Appeal details
Counselvise Citation
[2017] 123 COUNSELVISE.COM (IT) 3182 (ITAT-AMRITSAR)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 6 month(s) 3 day(s)
Appellant
Respondent
Appeal Type
Cross Objection
Pronouncement Date
11-10-2017
Appeal Filed By
Assessee
Order Result
Dismissed
Bench Allotted
DB
Next Hearing Date
21-06-2017
Assessment Year
misc
Appeal Filed On
08-04-2016
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. T. S. KAPOOR, ACCOUNTANT MEMBER AND SH. N. K. CHOUDHRY, JUDICIAL MEMBER I.T.A NO. 89/(ASR)/2016 ASSESSMENT YEAR: 2004-05 PAN: ADDPS2145Q INCOME TAX OFFICER, WARD-5 (4), AMRITSAR. VS. SH. VIJAY KUMAR SHARMA, PROP. M/S NATIONAL MOTORS, 10-11, COURT ROAD, AMRITSAR. (APPELLANT) (RESPONDENT) CROSS OBJECTION NO. 10/(ASR)/2016 ARISING OUT OF ITA NO. 89/(ASR)/2016 ASSESSMENT YEAR: 2004-05 PAN: ADDPS2145Q [ SH. VIJAY KUMAR SHARMA, PROP. M/S NATIONAL MOTORS, 10-11, COURT ROAD, AMRITSAR. VS. INCOME TAX OFFICER, WARD-5 (4), AMRITSAR. (CROSS OBJECTORS) (RESPONDENT) APPELLANT BY : SH. RAHUL DHAWAN (D. R.) RESPONDENT BY: SH. P. N. ARORA (ADV.) DATE OF HEARING: 17.08.2017 DATE OF PRONOUNCEMENT: 11.10.201 7 ORDER PER T. S. KAPOOR (AM): THIS IS AN APPEAL FILED BY REVENUE AGAINST THE ORDE R OF LD. CIT(A), AMRITSAR DATED 03.11.2015 FOR ASST. YEAR: 2004-05. 2. THE GROUNDS OF APPEAL TAKEN BY REVENUE ARE REPRO DUCED BELOW: (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A)-2, AMRITSAR ERRED IN LAW AND FACTS AND ALLOWING THE AP PEAL OF THE ASSESSEE ON THE ISSUE OF ADDITION OF RS.16,62,000/- MADE BY THE ASSESSING OFFICER, WITHOUT APPRECIATING THE FACTS T HAT DURING RE- ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS A LLOWED ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 2 SUFFICIENT OPPORTUNITIES TO THE ASSESSEE, BUT THE A SSESSEE FAILED TO PRODUCE M/S M. R. BOGGA AND FAMILY OR HIS CONFIRMAT ION. (II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LD. CIT(A)-2, AMRITSAR ERRED IN LAW AND FACTS AND ALLOWING THE AP PEAL OF ASSESSEE ON THE ISSUE OF ADDITION OF RS.9,00,000/- MADE BY ASSESSING OFFICER, WITHOUT APPRECIATING THE FACTS T HAT DURING RE- ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS FAILED TO PRODUCE THE LEGAL HEIR OF R. L. BHATIA OR THEIR CONFIRMATIONS, IN SPITE OF SUFFICIENT OPPORTUNITIES WERE ALLOWED TO THE ASSESSEE. (III) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A)-2, AMRITSAR ERRED IN LAW AND FACTS IN ALLOWING THE APP EAL OF THE ASSESSEE ON THE ISSUE OF ADDITION OF RS.4,40,000/- MADE BY ASSESSING OFFICER ON ACCOUNT OF COMMISSION RECEIPT WITHOUT APPRECIATING THE FACTS THAT DURING RE-ASSESSMENT PR OCEEDINGS, THE ASSESSEE FAILED TO FILE PARTY-WISE DETAIL OF COMMIS SION AND PRODUCE BOOKS OF ACCOUNT FOR VERIFICATION. (IV) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN ALLOWING THE APPEAL OF TH E ASSESSEE ON THE ISSUE OF ADDITIONS MADE BY ASSESSING OFFICER OF RS. 11,97,235/- ON ACCOUNT OF CONSTRUCTION CHARGES AND RS.3,21,600/- O N ACCOUNT OF COMMISSION RECEIPT, WITHOUT APPRECIATING THE FACTS THAT DURING RE- ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO FILE PARTY-WISE DETAIL OF CONSTRUCTION CHARGE AND COMMISSION RECEIV ED AS WELL AS PRODUCE BOOKS OF ACCOUNT FOR VERIFICATION. (V) APPLICANT CRAVES LEAVE TO AMEND OR ADD ANY OR MORE GROUNDS OF APPEAL. 