Vrinda P. Kittur., Goa V. The Assistant Commissioner of Income Tax, Central Circle, Panaji, Goa., Panaji

CO 22/PAN/2015

• Counselvise Citation: [2015] 123 COUNSELVISE.COM (IT) 1270 (ITAT-PANAJI)
• Duration Of Justice: 2 month(s) 19 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 17-08-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 17-08-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 28-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: K M MAHESH
• Assessee Lawyers: SHRINIVAS NAYAK
• Keywords: Unexplained investment; Capital asset; Business income; Search and seizure
• Section: 143(3); 153A; 145; 28

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI N.S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER ITA NO. 18 8 /PNJ/201 5 (ASST. YEAR : 200 8 - 0 9 ) ACIT, CENTRAL CIRCLE, PANAJI GOA . VS. S MT. VRINDA P . KITTUR, NO. C - 1, SPARSHA, LA - MARVEL COLONY, NEXT TO NIO, DONA PAULA, GOA. PAN NO. A DPPK 9982 M (APPELLANT) (RESPONDENT) C.O. NO. 22 /PNJ/201 5 (ASST. YEAR : 200 8 - 0 9 ) SMT. VRINDA P. KITTUR , NO. C - 1, SPARSHA, LA - MARVEL COLONY, NEXT TO NIO, DONA PAULA, GOA. VS. ACIT, CENTRAL CIRCLE, PANAJI GOA PAN NO. PAN NO. ADPPK 9982 M (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SHRINIVAS NAYAK C A. DEPARTMENT BY : SHRI K.M. MAHESH - D R DATE OF HEARING : 17 / 0 8 /2015 . DATE OF PRONOUNCEMENT : 1 7 / 0 8 /201 5 . O R D E R PER N.S. SAINI , ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 2 , PANAJI , DATED 0 6 /0 1 /201 5 . 2 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 2. IN THE REVENUES APPEAL , GROUNDS NO. 1 TO 3 READS AS UNDER: - 1. THE LD. CIT(A) - 2, PANAJI HAS ERRED IN NOT APPRECIATING THE PROVISIONS OF SECTION 2(47)(V) OF THE I.T. ACT R.W.S 153A OF THE TRANSFER OF PROPERTY ACT. 2. THE LD. CIT(A) - 2, PANAJI HAS ERRED IN HOLDING THAT THE PROFIT FROM THE SALE OF THE PROPERTY NEEDS TO BE TAXED IN A.Y. 2009 - 10 WHEN IT IS CLEAR THAT THE POSSESSION OF THE PROPERTY WAS HANDED OVER ON 08.03 . 2008 AND PART OF THE CONSIDERATION HAS ALREA DY BEEN RECEIVED DURING THE PREVIOUS YEAR RELEVANT TO A.Y. 2008 - 09. 3. THE LD. CIT(A) - 2, PANAJI HAS ERRED IN HOLDING THAT THE DISALLOWANCE OF EXPENSES IF ANY IS TO BE CONSIDERED FOR A.Y. 2009 - 10 AS IT IS EVIDENT THAT A TRANSACTION IS RELATABLE TO THE PREVI OUS YEAR RELEVANT TO A.Y. 2008 - 09. 3 . AT THE VERY OUTSET , BOTH THE PARTIES BEFORE US SUBMIT THAT THE ISSUE INVOLVED IN THE ABOVE GROUNDS OF APPEAL IS EXACTLY SIMILAR AS WAS IN THE CASE OF THE HUSBAND OF THE ASSESSEE AND THE FACTS ARE ALSO SIMILAR . THE TRIBUNAL IN THE CASE OF THE HUSBAND OF THE ASSESSEE IN I.T.A.NO. 186/PNJ/2015 FOR THE ASSESSMENT YEAR 2008 - 09 DATED 12/08/2015 , HELD AS UNDER: - 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED THAT M/S. UNICORN DEVELOPERS SOLD THE PROPERTY ADMEASURING 2,46,400 SQ.MTS AT SURVEY NO. 22/1 AT GANCIM , TIWADI, GOA BY A REGISTERED SALE DEED DATED 08/03/2008 AND THE POSSESSION OF THE LAND WAS HANDED OVER TO THE BUYER M/S. NAIKNAVRE PRESTIGE ENVIRON HOUSING PVT. LTD. ACCORD I NG TO THE AUDIT REPORT OF M/S. UNICORN DEVELOPERS, THE METHOD OF ACCOUNTING REGULARLY EMPLOYED IS MERCANTILE METHOD OF ACCOUNTING . ACCORD I NG TO THE REGISTERED SALE DEED DATED 08/03/2008 , A CONSIDERATION OF 16,01,60,000/ - ACCRUED TO M/S. UNICORN DEVELOPERS ON 08/03/2008 . HE ALSO OBSERVED THAT JOINT AGREEMENT DATED 12/04/2008 GIVES DETAILS AND MODE OF PAYMENT OF BALANCE SALE CONSIDERATION . MR. PRAKASH KITTUR TOOK A STAND THAT THE SALE DEED WAS EXECUTED ON 04/04/2008 . HE OBSERVED FROM THE COPY OF THE REGISTERED SALE DEED SUBMITTED BY M/S. NAIKNAVRE PRESTIGE ENVIRON HOUSING PVT. LTD. THAT THE SALE DEED WAS EXECUTED ON 08/03/2008 AND IT WAS PRESENTED TO THE SUB - REGISTRAR FOR REGISTRATION ON 03/04/2008 AND WAS REGISTERED ON 04/04/2008. I T IS NOTI C ED THAT THE DATE OF SALE DEED MENTIONED WAS 07/03/2008, WHICH WAS CORRECTED BY HANDWRITING AS 08/03/2008 . MR. PRAKASH KITTUR 3 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 CERTIFIED THE CORRECTION OF DATE . HENCE, IT IS EVIDENT THAT SALE DEED WAS ACTUALLY EXECUTED ON 08/03/2008 . M/S.NAIKNAVRE PRESTIGE ENVIRON HOUSING PVT. LTD. ALSO ACCOUNTED FOR PURCHASE OF LAND ON 08/03/2008 I.E. THE DATE OF EXECUTION OF THE SALE DEED , HENCE, PROFIT ON SALE OF ABOVE LAND AT GANCIM IS BROUGHT TO TAX FOR ASSESSMENT YEAR 2008 - 09 I.E. RELEVANT ASSESS MENT YEAR IN WHICH THE SALE DEED WAS EXECUTED. 