ACIT Cir 7, v. M/s. Vastunirmitee Developers & Builders Pvt Ltd,

ITA 452/PUN/2007 | misc
Pronouncement Date: 29-10-2010 | Result: Dismissed

Appeal Details

RSA Number 45224514 RSA 2007
Bench Pune
Appeal Number ITA 452/PUN/2007
Duration Of Justice 3 year(s) 1 month(s) 30 day(s)
Appellant ACIT Cir 7,
Respondent M/s. Vastunirmitee Developers & Builders Pvt Ltd,
Appeal Type Income Tax Appeal
Pronouncement Date 29-10-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted Not Allotted
Tribunal Order Date 29-10-2010
Assessment Year misc
Appeal Filed On 30-08-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE BEFORE SHRI I.C.SUDHIR JM AND SHRI RAJENDRA SINGH AM I.T.A. NO. 452/PN/20 07 (BLOCK PERIOD : 1996-97 TO 2002-03 ) ASSTT. COMMISSIONER OF INCOME TAX APPELLANT CIRCLE -7 PUNE VS. M/S. VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. RESPONDENT 1348 SADASHIV PETH PUNE -411030 I.T.A. NO. 428/PN/2007 (BLOCK PERIOD : 1996-97 TO 2002-03 ) M/S. VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. RESPONDENT 1348 SADASHIV PETH PUNE -411030 VS. DY. COMMISSIONER OF INCOME TAX APPELLANT CIRCLE -7 PUNE DEPARTMENT BY : SHRI ABHAY DAMLE ASSESSEE BY : NONE ORDER PER I.C. SUDHIR JM THESE ARE VERY OLD CASES. IT APPEARS FROM THE ORD ER-SHEET THAT SEVERAL ADJOURNMENTS HAVE BEEN TAKEN BY THE ASSESSEE. INIT IALLY THE APPEALS WERE FIXED FOR HEARING ON 11.9.2008 WHEN ON THE APPLICATION OF TH E ASSESSEE THE HEARING WAS ADJOURNED. THEREAFTER MATTER WAS FIXED ON 15.12.2 008 AND 23.2.2009 WHEN AT THE REQUEST OF THE ASSESSEE THE MATTER WAS ADJOURNED T O 21.4.2009. THEREAFTER SEVERAL DATES WERE FIXED ON 13.10.2010 THE ASSESSE E DID NOT BOTHER TO APPEAR BEFORE THE TRIBUNAL. NOTICES SENT ON THE GIVEN A DDRESS OF THE ASSESSEE ALSO REMAINED UN-RESPONDED. UNDER THESE CIRCUMSTANCES E SPECIALLY WHEN THE ASSESEE IS AWARE THAT APPEALS ARE FIXED FOR HEARING AND ARE ON BOARD THE ASSESSEE SHOULD HAVE KEPT TRACK OF DATE OF HEARING OF APPEALS BEFOR E THE TRIBUNAL TO REPRESENT ITS CASE. UNDER THESE CIRCUMSTANCES WE PREFER TO PROC EED EX-PARTE AGAINST THE ITA NO. 452 & 428/PN/2007 M/S.VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. (B.P. 1996-97 TO 2002-03) 2 ASSESSEE ON THE BASIS OF MATERIAL AVAILABLE ON THE RECORD. THE LD. D.R. WAS HEARD AND ORDERS OF THE LOWER AUTHORITIES AS WELL AS MATE RIAL AVAILABLE ON RECORD HAVE BEEN GONE THROUGH. 2. THE REVENUE HAS QUESTIONED FIRST APPELLATE ORDER ON SEVERAL GROUNDS INVOLVING TWO ISSUES. FIRSTLY AS TO WHETHER THE LD CIT(A) IS JUSTIFIED IN REDUCING THE ADDITION OF RS. 5 72 500/- MADE BY THE A.O WITH REF ERENCE TO ON-MONEY RECEIVED BY THE ASSESSEE COMPANY OF RS. 1 14 500/-. THE ANOTH ER ISSUE IS AS TO WHETHER THE LD CIT(A) IS JUSTIFIED IN DELETING THE ADDITION OF RS. 1 38 271/- MADE IN THE ASSESSMENT TOWARDS UNACCOUNTED PURCHASES OF VARIOUS ELECTRONIC GOODS. 