3. AT THE OUTSET, THE LD. DR SUBMITTED THAT LD. CIT (A) HAD DELETED THE ADDITIONS MADE BY ASSESSING OFFICER WITHOUT APPRECI ATING THE FACTS THAT DURING RE-ASSESSMENT PROCEEDINGS, THE ASSESSING OFF ICER HAD ALLOWED SUFFICIENT OPPORTUNITIES TO THE ASSESSEE BUT THE AS SESSEE FAILED TO PRODUCE M/S M. R. BOGGA AND FAMILY AND MR. R. L. BHATIA FOR THIER CONFIRMATIONS. THE LD. DR FURTHER ARGUED THAT THE L D. CIT(A) FURTHER DELETED THE ADDITIONS OF RS.4,40,000/- WHICH THE AS SESSING OFFICER HAD MADE ON ACCOUNT OF COMMISSION RECEIPT WITHOUT APPRE CIATING THE FACTS THAT DURING RE-ASSESSMENT PROCEEDINGS, THE ASSESSEE FAILED TO FILE PARTY- ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 3 WISE DETAIL OF COMMISSION AND PRODUCE BOOKS OF ACCO UNT FOR VERIFICATION. SIMILARLY HE ARGUED THAT THE OTHER ADDITIONS FOR CO NSTRUCTION CHARGES AND COMMISSION RECEIPTS WERE DELETED WITHOUT APPRECIATI NG THE FACT THAT DURING RE-ASSESSMENT PROCEEDINGS, THE ASSESSEE FAIL ED TO FILE PARTY-WISE DETAIL OF CONSTRUCTION CHARGES AND COMMISSION RECEI PT. THEREFORE IT WAS PRAYED THAT ORDER OF LD. CIT(A) BE SET ASIDE. 4. THE LD. AR ON THE OTHER HAND SUBMITTED THAT ASS ESSEE HAD FILED HIS RETURN OF INCOME AT RS.69,718/- ON 17.12.2004 A ND ASSESSMENT WAS COMPLETED BY ASSESSING OFFICER ON 22.12.2006 AT AN INCOME OF RS.79,44,900/-. IT WAS SUBMITTED THAT LD. CIT(A) HA D UPHELD THE ADDITION HOWEVER THE HON'BLE BENCH OF AMRITSAR ITAT VIDE ITS ORDER DATED 18.11.2008 HAD RESTORED THE MATTER BACK TO THE FILE OF LD. CIT(A) WITH THE DIRECTION TO AFFORD REASONABLE OPPORTUNITY OF BEING HEARD. THE LD. AR SUBMITTED THAT LD. CIT(A) ALLOWED PART RELIEF TO TH E ASSESSEE AND THE DEPARTMENT WENT IN APPEAL BEFORE THE HON'BLE ITAT W HICH VIDE ITS ORDER DATED 28.10.2013 SET ASIDE THE ASSESSMENT TO THE FI LE OF ASSESSING OFFICER TO DECIDE THE SAME AFRESH. THE LD. AR SUBMITTED THA T ASSESSING OFFICER AGAIN COMPLETED THE ASSESSMENT AT FIGURE OF RS.79,4 4,900/- AT WHICH FIGURE THE ORIGINAL ASSESSMENT WAS MADE. THE ASSESS EE AGAIN FILED APPEAL BEFORE LD. CIT(A) AND WHO DELETED THE WHOLE OF THE ADDITIONS AND NOW THE DEPARTMENT IS IN APPEAL BEFORE THIS TRIBUNAL. EXPLA INING THE FACTS OF THE CASE, THE LD. AR SUBMITTED THAT ASSESSING OFFICER H AD MADE AND ADDITION OF RS.16,62,000/- WHICH WAS FOUND CREDITED IN THE B OOKS OF ACCOUNTS OF ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 4 THE ASSESSEE IN THE NAME OF M. R. BOGGA AND FAMILY MEMBERS. IT WAS SUBMITTED TO THE ASSESSING OFFICER THAT THE ASSESSE E HAD SOLD PLOTS OF BOGA GROUP AND HAD EARNED COMMISSION ON THE SALE PR OCEEDS AND IT WAS SUBMITTED THAT SALE PROCEEDS WERE CREDITED TO THE A CCOUNTS OF M. R. BOGGA AND FAMILY MEMBERS AND WAS CHARGED A COMMISSI ON AT THE RATE OF 10%. HE SUBMITTED THAT THE COMPLETE COPY OF ACCOUNT S OF BOGA AND COMPANY ALONG WITH COPIES OF SALE DEEDS WERE FILED BEFORE THE LD. CIT(A). IN THIS RESPECT, THE LD. AR INVITED OUR ATTENTION T O P.B. PAGE 42 WHERE A COPY OF ACCOUNT SHOWING THE SALE PROCEEDS OF PLOT W AS PLACED. THE LD. AR ALSO INVITED OUR ATTENTION TO COPIES OF SALE DEEDS AND SPECIAL POWER OF ATTORNEY PLACED IN P.B. PAGE 44 TO 56. IT WAS SUBMI TTED THAT LD. CIT(A) HAS PASSED AN EXHAUSTIVE ORDER AND AFTER APPRECIATI NG THE FACTS OF THE CASE HAS DELETED THE ADDITIONS. ARGUING UPON THE SECOND ADDITION OF RS.9 LAKHS ON ACCOUNT OF UNEXPLAINED CREDITS IN THE NAME OF SH. R. L. BHATIA , THE LD. AR SUBMITTED THAT THE SAID AMOUNT OF LOAN WAS NOT RECE IVED DURING THE YEAR AND IT WAS CARRIED FORWARD BALANCES AND IN THIS RES PECT OUR ATTENTION WAS INVITED TO P.B. PAGE 61 WHERE A COPY OF ACCOUNT OF MR. R. L. BHATIA SHOWING IT AS AN OPENING BALANCE WAS PLACED. THE LD . AR ALSO INVITED OUR ATTENTION TO P.B. PAGE 60 WHERE A COPY OF BALANCE S HEET OF THE ASSESSEE FOR THE YEAR ON 31.03.2003 WAS PLACED AND WHERE THE AMOUNT OF RS. 9,00,000/- WAS APPEARING AS PART OF ADVANCES AGAINS T CONSTRUCTION AND THEREFORE IT WAS PRAYED THAT LD. CIT(A) CORRECTLY D ELETED THE ADDITION. ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 5 AS REGARDS THE ADDITION OF RS.4,40,000/-, THE LD. AR SUBMITTED THAT ASSESSEE HAD DECLARED A COMMISSION OF AN AMOUN T OF RS.60,000/-. THE ASSESSING OFFICER WITHOUT ANY MATERIAL IN HIS P OSSESSION ESTIMATED THE COMMISSION TO THE TUNE OF RS.5,00,000/- AND MAD E THE ADDITION OF RS.4,40,000/- AND WHICH THE LD. CIT(A) HAS RIGHTLY DELETED. AS REGARDS THE ADDITION OF RS.11,97,235/- WHICH TH E ASSESSING OFFICER HAD MADE ON ACCOUNT OF CONSTRUCTION CHARGES , THE LD. AR SUBMITTED THAT ASSESSING OFFICER HAD ESTIMATED THE CONSTRUCTION CHARGES AT RS.20,00,000/- AND AFTER DEDUCTING RS.8,02,765/- WHICH THE ASSESSEE HAD DECLARED AS NET PROFIT OUT OF CONSTRUCTION ACTI VITY MADE AN ADDITION OF RS.11,97,235/-. THE LD. AR SUBMITTED THAT ASSESS ING OFFICER MISDIRECTED HIMSELF IN ESTIMATING THE GROSS RECEIPT OF CONSTRUCTION CHARGES AT RS.20,00,000/- WHEREAS THE ACTUAL CONSTR UCTION CHARGES RECEIPT OF THE ASSESSEE WERE TO THE TUNE OF RS.38, 64,000/- AND WHICH WERE DECLARED IN THE P & L ACCOUNT. THE LD. AR SUBM ITTED THAT INSTEAD OF CONSIDERING THE CONSTRUCTION CHARGES OF RS.38,64,00 0/-, THE ASSESSING OFFICER MISTOOK THE GROSS PROFIT FIGURE OF RS.8,02, 705/- WHICH IS NOT AS PER THE FACTS AND THEREFORE LD. CIT(A) HAS RIGHTLY DELETED THE SAME. AS REGARDS THE ADDITION OF RS.3,21,6000/- WHICH TH E ASSESSING OFFICER HAD MADE ON ACCOUNT OF ESTIMATION OF COMMIS SION INCOME AT RS.5,00,000/-, THE LD. AR SUBMITTED THAT ASSESSING OFFICER AFTER ESTIMATING THE INCOME AT RS.5,00,000/- MADE THE ADD ITION OF RS.3,21,600/- AFTER CONSIDERING THE ALREADY DECLARE D INCOME OF ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 6 RS.1,78,700/-. THE LD. AR SUBMITTED THAT ASSESSING OFFICER HAD MADE THIS ADDITION WITHOUT ANY BASIS AND WHICH THE LD. C IT(A) HAS RIGHTLY DELETED. AS FAR AS THE CROSS OBJECTIONS FILED BY ASSESSEE A RE CONCERNED, THE LD. AR SUBMITTED THAT THESE ARE ONLY SUPPORTIVE OF LD. CIT(A)S ORDER. 5. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE THOUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT LD. CIT(A) AFTER GOI NG THROUGH ALL RECORDS AND RELEVANT FACTS AND CIRCUMSTANCES OF THE CASE HA S PASSED AN EXHAUSTIVE AND SPEAKING ORDER AND IN WHICH EACH OF THE ADDITION MADE BY ASSESSING OFFICER HAS BEEN DISCUSSED. IT WILL BE APPROPRIATE TO REPRODUCE HIS FINDINGS VIS--VIS VARIOUS ADDITIONS. THE FINDINGS OF LD. CIT(A) ARE REPRODUCED BELOW: (V) THE GROUND OF APPEAL NO. 5 IS AGAINST THE ADDI TION OF RS.16,62,000/- ON ACCOUNT OF AMOUNT SHOWN AS ADVANC E IN THE NAME OF M/S M R BHOGA & FAMILY FROM UNDISCLOSED SOURCES. AS PER THE BALANCE SHEET THE ASSESSEE HAD SHOWN ADVANCE AGAINST LAND A MOUNTING TO RS.88,55,470/- WHICH INCLUDES AN AMOUNT OF RS 16,62 ,000/- RECEIVED FROM M/S M R BHOGA 8S FAMILY. THE ASSESSEE WAS ASKED TO FURNISH COMPLETE DETAILS IN THIS REGARD IN RESPONSE TO WHICH THE ASS ESSEE HAD FILED THE COPY OF ACCOUNT OF THE PARTY AND THE COPY OF SALE DEED A ND CLAIMED THAT CERTAIN PLOTS WERE SOLD BY THE ASSESSEE ON BEHALF OF M/S M R BHOGA & FAMILY ON WHICH COMMISSION WAS CHARGED. DURING REASSESSMENT P ROCEEDINGS THE ASSESSEE WAS ASKED TO PRODUCE M/S M R BHOGA & FAMIL Y FOR EXAMINATION OR FILE THEIR CONFIRMATION BUT THE ASSESSEE FAILED TO DO SO. THEREFORE THE AO DID NOT ACCEPT THE CLAIM OF THE ASSESSEE OF HAVING SOLD PLOTS OF M/S M R BHOGA & FAMILY AND ADDED BACK THE AMOUNT OF ADVANCE OF RS 16,62,000/- SHOWN