4 . ON APPEAL , COMMISSIONER OF INCOME TAX (APPEALS) OBSERVED THAT DURING THE COURSE OF SEARCH, SALE DEED WAS FOUND AT THE OFFICE PREMISES OF THE ASSESSEE. THE SALE DEED WAS FRANKED FOR STAMP DUTY PURPOSE ON 08/3/2008. THE SAME WAS PRESENTED FOR REGISTRATION ON 04/04/2008 I.E. FINANCIAL YEAR 2008 - 09 REL E VANT TO ASSESSMENT YEAR 2009 - 10. TILL 08/03/2008 , THE ASSESSEE AND HIS NOMINEES HAD RECEIVED 5.50 CRORES AS SALE CONSIDERATION , WHICH IS 34% OF TOTAL CONSIDERATION TO BE RECEIVED. DURING THE FINANCIAL YEAR 2007 - 08 , THE POSSESSION OF THE LAND WAS ALSO NOT HANDED - OVER TO THE BUYER. THE COMMISSIONER OF INCOME TAX (APPEALS) CONCLUDED THAT SINCE THE SALE DEED WAS EXECUTED IN THE FINANCIAL YEAR 2008 - 09 RELE VANT TO ASSESSMENT YEAR 2009 - 10 AND THE MAJOR SALE CONSIDERATION WAS ALSO RE CEI VED IN AND AROU N D THAT PERIOD , IN HIS OPINION , THE PROFIT FROM THE SALE OF LAND NEEDS TO BE TAXED IN ASSESSMENT YEAR 2009 - 10 . 5. BEING AGGRIEVED BY THE SAID ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), THE REVENUE IS IN APPEAL BEFORE US. 6. THE DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND AUTHORIZED REPRESENTATIVE OF THE ASSESSEE RELIED ON THE ORDER COMMISSIONER OF INCOME TAX (APPEALS ) AND ARGUED THAT ALTHOUGH SALE DEED OF THE LAND WAS REGISTERED ON 04/04/2008, BUT THE POSSESSION OF THE LAND WAS STILL WITH THE ASSESSEE AND THE SAME WAS HANDED OVER TO THE BUYERS ONLY IN THE ASSESSMENT YEAR 2010 - 11 . HE SUBMITTED THAT THE SALE DEED WAS REGISTERED TO ENABLE THE BUYER TO OBTAIN BANK LOAN TO PAY THE SALE CONSIDERATION TO THE SELLERS OF THE LAND . THEREFORE, IT WAS THE SUBMISSION THAT THE PROFIT FROM THE SALE OF LAND SHOULD BE ASSESSED IN THE ASSESSMENT YEAR 2010 - 11 WHICH WAS SHOWN BY THE ASSESSEE AND ACCEPTED BY THE ASSESSING OFFICER IN ASSESSMENT MADE UNDER SEC. 143(3) OF THE ACT. 7. WE FIND THAT IT IS NOT IN DISPUTE THAT THE INCOME DERIVED FROM THE TRANSACTIONS IN QUESTION IS ASSESSABLE UNDER THE HEAD PROFITS AND GAINS FROM BUSINESS OR PROFESSIO N AND NOT UNDER THE HEAD CAPITAL GAINS. THE ASSESSING OFFICER HIMSELF TREATED THE 4 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 INCOME ARISING FROM THE TRANS A CTION IN QUESTION AS BUSINESS INCOME OF THE ASSESSEE. 8. AS PER THE PROVISIONS OF SEC. 45 OF THE ACT, CAPITAL GAIN IS ASSESSABLE IN THE YEAR IN WHICH TRANSFER OF CAPITAL ASSET TAKES - PLACE WHEREAS AS PER THE PROVISIONS OF SEC. 28 READ WITH SEC. 145 OF THE ACT, BUSINESS INCOME IS ASSESSABLE AS PER THE SYSTEM OF ACCOUNTING REGULARLY EMPLOYED BY THE ASSESSEE E ITHER CASH SYSTEM OR ACCRUAL SYSTEM. IN THE INSTANT CASE, IT IS NOT IN DISPUTE THAT THE ASSESSEE REGULARLY EMPLOYS ACCRUAL SYSTEM OF ACCOUNTING FOR ACCOUNTING HIS BUSINESS INCOME. AS PER ACCRUAL SYSTEM OF ACCOUNTING, THE INCOME IS ACCOUNTED FOR IN THE YEAR IN WHICH THE SAME IS ACCRUED TO THE ASSESSEE, WHICH MEANS THE LEGAL RIGHT TO RECEIVE THE INCOME ACCRUES TO THE ASSESSEE. 9. NOW IT IS ALSO A SETTLED POSITION OF LAW THAT TRANSFER OF A IMMOVABLE PROPERTY OF 100 OR MORE TAKES - PLACE ONLY ON EXECUTION OF A REGISTERED CONVEYANCE DEED . ONLY ON THE DATE O N WHICH A REGISTERED DEED IS EXECUTED IN RESPECT OF SUCH A IMMOVABLE PROPERTY IT CAN BE HELD THAT A LEGAL RIGHT TO RECEIVE CONSIDERATION VESTS IN THE ASSESSEE . 10. WE FIND TH A T THE HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. ASHA LAND CORPORATION (1982) 133 ITR 55 (GUJ.) HELD AS UNDER: - SECTION 4 OF THE ACT IMPOSES INCOME - TAX UPON A PERSON IN RESPECT OF HIS INCOME. IN OTHER WORDS, THE INCOME - TAX IS A TAX ON A PERS ON IN RELATION TO HIS INCOME. ' INCOME' AS DEFINED IN S. 2(24) INCLUDES PROFITS AND GAINS. SECTION 14 OF THE ACT ENUMERATES SIX HEADS UNDER WHICH THE INCOME OF AN ASSESSEE FALLS TO BE CHARGED. ONE OF SUCH HEADS IS ' PROFITS AND GAINS OF BUSINESS OR PROFESSION '. S O FAR AS THE INSTANT CASE IS CONCERNED, WE ARE CONCERNED WITH PROFITS AND GAINS OF BUSINESS. NOW, THE WORD ' PROFITS ' IS TO BE UNDERSTOOD AS OBSERVED BY LORD HALSBURY IN GRESHAM LIFE ASSURANCE SOCIETY V. STYLES [1892] 3 TC 185, 188 (HL), ' IN ITS NATURAL AND PROPER SENSE - IN A SENSE WHICH NO