3. THE ASSESSEE ON THE OTHER HAND QUESTIONED FIR ST APPELLATE ORDER MERELY ON TWO GROUNDS THAT THE LD CIT(A) HAS WRONGLY CONFIRME D THE ADDITION OF : 1) RS. 48 160/- MADE BY THE A.O ON THE BASIS OF IS OLATED PAPERS FOUND FROM THE APPELLLANTS PREMISES ; 2) RS. 1 14 500/- AS ON-MONEY RECEIVED BY THE AP PELLANT IN RESPECT OF ONE SHOP BY THE APPELLANT. GROUND NO.2(ASSESSEE) & ISSUE NO. 1 (REVENUE) 4. SINCE THE ISSUE RAISED IN GROUND NO. 2 OF THE AP PEAL PREFERRED BY THE ASSESSEE IS CONNECTED WITH THIS FIRST ISSUE RAIS ED IN THE APPEALS PREFERRED BY THE REVENUE IT IS BEING DISPOSED OF VIDE A CONSOLIDATE D ORDER. 5. THE RELEVANT FACTS ARE THAT DURING THE COURSE OF SEARCH AND SEIZURE OPERATIONS U/S. 132 OF THE ACT IN THE PREMISES OF BHAT BELWALK AR GROUP CASES ON 13.9.2001 CERTAIN DOCUMENTS/PAPERS BELONGING TO SOCIETY CO. WERE SEIZED. FROM ONE OF SUCH SEIZED DOCUMENTS MARKED BUNCH NO. 24 OF ANNEXURE A OF PANCHANAMA DT. 15.9.2001 THE A.O. NOTED THE DETAILS OF SALE-DEED OF SHOP NO.1 IN BUILDING NO. P PURCHASED BY SHRI ASHITOSH G. JOSHI AND SMT. MEGNA G. JOSHI FOR A SUM OF RS.2 98 500/-. PAGE NO. 32 CONTAINED THE PAYMENT DETAILS IN RESPECT OF SALE OF THE ITA NO. 452 & 428/PN/2007 M/S.VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. (B.P. 1996-97 TO 2002-03) 3 SAID SHOP. IN PAGE N. 25 AN AMOUNT OF RS. 1 14 50 0/- WITH DATE 3 % 8 WAS MENTIONED AND THE AMOUNT WAS ALSO MARKED WITH +/- BELOW THE AMOUNT OF RS. 2 98 500/-. THE ASSESSEE WAS ASKED TO EXPLAIN THE DETAILS OF THE ABOVE STATED TRANSACTION SHOW CAUSE AS TO WHY THE SUM OF RS. 1 14 500/- COULD NOT BE TREATED AS ON-MONEY TRANSACTION RECEIVED BY THE ASSESSEE ON ACCOUNT OF SALE OF SHOPS IN THE SCHEME. THE EXPLANATION OF THE ASSESSEE REMAINED T HAT THE FIGURE OF RS. 1 14 500/- NOTED ON ROUGH PAPER HAS GOT NO RELEVANCE. ASSESS EE SUBMITTED THAT THE FOR PURCHASES MR. & MRS. JOSHI WAS TO GET EXTRA WORK D ONE FROM THE ASSESSEE COMPANY WHICH INCLUDED SOME FABRICATION AND FURNITURE WORK ALSO FOR WHICH THEY PAID RS. 50 000/- TOWARDS EXTRA WORK AND NOT RS. 1 14 500/- AS MENTIONED IN THE DOCUMENT WHICH WAS MERELY AN ESTIMATED FIGURE OF EXTRA WORK. A.O. DID NOT AGREE WITH THIS EXPLANATION IN ABSENCE OF AN EVIDENCE IN SUPPORT. H E NOTED THAT THE PAGE CLEARLY INDICATES THAT THERE WERE VARIATION OF RS. 1 14 500 /- ON THE AGREED SALE PRICE OF R. 2 98 500/-. THE A.O ACCORDINGLY CAME TO THE CONC LUSION THAT THE ASSESSEE HAS ACCEPTED ON-MONEY OF RS. 1 14 500/- FOR EACH SHOP SOLD BY IT. HE FURTHER OBSERVED THAT OUT OF 9 SHOPS 4 SHOPS REMAINED UN-S OLD. SINCE ALMOST ALL SHOPS WERE HAVING MORE OR LESS SAME AREA THE A.O HELD TH AT ASSESSEE HAS ACCEPTED A SUM OF RS. 5 72 500/- (RS. 1 14 500 X 5) AS ON-MON EY AND THE AMOUNT WAS ADDED TO THE INCOME OF THE ASSESSEE. RE-ITERATING THE EXPLANATION MADE BEFORE THE A.O THE ASSESSEE FURTHER CONTENDED BEFORE THE LD CIT(A) THAT THE A.O HAS WRONGLY DRAWN THE CONCLUSION THAT ALL THE SHOPS SOLD BY THE ASSESSEE INVOLVED ACCEPTANCE OF ON-MONEY. IT WAS CONTENDED THAT IN REALITY ON T HE BASIS OF SOME NOTINGS OF SEIZED PAPER THE A.O HAS ASSUMED THAT THE ASSESSEE HAD RE CEIVED RS. 1 14 500/- AS ON- MONEY FROM THE CUSTOMER OF A PARTICULAR SHOP. SO FAR AS ADDITION OF RS. 1 14 500/- MADE BY THE A.O AND IN RESPECT OF SHOPS SOLD TO MR. AND MRS. JOSHI IS CONCERNED THE LD CIT(A) SUSTAINED THE ADDITION ON THE BASIS THAT THE ADDITION HAS BEEN MADE ON THE BASIS OF DOCUMENT SEIZED DURING THE COURSE O F SEARCH OPERATION AND THE ASSESSEE HAS NOT BEEN ABLE TO SATISFACTORILY EXPLAI N THE TRANSACTION RELATING TO THIS AMOUNT. THE LD CIT(A) HOWEVER DELETED THE ADDITI ON MADE BY THE A.O IN RESPECT ITA NO. 452 & 428/PN/2007 M/S.VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. (B.P. 1996-97 TO 2002-03) 4 OF OTHER 4 SHOPS ON THE BASIS THAT IT HAS BEEN MA DE ON SURMISES ONLY AS THE A.O HAS NOT BEEN IN POSSESSION OF ANY MATERIAL GOOD PR OOF THAT ANY MONEY IN ADDITION TO THE AGREED SALE PRICE HAS BEEN RECEIVED BY THE A SSESSEE COMPANY. THE ADDITION MADE BY THE A.O ON ACCOUNT OF ON-MONEY RECEIVED O UT OF SALE OF SHOPS AT RS. 5 72 500/- HAS BEEN THUS RESTRICTED TO RS. 1 14 50 0/- BY THE LD CIT(A). THE ASSESSEE HAD QUESTIONED SUSTENANCE OF ADDITION OF RS. 2 14 500/- BY THE LD. CIT(A) ON THIS ACCOUNT WHEREAS THE REVENUE IS IN APPEAL AG AINST THE RELIEF GRANTED BY THE LD CIT(A) TO THE ASSESSEE IN THIS REGARD. 6. THE LD. D.R. HAD TRIED TO JUSTIFY THE ASSESSMEN T ORDER ON THE ISSUE WITH SUBMISSION THAT WHEN AREA OF THE 5 SHOPS SOLD DURIN G THE YEAR WAS ALMOST SAME THE A.O ON THE BASIS OF DOCUMENTS SEIZED HAD RIGHTL Y COME TO THE CONCLUSION THAT ON-MONEY WAS RECEIVED BY THE ASSESSEE IN SELLING THOSE SHOPS AT THE RATE OF RS. 1 14 500/- ON EACH SHOP. 7. CONSIDERING THE ABOVE SUBMISSION OF LD. D.R. BE FORE US AND THE CASE OF THE ASSESSEE BEFORE THE LOWER AUTHORITIES WE FIND THAT LD CIT(A) HAS RIGHTLY HELD THAT THERE WAS NO EVIDENCE IN POSSESSION OF A.O TO SUPPO RT THE ALLEGATION OF THE A.O THAT SIMILAR AMOUNT OF RS. 1 14 500/- HAS BEEN RECEIVED BY THE ASSESSEE AGAINST THE SALE OF EACH SHOP EXCEPT THE ONE SHOP SOLD TO MR. & MRS. JOSHI. UNDISPUTEDLY IT IS A BLOCK ASSESSMENT WHEREIN ADDITION IS MADE ON ACCOUN T OF UNDISCLOSED INCOME STRICTLY ON THE BASIS OF DOCUMENT SEIZED DURING THE COURSE OF SEARCH. SINCE THERE WAS NO EVIDENCE TO SUPPORT THE ALLEGATION OF THE A. O THAT THE ASSESSEE HAS RECEIVED SIMILAR AMOUNT OF RS. 1 14 500/- BESIDES THE AGREED SALE CONSIDERATION IN REMAINING 4 SHOPS SOLD DURING THE YEAR THE A.O WAS NOT JUST IFIED IN MAKING SUCH ADDITION MERELY ON THE SURMISES THAT SIMILAR EXTRA AMOUNT OF RS. 1 14 500/- AS RECEIVED AGAINST THE SALE OF 1 SHOP TO MR. & MRS. JOSHI AS N OTED OF SEIZED DOCUMENT MIGHT HAVE BEEN RECEIVED IN ALL THE REMAINING SHOPS SOLD DURING THE YEAR. SIMILARLY THERE WAS NO EVIDENCE IN POSSESSION OF THE ASSESSEE TO S UPPORT ITS EXPLANATION THAT RS. ITA NO. 452 & 428/PN/2007 M/S.VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. (B.P. 1996-97 TO 2002-03) 5 50 000/- BESIDES THE AGREED SALE AMOUNT OF RS. 2 9 8 500/- WAS RECEIVED FROM MR. & MRS. JOSHI AGAINST THE SALE OF ONE SHOPS TOWARDS E XTRA WORK TO BE CARRIED ON BY THE ASSESSEE THEREIN AND THAT RS. 1 14 500/- AS MENTION ED IN THE DOCUMENT WAS MERELY AN ESTIMATED FIGURE OF EXTRA WORK. WE ARE ALSO OF THE VIEW THAT IN CASE OF ESTIMATION A SOUND FIGURE IS GENERALLY ARRIVED AT. FIGURE OF RS. 1 14 500/- CANNOT BE TAKEN AS A ROUND FIGURE. A ROUND FIGURE FOR THE PURPOSE OF ESTIMATION WOULD HAVE BEEN EITHER RS. 1 15 500/- OR RS. 1 16 000/- ETC. UNDER THESE CIRCUMSTANCES NEITHER THE ADDITIONS MADE BY THE A.O AGAINST ALL T HE SHOPS CAN BE HELD JUSTIFIED NOR THE ADDITION SUSTAINED BY THE LD CIT(A) AT RS. 1 14 500/- CAN BE INTERFERED. THE FIRST APPELLATE ORDER ON THE ISSUE IS THUS UPHE LD. THE GROUND NO. 1 RAISED IN THIS APPEAL PREFERRED BY THE REVENUE AND GROUND NO. 2 RAISED IN THE APPEAL FILED BY THE ASSESSEE ARE THUS DECIDED AGAINST THEM. THE RE LATED GROUNDS ARE ACCORDINGLY REJECTED. 8. ISSUE NO.2 (REVENUE) ON THE BASIS OF SEIZED DOCUMENT PAGE NO. 17 18 AND 20 TO 26 OF PARTY NO. A 2 BUNDLE NO. 1 I.E. BILLS RELATING TO PURCHASE OF VARIOUS ELECTRONIC GOODS FROM PANKAJ TELE VIDEO CENTRE BY SHRI BELWALKAR AND HIS FAMILY MEMBERS THE A.O MADE ADDITION OF RS. 1 38 271/- I.E. TOTAL PURCHASE AMOUNT. BEFORE THE LD CIT(A) THE ASSESSEE OBJECTED THE AD DITION ON THE BASIS THAT THE DOCUMENTS WERE SEIZED FROM THE PREMISES OF SHRI SAR AT K. BELWALKAR AND OTHERS AT FLAT NO. 12 THIRD FLOOR 360/361 NARAYAN PETH LAX MI ROAD PUNE AND THE AMOUNT HAS BEEN EXPLAINED IN INDIVIDUAL BLOCK RETURNS OF S HRI BELWALKAR FAMILY MEMBERS AND THE ASSESSEE COMPANY DOES NOT COME INTO PICTURE SO FAR AS THIS ISSUE IS CONCERNED. SIMILAR EXPLANATION MADE BEFORE THE A.O WAS NOT ACC EPTED BY HIM BUT LD CIT(A) ACCEPTED THIS EXPLANATION OF THE ASSESSEE AND DELET ED THE ADDITION. LD CIT(A) HAS DELETED THE ADDITION ON THE BASIS THAT SEIZED PAPER S HAVING BEEN FOUND FROM THE PREMISES OF THE ASSESSEE COMPANY DO NOT THEY CONTAI N ANY INFORMATION TO SHOW THAT THE SAID GOODS HAVE BEEN PURCHASED IN THE NAME OF THE COMPANY. THE LD CIT(A) HAS OBSERVED FURTHER THAT THE A.O HIMSELF HAS MENTIONED THAT THE VARIOUS ELECTRONIC ITA NO. 452 & 428/PN/2007 M/S.VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. (B.P. 1996-97 TO 2002-03) 6 GOODS WERE PURCHASED BY SHRI BELWALKAR AND HIS FAMI LY MEMBERS. BEFORE US THE LD. D.R. HAS TRIED TO JUSTIFY THE ACTION OF THE A.O ON THIS ISSUE. WE HOWEVER DID NOT FIND SUBSTANCE THEREIN SINCE WHEN THE A.O HAS H IMSELF NOTED THAT VARIOUS ELECTRONIC GOODS WERE PURCHASED BY SHRI BELWALKAR A ND HIS FAMILY MEMBERS AND THE DOCUMENTS ON THE BASIS OF WHICH ADDITION IN QUESTI ON HAS BEEN MADE WERE SEIZED FROM THE PREMISES OF SHRI SARAT K. BELWALKAR AND OT HERS THE ASSESSEE COULD NOT HAVE BEEN EXPECTED TO EXPLAIN THE SAME. WE THUS ARE NOT INCLINED TO INTERFERE WITH THE FIRST APPELLATE ORDER IN THIS REGARD AS TH E LD CIT(A) HAS RIGHTLY DELETED THE ADDITION IN ABSENCE OF EVIDENCE THAT THE AMOUNT SH OWN IN THE SEIZED DOCUMENT WAS RELATED TO THE ASSESSEE. THE FIRST APPELLATE ORDER IS THUS UPHELD. THE ISSUE IS DECIDED AGAINST THE REVENUE. THE RELATED GROUNDS A RE REJECTED. GROUND NO. 1( ASSESSEE) 9. HAVING GONE THROUGH THE ORDERS OF THE LOWER AUTH ORITIES AND THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE THEM WE FIND THAT THE A.O MADE ADDITION OF RS.48 160/- ON THE BASIS OF SEIZED DOCUMENTS WHEREI N ENTRIES OF SEVERAL AMOUNTS WERE FOUND WHICH HAVE BEEN TOTALED AT RS. 48 160/-. ALL THESE SEIZED DOCUMENTS WERE RELATING TO BUNDLE NO. 17 THE DETAILS OF WHIC H HAVE BEEN GIVEN BY THE A.O IN THE ASSESSMENT ORDER AND THE LD CIT(A) IN PARA NO. 4.1 ON THE FIRST APPELLATE ORDER. THE MAIN OBJECTION OF THE ASSESSEE AGAINST THIS ADD ITION REMAINED THAT THESE DOCUMENTS ARE NEITHER IN THE HAND-WRITING OF THE DI RECTORS OF THE COMPANY NOR ANY STAFF MEMBERS. THE LD CIT(A) HAS SUSTAINED THE ADD ITION ON THE BASIS THAT THE ASSESSEE HAS FAILED TO DISCHARGE ITS ONUS TO PROVE THAT THE INFORMATION CONTAINED ON THE DOCUMENTS FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION IN THE PREMISES OF THE ASSESSEE DO NOT PERTAIN TO IT. WE FULLY AGREE WITH THE APPROACH OF THE LD CIT(A) AS IN SUCH SITUATION WHEN THE DOCUME NTS CONTAINING THE ENTRIES HAVE BEEN FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION IN THE PREMISES OF THE ASSESSEE ONUS LIES HEAVILY ON ASSESSEE TO EXPLAIN THE SAME AND ASSESSEE CANNOT BE ITA NO. 452 & 428/PN/2007 M/S.VASTUNIRMITEE DEVELOPERS & BUILDERS PVT. LTD. (B.P. 1996-97 TO 2002-03) 7 ABSOLVED WITH AN EXCUSE THAT THOSE DOCUMENTS ARE NO T IN THE HANDWRITING OF THE EXECUTIVE OR STAFF MEMBERS OF THE ASSESSEE COMPANY. IN ABSENCE OF ANY CONVINCING EXPLANATION WE ARE OF THE VIEW THAT LD. CIT(A) HAS RIGHTLY SUSTAINED THE ADDITION. WE THUS DO NOT FIND REASON TO INTERFERE THEREWITH . THE SAME IS UPHELD. GROUND NO. 2 IS ACCORDINGLY REJECTED. 10. CONSEQUENTLY BOTH THE APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON TH OCTO BER 2010 SD/- SD/- (RAJENDRA SINGH) (I.C. SUDHIR) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE DATED THE 29TH OCTOBER 2010 THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 2 9-10-2010. SD/- SD/- (G.S. PANNU) (I.C. SUDHIR) A.M. J.M US COPY OF THE ORDER IS FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A)- III PUNE 4. CIT IV PUNE 5. D.R. ITAT A BENCH 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES PUNE