IN THE NAME OF M/S M R BHOGA & FAMILY. IN THE PRESENT APPEAL PROCEEDING THE APPELLANT HAS FILED THE SUBMISSIONS MADE ON THIS ISSUE BEFORE THE CIT(A), A MRITSAR IN THE FIRST ROUND OF APPEAL PROCEEDING. THE CONTENTION OF THE A SSESSEE WAS THAT THE ASSESSEE WAS SELLING PLOTS OF LAND FOR AND ON BEHAL F OF M R BOGA & FAMILY MEMBERS AND WAS EARNING ONLY COMMISSION / BROKERAGE / DALALI. THE LAND OF M R BOGA & FAMILY MEMBERS WAS SOLD AND THE SALE PROCEEDS WERE CREDITED IN THE ACCOUNTS OF M. R. BOGA & FAMILY MEM BERS. IT WAS POINTED ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 7 OUT THAT THE ASSESSEE HAS SHOWN COMMISSION @ 10% AN D A SUM OF RS 17,87,008/- WAS CREDITED IN THE BOOKS OF ACCOUNTS. IT WAS POINTED OUT THAT THE ASSESSEE WAS HAVING POWER OF ATTORNEY FOR SELLI NG OF PLOTS OF M R BOGA & FAMILY MEMBERS. THE COPIES OF SALE DEEDS WERE ALS O ENCLOSED WITH THE WRITTEN SUBMISSIONS WHICH CLEARLY PROVE THAT THE AS SESSEE WAS ONLY EARNING COMMISSION INCOME OUT OF THE SALE PROCEEDS CARRIED ON BEHALF OF M R BOGA & FAMILY MEMBERS AND THEREFORE THERE WAS NO REASON FOR MAKING THE ADDITION. DURING THE FIRST ROUND OF APPEAL BEFO RE THE CIT(A) THE AO WAS GIVEN PROPER OPPORTUNITY AND THE REPLY OF THE AO WA S RECEIVED VIDE REMAND REPORT DATED 12/15-3-2010 WHEREIN HE STATED THAT THE ADDITION OF RS 16,62,000/- WAS MADE AS THE ASSESSEE WAS NOT ABL E TO FILE EVIDENCE /CONFIRMATION FROM MRS. M R BOGA & FAMILY MEMBERS R EGARDING SALE OF LAND ON THEIR BEHALF THROUGH POWER OF ATTORNEY FOR RS 16,62,000/- DURING THE YEAR RELEVANT TO THE A Y UNDER CONSIDERATION. THE APPELLANT HAS FURNISHED THE COPY OF GENERAL POW ER ATTORNEY ISSUED BY SMT. M R BOGA D/O SHRI RUSTAM G, R/O R- 7 B, GREEN PARK MARKET, NEW DELHI IN FAVOUR OF SHRI VIJAY SHARMA S/ O SHRI INDERJIT SHARMA (ASSESSEE) IN RESPECT OF 450 SQ YDS OF PROPERTY HAVING TOTAL AREA 7655 SQ YDS, KHASRA NO. 144- 152/130 MIN SITUATED AT AMRITS AR URBAN, HIDE MARKET, G T ROAD, AMRITSAR FOR WHICH MRS M R BOGA H AD MADE AN AGREEMENT TO SELL WITH M/S SWARAN MANDIR ASSOCIATES , 10-11, COURT ROAD, AMRITSAR. THE APPELLANT WAS A SHAREHOLDER OF M/S SW ARAN MANDIR ASSOCIATES, 10-11, COURT ROAD, AMRITSAR GIVEN INTER ALIA THE POWER TO SELL THE PROPERTY TO ANYONE HE WANTS ON ANY PRICE, TO GI FT, LEASE, MORTGAGE, PARTITION THE SAID PROPERTY AND EXECUTE NECESSARY D EEDS, TO EXECUTE EXCHANGE DEED OR TRANSFER THE SAID PROPERTY IN ANY OTHER MEANS, TO RECEIVE SALE CONSIDERATION, TO MUTATE THE PROPERTY IN FAVOU R OF THE PURCHASER. THE SAID POWER OF ATTORNEY WAS EXECUTED ON 24-01-2000. A SIMILAR GENERAL POWER OF ATTORNEY WAS ISSUED BY S MT M R BOGA SMT. M R. BOGA D/O SHRI RUSTAM G, R/O R-7B, GREEN P ARK MARKET, NEW DELHI IN FAVOUR OF SHRI VIJAY SHARMA S/O SHRI INDER JIT SHARMA (ASSESSEE) IN RESPECT OF 500 SQ YDS OF PROPERTY HAVING TOTAL AREA 7655 SQ YDS, KHASRA NO. 144-152/130 MIN SITUATED AT AMRITSAR URBAN, HID E MARKET, G T ROAD, AMRITSAR FOR WHICH MRS M R BOGA HAD MADE AN AGREEME NT TO SELL WITH M/S SWARAN MANDIR ASSOCIATES, 10-11, COURT ROAD, AMRITS AR. THE SAID POWER OF ATTORNEY WAS EXECUTED ON 04-05-2000. SIMILARLY A GENERAL POWER OF ATTORNEY WAS ISSUED BY SHRI JAGDISH INDER SINGH S/O CAPT KARAM SINGH R/O HIDE MARKET, A MRITSAR IN FAVOUR OF SHRI VIJAY SHARMA S/O SHRI INDERJIT SHARMA (ASSESSE E) IN RESPECT OF PROPERTY HAVING TOTAL AREA 7655 SQ YDS, KHASRA NO. 144-152/130 MIN SITUATED AT AMRITSAR URBAN, HIDE MARKET, G T ROAD, AMRITSAR FOR WHICH HE HAD MADE AN AGREEMENT TO SELL WITH M/S SWARAN MANDI R ASSOCIATES, 10- 11, COURT ROAD, AMRITSAR. THE SAID POWER OF ATTORNE Y WAS