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TMI Blog2022 (1) TMI 1330X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by it in cash, which have also remained unexplained, but at the same time noting the fact that bungalows sold by the assessee were not hi-end properties, but small sized bungalows the component of the on-money received on the same @ 50% of the booked price is on a palpably very high side. We are of the view it would be just and reasonable to restrict the addition to the extent of profit element embedded in this transaction only. The AO is directed to restrict the addition by estimating GP on the on money receipts, at the higher of the rate in this line of business or as agreed to by him before us @ 15% thereof. We may add here that our above decision may not be treated as precedent in any other case having been rendered in the peculia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -12. Ahmedabad (referred to as CIT (Appeals)) erred in determining the total income of the appellant company at Asst.Year. 2013-14 Rs.33,53,680/- as against total income of Rs.3,08,680/- disclosed by the appellant. Asst.Year. 2015-16 Rs.1,57,19,060/- as against total income of Rs.21,69,060/- disclosed by the appellant. Asst.Year. 2016-17 Rs.48,33,160/- as against total income of Rs.14,32,160/- disclosed by the appellant or 2. On the facts and circumstances of the case as well as law on the subject, the learned CIT (Appeals) has erred in confirming the action of the Assessing Officer for making an addition of alleged cash receipt of - Asst.Year. 2013-14 Rs.30,45,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he other hand, vehemently objected to this plea of the assessee stating that the documents and the facts and circumstances revealed clearly that assessee had received on-money on sale of the property in the course of business and there was nothing to demonstrate any expenditure incurred out of the same by the assessee. That accordingly there was no reason to accede to this request of the ld.counsel for the assessee at all. 6. We have heard both the parties. Before proceeding to adjudicate the issue, we shall first bring out the relevant facts as drawn in para 3 to 3.2 of the consolidated order passed by the ld.CIT(A) in the present case as under: Facts of the case 3. The appellant is a partnership firm engaged in the busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apers inventorised from the premises of M/s. Rekvina Laboratories Ltd. as Annexure BF1 Page No. 33 it was seen that the page reflected the details of cheque and cash against some of the bungalow owners in New Mont Villa. The scanned image is at page 4 of the assessment order. The contents of these pages are tabulated at pages 5 and 6 of the assessment order. On the verification of the same, the AO found that the contents of the page very clearly show that on-money has been received by the firm in the project. The details of transaction related to bungalow No. A-20 as appearing in the register Annexure A3 reproduced at page 6 of the assessment order showed that the appellant firm made the sale agreement for Rs.29,41,000/- vide its sale deed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inst returned income of Rs.14,32,160/-. 7. The ld.counsel for the assessee has not challenged the addition made on account of on-money received on sale of property in the course of business carried on by the assessee and his only plea is vis- -vis restricting the addition to the profit element embedded in the same. We shall now proceed to examine whether there is any merit in this contention of the ld.counsel for the assessee. The contention of the ld.counsel for the assessee before us in support of his claim is that the on-money received was a substantial percentage of the total sale proceeds booked by the assessee of the properties sold, being upto 50% of the same, and if the on-money is treated entirely as income of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were booked as sold. Also the built up area of the bungalows sold approximates 160 sq. metres. Having noted these facts, we agree that it is highly improbable in this line of business to make profits upto the extent of 50% or more of the turnover that too on sale of such small sized properties. Even the Ld.DR was unable to enlighten us with statistics showing otherwise. We therefore agree with the ld.counsel for the assessee that making addition of the entire on-money received by the assessee would not be justified. Though we are of the view that the onus is on the assessee to show what expenses have been incurred by it in cash, which have also remained unexplained, but at the same time noting the fact that bungalows sold by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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