COMMERCIAL MAN WOULD MISUNDERSTAND '. THE OBSERVATIONS OF THE PRIVY COUNCIL IN PONDICHERRY RAILWAY CO. V. CIT [1931] 5 ITC 363 AND OF THE SUPREME COURT IN BADRIDAS DAGA V. CIT [1958] 34 ITR 10 (SC), CALCUTTA CO. LTD. V. CIT [1959] 37 ITR 1 (SC) AND CIT V. BAI SHIRINBAI K. KOOKA [1962] 46 ITR 86 (SC ) SHOW THAT THE PROFITS TO BE ASSESSED ARE REAL PROFITS AND THEY MUST BE ASCERTAINED ON THE ORDINARY PRINCIPLES OF COMMERCIAL TRADING AND COMMERCIAL 5 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 ACCOUNTING. WHAT ARE CHARGEABLE TO INCOME - TAX IN RESPECT OF BUSINESS ARE PROFITS OF THE PREVIOUS YEAR. THER EFORE, THE QUESTION WHICH ARISES IN THE INSTANT CASE IS, WHETHER THE ASSESSEE HAD EARNED ANY PROFITS IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 1971 - 72, WHICH ARE CHARGEABLE TO INCOME - TAX. THE ASSESSEE IS A DEALER IN LAND. IN OTHER WORDS, ITS BUS INESS IS PURCHASE AND SALE OF LAND. THEREFORE, THE PROFITS WHICH IT WOULD DERIVE FROM THE TRANSACTIONS OF PURCHASE AND SALE OF LAND WOULD BE ITS PROFITS OF BUSINESS CHARGEABLE TO INCOME - TAX. THE LAND IS STOCK - IN - TRADE OF THE ASSESSEE. WHEN THE ASSESSEE PUR CHASES LAND, SUCH LAND WOULD BECOME PART OF ITS STOCK - IN - TRADE. THE LAND WOULD CEASE TO BE ITS STOCK - IN - TRADE WHEN IT WOULD SELL IT. IN OTHER WORDS, THE LAND PURCHASED BY THE ASSESSEE WHICH FORMS PART OF ITS STOCK - IN - TRADE, WOULD CONTINUE TO BE ITS STOCK - I N - TRADE, UNTIL AND UNLESS, IT SELLS IT. THE ASSESSEE WOULD CONTINUE TO BE THE OWNER OF THE LAND WHICH IT HAS PURCHASED AND WHICH IS PART OF ITS STOCK - IN - TRADE, TILL IT IS DIVESTED OF THE OWNERSHIP BY COMPLETION OF THE SALE TRANSACTION. THE BUSINESS DEAL IN RESPECT OF A LAND OWNED BY THE ASSESSEE WOULD BE COMPLETE ONLY WHEN IT EXECUTES A REGISTERED SALE DEED. IT IS ONLY ON COMPLETION OF THE SALE TRANSACTION IN RESPECT OF THE LAND OWNED BY THE ASSESSEE THAT THE ASSESSEE COULD BE SAID TO HAVE EARNED PROFIT OR SUFFERED LOSS, AS THE CASE MAY BE. THE ASSESSEE PURCHASED THE LAND, A PORTION OF WHICH IS THE SUBJECT - MATTER OF DISPUTE BEFORE US, ON MARCH 15, 1967. ON AND FROM THE DATE OF PURCHASE, THE LAND BECAME PART OF THE STOCK - IN - TRADE OF THE ASSESSEE. THE LAND WHI CH FORMS PART OF THE STOCK - IN - TRADE OF THE ASSESSEE WOULD NOT, AS OBSERVED ABOVE, CEASE TO BE SO UNLESS THE ASSESSEE SELLS IT. AND SALE WOULD NOT BE COMPLETE UNLESS IT EXECUTES A REGISTERED SALE DEED. ADMITTEDLY, NO SALE TRANSACTION TOOK PLACE IN THE PREVI OUS YEAR RELEVANT TO THE ASSESSMENT YEAR 1971 - 72. ALL THAT HAPPENED IN THAT YEAR WAS THAT THE ASSESSEE ENTERED INTO AN AGREEMENT TO SELL CERTAIN PLOTS OF LAND OUT OF THE LAND PURCHASED BY IT IN 1967 TO THE SOCIETY UNDER THE AGREEMENT DATED NOVEMBER 4, 1970 . SINCE NO ACTUAL SALE TOOK PLACE IN THAT YEAR, LAND OR ANY PORTION THEREOF WHICH WAS THE SUBJECT - MATTER OF THE AGREEMENT DID NOT CEASE TO BE THE STOCK - IN - TRADE OF THE ASSESSEE IN THAT YEAR. IT IS, HOWEVER, CONTENDED ON BEHALF OF THE ASSESSEE THAT IN PURSU ANCE OF THE AGREEMENT FOR SALE, IT HAD RECEIVED RS. 5,000 BY WAY OF EARNEST MONEY AND RS. 2,08,772 AS ADVANCE TOWARDS THE TOTAL SALE PRICE OF THE LAND AGREED TO BE SOLD. THESE RECEIPTS, SAYS THE ASSESSEE, 6 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 ARE ITS TRADING RECEIPTS AND, THEREFORE, THEY REPRE SENT ITS GROSS INCOME EARNED IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 1971 - 72. IT IS CONTENDED THAT SINCE THE BUSINESS OF THE ASSESSEE IS TO PURCHASE AND SELL LAND, IT IS IMMATERIAL AS TO WHEN THE SALE DEEDS IN RESPECT OF THE LAND AGREED TO BE SOLD ARE EXECUTED. WHATEVER IT RECEIVES IN ADVANCE TOWARDS THE SALE PRICE BETWEEN THE AGREEMENT TO SELL AND EXECUTION OF THE REGISTERED SALE DEEDS IS NOTHING BUT TRADING RECEIPT. IT IS FURTHER CONTENDED THAT SUCH TRADING RECEIPTS REPRESENT THE ASSESSEE'S I NCOME EARNED ON THE DATE ON WHICH THEY ARE RECEIVED. WE ARE UNABLE TO ACCEPT THIS ARGUMENT. ALL RECEIPTS ARE NOT INCOME. IN ORDER TO PARTAKE OF THE CHARACTER OF INCOME, RECEIPT MUST BE PART OF THE PROFITS EARNED BY THE ASSESSEE. IN OTHER WORDS, THE RECEIPT MUST ASSUME THE CHARACTER OF INCOME BEFORE IT BECOMES EXIGIBLE TO INCOME - TAX. THE ASSESSEE UNDOUBTEDLY RECEIVED A TOTAL SUM OF RS. 2,13,772 IN ADVANCE TOWARDS THE SALE PRICE OF THE LAND