EXECUTED ON 29- 05-2000. THE APPELLANT HAD ALSO SUBMITTED THE COPIES OF SALE DEED OF PLOTS SOLD IN AMRITSAR URBAN, HIDE MARKET, TEHSIL, AMRITS AR AS UNDER:- ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 8 SR NO. NAME OF SELLER THROUGH SELF / POWER OF ATTORNEY PLOT NO. SOLD/ AREA SOLD SALE CONSIDERATION (RS) NAME OF PURCHASER DATE OF SALE DEED 1. MRS. M R BOGA W/ O ROBERT GROSAKRATH BOGA R/O R- 7B, GREEN PARK MARKET, NEW DELHI SH VIJAY SHARMA S/O SH INDERJIT SHARMA 58 / 33.33 SQ YDS 200,000/- SMT. DARSHAN RANI W/O LATE SHRI YASHPAL 22-08 03 2. MRS. M R BOGA W/O ROBERT GROSAKRATH BOGA R/O R- 7B, GREEN PARK MARKET, NEW DELHI SHARMA S/O SHRI INDERJIT SHARMA YDS SURINDER KUMAR S/O SHRI GURDITTA MAL, & SMT. VEENA KUMARI W/O SHRI SURINDER KUMAR 02 3. SH. JAGDISH SINGH S/O CAPT KARAN SINGH SHRI VIJAY SHARMA S/O SHRI INDERJIT SHARMA 3/46.67 SQ YDS 250,000/- SHRI RAMESH KUMAR S/O SHRI JAGAN NATH 14-02- 2003 4. SH. JAGDISH SINGH S/O CAPT KARAN SINGH SHRI VIJAY SHARMA S/O SHRI INDERJIT SHARMA 4- 5/78.33 SQ YDS 353,000/- SHRI SUKHDEV SINGH JOSAN S/O SHRI GURBAX SINGH JOSAN AND OTHERS 7-6-2000 5. MRS. M R BOGA W/ O ROBERT GROSAKRATH BOGA R/O R- 7B, GREEN PARK MARKET, SHRI VIJAY SHARMA S/O SHRI INDERJIT SHARMA 84/33.33 SQ. YDS 200,000/- SHRI MADHU SUDAN S/O SHRI JAGANNATH GUPTA 11-8-03 NEW DELHI 6. MRS. M R BOGA W/ O ROBERT GROSAKRATH BOGA R/O R- 7B, GREEN SHRI VIJAY SHARMA S/O SHRI INDERJIT SHARMA 39/33.33 SQ YDS 200,000/- SHRI RAJIV PANDEY S/O SHRI A P PANDEY 20-06-02 ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 9 PARK MARKET, NEW DELHI 7. MRS. M R BOGA W/ O ROBERT GROSAKRATH BOGA R/O R- 7B, GREEN PARK MARKET, NEW DELHI SHRI VIJAY SHARMA S/O SHRI INDERJIT SHARMA 45/33.33 SQ. YDS 200,000/- SHRI JAGJIT SINGH S/O SHRI DARA SINGH 27-06-03 TOTAL 17,03,000/- THEREFORE ALL THE ABOVE SALE DEEDS WERE EXECUTED BY SH VIJAY SHARMA S/O SHRI KARAM SINGH (APPELLANT) IN THE CAPA CITY OF HOLDER OF GENERAL POWER OF ATTORNEY ISSUED IN HIS FAVOUR BY T HE ABOVE NAMED OWNERS OF LAND NAMELY MR. M R BOGA & FAMILY MEMBERS , AND NOT IN THE CAPACITY OF THE OWNER OF LAND. THEREFORE THE SALE P ROCEEDS OF THE LAND (AS ABOVE) WAS CREDITED TO THE LEDGER ACCOUNT OF PLOT SALE N. S. COMPLEX IN THE BOOKS OF SHRI VIJAY KUMAR SHARMA PROP. M/S NATI ONAL MOTORS, COURT ROAD, AMRITSAR AND THE CREDIT BALANCE AS ON 31-3-20 04 WAS RS 16,62,000/-. THE PHOTOCOPIES OF SALE DEEDS REVEAL T HAT THE SOURCE OF SALE OF PLOTS WAS THE TUNE OF RS 17,87,000/- ON WHICH CO MMISSION OF RS'1:78,700/- WAS CHARGED @ 10%. THE COPY OF COMMI SSION ACCOUNT IN THE BOOKS OF SHREE VEE-JAY BUILDERS & DEVELOPERS FO R THE YEAR ENDING 31- 03-2004 REVEALS CREDIT OF COMMISSION FROM MR. M R B OGA OF RS 178,700/-. IT IS OBSERVED THAT WHILE MAKING THE ADDITION OF RS 16,62,000/- THE AO HAD PLACED A LOT OF EMPHASIS THAT THE ASSESSEE H AD NOT PRODUCED CONFIRMATION FROM M/S M R BOGGA & FAMILY NOR PRODUC ED THEM FOR EXAMINATION. HOWEVER, THE APPELLANT VIDE LETTER DAT ED 14-12-06 INFORMED THE AO IN RESPONSE TO NOTICE DATED 12-12-06 THAT TH E OWNER MRS M R BOGGA WAS NOW STAYING IN USA AND SINCE THERE HAVE BEEN DI SPUTE WITH THESE PARTIES, HE WAS NOT IN TOUCH WITH THEM. IT SEEMS TH AT THE AO HAD OVERLOOKED THE SAID SUBMISSION OF THE APPELLANT. THE SAID AMOUNT OF RS 16,62,000/- ON ACCOUNT OF SAL E PROCEEDS OF LAND OF M/S BOGGA GROUP AT HIDE MARKET IN F Y 2003- 04 WAS BELONGING TO OF M/S M.R. BOGGA 86 FAMILY AND HELD WITH THE APPEL LANT AS TRUST MONEY ONLY AND THEREFORE NOT THE INCOME OF THE APPELLANT. THEREFORE THE ADDITION OF RS 16,62,000/- WAS UNJUSTIFIED AND IS