|The Tax Publishers2021 TaxPub(DT) 0898 (Del-Trib)
INCOME TAX ACT, 1961
Section 153A Section 69 Section 132(a)
Had Rs. 3.01 Cr. been paid in cash, the total cost of purchase paid in cheque as per the four sale deed should be Rs. 17,47,71,637 whereas in reality the total amount of Rs. 20,30,27,000 has been paid in cheque hence, there was no scope to treat the amount as paid in cash to be brought under unexplained investment under section 69.
Search and seizure - Assessment under section 153A - Undisclosed investment in land in cash -
During the course of search and seizure proceedings, T. Kumar surrendered an amount of Rs. 17 Crores as undisclosed income while making statement under section 132(4) in front of the search parties. The statement was subsequently retracted by the assessee as the disclosure was allegedly made under pressure and no corresponding incriminating documents was found during the course of search to substantiate the said disclosure. For undisclosed investment in land the AO had made the addition on the basis of statement made during the course of search and seizure proceedings and also on the basis of analysis of the seized documents (Annexure A-21) at page-9 i.e. a diary in the handwriting of T Kumar which was found from the office premises of the company and some other connected.documents thereof. The total cost of the project was Rs. 7,14,20,134. Amount paid by cheque was Rs. 17,47,71,637. Amount paid by cash was Rs. 3,01,00,000. The deal was in a joint manner between GTM Builders and Promoters and Sargam Estates (P) Ltd. and the payment was made by GTM Builders and Promoter, substantive addition was made in the hands of GTM Builders and Promoters and protective addition was made in the hands of Sargam Estates (P) Ltd. The CIT(A) confirmed the addition of Rs. 3.01 Crores. said to have been paid in cash by the assessee and deleted amount as there was no corroborative evidence to establish the said payment in cash. Held: The total consideration for purchase of land at Dehradun was Rs. 20,30,27,000. Hence, it cannot be said that the amount of Rs. 3.01 Cr. has been paid in cash. Had Rs. 3.01 Crores been paid in cash, the total cost of purchase paid in cheque as per the four sale deed should be Rs. 17,47,71,637 whereas in reality the total amount of Rs. 20,30,27,000 had been paid in cheque. Hence, there was no scope to treat the amount as paid in cash to be brought under unexplained investment under section 69. Regarding the addition made by the AO of Rs. 3,84,00,000, there was no material to come to such a conclusion. The AO had merely subtracted the amount of Rs. 27,14,20,134 mentioned in the seized material which were the estimates of cost of lands and cost of sale value area, average rate, car parking and mall from Rs. 20,30,27,000 paid by the assessee in cheque to the farmers for purchase of the land. There was no material to corroborate such an addition, the AO merely went back the Annexure A 21 page no. 1 to make such addition. Hence, the action of the AO cannot be supported. The appeal of the assessee on this ground was allowed and appeal of the revenue was dismissed.
FAVOUR : In assessee's favour.
INCOME TAX ACT, 1961
Section 153A Section 69
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