WHICH IT HAD AGREED TO SELL TO THE SOCIETY, BUT CAN THIS RECEIPT BE C ONSIDERED TO BE ITS INCOME ? THE ANSWER MUST BE EMPHATICALLY ' NO '. BUSINESS OF THE ASSESSEE, AS POINTED OUT ABOVE, IS TO PURCHASE AND SELL LAND. UNLESS THE TITLE OF THE ASSESSEE IS EXTINGUISHED, THE TITLE OF THE PURCHASER CANNOT ARISE. BOTH CANNOT BE THE EXCLUSIVE OWNERS OF THE SAME PROPERTY AT THE SAME TIME. SO LONG AS THE ASSESSEE CONTINUES TO BE THE OWNER, HOW CAN IT BE SAID THAT HIS TITLE IS DIVESTED AND THE SALE HA S RESULTED IN ANY PROFIT TO HIM ? IT IS AXIOMATIC THAT AN AGREEMENT TO SELL DOES NOT CREA TE ANY INTEREST IN FAVOUR OF THE PURCHASER. IT IS ON COMPLETION OF THE TRANSACTION OF PURCHASE AND SALE CULMINATING IN THE EXTINGUISHMENT OF THE TITLE OF THE VENDOR AND SIMULTANEOUS CREATION OF THE TITLE IN THE VENDEE THAT THE ASSESSEE EARNS PROFIT OR SUFF ERS LOSS. A TRANSACTION WHICH MAY OR MAY NOT ULTIMATELY RESULT IN A COMPLETED SALE BY EXECUTING A REGISTERED CONVEYANCE, IS NO TRANSACTION AT ALL FOR THE PURPOSE OF WORKING OUT PROFIT. RECEIPT OF RS. 2,13,772 WOULD ASSUME THE CHARACTER OF INCOME OR PROFIT ONLY WHEN THE SALE TRANSACTION IS COMPLETED IN ACCORDANCE WITH LAW. IT IS THE TRANSFER OF TITLE IN LAND TO THE PURCHASER WHICH COMPLETES THE TRANSACTION OF SALE. IT WAS ARGUED THAT WHILE ACCEPTING RS. 2,08,772 TOWARDS PART PAYMENT OF SALE PRICE, THE ASSESS EE HAD PARTED WITH POSSESSION OF SOME OF THE PLOTS OF LAND AGREED TO BE SOLD. PARTING WITH POSSESSION OF THE LAND, IT WAS URGED, WOULD IN ANY CASE MAKE THE RECEIPT OF THE AFORESAID AMOUNT A TRADING RECEIPT. WE ARE AFRAID, WE CANNOT ACCEPT THIS ARGUMENT ALS O. THE RECEIPT OF A PART PAYMENT OF PRICE 7 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 COUPLED WITH THE PARTING OF POSSESSION OF SOME PORTION OF THE LAND AGREED TO BE SOLD WOULD NOT CONFER ANY TITLE ON THE PURCHASER, I.E., THE SOCIETY, EVEN IN RESPECT OF THE LAND OF WHICH POSSESSION IS GIVEN TO IT. D OCTRINE OF PART PERFORMANCE CANNOT BE BROUGHT INTO AID TO TREAT THE RECEIPT OF RS. 2,13,772 AS A TRADING RECEIPT. DOCTRINE OF PART PERFORMANCE EMBODIED IN S. 53A OF THE TRANSFER OF PROPERTY ACT HAS A LIMITED APPLICATION AND IT AFFORDS ONLY A GOOD DEFENCE T O THE PERSON PUT IN POSSESSION UNDER AN AGREEMENT IN WRITING TO PROTECT HIS POSSESSION TO THE EXTENT PROVIDED IN THE SAID S. 53A OF THE TRANSFER OF PROPERTY ACT ; BUT, IN ANY CASE, THE AGREEMENT IN WRITING TO SELL, COUPLED WITH PARTING OF POSSESSION, WOULD NOT CONFER ANY LEGAL TITLE ON THE PURCHASER AND TAKE THE LAND OUT OF THE STOCK - IN - TRADE OF THE SELLER IF HE IS A DEALER IN LAND. IF A MERE AGREEMENT OF SALE WERE TO BE TREATED AS CREATING ANY SUCH RIGHT AS CONTENDED BY THE ASSESSEE, IT WOULD CREATE MANY C OMPLICATIONS WHICH WOULD BE DIFFICULT TO RESOLVE. FOR EXAMPLE, CAN A PERSON WHO HAS AGREED TO SELL HIS PROPERTY, EXCLUDE THE VALUE OF SUCH PROPERTY FROM HIS NET WEALTH WHILE FILING RETURN OF HIS NET WEALTH ? WOULD THE PERSON WHO HAS AGREED TO PURCHASE LAND BE LIABLE TO INCLUDE PROPERTY IN HIS NET WEALTH, EVEN THOUGH NO SALE DEED IS EXECUTED IN HIS FAVOUR ? BOTH THE QUESTIONS SHALL HAVE TO BE ANSWERED IN THE AFFIRMATIVE, IF THE CONTENTION OF THE ASSESSEE WERE TO BE ACCEPTED. WE HAVE, HOWEVER, NO MANNER OF DOUB T THAT THE ANSWER TO BOTH THE QUESTIONS IS IN THE NEGATIVE, FOR, AS DISCUSSED EARLIER, THE TITLE OF THE ASSESSEE STILL SUBSISTS AND THAT OF THE PURCHASER IS YET TO ARISE. WHETHER OR NOT TO INCLUDE THE PROPERTY IN THE NET WEALTH DEPENDS UPON, WHO IS THE OWN ER OF THE PROPERTY. A MERE AGREEMENT TO SELL DOES NOT CONFER ANY TITLE ON THE PERSON WHO HAS AGREED TO PURCHASE OR DIVEST THE PERSON WHO HAS AGREED TO SELL OFF HIS TITLE. LET US TAKE ANOTHER EXAMPLE: ' A ' AGREES TO SELL HIS PROPERTY TO ' B ', BUT BEFORE T HE SALE DEED COULD BE EXECUTED, THE PROPERTY IS DESTROYED IN FIRE, WHO WOULD SUFFER THE LOSS RESULTING FROM THE FIRE - ' A ' OR ' B ' ? ANSWER IS OBVIOUSLY 'A ', BECAUSE TITLE HAS NOT BEEN PASSED ON TO 'B ', THERE BEING NO COMPLETED SALE. IN THE SAME EXAMPLE, I F AFTER THE EXECUTION OF THE AGREEMENT TO SELL AND BEFORE T HE EXECUTION OF THE SALE DEED ' B' DIES, WOULD THE VALUE OF THE PROPERTY AGREED TO BE SOLD BE LIABLE TO BE INCLUDED IN THE DUTIABLE ESTATE OF 'B ' ? HERE ALSO, THE ANSWER IS IN THE NEGATI VE, BECAUSE ' B ' HAD NOT ACQUIRED ANY LEGAL TITLE OVER THE PROPERTY. 8 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 IN THE ILLUSTRATIONS WHICH WE HAVE GIVEN ABOVE, THE VITAL QUESTION TO BE ANSWERED IS, WHO IS THE OWNER OF THE PROPERTY OR IN WHOM THE TITLE TO THE PROPERTY VESTS. IN THE CASE OF A PERSON WHO IS A DEALER IN LAND, THE BUSINESS TRANSACTION WOULD BE COMPLETED ONLY WHEN THE PURCHASE OR THE SALE TRANSACTION IS COMPLETE. IN ORDER TO DECIDE WHETHER THE BUSINESS TRANSACTION IS COMPLETE, THE QUESTION OF VITAL IMPORTANCE IS WHETHER TITLE IN THE PROPERTY HAS PASSED. IT IS ONLY ON THE PASSING OF THE TITLE THAT THE TRANS ACTION BECOMES COMPLETE, AND UNLESS THE TRANSACTION IS COMPLETE, AN ADVANCE RECEIPT OF MONEY TOWARDS THE TRANSACTION WOULD NOT FORM PART OF THE INCOME OR PROFIT. IN OTHER WORDS, THE RECEIPT WOULD PARTAKE OF THE CHARACTER OF INCOME ONLY WHEN THE TRANSACTION IS COMPLETE. WE ARE UNABLE TO SEE HOW THE METHOD OF ACCOUNTING HAS ANY RELEVANCE IN DETERMINING WHETHER THE RECEIPT OF THE TWO AMOUNTS, AS AFORESAID, BY THE ASSESSEE IS A TRADING RECEIPT OR INCOME. EVEN ASSUMING FOR THE SAKE OF ARGUMENT THAT THE METHOD O F ACCOUNTING WHICH THE ASSESSEE FOLLOWS IS THE CASH METHOD, IT WOULD HAVE A BEARING ONLY IN RESPECT OF COMPLETED BUSINESS TRANSACTIONS. IF THE METHOD FOLLOWED IS THE CASH METHOD, ONLY AMOUNTS WHICH THE ASSESSEE HAS RECEIVED WILL FORM PART OF ITS INCOME, BU T THAT WOULD BE SO ONLY AFTER THE TRANSACTIONS IN RESPECT OF WHICH THE AMOUNTS ARE RECEIVED ARE LEGALLY COMPLETED. SUCH AMOUNTS CANNOT BE TREATED AS TRADING RECEIPTS TILL THE TITLE PASSES TO THE PURCHASER AND THE LAND FOR WHICH THE AMOUNT IS RECEIVED GOES OUT OF THE STOCK - IN - TRADE OF THE ASSESSEE. IF THE METHOD OF ACCOUNTING FOLLOWED IS MERCANTILE, ON COMPLETION OF THE TRANSACTION THE ENTIRE SALE PRICE WILL BECOME THE INCOME OF THE ASSESSEE IRRESPECTIVE OF THE FACT WHETHER OR NOT HE ACTUALLY RECEIVED IT. BU T, IN EITHER CASE, THERE IS NO QUESTION OF THE RECEIPT BECOMING AN INCOME BEFORE THE COMPLETION OF THE TRANSACTION AND A TRANSFER OF THE TITLE. THE REAL TEST IN DECIDING WHETHER THE RECEIPT IS THE ASSESSEE'S INCOME OR NOT, IS WHETHER THE ASSESSEE CONTINUES TO BE THE OWNER OF THE LAND, OR WHETHER HE IS DIVESTED OF SUCH OWNERSHIP. THE LAND OF WHICH THE ASSESSEE IS THE OWNER IS ITS STOCK - IN - TRADE AND THE LAND WHICH IS SOLD, I.E., THE LAND OF WHICH THE OWNERSHIP OR TITLE IS TRANSFERRED, CEASES TO BE ITS STOCK - I N - TRADE ONLY WHEN THE TRANSACTION IS COMPLETE. IN OUR OPINION, THEREFORE, EVEN ASSUMING THAT THE METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE IS THE CASH METHOD, THE AMOUNT OF RS. 2,13,772 WHICH IT RECEIVED TOWARDS THE SALE PRICE IS NOT ITS TRADING RECEIP T, SINCE THE 9 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 LANDS TOWARDS THE PRICE OF WHICH THE SAID AMOUNT WAS RECEIVED WERE NOT SOLD IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 1971 - 72. AS POINTED OUT ABOVE, THE SALE DEEDS WERE ADMITTEDLY EXECUTED IN THE PREVIOUS YEAR RELEVANT TO THE ASSESS MENT YEAR 1972 - 73. THEREFORE, NO PART OF THE AMOUNT OF RS. 2,13,772 FORMED PART OF THE TRADING RECEIPT OF THE ASSESSEE IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 1971 - 72. A SIMILAR QUESTION IN A DIFFERENT CONTEXT HAD ARISEN BEFORE US IN INCOME - T AX REFERENCE NO. 232 OF 1976, DECIDED ON MARCH 24/25, 1981. (CIT V. SHAH DOSHI & CO. - SEE P. 23 SUPRA). IN THAT CASE, THE ASSESSEE - FIRM, TRADING IN LAND, HAD ENTERED INTO AN AGREEMENT TO PURCHASE LAND FROM A FIRM, M/S. SHAH & COMPANY. THE ASSESSEE ENTERED I NTO ANOTHER AGREEMENT WITH MAI KRUPA CO - OPERATIVE HOUSING SOCIETY LTD. TO SELL THE LAND WHICH IT HAD AGREED TO PURCHASE FROM M/S. SHAH & CO. THE RIGHT WHICH THE ASSESSEE ACQUIRED UNDER THE AGREEMENT WITH M/S. SHAH & CO. WAS SOUGHT TO BE TREATED AS ITS STOC K - IN - TRADE. THE QUESTION WHICH AROSE BEFORE US IN THAT CASE WAS WHETHER AS A RESULT OF THE AGREEMENT WITH M/S. SHAH & CO., THE ASSESSEE HAD ACQUIRED ANY STOCK - IN - TRADE. THIS COURT TOOK THE VIEW THAT, SINCE THE ASSESSEE WAS A DEALER IN LAND, ONLY SUCH LAND WHICH IT ACQUIRED IN THE COURSE OF ITS BUSINESS WOULD FORM PART OF ITS STOCK - IN - TRADE. IT WAS OBSERVED THAT A MERE AGREEMENT TO PURCHASE LAND WOULD NOT CONFER ANY TITLE ON THE ASSESSEE AND THE LAND AGREED TO BE PURCHASED COULD NOT BE TREATED AS ITS STOCK - I N - TRADE UNLESS AND UNTIL THE SALE TRANSACTION WAS COMPLETE. THE STOCK WHICH THE ASSESSEE HAD CONTRACTED TO PURCHASE, AND WHICH MIGHT HAVE BEEN APPROPRIATED TO THE CONTRACT, BUT THE PROPERTY IN WHICH HAS NOT PASSED TO THE ASSESSEE, CANNOT BE REGARDED AS THE ASSESSEE'S STOCK - IN - TRADE. THE INSTANT CASE BEFORE US IS A CONVERSE CASE. HERE, WHAT IS ARGUED ON BEHALF OF THE ASSESSEE IS THAT ON AND FROM THE DATE OF THE AGREEMENT TO SELL THE LAND TO THE SOCIETY, THE LAND CEASED TO BE ITS STOCK - IN - TRADE AND, THEREFORE , THE AMOUNT RECEIVED BY IT TOWARDS THE SALE PRICE SHOULD BE TREATED AS ITS INCOME. AS POINTED OUT ABOVE, THE LAND DOES NOT CEASE TO BE THE STOCK - IN - TRADE OF THE ASSESSEE UNLESS AND UNTIL THE SALE IS COMPLETED. THEREFORE, THE AMOUNT RECEIVED BY THE ASSESSE E BY WAY OF EARNEST MONEY AND PART PAYMENT OF THE PURCHASE PRICE CANNOT BE TREATED AS ITS TRADING RECEIPT. A QUESTION SIMILAR TO THE ONE WHICH HAS ARISEN BEFORE US HAD COME UP FOR CONSIDERATION IN THE CASE OF CHIDAMBARAM 10 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 CHETTIAR V. CIT [1936] 4 ITR 309 (MAD). THAT WAS A CASE, IN WHICH THE ASSESSEE, WHO WAS CARRYING ON BUSINESS AT KLANG (IN BURMA), HAD ENTERED INTO AN AGREEMENT WITH ONE S. A. RM., WHO CARRIED ON BUSINES S AT PENANG, FOR THE PURCHASE OF HOUSE SITES BELONGING TO S. A. RM IN BRITISH INDIA. ON 3RD APRIL, 1929, A SUM OF RS. 50,000 WAS PAID TO S. A. RM AT PENANG BY THE ASSESSEE'S KLANG FIRM TOWARDS THE PRICE AND THE ASSESSEE WAS DEBITED WITH THIS AMOUNT ON THAT DATE. THE SALE DEED WAS EXECUTED ON 8TH MAY, 1929. IN THE ASSESSMENT FOR THE ACCOUNTING YEAR 13TH APRIL, 1929, TO 12TH APRIL, 1930, THE ASSESSEE CONTENDED THAT THIS SUM OF RS. 50,000 MUST BE DEEMED TO HAVE BEEN REMITTED TO HIM ON 3RD APRIL, 1929, AND NOT ON 8TH MAY, 1929, AND THAT IT COULD NOT, THEREFORE, BE INCLUDED IN THE INCOME OF THE YEAR ENDING 12TH APRIL, 1930. ON A REFERENCE, THE MADRAS HIGH COURT TOOK THE VIEW THAT THE ASSESSEE RECEIVED THE MONEY IN THE SHAPE OF HOUSE SITES ONLY ON THE 8TH MAY, 192 9, AND SO THE AMOUNT WAS LIABLE TO BE ASSESSED TO TAX IN THE ACCOUNTING YEAR ENDING 12TH APRIL, 1930. IN OTHER WORDS, IT WAS HELD THAT THE ASSESSEE COULD NOT BE SAID TO HAVE RECEIVED MONEY, UNLESS AND UNTIL THE SALE WAS COMPLETED ON MAY 8, 1929. SIMILAR VI EW WAS TAKEN IN RE KUNJAMAL AND SONS [1941] 9 ITR 358 (ALL). WE ARE, THEREFORE, UNABLE TO AGREE WITH THE VIEW TAKEN BY THE TRIBUNAL THAT THE AMOUNT OF RS. 5,000 RECEIVED BY THE ASSESSEE AS EARNEST MONEY AND RS. 2 ,08,772 RECEIVED BY IT AS PART PAYMENT OF PRICE CONSTITUTE THE ASSESSEE'S INCOME TAXABLE FOR THE ASSESSMENT YEAR 1971 - 72. 11 . THUS, A READING OF THE ABOVE ORDER SHOWS THAT IN ORDER TO TAX THE INCOME IN THE ASSESSMENT YEAR , THREE CONDITIONS HAVE TO BE CUMULATIVE LY SATISFIED : - 1) S ALE DEED SHOULD BE REGISTERED ; 2) THE ASSESSEE SHOULD HAVE ACQUIRED A LEGAL RIGHT TO RECEIVE THE CONSIDERATION STATED IN THE REGISTERED SALE DEED; AND 3) THE POSSESSION OF THE PROPERTY MUST BE HANDED - OVER TO THE BUYER. 1 2 . IN THE INSTANT CASE , IT IS NOT IN DISPUTE THAT THE SALE DEED WAS REGISTERED ON 04/04/2008 WHICH IS THE PREVIOUS YEAR REL E VANT TO THE ASSESSMENT YEAR 2009 - 10 . THUS, ONE OF THE CONDITIONS FOR TREATING THE INCOME FROM SALE OF LAND AS INCOME ACCRUED TO THE ASSESSEE DURING THE YEAR UNDER APPEAL IS NOT SATISFIED. THEREFORE, WE FIND THAT THE COMMISSIONER OF INCOME TAX (APPEALS) WAS JUSTIFIED IN HOLDING THE SALE CONSIDERATION FROM THE PROPERTY WAS 11 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 NOT TAXABLE IN THE ASSESSMENT YEAR 2008 - 09. HENCE, WE D ISMISS THE ABOVE GROUNDS OF APPEAL OF THE REV E NUE. 4. WE FIND TH A T THE FACTS AND THE ISSUE INVOLVED IN THE ABOVE GROUNDS OF APPEAL OF THE REVENUE ARE THE SAME AS WERE IN THE CASE OF THE HUSBAND OF THE ASSESSEE. FURTHER, THE ASSESSEE HAS SHOWN THE INCOME FROM THE SALE OF LAND IN THE ASSESSMENT YEAR 2011 - 12 WHICH HAS BEEN ACCEPTED BY THE DEPARTMENT IN ASSESSMENT MADE UNDER SEC. 143(3) OF THE ACT. IN SUPPORT OF WHICH, THE ASSESSEE HAS PLACED BEFORE US THE COPY OF COMPUTATION OF INCOME FOR ASSESSMENT YEAR 2011 - 12 , BALANCE SHEET OF THE ASSESSEE AS ON 31/03/2011 AND COPY OF THE ASSESSMENT ORDER DATED 30/03/2013 UNDER SEC. 143(3) OF THE ACT AT PAGE NOS. 298 TO 325 OF THE PAPER BOOK . THEREFORE, W E FIND NO IN FIRMITY IN THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) WHICH IS CONFIRMED AND THE GROUNDS OF APPEAL OF THE REVENUE ARE DISMISSED. 5 . GROUND NO.4 OF THE APPEAL READS AS UNDER: - 4. THE LD. CIT(A) - 2, PANAJI HAS ERRED IN DELETING IN ADDITION OF THE UNEXPLAINED INVESTMENT AMOUNTING TO RS.5,77,63,450/ - WITHOUT APPRECIATING T HE FACTS BROUGHT ON RECORD BY THE ASSESSING OFFICER. 6 . AT THE VERY OUTSET BOTH THE PARTIES BEFORE US SUBMITTED THAT THE ISSUE RAISED IN THE ABOVE GROUND OF APPEAL IS SIMILAR TO THAT RAISED IN THE CASE OF THE HUSBAND OF THE ASSESSEE IN I.T.A.NO. 186/PNJ/2015 FOR THE ASSESSMENT YEAR 2008 - 09 DATED 12/08/2015 WHEREIN 50% OF ADDITION OF THE AMOUNT HAS BEEN MADE IN THE HANDS OF THE ASSESSEES HUSBAND AND 50% IN THE HANDS OF THE ASSESSEE, THEREFORE, SAME MAY BE DECIDED ACCORDINGLY. 7 . I N I.T.A.NO. 186/PNJ/2015, THE SAME BENCH OF THE TRIBUNAL HAS HELD AS UNDER: - 12 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 30 WE FIND NO SPECIFIC ERROR IN THE FINDING OF THE COMMISSIONER OF INCOME TAX (APPEALS) COULD BE POINTED OUT BY THE R E VENUE . THE ASSESSEE EXPLAINED THE COST OF THE LAND WAS MET FROM THE FUNDS RECEIVED FROM 04 PERSONS NAMELY M/S. ASHMA VIR FINANCE PVT. LTD. , TAHIR ISANI, RAJARAM DIVEKAR AND PRAKASH BANDEKAR , WHO DIRECTLY PAID THE MONEY TO THE SELLERS OF THE LAND AND THE BALANCE AMOUNT OF 94,76,000/ - WAS PAID FROM THE PROPRIETARY CONCER N OF THE ASSESSEE NAMELY M/S. UNICORN DEVELOPERS. 31 WE FIND THAT THE IDENTITY OR THE CREDITWORTHINESS OF THE ABOVE NAME D 04 PERSONS HAS NOT BEEN DISPUTED BY THE ASSESSING OFFICER. NO MATERIAL WAS BROUGHT ON RECORD BY THE ASSESSING OFFICER AFTER EXAMINING THE SAID 04 PERSONS TO SHOW THAT THE CLAIM OF THE ASSESSEE CANNOT BE ACCEPTED . SIMPLY BECAUSE IN THE SUBJECTIVE OPINION OF THE ASSESSING OFFICER, THE INTEREST OF THE 04 PERSONS IN ASSISTING THE ASSESSEE IN ACQUIRING THE LAND COULD N O T BE EXPLAINED DOES NOT EMPOWER THE ASSESSING OFFICER TO TREAT THE SOURCE AS UNEXPLAINED. FURTHER, SIMPLY BECAUSE THE PERSONS TO WHOM THE ASSESSEE SOLD THE LAND PAID DIRECTLY TO 02 PERSONS, AMOUNT DIFFERENT FROM THE AMOUNT TAKEN FROM THEM FOR THE PURPOSE S OF ACQUISITION OF LAND BECAUSE OF OTHER TRANSACTIONS OF THE ASSESSEE WITH THOSE 02 PERSO NS DOES NOT MEAN THAT NO FUNDS WERE RECEIVED FROM THOSE 02 PERSONS. IT IS OBSERVED THAT NO MATERIAL HAS BEEN BROUGHT ON RECORD BY THE ASSESSING OFFICER TO SHOW THAT THE SOURCE OF 94,76,000/ - CLAIMED BY THE ASSESSEE AS PAID OUT OF HIS OWN PROPRIETARY CONCERN STYLE D M/S. UNICORN DEVELOPERS CANNOT BE ACCEPTED AND WHY THE ASSESSEE COULD NOT HAVE INVESTED THE SAID AMOUNT FROM HIS PROPR IE TARY CONCER N . 32 . IN THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) . THEREFORE, THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) IS CONFIRMED AND THE GROUNDS OF THE APPEAL OF THE REVENUE ARE DISMISSED. 8 . FACTS BEING IDENTICAL RESPECTFULLY FOLLOWING THE PRECEDENT, WE DISMISS THE GROUND OF APPEAL OF THE REVENUE . 9 . GROUNDS NO. 5 & 6 READS AS UNDER: - 5. THE LD. CIT(A) - 2, PANAJI HAS ERRED IN ADMITTING THE EVIDENCE FILED BY THE ASSESSEE ON THIS POINT WITHOUT ALLOWING AN OPPORTUNITY TO THE AO TO EXAMINE THE EVIDENCE. 6. FOR THE ABOVE GROUNDS AND ANY ADDITIONAL GROUNDS THAT MAY BE AGITATED DURING THE COURSE OF THE HEARING IT IS PRAYED THAT 13 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 THE ORDER OF THE LD. CIT(A) - 2, PANAJI MAY BE QUASHED AND THAT OF THE AO RESTORED. 10 . AT THE TIME OF HEARING, NO SPECIFIC SUBMISSIONS WERE MADE BY THE DEPARTMENTAL REPRESENTATIVE, HENCE, SAME ARE DISMISSED. C.O. NO. 22 /PNJ/2015 1 1 . IN THE CROSS OBJECTION, THE ASSESSEE HAS RAISED 09 GROUNDS OF CROSS OBJECTION. GROUND NO S .1 & 9 ARE GENERAL IN NATURE , THEREFORE, REQUIRES NO SEPARATE ADJUDICATION BY US. 12 . GROUND NOS. 2 TO 4 OF THE CROSS OBJECTION ARE DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) SUSTAINING ADDITION O F 28,25,000/ - TOWARDS CASH PAID TO M/S. HAZRAT CONSTRUCTIONS. 1 3 . AT THE VERY OUTSET BOTH THE PARTIES BEFORE US SUBMITTED THAT THE ISSUE RAISED IN THE ABOVE GROUNDS OF CROSS OBJECTION ARE SIMILAR TO THAT RAISED IN THE CASE OF THE HUSBAND OF THE ASSESSEE IN C.O. NO. 20 /PNJ/2015 FOR THE ASSESSMENT YEAR 2008 - 09 DATED 12/08/2015 WHEREIN 50% OF ADDITION OF THE AMOUNT HAS BEEN MADE IN THE HANDS OF THE ASSESSEES HUSBAND AND 50% IN THE HANDS OF THE ASSESSEE, THEREFORE, SAME MAY BE DECIDED ACCORDINGLY. 14 . I N THE CASE OF THE HUSBAND OF THE ASSESSEE, THE TRIBUNAL VIDE ORDER DAT E D 12/08/2015 HELD AS UNDER: - 48 . AFTER GOING THROUGH THE LOOSE SHEET, WE FIND THAT MERELY FROM THE SAID SHEET IT CANNOT BE CONCLUDED THAT IT RECORDS ACTUAL FINANCIAL TRANSACTIONS BETWEEN THE ASSESSEE AND M/S. HAZRAT CONSTRUCTIONS OR ANY OTHER PERSON. FROM THE SAID LOOSE SHEET, IT CANNOT BE CONCLUDED THAT THE ASSESSEE ACTUALLY PAID THE AMOUNT STATED ON THE DATES MENTIONED THEREIN OR EVEN M/S. HAZRAT CONSTRUCTIONS ACTUALLY RECEIVED THOSE AMOUNTS FROM ANY PERSON. 14 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 THUS, THE SAID DOCUMENT WHICH WAS NOT A PART OF REGULARLY MAINTAIN ED BOOKS OF ACCOUNTS CANNOT BE TREATED AS EVIDENCE OF ACTUAL TRANSACTION OF THE ASSESSEE WITHOUT ANY CORROBORATIVE EVIDENCE FOUND DURING THE COURSE OF SEARCH . IN ABSENCE OF ANY CORROBORATIVE EVIDENCE BEING BROUGHT ON RECORD BY THE R E VENUE , IN OUR CONSIDERED VIEW THE ADDITION MADE MERELY ON THE BASIS OF LOOSE SHEET WHICH DOES NOT BEAR SIGNATURE OF ANY PERSON AND WHICH DOES NOT CREATE ANY LEGAL RELATIONSHIP BETWEEN THE ASSESSEE AND ANY OTHER PERSON CANNOT BE SUSTAINED. 4 9 . IN THE ABOVE CIRCUMSTANCES , WE ARE UNABLE TO SUSTAIN THE ADDITION MADE BY THE REVENUE AND ACCORDINGLY THE SAME IS DELETED. THUS, THESE GROUNDS OF CROSS OBJECTION ARE ALLOWED. 15 . FACTS BEING IDENTICAL RESPECTFULLY FOLLOWING THE PRECEDENT, WE ALLOW THE GROUNDS OF CROSS OBJECTION OF THE ASSESSEE. 16 . GROUND NO S . 5 TO 8 OF THE CROSS OBJECTIONS READ AS UNDER: - 5. THE LD CIT(A) HAS WRONGLY SUSTAINED AMOUNT OF RS.20,80,000/ - FROM THE ADDITION OF RS.1,00,00,000/ - AS INCOME FROM M/S. SHIRDI INFRASTR UCTURE AND DEVELOPERS PVT. LTD. 6. THE LD CIT(4) HAS TOTALLY IGNORED THE PREY OF THE ASSESSEE THAT HE IS AGREEABLE TO DECLARE RS.1 CRORE AS BROKERAGE INCOME UNDER THE CONDITION THAT THERE WILL NOT BE ANY ADDITION ON ACCOUNT OF ALLEGED CASH PAYMENT TO M/S. HAZRAT CONSTRUCTIONS. 7. THE LD CIT(A) HAS SUSTAINED THE B ALANCE AMOUNT OF RS.20,80,000/ - (RS.10000000 7920000 ALLEGED CASH OF M/S. HAZRAT), WHICH IS TOTALLY WRONG A ND UNDESIRED AS CIT(A) HAS SUSTAINED THE ADDITIONS OF ALLEGED CASH PAID TO M/S.HAZRAT CONSTRUCTIONS IN HIS ORDER. 8. THE LEARNED CIT(A) HAS ERRED PASSING THE ORDER WITHOUT CONSIDERING THE FACT THAT NO CROSS EXAMINATION IS PROVIDED AND NO EVIDENCE IS PROVI DED OR DISCUSSED IN THE ORDER OF AO AS WELL AS OF THE CIT(A). ADDITION SUSTAINE D ARE MAINLY ON THE BASIS OF COMM UNICATION FROM THE ASSESSEE WHICH ARE NOT SUBSTANTIATED BY ANY SECONDARY DIRECT EVIDENCE COLLECTED FROM THE ASSESSEE. 15 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 1 7 . AT THE TIME OF HEARING, AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT HE IS NOT PRESSING THESE GROUNDS OF CROSS OBJECTION AND ALSO MADE AN ENDORSEMENT TO THIS EFFECT ON THE GROUNDS OF CROSS OBJECTION FILED TOGETHER WITH MEMO OF CROSS OBJECTION . HENCE, THESE GROUNDS OF CROSS OBJECTION ARE DISMISSED AS NOT PRESSED. 1 8 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED AND THE CROSS OBJECTION OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON MONDAY , THE 1 7 TH DAY OF AUGUST , 201 5 AT GOA . S D / - S D / - (GEORGE MATHAN) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 1 7 TH AUGUST , 201 5 . VR/ - COPY TO: 1 . THE ASSESSEE. 2 . THE REVENUE. 3 . THE CIT 4 . THE CIT(A) 5 . THE D.R . 6 . GUARD FILE. BY ORDER 16 ITA NO. 18 8 /PNJ/2015 C.O.NO. 22 /PNJ/2015 DATE INITIAL ORIGINAL DICTATION PAD IS ENCLOSED WITH I.T.A.NO. 18 6 /PNJ/2015 1. DRAFT DICTATED ON 1 7 / 0 8 / 2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 1 8 .08 .2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 18 /08 /2015 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 18 /0 8 /2015 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 18 /08 /2015 SR.PS 6. DATE OF PRONOUNCEMENT 17 /0 8 /2015 SR.PS 7. FILE SENT TO THE BENCH CLERK 1 8 /08 /2015 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER