Income 2011-12 Rs. 29,97,040/- Rs. 4,36,48,275/- Rs. 4,66,45,320/- 2012-13 Rs. 54,26,570/- Rs. 9,24,40,503/- Rs. 9,78,67,070/- The Assessing Officer made the above additions on the basis of some letters received from four people namely Shri Dinesh Purohit, Smt. Manisha Patel, ShriAnkit Jain and Smt. Vijaya Pawar where they have stated that they paid on money over and above the amount for which the Registries hav ..... X X X X Extracts X X X X X X X X Extracts X X X X
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