M/s Bhavya Constructions Private Limited, Hyderabad V. Dy. CIT, Central Circle-5, Hyderabad

ITA 1747/Hyd/2013

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 7700 (ITAT-HYDERABAD)
• Duration Of Justice: 7 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-B
• Assessment Year: 2009-2010
• Appeal Filed On: 17-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 143(3); 153A; 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD ‘B’ BENCH, HYDERABAD. BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI L. P. SAHU, ACCOUNTANT MEMBER (Through Virtual Hearing) ITA No.1747/Hyd/2013 (Assessment Year : 2009-10) M/s. Bhavya Constructions Pvt. Ltd., Hyderabad. PAN AAACB8482C .....Appellant. Vs. Dy. Commissioner of Income Tax, Central Circle 5, Hyderabad. .....Respondent. Appellant By : Shri S. Rama Rao. (A.R.) Respondent By : Shri YVST Sai. (D.R.) Date of Hearing : 17.11.2021. Date of Pronouncement : 25.11.2021. O R D E R Per Shri S.S. Godara, J.M. : This assessee’s appeal for Asst. Year 2009-10 arises from the Commissioner of Income Tax (Appeals)-VII, Hyderabad’s order dt.29.11.2013 passed in case No.2595/2011-12/CIT(A)-VII/2011-12 in proceedings 2 ITA No.1747/Hyd/2013 under Section 143(3) r.w.s. 153A of the Income Tax Act, 1961 (‘the Act’). Heard both the parties. Case file perused. 2. Coming to the assessee's sole substantive grievances that both the lower authorities’ have erred in law and on facts in making undisclosed income addition of Rs.2,87,40,000 during the course of assessment framed on 30.12.2011 as upheld in the CIT(A)’s order, we note that the lower appellate discussion to this effect read as under : 3 ITA No.1747/Hyd/2013 4 ITA No.1747/Hyd/2013 5 ITA No.1747/Hyd/2013 6 ITA No.1747/Hyd/2013 7 ITA No.1747/Hyd/2013 8 ITA No.1747/Hyd/2013 9 ITA No.1747/Hyd/2013 10 ITA No.1747/Hyd/2013 11 ITA No.1747/Hyd/2013 12 ITA No.1747/Hyd/2013 3. Mr. Rama Rao vehemently contended during the course of hearing that the CIT(A) has erred in law and on facts in affirming the impugned addition. He took us to the assessee's detailed paper book(s) running into 221 pages and 52 pages comprising of all the relevant details including return, computation, balance sheet, P & L account, development agreement dt.10.01.2008 and other similar evidences. He inter alia submitted that the Hyderabad Urban Development Authority (HUDA) had entered into a development agreement with this assessee on 10.01.2008. It gave possession of 65 acres to the assessee. And the latter in turn was supposed to receive a part of the land developed i.e. 15 acres 26 guntas out of which it got 7 acres 13 ITA No.1747/Hyd/2013 33 guntas on 30.06.2008 vide registered sale deed executed by the former’s authorized person. The assessee then agreed to sell land measuring of 5 acres 33 guntas to M/s. Bharat Exporters on 26.08.2008 (page 89) for agreed sale price of Rs.2,35,80,000 per acre. There is no dispute that the assessee had executed its sale deed(supra)) of 3 acres in favour of the foregoing entity @ SRO price of Rs.1.4 crores per acre in the relevant previous year. 4. We now come to the search action dt.7.10.2009 carried out in assessee's case. The department found/seized the foregoing agreement and sale deed indicating the assessee having received less than the agreed price in above terms. All this lead to initiation of 153A proceedings finally culminating in the impugned addition made in assessee's hands and upheld in the CIT(A) order. 5. Mr. Rama Rao has vehemently contended during the course of hearing that not only the assessee vendor and this vendee has reduced price of remaining land sold in the Assessment Year 2010-11 and 2011-12; but also, the former had in fact transferred undeveloped land and 14 ITA No.1747/Hyd/2013 incurred development cost thereupon. Learned counsel took us to the assessee’s computation and P & L account for the said subsequent year indicating it to have received and declared profits of Rs.1.52 crores. Mr. Rama Rao accordingly submitted that once the department has accepted the sale price of the very same land @ 60.75 lakhs in 143(1) and 143(3) assessment(supra)) in Assessment Year 2011-12 and 2010-11 respectively; there is hardly any merit in the impugned addition wherein the lower authorities have gone by the sale agreement only. He therefore strongly argued against the correctness of the impugned addition amounting to Rs.2,87,00,000 in both the lower authorities’ orders. 6. Learned CIT-DR, On the other hand, sought to highlight the fact inter alia the assessee had in fact received a chunk developed land only from HUDA and thereafter, it had agreed to sell the same for higher price; but to sold at much lower price in foregoing terms. He next invited our attention to the assessee's authorized person’s search statement not to have disputed the contents of the 15 ITA No.1747/Hyd/2013 agreement as well at any point of time. Mr. Sai lastly supported the CIT(A)’s detailed discussion that both the sale agreement(s) as well as sale deed(s) and submitted that the assessee has nowhere sought to modify the corresponding clauses therein in future. 7. We have given our thoughtful consideration to rival pleadings and find no merit in the assessee's stand. We make it clear that the impugned addition is very much based on the assessee's registered agreement(s) found/seized during the course of search. And also that its Managing Director had nowhere even claimed during the course of search that the relevant terms in the agreement regarding higher price than recorded in sale deed had ever been diluted by both vendor and vendee parties. We further observe that it is contrary to the assessee's claim of having reduced the price in Assessment Year 2010-11 and 2011- 12 involving regular proceedings as well since we are dealing with a section 153A assessment wherein the addition has to be based on the incriminating material found/seized during the course of search only. We further 16 ITA No.1747/Hyd/2013 find no material in the case record which could suggest that the assessee’s sale deed(supra)) had ever diluted any of the terms in the agreement fetching higher price. And also that even if it is observed that both the vendor and vendee parties have agreed to reduce the price in future, same are not found to be pertaining to the land sold as rightly claimed in the Revenue’s stand. We accordingly affirm the CIT(A)’s detailed discussion and uphold the Assessing Officer’s action making the impugned addition. No other ground has been pressed before us. 8. This assessee's appeal is dismissed. Order pronounced in the open court on 25th Nov., 2021. Sd/- Sd/- (L.P. SAHU) (S.S. GODARA) Accountant Member Judicial Member Hyderabad, Dt.25.11.2021. * Reddy gp Copy to : 1. M/s. Bhavya Constructions Pvt. Ltd., Padmavathy Mansions, Plot No.23, Ameerpet, Hyderabad. 2. DCIT, Central Circle 5, Hyderabad. 3. Pr. C I T / CIT (Central), Hyderabad. 4. CIT(Appeals)-VII, Hyderabad. 5. DR, ITAT, Hyderabad. 6. Guard File.