DELETED. (VI) THE GROUND OF APPEAL NO. 6 IS AGAINST THE ADDI TION OF RS.9,00,000/- IN THE NAME OF SHRI R L BHATIA IN THE BOOKS OF M/S VEEJAY BUILDERS &, DEVELOPERS AS INCOME FROM UNDISCLOSED SOURCES. THE AO OBSERVED A CREDIT BALANCE OF RS 900,000/- AS ON 31-03-2004 IN THE NAM E OF SHRI R L BHATIA IN THE BALANCE SHEET OF M/S SHRI VEEJAY BUILDERS 86 DEVELOPERS. THE AO ASKED THE ASSESSEE TO FURNISH CONFIRMATION OF SHRI R L BHATIA TO JUSTIFY THE CREDIT BALANCE AND OTHER DOCUMENTARY EVIDENCES TO P ROVE THE SAME. IN THE ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 10 REPLY FILED BY THE ASSESSEE BEFORE THE AO IT WAS ST ATED THAT THIS IS AN OLD BALANCE WHICH WAS CARRIED FORWARD DURING THE YEAR U NDER CONSIDERATION AND SUBMITTED THE COPY OF ACCOUNT OF THE SAME ALONG WITH COPY OF BALANCE SHEET OF A Y 2003-04. THE AO HOWEVER DEMANDED THE A SSESSEE TO PRODUCE THE LEGAL HEIR OF SHRI R L BHATIA FOR EXAMINATION A ND FILE CONFIRMATION OF LEGAL HEIR, BUT THE ASSESSEE FAILED TO PRODUCE THE LEGAL HEIR AS WELL AS CONFIRMATION BUT SIMPLY FILED THE COPY OF ACCOUNT O F THE DECEASED SHRI R L BHATIA. THEREFORE THE AO DID NOT ACCEPT THE ADVANCE AS GENUINE AND ADDED BACK TO THE TOTAL INCOME AS INCOME FROM UNDIS CLOSED SOURCES. IN THE WRITTEN SUBMISSIONS IT WAS ARGUED THAT THIS IS NOT FRESH CREDIT BUT AN OLD BALANCE WHICH WAS CARRIED FORWARD FROM L AST YEAR AND APPEARING IN THE BALANCE SHEET OF LAST YEAR. HE SUB MITTED THE PHOTOCOPY OF BALANCE SHEET OF LAST YEAR TO PROVE THAT THE CREDIT BALANCE IN THE NAME OF SHRI R L BHATIA IS AN OLD BALANCE. IT IS OBSERVED THAT THE ASSESSEE HAD INFORMED THE A O VIDE LETTER DATED 29-11-2006 IN RESPONSE TO NOTICE OF AO DATED 24-11- 06 THAT THE ASSESSEE HAD RECEIVED A SUM OF RS 900,000/- FROM SH RI R L BHATIA R/O 14, R B RATTAN CHAND ROAD, THE MALL, AMRITSAR FOR C ONSTRUCTION OF SHOP NO. 47-48, 54. THE AMOUNT WAS RECEIVED BY CHEQUE WHICH WAS ENCASHED IN HIS ACCOUNT IN UCO BANK. HOWEVER SHRI R L BHATIA HA D EXPIRED AND AFTER HIS DEATH HIS BANKER PUNJAB NATIONAL BANK HAD AFFIX ED NOTICES FOR TAKING OVER THE POSSESSION OF THESE PLOTS AND THE BUILDING UNDER CONSTRUCTION. THE APPELLANT HAD SUBMITTED THE COPIES OF BANK STATEMEN T OF UCO BANK ACCOUNT NO. 345, OBC CURRENT ACCOUNT NO. 8399 AND O BC CC ACCOUNT NO. 1135 WITH COMPLETE NARRATION BEFORE THE AO. THE ATTESTED COPY OF BALANCE SHEET OF M/S SHREE VEE JAY BUILDERS & DEVELOPERS FOR THE YEAR ENDING 31-03-2003 WAS PERUS ED, WHICH REVEALED THE ADVANCE AGAINST CONSTRUCTION RECEIVED FROM SH R . L. BHATIA (PLOT NO. 47, 48 AND 54) AT RS 900,000/- AND THIS PROVES THAT IT WAS AN OLD BALANCE WHICH WAS CARRIED FORWARD FROM LAST YEAR. ACCORDING LY THE ADDITION OF RS 900,000/- ON ACCOUNT OF CREDIT BALANCE IN THE NAME OF SHRI R L BHATIA APPEARING IN THE BALANCE SHEET OF THE APPELLANT FOR A Y 2004-05 WAS UNCALLED FOR. FURTHER THE AO IN HIS REMAND REPORT D ATED 12/15-03-2010 IN THE FIRST ROUND OF APPEAL BEFORE CIT(A) THE AO HAD NOT PLACED ANY MATERIAL ON RECORD FOR NOT ACCEPTING THE DEAL OF THE ASSESSE E WITH SHRI R L BHATIA. SINCE THE CREDIT IN THE NAME OF SHRI R L BHATIA AT RS 900,000/- WAS AN OLD CREDIT BALANCE, WHICH HAS BEEN CARRIED FORWA RD FROM LAST YEAR, THEREFORE THE ADDITION OF RS 900,000/- WAS UNCALLED FOR IN THE YEAR UNDER CONSIDERATION AND IS ACCORDINGLY DELETED. (VII) THE GROUND OF APPEAL NO. 7 IS AGAINST THE ADD ITION OF RS.440,000/- IN THE BOOKS OF M/S NATIONAL MOTORS ON ACCOUNT OF C OMMISSION RECEIVED ON SALE OF CARS. THE ASSESSEE HAD SHOWN INCOME UNDER T HE HEAD COMMISSION ACCOUNT IN THE BOOKS OF M/S NATIONAL MOTORS OF RS.6 0,000/- ONLY. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH THE PARTY WISE DETAILS OF COMMISSION RECEIVED AT RS.60,000/- IN THE CASE OF M /S NATIONAL MOTORS. HE WAS ALSO ASKED TO GIVE THE NAMES AND ADDRESS AND PA N OF THE PARTIES FROM WHOM COMMISSION WAS RECEIVED AND ALSO THE PROP ERTY AGAINST WHICH COMMISSION HAD BEEN RECEIVED. BUT THE ASSESSEE DID NOT FURNISH PARTY ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 11 WISE DETAILS OF COMMISSION NOR PRODUCED BOOKS OF AC COUNT AND SIMPLY SUBMITTED THAT THE RECEIPT OF COMMISSION HAS BEEN D ULY SHOWN, WHICH STANDS DULY CREDITED IN THE BOOKS OF ACCOUNTS. IN A BSENCE OF COMPLETE PARTY WISE DETAILS OF COMMISSION THE ASSESSING OFFI CER ESTIMATED THE COMMISSION AT RS.500,000/- AND AFTER GIVING CREDIT OF RS.60,000/- SHOWN AS COMMISSION INCOME, AND MADE THE ADDITION OF THE BALANCE AMOUNT OF RS.440,000/- IN THE WRITTEN SUBMISSIONS IT WAS ARGUED THAT THE A O HAS NO MATERIAL WHATSOEVER FOR MAKING THE ADDITION WHICH W AS BASED PURELY ON CONJECTURES, SURMISES AND SUPPOSITIONS. THE ASSESSMENT ORDER AND THE WRITTEN SUBMISSIONS OF THE APPELLANT ON THE ISSUE UNDER CONSIDERATION WAS CONSIDERED. IT IS OBSERVED THAT THE AO HAD ESTIMATED THE COMMISSION OF THE APPELLANT AT RS 500,000/- WITHOUT ANY EVIDENCE IN SUPPORT OF THE SAME. THEREF ORE THE AD HOC ADDITION OF RS 440,000/- CANNOT BE SUSTAINED AND THE SAME IS DELETED. (VIII) THE GROUND OF APPEAL NO. 8 IS AGAINST THE AD DITION OF RS.15,18,835/- ON ACCOUNT OF CONSTRUCTION CHARGES & COMMISSION RECEIVED IE RS 11,97,325/- & RS. 321,600/-. IN THE CASE OF M/S SHREE VEEJAY BUILDERS & DEVELOPE RS, THE ASSESSEE HAD SHOWN RECEIPT OF COMMISSION OF RS 178, 000/- AND CONSTRUCTION CHARGES OF RS 802,765/-. THE ASSESSEE DURING THE REASSESSMENT PROCEEDINGS WAS REQUIRED TO FURNISH PA RTY WISE DETAILS OF COMMISSION RECEIVED AND CONSTRUCTION CHARGES RECEIV ED. IN REPLY THE ASSESSEE HAD STATED THAT HIS PREDECESSOR HAD WRONGL Y OBSERVED THAT CONSTRUCTION CHARGES WERE RECEIVED AT RS 802,705/- WHICH IS INCORRECT. IT WAS POINTED OUT THAT THE CONSTRUCTION CHARGES RECEI VED WERE RS 38,64,000/- WHICH WERE ADDED IN THE P & L ACCOUNT. THAT THE ASSESSEE HAD EARNED COMMISSION INCOME ON SALE OF PLOTS FROM M R. BOGGA & FAMILY OF RS 178,400/- ON TOTAL SALE CONSIDERATION OF RS 1 7,87,000/-. THE AO HOWEVER OBSERVED THAT THE PERUSAL OF P & L A CCOUNT ORIGINALLY FILED WITH THE RETURN REVEALS THAT THE A SSESSEE HAD CREDITED AN AMOUNT OF RS.178,400/- ON ACCOUNT OF COMMISSION AND FURTHER CREDITED AN AMOUNT OF RS 802,765/- ON ACCOUNT OF CONSTRUCTION C HARGES RECEIVED AND NOWHERE MENTIONED CONSTRUCTION CHARGES RECEIPT OF R S 39,64,000/- AS CLAIMED IN HIS REPLY. THEREFORE THE AO HELD THAT TH E P & L ACCOUNT PUT UP BEFORE THE HIGHER AUTHORITIES AS ADDITIONAL EVIDENC E WAS A FABRICATED DOCUMENT AND NOT ORIGINAL. ALSO THE AO OBSERVED THA T THE ASSESSEE HAD NOT FURNISHED PARTY WISE DETAILS OF CONSTRUCTION CH ARGES RECEIVED BY HIM AND PAID BY HIM. SIMILARLY IN RESPECT OF COMMISSION RECEIVED SHOWN AT RS 178,400/-, THE ASSESSEE HAD NOT GIVEN ANY DETAILS O F COMMISSION RECEIVED AND NOR DID HE PRODUCE BOOKS OF ACCOUNTS. THE AO TH EREFORE ESTIMATED THE CONSTRUCTION CHARGES OF THE ASSESSEE AT RS 20,00,00 0/- AS AGAINST RS 802,765/- AND COMMISSION RECEIPT WAS ESTIMATED AT R S 500,000/- AS AGAINST RS 178,400/- SHOWN. AS SUCH THE AO MADE THE ADDITION OF RS 11,97,235/- ON ACCOUNT OF CONSTRUCTION CHARGES AND RS 321,600/- ON ACCOUNT OF COMMISSION RECEIPT SHOWN LESS. ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 12 THE WRITTEN SUBMISSION OF THE APPELLANT IN RESPECT OF ADDITION OF RS 321,600/- AND RS 11,97,235/- WAS THAT THE ASSESSEE HAD SHOWN COMMISSION OF RS 1,78,700/-. THE ASSESSEE ARGUED TH AT THE AO HAS WRONGLY OBSERVED THAT CONSTRUCTION CHARGES WERE REC EIVED AT RS 802,765/- . AS A MATTER OF FACT, THE SUM OF RS 802,765/- REPR ESENTS GROSS PROFIT. HE ARGUED THAT THE CONSTRUCTION CHARGES RECEIVED AMOUN TED TO RS 39,64,000/- WHICH WERE CREDITED IN THE PROFIT AND LOSS ACCOUNT. HE POINTED OUT THAT THE ASSESSEE HAD ONLY EARNED COMMISSION OF RS 178,700/- ON SALE OF PLOTS OF M/S M R BOGGA & FAMILY FOR RS 17,87,000/- AND THE N ECESSARY DETAILS HAVE BEEN PROVIDED. THAT THE AO HAS NOT PLACED ANY MATERIAL ON RECORD FOR JUSTIFYING THE ADDITION OF RS 178,000/-. THE APPELLANT POINTED OUT THAT IN THE CONSTRUCTION ACCOUNT THE RECEIPTS WERE SHOWN AT RS 39,64,000/- AND NECESSARY DETAILS PRODUCED BEFORE THE AO IT WAS SUBMITTED. HE ARGUED THAT THE ADDITION HAS BEEN MADE PURELY ON CONJECTURES, SURMISES AND SUPPOSITIO N AND NOTHING HAS BEEN BROUGHT ON RECORD FOR ESTIMATING THE ADDITION. I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE WRIT TEN SUBMISSION OF THE APPELLANT. THE CERTIFIED COPY OF TRADING, PR OFIT & LOSS ACCOUNT FOR THE YEAR ENDING 31-03-2004 OF SHRI VEEJAY BUILDER & DEV ELOPERS, AMRITSAR FILED BY THE APPELLANT REVEALS THAT THE TRADING ACC OUNT WAS CREDITED WITH CONSTRUCTION CHARGES RECEIPTS OF RS 39,64,000/- AND THE PROFIT 8& LOSS ACCOUNT WAS CREDITED INTERALIA WITH GROSS PROFIT OF RS 802,765/- AND COMMISSION RECEIPT OF RS 178,700/-. FURTHER THE COP Y OF CONSTRUCTION CHARGES RECEIPT ACCOUNT IN THE BOOKS OF SHREE VEEJ AY BUILDERS 8S DEVELOPERS FOR THE YEAR ENDING 31-03-2004 REVEALS T HE TOTAL RECEIPT OF THE F Y 2003-04 AT RS 39,64,000/- AND ALSO MENTIONED THE DETAILS OF EACH RECEIPT PLOTWISE. ACCORDINGLY IN VIEW OF THE ABOVE DETAILS OF CONSTRU CTION RECEIPTS AND COMMISSION INCOME AVAILABLE IN THE TRADING, PROFIT 8S LOSS ACCOUNT OF SHREE VEEJAY BUILDERS 8S DEVELOPERS FOR A Y 2004- OS, THE ARGUMENT OF THE AO THAT THE P 8S L ACCOUNT OF SHREE VEEJAY BUILDERS 8S DEVELOPERS PUT UP BEFORE THE HIGHER AUTHORITIES AS ADDITIONAL EVIDENC E WAS A FABRICATED DOCUMENT WAS MISPLACED AND IS DISMISSED. IT SEEMS T HAT THE AO HAD MISREAD THE TRADING, PROFIT & LOSS ACCOUNT OF SHREE VEEJAY BUILDERS & DEVELOPERS FOR A Y 2004-05. ACCORDINGLY IT IS HELD THAT THE ADDITION OF RS 1 1, 97,235/- ON ACCOUNT OF CONSTRUCTION CHARGES AND RS 321,600/- ON ACCOUNT OF COMMISSION RECEIPT SHOWN LESS WAS WITHOUT ANY BASIS OR EVIDENCE AND CANNOT BE SUSTAINED. THE AO HAD ONLY MADE THE ESTIM ATED ADDITION OF RS 321,600/- AND RS 11,97,235/- ON CONJECTURES, SURMIS ES AND SUPPOSITION AND NOTHING HAS BEEN BROUGHT ON RECORD FOR ESTIMATI NG THE ADDITION. ACCORDINGLY THE ADDITION OF RS.321,600/- AND RS.11, 97,235/- IS DELETED. ITA NO. 89/ASR/2016, & C.O. NO.10/ASR/2016 ASSTT. YEAR: 2004-05 13 WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. C IT(A) AND THEREFORE THE APPEAL FILED BY REVENUE IS DISMISSED. THE CROSS OBJECTIONS FILED BY ASSESSEE ARE ONLY SUPPORTIVE OF ORDER OF LD. CIT(A) AND AS WE HAVE DECIDED THE APPEAL FILED BY REVENUE IN FAVOUR OF AS SESSEE, THE CROSS OBJECTIONS FILED BY ASSESSEE HAS BECOME INFRUCTUOUS AND THEREFORE THE SAME ARE DISMISSED. 6. IN NUTSHELL, THE APPEALS FILED BY REVENUE AS WEL L AS CROSS OBJECTIONS FILED BY ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.10.2017 SD/- SD/- (N. K. CHOUDHRY) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 11.10.2017. /GP/SR. PS . COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER
