DCIT Circle - 7(1), Hyderabad V. Frontline & BYK Constructions, Hyderabad

ITA 1115/HYD/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66267 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 09-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAO SHRI C P RAMASWAMY
• Section: 133A; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NO. 1115/HYD/2011 ASSESSMENT YEAR: 2007-08 DCIT, CIR-7(1), HYDERABAD. .... APPELLANT VS. FRONTLINE & BYK CONSTRUCTIONS, AC GUARDS, HYDERABAD. RESPONDENT PAN:AABFF 4152B APPELLANT BY : SHRI M.S. RAO RESPONDENT BY : SHRI C.P. RAMASWAMY DATE OF HEARING : 30-07-2012 DATE OF PRONOUNCEMENT : 07-09-2012 ORDER PER SAKTIJIT DEY, J.M.: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST ORDER DATED 31-3-2011 OF CIT (A), VIJAYAWADA PASSED IN APPEAL NO.202/CIT(A)/TR/VJA/10-11 AND IT PERTAINS TO THE ASSESSMENT YEAR 2007-08. 2. THE FOLLOWING TWO EFFECTIVE GROUNDS ARE RAISED B Y THE REVENUE:- 2 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. 1 .THE CIT (A) ERRED IN HOLDING THAT THE RATE ADOPTE D IN THE BOOKS OF ACCOUNTS AND THE ACTUAL SALES AS PER T HE SALE AGREEMENTS ENTERED. 2. THE CIT (A) ERRED IN HOLDING THAT THE ADDITION WERE MADE BY THE AO BASING ON THE MATERIAL FOUND DURING THE COURSE OF SURVEY OPERATION AND FURTHER ENQUIRIE S MADE. 3. BRIEFLY THE FACTS ARE THE ASSESSEE A PARTNERSHI P FIRM IS ENGAGED IN REAL ESTATE BUSINESS. FOR THE ASSESSMEN T YEAR UNDER DISPUTE IT FILED ITS RETURN OF INCOME ON 13-11-2007 DECLARING A TOTAL INCOME OF RS.56,07,950. IT WILL BE PERTINENT TO MENTION HERE THAT A SURVEY U/S 133A WAS CONDUCTED IN THE BU SINESS PREMISES OF THE ASSESSEE ON 13-1-2007 AND CERTAIN B OOKS AND DOCUMENTS WERE IMPOUNDED. ON THE DATE OF SURVEY TH E ASSESSEES FIRST PROJECT NAFEEZ RESIDENCY WAS UND ER DEVELOPMENT AND ABOUT 50% OF THE CONSTRUCTION WORK WAS COMPLETED. CONSIDERING THE FACT THAT IN THE IMPOUN DED DOCUMENTS THE AVERAGE SALE PRICE RECORDED TO BE ADO PTED AT RS.1600 PER SFT AS AGAINST RS.1400 PER SFT RECORDED IN THE SALE DEED AND AGREEMENTS, THE TOTAL PROFIT ON THE PROJEC T WAS ESTIMATED TO BE NEAR ABOUT RS.120 LAKHS. THE ASSES SEE IN ITS LETTER DATED 23-1-2007 AGREED AND ACCEPTED TO PAY T AXES ON THE TOTAL INCOME FROM THE PROJECT OF RS.105 LAKHS SINCE RS.15 LAKHS HAD ALREADY BEEN DECLARED BY THE ASSESSEE FOR THE A SSESSMENT YEAR 2006-07. THE ASSESSEE ALSO PAID THE ENTIRE TA X OF RS.32,25,000/- ON THE INCOME OF RS.105 LAKHS ON 25- 1-2007 AND 15-3-2007. AO REOPENED THE ASSESSMENT FOR THE IMPU GNED ASSESSMENT YEAR BY ISSUING A NOTICE U/S 148 OF THE ACT. IN COURSE OF THE REASSESSMENT PROCEEDING THE AO OBSERVING THA T WHILE IN 3 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. LETTER DATED 23-1-2007 THE ASSESSEE HAD AGREED AND ACCEPTED TO DECLARE RS.105 LAKHS AS INCOME FOR THE ASSESSMENT Y EAR 2007-08, WHEREAS IN THE RETURN OF INCOME FILED FOR THE ASSES SMENT YEAR 2007-08 IT HAD DECLARED INCOME OF RS.56,07,950/- AS KED THE ASSESSEE TO EXPLAIN THE REASONS FOR GOING BACK ON I TS OFFER. THE ASSESSEE EXPLAINED BEFORE THE AO THAT THE CONSTRUCT ION OF THE PROJECT WAS STARTED DURING THE FINANCIAL YEAR 2004- 05 AND ONLY 50% OF THE WORK WAS COMPLETED AT THE TIME OF SURVEY . TO AVOID LITIGATION AND BUY PEACE WITH THE DEPARTMENT THE AS SESSEE AGREED TO ADOPT AN AVERAGE RATE OF RS.1600 PER SFT IN PLA CE OF RS.1400 SHOWN IN THE SALE DEEDS/AGREEMENTS AND DECLARED PRO FIT AT RS.120 LAKHS. THE ASSESSEE EXPLAINED THAT THE TOTAL PROFI T AGREED TO BE DECLARED WAS FOR THE TOTAL PROJECT AND NOT FOR ANY PARTICULAR ASSESSMENT YEAR. THE ASSESSEE EXPLAINED THAT BECAU SE OF THE INSISTENCE OF THE DEPARTMENT TAX IN ADVANCE WAS PAI D IN EXCESS OVER WHAT S ACTUALLY DUE FOR THE ASSESSMENT YEAR 20 07-08. THE ASSESSEE THEREFORE CARRIED FORWARD THE EXCESS ADVAN CE TAX PAID FOR ADJUSTMENT AGAINST TAX LIABILITY OF SUBSEQUENT ASSESSMENT YEARS. 4. THE ASSESSING OFFICER REJECTING THE EXPLANATION OF THE ASSESSEE ADDED AN AMOUNT OF RS.48,92,050/- BEING TH E DIFFERENTIAL FIGURE BETWEEN THE ASSESSEES OFFER OF RS.105 LAKHS MADE IN THE LETTER DATED 13-1-2007 AND INCOME DECLA RED IN THE RETURN OF INCOME FILED FOR THE ASSESSMENT YEAR 2007 -08. THE ASSESSING OFFICER FURTHER ADDED A SUM OF RS.96,39,6 00/- ALLEGING UNDERSTATEMENT IN THE SALE CONSIDERATION BY ADOPTIN G COST F SALE AT RS.2000/- PER SFT IN PLACE COST OF RS.1600/- AGR EED TO BE DECLARED BY THE ASSESSEE AT THE TIME OF SURVEY AT R S.1600 PER SFT. 5. THE ASSESSEE CHALLENGED THE ASSESSMENT ORDER BY FILING AN APPEAL BEFORE THE CIT (A). IN COURSE OF HEARING BE FORE THE CIT 4 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. (A) THE ASSESSEE CONTENDED THAT THE ASSESSEE HAS UN DERTAKEN ONLY ONE PROJECT OF CONSTRUCTION OF RESIDENTIAL APA RTMENT ON DEVELOPMENT BASIS OVER THE LAND BELONGING TO LANDOW NERS. THE CONSTRUCTION WORK AS WELL AS THE BOOKINGS STARTED I N THE FINANCIAL YEAR 2004-05 AND THE PROJECT WAS COMPLETED IN ALL R ESPECTS IN FINANCIAL YEAR 2008-09. AS PER THE DEVELOPMENT AGR EEMENT ASSESSEES SHARE IS 36 FLATS. AS PER THE METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE REVENUE IS RECOGNISED ON C RYSTALLISATION OF SALE TRANSACTION OR ON RECEIPT OF AMOUNT TOWARDS SALE CONSIDERATION FROM THE PURCHASER OF FLATS. THE ASS ESSEE REITERATING ITS STAND TAKEN BEFORE THE AO SUBMITTED THAT THE ASSESSEE HAD ADMITTED FOR DECLARING THE PROFIT AT R S.120 LAKHS FOR THE TOTAL PROJECT AND NOT FOR THE FINANCIAL YEAR 20 06-07. STICKING TO THE COMMITMENT THE ASSESSEE HAS TAKEN THE AVERAG E SALE PRICE AT RS.1600 PER SFT., INSTEAD OF RS.1400 PER SFT SHO WN IN THE SALE DEEDS/AGREEMENTS. THE ASSESSEE CONTENDED THAT IN F ACT IT HAS SHOWN PROFIT OF RS.124 LAKHS FOR THE TOTAL PROJECT WHICH IS MORE THAN WHAT WAS COMMITTED AT THE TIME OF SURVEY. 6. WITH REGARD TO THE ADDITION OF RS.48.92,050/- TH E CIT (A) AFTER CONSIDERING THE CONTENTIONS OF THE ASSESSEE A ND THE EXAMINING THE MATERIALS AVAILABLE ON RECORD, MORE P ARTICULARS IN ASSESSEES LETTER DATED 23-1-2007 OFFERING INCOME O F RS.120 LAKHS HELD IN THE FOLLOWING MANNER:- ON A PERUSAL OF THE ABOVE LETTER, IT IS SEEN THAT T HE APPELLANT HAD EXPECTED THE CONSTRUCTION WORK OF THE PROJECT TO BE COMPLETED BY SEPTEMBER, 2007. THE GRO SS RECEIPTS ON THE SALE OF FLATS WAS ESTIMATED TO BE APPROXIMATELY RS.10 CRORES AND AFTER CONSIDERING TH E EXPENDITURE INCURRED AND TO BE INCURRED IN FUTURE, THE TAXABLE INCOME FROM THE PROJECT WAS ESTIMATED TO BE IN THE RANGE OF RS. 120 LAKHS. CONSIDERING THAT AN INCOME OF RS.15 5 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. 1ACS WAS ALREADY DISCLOSED FOR THE AY.2006-07, THE APPELLANT CAME FORWARD TO DECLARE A SUM OF RS. 105 LAKHS APPROXIMATELY TOWARDS THE INCOME OF THE PROJECT. FU RTHER, HE UNDERTOOK TO PAY THE TAXES ACCORDINGLY. FURTHER, FOR ASST.YR.2007-08' EVIDENTLY WAS ADDED IN PEN AFTER T HE LETTER WAS TYPED OUT. FROM THE ABOVE, IT WOULD APPE AR THAT THE COMMITMENT OF THE APPELLANT WAS TOWARDS DECLARI NG A PROFIT OF RS. 120 LAKHS FOR THE ENTIRE PROJECT AND FOR THE PAYMENTS OF THE TAXES ON SUCH INCOME. I AM UNABLE T O ACCEPT THE OBSERVATION OF THE ASSESSING OFFICER THA T THE APPELLANT HAD RETRACTED FROM THE COMMITMENT MADE IN THIS LETTER. AS SEEN FROM THE RETURNS FILED BY THE APPEL LANT FOR THE A.Y.2007-08, 2008-09 AND 2009-10, THE TOTAL PRO FIT DECLARED FOR THE ENTIRE PROJECT IS AROUND RS. 1,24, 39,783/-. THE TAXES OF RS.42,32,290/-HAVE BEEN PAID IN TOTAL ON THE INCOMES DECLARED IN THE RELEVANT YEARS. FROM THE AB OVE, IT WOULD NECESSARILY FOLLOW THAT THE PROJECT COULD NOT HAVE BEEN COMPLETED BY SEPTEMBER 2007 AS ENVISAGED AT TH E TIME OF SUBMITTING THE LETTER ON 23/1/2007. IN SUCH CIRCUMSTANCES, THE APPELLANT CANNOT BE INSISTED UPO N TO DECLARE INCOME FROM A PROJECT WHICH WAS NOT COMPLET ED DURING THE PERIOD RELEVANT TO THE AY.2007-08. IN OT HER WORDS, EVEN PRESUMING THAT THE APPELLANT HAD COME FORWARD IN GOOD FAITH TO COMMIT HIMSELF TO THE ENTI RE PROFIT FOR TAXATION IN THE AY.2007 -08 ITSELF, CONSIDERING THE FACT THAT THE PROJECT WAS NOT COMPETED DURING THE RELEVA NT PERIOD AND HAD ACTUALLY TAKEN UP COUPLE OF YEARS MO RE FOR COMPLETION, NO LIABILITY CAN BE FASTENED ON TO THE APPELLANT BASED ON SUCH AN IMPRACTICAL COMMITMENT. THE COMMIT MENT IS FOR OFFERING TO TAX A PROFIT OF RS. 120 LAKHS ON THE PROJECT AS A WHOLE AND NOT ONLY FOR THE AY.2007-08. THIS VI EW IS STRENGTHENED BY THE FACT THAT THE WORDS 'FOR ASST.Y R.2007- 08' HAVE BEEN ADDED IN PEN AT THE END OF THE LAST S ENTENCE IN THE LETTER WHICH SPEAKS OF THE UNDERTAKING TO DE CLARE THE 6 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. BALANCE INCOME OF RS.105 LAKHS FOR THE PROJECT AND TO PAY TAXES ACCORDINGLY. THE COMMITMENT MADE IN THE LETTE R DATED 23/01/2007 CANNOT BE CONSIDERED AS INVIOLABLE IF FACTS SHOW OTHERWISE I.E. SUCH AN UNDERTAKING IS SU BJECT TO MODIFICATION, IF FACTS SO WARRANT. THE APPELLANT HA S RETURNED INCOME OF RS.1,24,39,783/- AS PER THE COMMITMENT MADE DURING THE COURSE OF SURVEY IN ITS RETURNS FILED FOR THE AY.2007-08 TO 2009-10 EVEN BE FORE THE PRESENT ASSESSMENT ORDER IN APPEAL WAS PASSED O N 29/12/2009. IN THE LIGHT OF THE FOREGOING DISCUSSIO N, I AM OF THE VIEW THAT THERE IS NO JUSTIFICATION FOR BRIN GING TO TAX THE TOTAL PROFIT OF THE PROJECT IN THE YEAR 2007-08 ITSELF IGNORING THE FACT THAT THE PROJECT ITSELF WAS STILL UNDER COMPLETION DURING THE RELEVANT PERIOD. CONSEQUENTLY , THE ADDITION OF RS.48,92,050/- STANDS DELETED. 7. SO FAR AS THE ADDITION OF RS.96,39,600/- BY ADOP TING THE AVERAGE SALE PRICE AT RS.2000/- PER SFT IS CONCERNE D, THE ASSESSEE SUBMITTED THAT ALL THE 36 FLATS FALLING TO THE SHAR E OF THE ASSESSEE WAS BOOKED PRIOR TO 31-12-2005 AND THE ASSESSEE HAD RECEIVED AMOUNT TOWARDS PRICE FROM THE PROSPECTIVE BUYERS BA SING ON THE STAGE OF CONSTRUCTION. THE ASSESSEE CONTENDED THAT THOUGH THE REGISTRATION OF THE 14 FLATS IN THE NAME OF THE CUS TOMERS WAS DONE AT SEMI FINISHED STAGE BUT THE ACTUAL BOOKING OF THE FLATS WAS MADE MORE THAN A YEAR EARLIER. THE ASSESSEE CO NTENDED THAT ADOPTION OF SALE PRICE AT RS.2000 PER SFT BY THE AO BASING ON THE PRICE, AT WHICH THE LANDOWNER SOLD ONE FLAT IN NOVE MBER, 2006 WAS NOT CORRECT. SO FAR AS THE SECOND ADDITION OF RS.96,39,600 (WRONGLY MENTIONED AS RS.36,39,600 IN THE ORDER OF CIT (A) THE CIT (A) DELETED THE ADDITION BY OBSERVING IN THE FO LLOWING MANNER:- 7 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS MADE I N THIS REGARD. THERE IS CONSIDERABLE MERIT IN THE ARGUMENT OF THE LEARNED AUTHORISED REPRESENTATIVE THAT A SALE TRANS ACTION ENTERED INTO IN NOVEMBER, 2006 CANNOT BE COMPARED W ITH THE BOOKING PRICE OF THE APPELLANT BUILDER MUCH EAR LIER. IT IS NOT DISPUTED THAT THE BOOKINGS OF THE FLATS WERE MADE BY THE APPELLANT DURING THE PERIOD MAY 2004 TO DECEMBE R 2005. IT IS COMMON KNOWLEDGE THAT A DEVELOPER ENTER S INTO AGREEMENTS FOR SALE OF THE FLATS TO BE CONSTRUCTED AT THE INITIAL STAGE ITSELF TO RAISE FUNDS FOR THE CONSTRU CTION WHEREAS THE LAND OWNER WHO RECEIVES HIS SHARE OF CONSIDERATION AS PER THE DEVELOPMENT AGREEMENT IN T HE FORM OF CONSTRUCTED AREA WOULD ENTER INTO ANY TRAN SACTION ONLY AFTER CONSTRUCTION AND HANDING OVER OF HIS SHA RE OF THE CONSTRUCTED AREA. IT IS THE APPELLANT'S CLAIM THAT AMOUNTS WERE RECEIVED FROM THE PROSPECTIVE BUYERS OF THE 14 FLATS SOLD DURING THE RELEVANT PERIOD RIGHT FROM THE STAG E OF CONSTRUCTION ITSELF IN INSTALMENTS. SUCH PAPERS PER TAINING TO THE BOOKINGS WERE ALREADY IN THE POSSESSION OF T HE DEPARTMENT AS A RESULT OF THE SURVEY ACTION. IT WOU LD APPEAR THAT THE SALE PRICE OF RS.1,400/- PER SQUARE FEET WAS REVISED TO AN AVERAGE SALE PRICE OF RS.1.600/- PER SQUARE FEET ONLY ON THE BASIS OF THE LOOSE SHEET AN D OTHER PAPERS RECOVERED DURING THE SURVEY. IF THE BOOKINGS OF THE 14 FLATS HAD ALREADY BEEN MADE BY THE TIME THE SURV EY WAS CONDUCTED THERE CAN BE NO JUSTIFICATION OR ANY BASI S FOR ADOPTING A FURTHER ENHANCED SALE PRICE OF RS.2,OOO/ - PER SQUARE FEET CONSIDERING THAT A FLAT WAS SOLD FOR SU CH A PRICE LATER IN NOVEMBER, 2006. THE ASSESSING OFFICER HAS NOT BEEN ABLE TO BRING ON RECORD ANY EVIDENCE TO ESTABL ISH THAT THE APPELLANT HAD ACTUALLY RECEIVED SALE CONSIDERAT ION OF RS.2,OOO/- PER SQUARE FEET FOR THE FLATS SOLD DURIN G THE YEAR. I AM OF THE VIEW THAT THE ABOVE ADDITION HAS NOT BEEN MADE ON ANY SOUND BASIS OR LOGIC AND AS NO EVIDENCE IN 8 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. SUPPORT OF THE SALE PRICE BEING RS.2,OOO/- PER SQUA RE FEET HAS BEEN BROUGHT ON RECORD, THERE IS NO JUSTIFICATI ON FOR ADOPTING A SALE PRICE OF RS.2,OOO/- PER SQUARE FEET FOR THE 14 FLATS SOLD DURING THE YEAR. ACCORDINGLY, THE ADD ITION OF RS.36,39,600/- IS HEREBY DELETED. 8. WE HAVE HEARD SUBMISSIONS OF THE PARTIES AND PER USED THE MATERIALS ON RECORD. SO FAR AS THE ADDITION OF RS. 48,92,050/- IS CONCERNED, THE AO HAS MADE THE ADDITION BY ALLEGING THAT THE ASSESSEE HAS HIMSELF OFFERED TO DECLARE THE INCOME OF RS.105 LAKHS IN THE ASSESSMENT YEAR UNDER DISPUTE AND HAS ALSO PAID THE ADVANCE TAX. HOWEVER, THE LETTER DATED 23-1-2007 O F THE ASSESSEE ON WHICH THE AO HAS RELIED UPON FOR MAKING THE ADDITION AND WHICH IS REPRODUCED AT PAGE-5 OF THE CIT (A)S ORDER CLEARLY REVEALS THAT THE ASSESSEE HAS OFFERED TAXABLE INCOM E OF THE TOTAL PROJECT AT RS.120 LAKHS. IN TERMS WITH THE AFORESA ID COMMITMENT THE ASSESSEE IN FACT HAS DECLARED TAXABLE INCOME OF ABOUT RS.124 LAKHS SPREADING OVER FOUR ASSESSMENT YEARS I.E., F ROM ASSESSMENT YEAR 2006-07 TO ASST. YEAR 2009-10. THE REFORE, IT CANNOT BE SAID THAT THE ASSESSEE HAS GONE BACK ON I TS OFFER. IT IS A FACT THAT THE ASSESSEE IS DECLARING INCOME FROM T HE PROJECT ON THE CRYSTALLIZATION OF THE SALE TRANSACTION ON A PA RTICULAR FINANCIAL YEAR. THE AO HAS ALSO NOT BROUGHT ANY MATERIAL ON RECORD TO SHOW THAT BY THE END OF FINANCIAL YEAR 2006-07 THE ASSESSEE HAS SOLD ALL THE FLATS FALLING TO ITS SHARE OR HAS RECE IVED THE SALE CONSIDERATION FOR ALL THE FLATS. THE ASSESSEES CO NTENTION THAT PAYMENT OF TAX ON INCOME OF RS.105 LAKHS AND ADDING THE WORDS FOR ASSESSMENT YEAR 2007-08 IN INK WAS DONE AT TH E INSISTENCE OF THE DEPARTMENT AND TO BUY PEACE WITH THE DEPARTM ENT ALSO CANNOT BE DISBELIEVED. CONSIDERING THE AFORESAID F ACTS AND 9 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. CIRCUMSTANCES CIT (A) WAS PERFECTLY JUSTIFIED IN DE LETING THE ADDITION OF RS.48,92,050/-. WE, ACCORDINGLY UPHOLD THE ORDER OF THE CIT (A). 9. WITH REGARD TO ADDITION OF RS.96,39,600/- IT IS SEEN THAT THE AO HAS MADE THE ADDITION BY ADOPTING THE SALE PRICE OF RS.2000 PER SFT ON THE BASIS OF SALE OF A FLAT MADE BY THE LAND OWNER IN NOVEMBER, 2006. THE AO WHILE ADOPTING THE RATE OF RS.2000 PER SFT HAS COMPLETELY IGNORED THE FACT THAT BOOKING OF THE FLATS WITH THE ASSESSEE WAS MADE MUCH EARLIER THAN NOVEMBER, 1 996 ON AN AVERAGE AGREED PRICE OF RS.1400 PER SFT WHICH WERE ALSO FOUND AT THE TIME OF SURVEY OPERATION U/S 133A AND ARE IN PO SSESSION OF THE DEPARTMENT. FURTHERMORE ON THE BASIS OF CERTAIN LOOSE SHITS FOUND AT THE TIME OF SURVEY THE AVERAGE SALE PRICE WAS REVISED BY THE DEPARTMENT TO RS.1600 PER SFT WHICH WAS ALSO AC CEPTED BY THE ASSESSEE AND IT OFFERED THE INCOME OF RS.120 LAKHS FOR THE PROJECT. CONSIDERING THE AFORESAID FACTS THE AO WAS NOT JUSTIFIED IN ADOPTING SALE PRICE OF RS.2000 PER SFT ON THE BA SIS OF A FLAT SOLD BY THE LAND OWNER IN NOVEMBER 2006. THAT BESIDES W HEN THE ASSESSING OFFICER IS ACCEPTING THE FACT THAT PROFIT FROM THE TOTAL PROJECT IS RS.120 LAKHS WHICH HAS BEEN DECLARED BY THE ASSESSEE. THERE IS NO JUSTIFICATION ON HIS PART TO MAKE A SEP ARATE ADDITION OF RS.96,39,600 BY ADOPTING THE RATE OF RS.2000 PER SFT AS THE UNDERSTATED SALE PRICE OF 14 NOS., OF FLATS SOLD BY THE ASSESSEE. THIS WILL AMOUNT TO DOUBLY TAXING THE SAME INCOME. WE THEREFORE UPHOLD THE DECISION OF THE CIT (A) IN DELETING THE ADDITION. THE GROUNDS RAISED BY THE DEPARTMENT ARE THUS DISMISSED . 10. IN THE RESULT, THE APPEAL FILED BY THE DEPARTME NT IS DISMISSED. 10 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD. ORDER PRONOUNCED IN THE COURT ON 7-9-2012. SD/- S D/- (CHANDRA POOJARI) ACCOUNTANT MEMBER (SAKTIJIT DEY) JUDICIAL MEMBER HYDERABAD, DATED THE 7 TH SEPTEMBER, 2012. COPY TO:- 1)DCIT, CIR-7(1), IT TOWERS, AC GUARDS, HYDERABAD. 2) FRONTLINE & BYK CONSTRUCTIONS, 10-2-2/1/2/3, A.C .GUARDS, HYDERABAD. 3) THE CIT (A), VIJAYAWADA. 4) THE CIT CONCERNED, 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABA D. JMR* 11 ITA NO. 1115 OF 2011 FRONTLINE & BYK CONSTRUCTIONS, HYD.