True Zone Buildwell Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 2092/DEL/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1305 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: H
• Next Hearing Date: 29-11-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 03-05-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIJAY VARMA
• Keywords: Unexplained expenditure; Business income; Business expenditure; Search and seizure; Document seized; Deemed to accrue or arise in india; Additional evidence; Question of law; Assessment record; Documents seized
• Section: 69C; 143(3); 153A; 69; 132

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI BEFORE SMT DIVA SINGH , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10 ) TRUE ZONE BUILDWELL PVT. LTD, 12, RING ROAD, LAJPAT NAGAR PART - IV, NEW DELHI PAN: AABCT9812 B VS. DCIT, CENTRAL CIRCLE - 12, ROOM NO. 330, 3 RD FLOOR, ARA CENTRE, E - 2, JHANDEWALA EXTN, NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SUDESH GARG, ADV REVENUE BY: SHRI VIJAY VARMA, CIT DR DATE OF HEARING 01/08 / 2018 DATE OF PRONOUNCEMENT 1 3 / 0 9 / 2018 O R D E R PER PRASHANT MAHARISHI, ACCOUNTANT MEMBER 1. THIS IS THE BUNCH OF THREE APPEALS FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2007 08 TO 2009 10 AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX ( APPEALS ) XXXI [CIT (A) ] ALL DATED 31 /1/2012 CONFIRMING THE ADDITION OF UNACCOUNTED COMMISSION EXPENSES FOR ALL THESE YEARS , ALSO CONFIRMED BY THE COOR DINATE BENCH . ON APPEAL , HONOURABLE HIGH COURT REMITTED BACK ALL THESE APPEALS TO ITAT FOR FRESH ADJUDICATION . RELEVANT GROUNDS OF APPEAL ARE ENCAPSULATED AS UNDER: - 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS FOR ASSESSMENT YEAR 2007 - 08: - 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT(A) - XXXI ERRED IN CONFIRMING THE ADDITION OF RS. 599130/ - BEING THE AMOUNT OF OUT OF BOOKS COMMISSION PAID BY THE ASSESSEE COMPANY U/S 69C OF THE INCOME TAX ACT, 1961. 3. THE ASSESSEE HAS RAISED TH E FOLLOWING GROUNDS FOR ASSESSMENT YEAR 2008 - 09: - 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT(A) - XXXI ERRED IN CONFIRMING THE ADDITION OF RS. 1,89,87,400/ - BEING THE AMOUNT OF OUT OF BOOKS COMMISSION PAID BY THE ASSESSEE COMPANY U/S 69C OF THE INCOME TAX ACT, 1961. 4. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS FOR ASSESSMENT YEAR 2009 - 10: - 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD CIT(A) - XXXI ERRED IN CONFIRMING THE ADDITION OF RS. 5,58,149/ - BEING THE AMOUNT OF OUT OF BOOKS COMMISSION PAID BY THE ASSESSEE COMPANY U/S 69C OF THE INCOME TAX ACT, 1961. TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 2 5. BRIEF LITIGATION HISTORY OF THESE APPEALS SHOWS THAT ALL THESE THREE APPEALS WERE EARLIER DISPOSED OF BY THE COORDINATE BENCH VIDE ORDERS DATED 4/1/2013 AND 24/1/2013 RESPECTIVELY . AGAINST TH ESE THREE ORDERS , ASSESSEE FILED MISCELLANEOUS APPLICATION BEFORE THE COORDINATE BENCH, UNSUCCESSFULLY. VIDE ORDER DATED 27/4/ 2016 ; IT HELD THAT THERE IS NO ERROR APPARENT ON RECORD. 6. SUBSEQUENTLY , ASSESSEE APPROACHED THE HONBLE DELHI HIGH COURT IN WRIT PETITION NUMBER 8439/2016 WHEREIN HONBLE DELHI HIGH COURT PASS ED ORDER DATED 5/9/2017, WHEREIN PER PARA NUMBER 18, IT SET ASIDE THE ORDER DATED 4 JANUARY 2013 PASSED BY ITAT FOR FRESH ADJUDI CATION OF ASSESSEES APPEAL FOR ASSESSMENT YEAR 2007 08 AND TWO ORDERS DATED 24 JANUARY 2013 PASSED FOR ASSESSMENT YEAR 2008 09 AND 2009 10, RESPECTIVELY ALSO MET THE SAME FATE . HONBLE HIGH COURT HELD THAT THE ABOVE THREE APPEALS ARE RESTORED T O THE FILE OF THE ITAT AND DIRECTED THAT THE ITAT WILL PASS A FRESH ORDER ON MERITS AFTER HEARING THE PARTIES . THE HONBLE HIGH COURT ALSO FIXED THE DATE OF HEARING OF 16/10/2017 BEFORE ITAT . TO ASSIMILATE THE ISSUE IT IS NECESSARY TO UNDERSTAND THE DI RECTION OF THE HON'BLE HIGH COURT WHICH IS AS UNDER : - 1. IN PECULIAR FACTS AND CIRCUMSTANCES, THE PETITIONER (ASSESSEE) HAS APPROACHED THIS COURT CHALLENGING THE IMPUGNED ORDER DATED 27TH APRIL 2016 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL (ITAT ) IN THREE MISCELLANEOUS APPLICATIONS BEING M.A. NOS. 83, 84 AND 85 OF 2014 FILED BY THE ASSESSEE UNDER SECTION 254 (2) OF THE INCOME TAX ACT, 1961 (ACT). THE SAID APPLICATIONS WERE FILED IN RELATION TO THE ORDERS PASSED BY THE ITAT IN THE THREE APPEALS OF THE ASSESSEE, ITA NO. 2092/DEL/2012 FOR ASSESSMENT YEAR (AY) 2007 - 08; ITA NO. 2093/DEL/2012 FOR AY 2008 - 09 AND ITA NO. 2094/DEL/2012 FOR AY 2009 - 10. 2. THE BACKGROUND FACTS ARE THAT THE ASSESSEE WAS SUBJECTED TO A SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF THE ACT ON 31ST JULY 2008. AFTER RECEIVING NOTICES UNDER SECTION 153A OF THE ACT, THE ASSESSEE FILED, ON 22ND MARCH 2010, RETURNS DECLARING AN INCOME OF 11,95,100/ - FOR AY 2006 - 07, 24,66,241/ - FOR AY 2007 - 08 AND 1,81,84,890/ - FOR AY 20 08 - 09. FOR AY 2009 - 10, THE ASSESSEE FILED A RETURN ON 11TH AUGUST 2010, DECLARING AN INCOME OF 4,48,15,820/ - . 3. ACCORDING TO THE ASSESSEE, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT REPLIED TO THE QUERIES RAISED BY THE AO BY WAY OF QUESTIONNAIRES A ND PLACED ON RECORD THE RELEVANT DETAILS. ON 29TH DECEMBER 2010, SEPARATE ASSESSMENT ORDERS WERE PASSED BY THE AO FOR AYS 2006 - 07, 2007 - 08, 2008 - 09 AND 2009 - 10. THE AO MADE ADDITIONS UNDER SECTION 69C OF THE ACT IN RESPECT OF THE AFOREMENTIONED AYS APART F ROM OTHER ADDITIONS. IT MUST BE MENTIONED THAT THE PRESENT PETITION CONCERNS THE ADDITIONS MADE UNDER SECTION 69C OF THE ACT. 4. AGGRIEVED BY THE ORDERS OF THE AO, THE ASSESSEE FILED APPEALS BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) [CIT (A)]. THESE APPEALS WERE PARTLY ALLOWED BY THE CIT (A) BY ITS ORDER DATED 31ST JANUARY 2012. THE ADDITIONS MADE BY THE AO UNDER SECTION 69C OF THE ACT WERE DELETED IN PART. TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 3 5. WHILE THE REVENUE FILED APPEALS AGAINST THE ORDERS OF THE CIT (A) FOR EACH OF THE ABOVE AYS BEFORE THE ITAT, THE ASSESSEE FILED CROSS OBJECTIONS (COS). TO THE EXTENT THAT THE ASSESSEE WAS DENIED RELIEF BY THE CIT ( A), IT ALSO FILED SEPARATE APPEALS BEFORE THE ITAT. 6. IT IS STATED THAT ON 29TH NOVEMBER 2012, ALL THE APPEALS AND CROSS OBJECTIONS WERE HEARD BY THE ITAT AND ORDERS WERE RESERVED. 7. BY THE ORDER DATED 31ST DECEMBER 2012, PASSED BY THE ITAT IN ITA NOS. 1 693/DEL/2012 AND 2091/DEL/2012 AND CO NO. 246/DEL/2012, THE ITAT REJECTED THE REVENUES APPEAL. AGAINST THIS ORDER OF THE ITAT FOR AY 2006 - 07, THE REVENUE FILED AN APPEAL BEFORE THIS COURT VIZ., ITA NO. 400/2013. THE SAID APPEAL WAS DISMISSED BY THIS COURT ON 3RD APRIL 2014, THUS CONFIRMING THE ORDER DATED 31ST DECEMBER 2012 PASSED BY THE ITAT IN ITA NOS. 1693/DEL/2012 AND 2091/DEL/2012 AND CO NO. 246/DEL/2012 FOR AY 2006 - 07. 8. FOR SOME REASON, ALTHOUGH THE ARGUMENTS IN THE APPEALS AND COS FOR THE ABOVE FO UR AYS WERE HEARD TOGETHER, THE ORDERS IN RESPECT OF THE APPEALS FOR THE DIFFERENT AYS WAS NOT PASSED ON THE SAME DATE BY THE ITAT. THE ORDER IN THE APPEAL FOR AY 2007 - 08 WAS PASSED BY THE ITAT FIVE DAYS LATER ON 4TH JANUARY 2013. THE ITAT FOLLOWED ITS OWN ORDER FOR AY 2006 - 07 AND DISMISSED THE GROUND RAISED BY THE REVENUE IN ITS APPEAL IN RESPECT OF THE ADDITIONS UNDER SECTION 69C OF THE ACT. HOWEVER, WHILE DEALING WITH THE GROUND RAISED BY THE ASSESSEE IN RESPECT OF THE ACTION OF THE CIT (A) SUSTAINING TH E PART OF ADDITIONS UNDER SECTION 69C OF THE ACT, THE ITAT DISMISSED THE ASSESSEES APPEAL. THIS TIME IT CHOSE NOT TO FOLLOW ITS OWN ORDER FOR AY 2006 - 07. 9. INTERESTINGLY, THE APPEAL BY THE REVENUE (ITA NO. 736/2014) AGAINST THE ORDER DATED 4TH JANUARY 20 13 OF THE ITAT IN ITA NO. 1694/DEL/2012 (REVENUES APPEAL) FOR AY 2007 - 08 WAS DISMISSED BY THIS COURT BY AN ORDER DATED 5TH AUGUST 2015. THUS, THE ITATS ORDER DISMISSING THE REVENUES APPEAL FOR AY 2007 - 08 WAS CONFIRMED BY THIS COURT. 10. TWENTY DAYS AFTE R THE ORDER IN THE APPEAL FOR AY 2007 - 08, THE ITAT ON 24TH JANUARY 2013 PASSED A SEPARATE ORDER IN THE APPEAL FOR AY 2008 - 09. THE ITAT DISMISSED THE REVENUES APPEAL BY FOLLOWING ITS OWN ORDER FOR AY 2006 - 07. HOWEVER, IT ALSO DISMISSED THE ASSESSEES APPEA L BY CHOOSING NOT TO FOLLOW ITS ORDER FOR AY 2006 - 07. 11. ON THE SAME DATE, I.E. 24TH JANUARY 2013, THE ITAT BY A SEPARATE ORDER DISMISSED THE REVENUES APPEAL FOR AY 2009 - 10 FOLLOWING ITS ORDER FOR AY 2006 - 07. THE ITAT, HOWEVER, DISMISSED THE ASSESSEES A PPEAL CHOOSING NOT TO FOLLOW ITS ORDER FOR AY 2006 - 07. 12. THE GRIEVANCE OF THE ASSESSEE IS THAT DESPITE THE FACTS AND CIRCUMSTANCES FOR ALL THE FOUR AYS, I.E. 2006 - 07, 2007 - 08, 2008 - 09 AND 2009 - 10 BEING THE SAME, AND THE ITAT HEARING THE APPEALS AND COS A RISING IN RESPECT THEREOF TOGETHER AND RESERVING ORDERS ON THE SAME DAY, THE ITAT PASSED SEPARATE ORDERS FOR THE DIFFERENT AYS. FURTHER, THE SAID ORDERS WERE NOT CONSISTENT. THE ITAT FOLLOWED ITS OWN ORDER FOR AY 2006 - 07 WHILE REJECTING THE REVENUES APPEA LS FOR THE SUBSEQUENT AYS, BUT ALSO REJECTED THE ASSESSEES APPEALS BY NOT FOLLOWING THE SAID ORDER FOR AY 2006 - 07. 13. THIS LED THE ASSESSEE TO FILE THE AFOREMENTIONED MAS UNDER SECTION 254 (2) OF THE ACT BEFORE THE ITAT ON 16TH JUNE 2014 SEEKING RECTIFIC ATION OF THE ITATS ORDERS TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 4 IN THE ASSESSEES APPEALS BEING ITA NOS. 2092 - 2094/DEL/2012 FOR AYS 2007 - 08, 2008 - 09 AND 2009 - 10 RESPECTIVELY. THESE THREE APPLICATIONS, NUMBERED AS M.A. NOS. 83/2014, 84/2014 AND 85/2014 WERE DISMISSED BY THE ITAT BY THE IMPUGNE D ORDER DATED 27TH APRIL 2016. THE ITAT WAS OF THE VIEW THAT ALLOWING THE APPLICATIONS WOULD AMOUNT TO REVIEWING ITS OWN ORDERS DATED 4TH JANUARY 2013 (FOR AY 2007 - 08) AND 24TH JANUARY 2013 (FOR AYS 2008 - 09 AND 2009 - 10 RESPECTIVELY). 14. HAVING HEARD THE L EARNED COUNSEL FOR THE PARTIES, THE COURT IS OF THE VIEW THAT THE PETITIONER HAS BEEN ABLE TO MAKE OUT A CASE TO SHOW THAT THE ITAT CONTRADICTED ITSELF BY PASSING SEPARATE ORDERS IN RESPECT OF THE ASSESSEES APPEALS FOR THE AFOREMENTIONED AYS ON DIFFERENT DATES. IT IS NOT UNDERSTOOD AS TO HOW THE FACTUAL MATRIX FOR AYS 2007 - 08, 2008 - 09 AND 2009 - 10 COULD BE DIFFERENT FROM THAT OF AY 2006 - 07 SUCH THAT IT WOULD NECESSITATE CONTRADICTORY ORDERS BEING PASSED IN EACH OF THE AYS. THE ITATS ORDER DATED 31ST DECEMB ER 2012 ALLOWING THE ASSESSEES APPEAL FOR AY 2006 - 07 HAS BEEN SUSTAINED BY THIS COURT BY DISMISSING THE REVENUES APPEAL, BEING ITA NO. 400/2013, ON 3RD APRIL 2014. YET, THE ITAT DID NOT FOLLOW THE SAID ORDER FOR AY 2006 - 07 WHEN IT CAME TO THE ASSESSEES APPEALS FOR THE SUBSEQUENT YEARS, I.E. 2007 - 08, 2008 - 09 AND 2009 - 10. 15. IN THE CONSIDERED VIEW OF THE COURT, THIS WAS A GOOD ENOUGH GROUND FOR THE ASSESSEE TO SEEK RECTIFICATION OF THE ORDER UNDER SECTION 254 (2) OF THE ACT. ACCORDINGLY, THE IMPUGNED ORDE R DATED 27TH APRIL 2016 PASSED BY THE ITAT IS HEREBY SET ASIDE. THIS WOULD BE TANTAMOUNT TO THE THREE M.A. NOS. 83, 84 AND 85 OF 2014 FILED BY THE ASSESSEE BEFORE THE ITAT BEING ALLOWED. 16. THE QUESTION THEN ARISES AS TO THE CONSEQUENTIAL ORDER THAT REQUI RES TO BE PASSED SINCE THE CHALLENGE IN THE PRESENT PETITION IS NOT TO THE MAIN ORDERS PASSED BY THE ITAT ON 4TH JANUARY 2013 AND 24TH JANUARY 2013, DISMISSING THE ASSESSEES APPEALS FOR THE AFOREMENTIONED AYS. 17. IN PROMAIN LIMITED V. CIT [2016] 382 ITR 25 (DEL), IN SIMILAR CIRCUMSTANCES, THE COURT OBSERVED THAT, IN LIGHT OF THE LAW EXPLAINED BY THE SUPREME COURT IN HONDA SIEL POWERS PRODUCTS LTD. V. CIT [2007] 295 ITR 466 (SC), THE ASSESSEE CANNOT BE FAULTED FOR APPROACHING THE ITAT UNDER SECTION 254 (2) OF THE ACT INSTEAD OF DIRECTLY FILING AN APPEAL IN THIS COURT. THIS PERSUADES THIS COURT TO HOLD THAT THE ITAT SHOULD HEAR AFRESH THE ASSESSEES APPEALS FOR AFORESAID AYS, I.E. 2007 - 08, 2008 - 09 AND 2009 - 10, IN VIEW OF THE SUBSEQUENT DEVELOPMENTS AS NOTICE D HEREINABOVE. 18. FOR ALL OF THE AFOREMENTIONED REASONS, THE COURT HEREBY SETS ASIDE THE ORDER DATED 4TH JANUARY 2013 PASSED IN THE ASSESSEES APPEAL ITA NO. 2092/DEL/2012 FOR AY 2007 - 08, AND THE TWO ORDERS DATED 24TH JANUARY 2013 PASSED BY THE ITAT IN IT A NOS. 2093/DEL/2012 AND 2094/DEL/2094/2012 FOR AYS 2008 - 09 AND 2009 - 10 RESPECTIVELY. THE SAID THREE APPEALS, I.E. ITA NOS. 2092/DEL/2012; 2093/DEL/2012 AND 2094/DEL/2094/2012 ARE RESTORED TO THE FILE OF THE ITAT. THE ITAT WILL PASS A FRESH ORDER ON MERITS AFTER HEARING THE PARTIES. THE AFOREMENTIONED APPEALS SHALL BE NOW LISTED BEFORE THE ITAT FOR DIRECTIONS ON 16TH OCTOBER 2017. 7. THUS, ALL THE THREE APPEALS DISPOSED OF BY THE COORDINATE BENCH EARLIER ARE RESTORED BACK BY THE HONBLE DELHI HIGH COURT . AS THE ISSUE INVOLVED IN THESE THREE APPEAL ARE IDENTICAL EXCEPT THE QUANTIFICATION, OF WITH RESPECT TO THE ADDITION ON ACCOUNT OF THE COMMISSION TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 5 EXPENDITURE UNDER SE CTION 69C OF THE INCOME TAX ACT, REVOLVING AROUND THE SAME FACTS EMERGING OUT OF THE SAME SEARCH IN CASE OF THE ASSESSEE WHERE CERTAIN DOCUMENTS WERE FOUND. THEREFORE, AT THE REQUEST OF THE PARTIES, THEY ARE HEARD TOGETHER AND DISPOSED OFF BY THIS COMMON ORDER. 8. THE LEARNED AUTHORIZED REPRESENTATIVE SUBMITTED THAT IN ALL THESE 3 APPEALS ONLY SUR VIVING ISSUE IS ADDITION MADE BY THE LEARNED ASSESSING OFFICER ON ACCOUNT OF ALLEGED UNACCOUNTED COMMISSION PAYMENT MADE TO THE BROKERS . HE FURTHER SUBMITTED THAT A. IN CASE OF THE ASSESSEE IDENTICAL ASSESSMENT ORDER IS PASSED FOR FOUR ASSESSMENT YEARS ON 29/12/2010 FOR A Y 2006 07 TO A Y 2009 10 , MAKING ADDITION ON THE ISSUE OF ALLEGED UNACCOUNTED COMMISSION PAYMENTS MADE TO THE BROKERS . HE REFERRED TO PAPER BOOK PAGES NUMBER 1 - 35 TO SHOW THE ASSESSMENT ORDERS FOR ALL THESE FO U R YEARS . B. ON A PPEAL BEFORE CIT (A ), APPEALS WERE PARTLY ALLOWED GRANTING PARTIAL RELIEF TO THE ASSESSEE ON THE ISSUE. C. THEREFORE, THE ORDER OF THE LEARNED CIT (A) FOR ALL THESE FOUR YEARS WAS FOR SUBJECT MATTER OF APPEAL BEFORE THE COORDINATE BENCH. D. F OR ASSESSMENT YEAR 2006 - 07 , THE COORDINATE BENCH V IDE ORDER DATED 31/12/2012 ALLOWED THE APPEAL OF THE ASSESSEE IN TOTO AND DISMISSED THE APPEAL OF THE DEPARTMENT . HE REFERRED TO THE ORDER OF THE COORDINATE BENCH FOR THAT YEAR PLACED AT PAGE NUMBER 149 - 166 OF THE PAPER BOOK . THIS ORDER O F THE ITAT WAS CHALLENGED BY REVENUE BEFORE HON'BLE HIGH COURT WHERE IN THE APPEAL OF THE REVENUE IS DISMISSED AND ORDER OF THE BENCH IS UPHELD. THEREFORE, NOW THE ISSUES ARE SQUARELY COVERED IN FAVOUR OF THE ASSESSEE FOR ALL THESE THREE YEARS BY THE ORDER OF THE HON'BLE HIGH COURT FOR AY 2006 - 07. E. H OWEVER, ITAT DISMISSED THE APPEALS OF THE ASSESSEE FOR ASSESSMENT YEAR 2007 08 DATED 4/1/2013 AND FOR ASSESSMENT YEAR 2008 09 AND 2009 10 V ID E ORDER DATED 24/1/ 2013 . ORDERS PLACED AT PAGE NUMBER 167 226 OF THE PAPER BOOK. F. THAT THOUGH , O N THE IDENTICAL FACTS AND CIRCUMSTANCES FOR AY 2006 07 , APPEAL OF ASSEESEE WAS ALLOWED, BUT , WITHOUT NOTING ANY CHANGES IN THE FACTS AND CIRCUMSTANCES OF THE CASE , DISMISSED THE APPEAL S OF THE ASSESSEE FOR ASSESSMENT YEAR 2007 - 08 , ASSESSMENT YEAR 2008 09 AND ASSESSMENT YEAR 2009 10. G. HE SUBMITTED A COMPARATIVE CHART TO SHOW THAT THE GROUNDS OF APPEAL FOR THESE THREE ASSESSMENT YEARS ARE IDENTICAL TO THE GROUNDS OF APPEAL FOR ASSESSMENT YEAR 2006 07 . HE FURTHER SUBMITTED THAT THE ASSESSMENT ORDER PASSED BY THE LEARNED ASSESSING OFFICER IS ALSO IDENTICAL FOR ALL THESE FOR YEARS . HE FURTHER REFERRED TO THE ORDER OF THE TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 6 COMMISSIO NER OF INCOME TAX APPEALS IN ALL THESE FOR APPEALS FILED BY THE ASSESSEE BEFORE HIM ARE ALSO HAVING THE IDENTICAL FACTS AND CIRCUMSTANCES AND THEREFORE, THE LEARNED CIT (A) HAS ALSO PASSED IDENTICAL ORDERS ON THE SAME DAY. H. HE FURTHER SUBMITTED THAT JUDICIAL DISCIPLINE DEMANDS THAT ITAT SHOULD HAVE FOLLOWED ITS OWN ORDER FOR AY 2006 - 07 WHILE DECIDING THE APPEAL OF THE ASSESSEE FOR AY 2007 - 08 TO 2009 - 10. HE FURTHER SUBMITTED THAT WHEN THE APPEAL WERE HEARD ON THE SAME DAY FOR THESE FOUR YEARS, THERE IS NO R EASON/ JUSTIFICATION FOR PASSING THE ORDERS ON DIFFERENT DAYS RENDERING DIFFERENT FINDINGS AND GIVING DIFFERENT RESULTS. HE SUBMITS THAT IT RESULTED IN TO GROSS INJUSTICE. I. ON THE MERITS , HE SUBMITTED THAT NOW ISSUE IS SQUARELY COVERED IN FAVOUR OF TH E ASSESSEE BY THE ORDER OF THE COORDINATE BENCH FOR ASSESSMENT YEAR 2006 07 WHEREIN AN IDENTICAL FACTS AND CIRCUMSTANCES THE ADDITION MADE IN THE HANDS OF THE ASSESSEE HAS BEEN DELETED . HE FURTHER STATED THAT AGAINST THE ABOVE DELETION OF THE ADDITION TH E REVENUE CHALLENGED BEFORE THE HONBLE DELHI HIGH COURT AND HONBLE DELHI HIGH COURT IN ITA NUMBER 400/2013 DATED 3/4/2014 UPHELD THE ORDER OF THE COORDINATE BENCH WHERE THE ADDITION MADE IN THE HANDS OF THE ASSESSEE STANDS DELETED. HE THEREFORE STATED THAT THE ISSUE IS NOW SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. J. HE FURTHER REITERATED THE SUBMISSIONS THAT WERE BEFORE THE BENCH WHILE DECIDING THE ORIGINAL APPEAL AS WELL AS THE APPEALS FOR ASSESSMENT YEAR 2006 - 07. 9. THE LEARNED CIT DR VEHEMENTLY SUPPOR TED THE ORDER OF THE LEARNED CIT (A) AND SUBMITTED THAT ADDITION HAS BEEN MADE IN THE H ANDS OF ASSESSEE BASED ON SEIZED MATERIAL FOUND DURING THE COURSE OF SEARCH. HE FURTHER STATED THAT FROM THE RESIDENCE OF SHRI RAKESH KUMAR GARG ON 31/7/2008 CERTAIN D OCUMENTS WERE FOUND WHICH ARE LISTED AT ANNEXURE A 1/42 44, ANNEXURE A 2/5, A 2/69, 70 AND ANNEXURE A 1/36. THESE ARE THE VARIOUS BILLS OF THE PARTIES WHERE THE ASSESSEE WAS TO PAY COMMISSION ON SALE OF THE REAL ESTATE . HE FURTHER STATED THAT THERE WAS DIFFERENCE BETWEEN THE AMOUNT OF COMMISSION PAID BY THE ASSESSEE AS PER BOOKS OF ACCOUNTS AND THE AMOUNT STATED IN THOSE BILLS FO UND DURING THE COURSE OF SEARCH, THEREFORE, THE LEARNED AO HAS MADE THE ADDITION OF 9550548 / FOR ASSESSMENT YEAR 2007 08 . HE FURTHER SUBMITTED THAT THE LEARNED CIT (A) HAS ANALYZED ALL THE SEIZED MATERIAL AND FROM THAT WHATSOEVER IS FOUND RECORDED IN THE BOOKS OR DUPLICATE ENTRIES, SAME WAS DELETED AND WHATEVER WAS FOUND PERTAINING TO ANOTHE R YEARS AND NOT RECORDED IN BOOKS , ADDITION WAS CONFIRMED IN THAT YEAR . HE FURTHER REFERRED TO PARA NUMBER 5.3 OF THE ORDER OF THE LEARNED CIT A AND STATED THAT THAT WHEREVER THERE IS A DIFF ERENCE BETWEEN THE AMOUNT OF BILL TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 7 SHOWN AS PER THE SEIZED DOCUMENTS AND THE AMOUNT OF COMMISSION EXPENDITURE ENTERED IN THE BOOKS OF ACCOUNTS , ADDITION HAS BEEN CONFIRMED AS ASSESSEE COULD NOT EXPLAIN THE REASONS SATISFACTORILY. HE FURTHER STATED THAT WHEN THE COMMISSION EXPENDITURE HAS BEEN SETTLED FOR IN T HE SUBSEQUENT YEAR S, THE ADDITION HAS BEEN DELETED IN THIS YEAR . THEREFORE, HE FURTHER HELD THAT OUT OF THE TOTAL ADDITION OF 1448538/ , PERTAINING TO VARDHMAN ASSOCIATES PRIVATE LIMITED THE ADDITION WITH RESPECT TO RS. 575879 IS SUSTAINED . F URTHE R WITH RESPECT TO PAYMENTS TO UNISON ESTATES PRIVATE LIMITED , HE HAD UPHELD THE ADDITION TO THE EXTENT OF RS. 2 3251/ . IN VIEW OF THIS , OUT OF THE TOTAL ADDITION MADE BY THE LEARNED AO OF 9 550548/ , THE LEARNED CIT A UPHELD THE ADDITION OF 599130/ - ONLY HOLDING THAT THE ABOVE COMMISSION HAS BEEN INCURRED BY THE ASSESSEE OUT OF THE B OOKS AND THEREFORE IT IS CORRECTLY ADDED BY THE LEARNED ASSESSING OFFICER UNDER SECTION 69C OF THE INCOME TAX ACT . 10. HE FURTHER REFERRED TO THE ASSESSMENT ORDER AS WELL AS THE ORDER OF THE COMMISSIONER OF INCOME TAX APPEALS FOR ASSESSMENT YEAR 2008 09 . ON IDENTICAL FACTS AND CIRCUMSTANCES IN THE CASE, AND ADDITION OF 46209068 IS MADE ON ACCOUNT OF EXPENDITURE NOT R ECORDED IN THE BOOKS OF ACCOUNTS UNDER SECTION 69C OF THE INCOME TAX ACT . THE LEARNED CIT (A) UPHELD THE DISALLOWANCE PARTLY . HE FURTHER REFERRED TO PARA NUMBER 6 OF THE ORDER OF THE LEARNED CIT (A) , WHERE HE HAS ANALYZED EACH AND EVERY DETAILS OF THE BRO KER AND AFTER THAT O UT OF THE TOTAL ADDITION OF 4 6209068 ON ACCOUNT OF BROKERAGE FOR COMMISSION PAID OUT OF THE BOOKS , HE SUSTAINED THE ADDITION OF 18987400./ - 11. SIMILARLY FOR ASSESSMENT YEAR 2009 - 10 , HE SUBMITTED THAT THE LEARNED ASSESSING OFFI CER HAS M ADE AN ADDITION OF 1 485009/ ON ACCOUNT OF BILLS FOUND AT THE TIME OF SEARCH AT THE OFFICE OF THE ASSESSEE NOT RECORDED IN THE BOOKS OF ACCOUNTS . HE FURTHER REFERRED TO THE ORDER OF THE LEARNED CIT(A) WHEREIN HE RETAINED AND CONFIRMED THE ADDITION OF 5 58149/ . 12. IN VIEW OF ABOVE FACTS , HE SUBMITTED THAT THE ORDER OF THE LEARNED CIT (A) REQUIRES TO BE UPHELD AS THE LEARNED CIT (A) HAS GIVEN RELIEF TO THE ASSESSEE WITH RESPECT TO THE AMOUNT OF EXPENDITURE WHICH HAS BEEN SHOWN BY THE ASSESSEE ALREADY RECORDED IN THE BOOKS OF ACCOUNTS FOR SUBSEQUENT YEARS OR OF THE SAME YEAR. 13. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AS WELL AS PERUSED THE ORDERS OF THE ASSESSING OFFICER AS WELL AS THE LEARNED CIT (A) . WE HAVE ALSO PERUSED THE ORDER OF THE COORDINATE BENCH FOR ASSESSMENT YEAR 2006 07 AS WELL AS THE ORDER OF THE HONBLE DELHI HIGH COURT IN CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 2006 07 IN THE APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE COORDINATE BENCH WHERE THE IDENTICAL ADDITION MADE BY LD AO, CONFIRMED BY LD CIT (A) , DELETED BY THE ITAT, WAS UPHELD BY HONORABLE HIGH COURT. BOTH THE PARTIES HAVE CONFIRMED BEFORE US THAT THERE ARE NO CHANGES IN THE FACTS AND TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 8 CIRCUMSTANCES OF THE CASE FOR THESE THREE YEARS, COMPARED WITH THE CASE FOR ASSESSMENT YEAR 2006 07. 14. FOR AY 2006 - 07 THE APPEAL OF THE ASSESSEE WAS DECIDED BY THE COORDINATE BENCH VIDE ORDER DATED 31/12/2012 IN ITA NO 2091/DEL/2012 AT PARA NO 7 TO 13 AS UNDER : - CO NO.246/DEL/2012 ITA NO.2091/DEL/2012 7. GROUND NO.2 IN TH E REVENUE'S APPEAL AND GROUND NO.2 IN THE ASSESSEE'S APPEAL ARE RELATED TO DELETION AND SUSTENANCE OF ADDITIONS MADE U/S 69C OF THE INCOME - TAX ACT, 1961 RESPECTIVELY. THE CIT (A) HAS DELETED THE ADDITION OF RS.17,27,327/ - AND SUSTAINED THE ADDITION OF RS.1 ,29,52,063/ - . THIS ADDITION HAS BEEN MADE U/S 69C AND THE SCOPE OF THIS SECTION RELATES TO CERTAIN UNEXPLAINED EXPENDITURE FOR WHICH ASSESSEE OFFERED NO EXPLANATION ABOUT THE SOURCE OF SUCH EXPLANATION OR IT WAS NOT SATISFACTORILY EXPLAINED. 8. SOME BILLS WERE FOUND AT THE TIME OF THE SEARCH AT THE RESIDENCE OF SHRI RAKESH KUMAR GARG FOR A PERIOD RELEVANT TO THE ASSESSMENT YEAR. THE DETAILS OF WHICH ARE AS UNDER : - DETAIL OF BILLS FOUND AT THE TIME OF SEARCH AT THE RESIDENCE OF SH. RAKESH KUMAR GARG ON 31 - 7 - 2008 PERIOD 1.4.2005 - 31.3.2006 PARTY A - 1 S.NO. ANNEXURE DATE NAME OF THE PARTY AMOUNT NO/PAGE 1 A - 2/28 27.7.2005 SACHIN POPETECH 18764550 LTD. 2 A - 2/45 5.4.2005 THE PROPERTY MART 773604 3 A - 2/46 4.4.2005 SURAJ BHAN PRIVATE 241000 LTD. 4 A - 2/51 25.10.2005 NEEL KAMAL 55132 PROPERTIES TOTAL 19834286 THE ASSESSEE CONTENDED THAT DURING THE RELEVANT FINANCIAL YEAR, THE COMMISSION OF RS.51,54,896/ - WAS PAID TO SACHIN PROPTECH (PVT.) LTD. THIS AMOUNT WAS DULY REFLECTED IN BOOKS OF ACCOUNTS OF THE ASSESSEE. AS PER REVENUE, THE BILLS FOUND AT THE TIME OF SEA RCH WAS OF RS.1,87,64,550/ - . THE DIFFERENCE WAS TREATED AS UNEXPLAINED EXPENDITURE. FURTHER, THE ASSESSING OFFICER ALSO OBSERVED THAT THE BILLS FOUND IN THE NAME OF NEEL KAMAL PROPERTIES WERE NOT IN THE LIST WHICH WAS SUBMITTED BY THE ASSESSEE ALONG WITH THE REPLY DATED 20.11.2010. FURTHER THE ASSESSING OFFICER HAS ALSO TREATED THE OTHER PAYMENTS OUT OF BOOKS AND MADE A TOTAL ADDITION OF RS.1,46,79,390/ - . THE CIT (A) GRANTED THE PARTIAL RELIEF BY HOLDING AS UNDER : - '5.3 I HAVE CAREFULLY CONSIDERED THE SU BMISSION, PERUSED THE ORDER OF ASSESSMENT AND EVIDENCE ON RECORD. THE DISPUTE, AS RAISED BY THE APPELLANT, PERTAINS TO THE ADDITIONS OF RS.1,46,79,390/ - MADE BY THE AO ON ACCOUNT OF COMMISSION PAID OUT OF BOOKS U/S TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 9 69C OF THE INCOME TAX ACT. AS PER THE AO, AMOUNT PAID FOR COMMISSION DURING THE YEAR IS LESS THAN THE AMOUNT OF BILLS OF COMMISSION SEIZED BY THE DEPARTMENT AT THE TIME OF SEARCH AND THEREFORE AN ADDITION OF DIFFERENCE AMOUNT WAS MADE BY THE AO. IN CONTENTION TO THAT THE AR HAS SUBMITTED DETAILED EXPLANATION PARTY WISE AND ALSO SUBMITTED THE RECONCILIATION FOR THE DIFFERENCE AMOUNT. AFTER CONSIDERING THE SUBMISSIONS MADE AND DOCUMENTS SUBMITTED, I AM OF THE CONSIDERED OPINION THAT AN ADDITION OF RS.1,24,44,544/ - IS TO BE RETAINED AGAINST RS.1,36,0 9,651/ - OF SACHIN PROPTECH PVT. LTD. A BILL OF 1,87,64,550/ - WAS RAISED BY M/S SACHIN PROPTECH (P) LTD AND THE ASSESSEE COMPANY HAS CREDITED COMMISSION AMOUNT OF RS.59,65,452/ - AFTER DEDUCTION OF TDS @ 5.61 %. IF THIS AMOUNT IS GROSSED UP, IT COMES TO RS.6 3,19,996/ - . THEREFORE, THE AO SHOULD HAVE ALLOWED THE DEDUCTION OF RS.63,19,996/ - INSTEAD OF RS.51,54,896/ - . THEREFORE, A FURTHER DEDUCTION OF RS.11,65,100/ - SHOULD BE ALLOWED TO THE APPELLANT. THE COMMISSION AMOUNT OF RS.4,52,377/ - AGAINST RS.7,73,604/ - O F THE PROPERTY MART AND RS.55,132 AGAINST 55,132/ - OF NEEL KAMAL PROPERTIES HAVE ALSO BEEN RETAINED BECAUSE PROPER EXPLANATION AND RECONCILIATIONS HAVE NOT BEEN PLACED BY THE AR ON RECORD. THEREFORE, THE ADDITION AMOUNTING TO RS.1,29,52,053. (1,24,44,544 + 4,52,377 + 55,132) IS CONFIRMED. FURTHER, AN ADDITION OF RS.2,41,000 OF SURAJ BHAN ESTATE PVT LTD. HAS BEEN DELETED AS THE SAME HAS BEEN FOUND ACCOUNTED FOR IN THE BOOKS OF ACCOUNT. THE GROUND RAISED BY THE APPELLANT IS THUS PARTLY ALLOWED.' 9. THE LD. AR SUBMITTED THAT ADDITION UNDER THIS SECTION CAN BE MADE TO CERTAIN UNEXPLAINED EXPENDITURE ONLY WHEN ASSESSEE OFFERED NO EXPLANATION ABOUT THE SOURCE OF SUCH EXPENDITURE OR THE EXPLANATION IS NOT FOUND SATISFACTORY. THIS SECTION WAS BROUGHT ON THE STATUTE W.E.F. 1.4.1976 BY THE TAXATION LAWS (AMENDMENT) ACT , 1975. THE PROVISO TO THE SECTION WAS INSERTED BY THE FINANCE (NO.2) ACT 1998 W.E.F. 1.4.1999. AS P ER THIS PROVISO, ANY UNEXPLAINED EXPENDITURE WHICH IS DEEMED TO BE THE INCOME OF THE ASSESSEE WAS NOT TO BE ALLOWED AS DEDUCTION UNDER ANY HEAD OF INCOME. THE LD. AR SUBMITTED THAT ANY EXPENDITURE IS OTHERWISE BUSINESS EXPENDITURE AND COULD BE EASILY CLAIM ED AGAINST BUSINESS INCOME CANNOT BE TREATED INCOME UNDER THE SCOPE OF SECTION 69C OF THE INCOME - TAX ACT. UNLESS IT IS ESTABLISHED THAT SAME IS UNDISCLOSED INCOME OF THE ASSESSEE. IN SUCH CIRCUMSTANCES, CO RROBORATIVE EVIDENCE OR SUPPORTING MATERIAL AND STATEMENTS RECORDED OF THE PERSONS CONFIRMING THE SAME IS NECESSARY. THE LD. AR SUBMITTED THAT THE AO HAS NEITHER CALLED FOR ANY OF THESE PARTIES NOR SUMMONED THEM. LD. AR SUBMITTED THAT THE PAYMENT OF THE CO MMISSION WAS MADE ONLY ON THE MATURITY OF THE PROJECT OR COMPLETION OF THE DEALS. THESE PARTIES WERE BOOKING PLOTS IN VARIOUS PROJECTS AT KARNAL, JAIPUR AND AGRA. THE BOOKINGS OF THE PLOT ARE MADE ONLY ON THE PART PAYMENT RECEIVED FROM THE PURCHASER WHICH IS CLEAR FROM THE SEIZED MATERIAL. IN MANY CASES, THESE BOOKINGS WERE CANCELLED SUBSEQUENTLY. THE PROJECTS WERE STARTED DURING 2005 - 06 AND IT TOOK AROUND 2 TO 3 YEARS FOR COMPLETION OF THE PROJECTS. THE AMOUNT WAS CAPITALIZED IN THE ASSESSMENT YEAR 2005 - 06 AND WHICH WAS DULY EXAMINED BY ASSESSING OFFICER U/S 143(3) OF THE INCOME - TAX ACT . THE BROKERAGE IS PAID TO THE BROKERS ONLY AFTER RECEIVING THE FULL PAYMENT AND THE DOCUMENTS REGISTERED IN THE NAME OF T HE PURCHASERS. ONE OF THE PROJECTS AT JAIPUR HAS BEEN CANCELLED AS ASSESSEE COULD NOT GET CERTAIN PERMISSIONS FROM THE GOVERNMENT OF RAJASTHAN. THE LD. AR SUBMITTED THAT NO MATERIAL HAS BEEN BROUGHT ON RECORD WHICH COULD SHOW THAT ANY OF THE BROKER MENTION ED RECEIPT OF ANYTHING MORE THAN WHAT IS RECORDED IN THE BOOKS OF ACCOUNT. WHATEVER AMOUNT OF COMMISSION PAID TO THE BROKERS HAS BEEN PAID BY ACCOUNT PAYEE CHEQUES AFTER DEDUCTING TDS ON THE SAME. THE SEIZED DOCUMENTS ITSELF SHOW THAT AMOUNT HAS BEEN TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 10 ASKED BY WAY OF CHEQUES. IN VIEW OF THIS FACT, AN INFERENCE THAT ASSESSEE HAS MADE THE PAYMENTS OUT OF THE BOOKS IS COMPLETELY UNFOUNDED. MOREOVER IF IT WOULD HAVE BEEN THE CASE, THEN THIS EXPENDITURE SHALL REDUCE THE TAXABLE INCOME OF THE ASSESSEE. THEN ALSO T HERE IS NO ADDITIONAL TAX LIABILITY WHICH CAN BE LEVIED ON THE TAXPAYER. LD. AR VEHEMENTLY PLEADED THAT SUCH BASELESS ADDITION DESERVES TO BE DELETED. 10. ON THE OTHER HAND, THE LD. DR SUBMITTED THAT THE SEIZED MATERIAL CLEARLY LEADS TO THE INFERENCE THAT THERE WAS HIDDEN DEALS WITH THE BROKERS WHO DEMONSTRATE THEIR BROKERAGE. AS PER LD. DR'S CONTENTION, THE ASSESSEE HAD FAILED TO EXPLAIN THE DIFFERENCE IN THE AMOUNT DEBITED IN BOOKS OF ACCOUNT AND THE AMOUNT RECORDED IN THE SEIZED MATERIAL. 11. IN THE REJO INDER, THE LD. AR SUBMITTED THAT THIS ADDITION HAS BEEN MADE WITHOUT ANY INCRIMINATING DOCUMENT SUGGESTING THAT ASSESSEE HAD MADE ANY HIDDEN PAYMENT AS CLAIMED BY LD. DR. HE PLEADED TO SET ASIDE THE ORDER OF THE CIT (A) FOR SUSTAINING PART ADDITION. 12. O N THIS ISSUE, THE REVENUE IS IN APPEAL IN THE GROUND NO.2. THIS ADDITION HAS BEEN MADE UNDER SECTION 69C OF THE INCOME - TAX ACT, 1961. UNDER THIS SECTION, THE ADDITION CAN BE MADE WHERE AN ASSESSEE INCURS A N EXPENDITURE AND OFFERS NO EXPLANATION ABOUT THE SOURCE OF SUCH EXPENDITURE OR PART THEREOF, OR THE EXPLANATION, IF ANY, OFFERED BY HIM IS NOT SATISFACTORY. THEN ONLY SUCH EXPENDITURE OR PART THEREOF CAN BE TREATED AS DEEMED INCOME OF THE ASSESSEE FOR SUC H FINANCIAL YEAR. 13. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE. THESE BILLS WERE RAISED BY BROKERS WERE FOUND DURING THE SEARCH OPERATION AT THE RESIDENCE OF DIRECTOR OF ASSESSEE. AS PER REVENUE, THE PAYMENTS OF ALL THESE BILLS WERE NOT ACCOUNTED FOR IN T HE BOOKS OF ACCOUNT AS THESE CANNOT BE RECONCILED WITH THE BOOKS OF ACCOUNT AND ONLY ON THIS BASIS, THE REVENUE PRESUMED THAT THESE PAYMENTS HAVE BEEN MADE OUT OF UNDISCLOSED SOURCE. WE HAVE PERUSED THE SEIZED MATERIAL AND THE RELEVANT PROVISIONS OF SECTION 69C OF THE ACT. THIS SEIZED MATERIAL RELATES TO CERTAIN CORRESPONDENCE BY WHICH THE BROKERS HAVE DEMANDED THEIR COMMISSION. AS PER THESE CORRESPONDENCES, THE RATE OF COMMISSION ASKED WAS VARYING FROM 4 - 6 %. THERE IS NO DOCUMENT REFERRED BY THE AO OR BY THE CIT (A) OR EVEN BEFORE US BY THE REVENUE WHICH COULD SHOW THAT THE RATE OF COMMISSION WAS IN THE RANGE OF 4 - 6%. FURTHER THE REVENUE HAS FAILED TO CONFIRM THE CONTENTS OF THE CORRESPONDENCE WITH THE BROK ERS BY WAY OF VERIFYING THEIR BOOKS OF ACCOUNT OR RECORDING THE STATEMENT OF CONCERNED PERSONS. THE ASSESSING OFFICER HAS NOT MADE ANY ENQUIRY IN RESPECT OF CORRECTNESS OF THE CONTENTS OF THE CORRESPONDENCE BY THE BROKERS. THERE IS NO EVIDENCE FOUND WITH R EGARD TO THE PAYMENT OF THESE BILLS FROM ANY SOURCE OF INCOME. THE ASSESSEE'S CLAIM THAT PAYMENTS OF COMMISSION HAD BEEN MADE BY CHEQUES AND THE NECESSARY TDS WERE DEDUCTED HAD SOME FORCE. IN OUR CONSIDERED VIEW, NO ADDITION CAN BE MADE MERELY ON THE BASIS OF CERTAIN CORRESPONDENCE ON THE PRESUMPTION WHEN ADDITION IS TO BE MADE U/S 69C OF THE INCOME - TAX ACT WHILE MAKING THE ASSESSMENT U/S 153 A OF THE INCOME - TAX ACT . NO ADDITION CAN BE MADE UNDER THE SCOPE O F SECTION 153A ON PRESUMPTION BASIS. THE REVENUE HAS TO BRING CERTAIN CORROBORATIVE EVIDENCE OR SUPPORTING MATERIAL BY WAY OF MAKING INVESTIGATION OR ENQUIRIES. ALL THE BROKERS WERE LOCATED IN DELHI, HOWEVER, THE REVENUE HAS DONE NOTHING IN THIS REGARD. SOME OF THE BROKERS WERE EVEN CORPORATE ASSESSEES. THEIR RECORDS COULD HAVE BEEN EASILY VERIFIED. THE SEIZED MATERIAL RELIED UPON BY THE AO ALONE CANNOT BE MADE A BASIS FOR DRIVING ADVERSE INFERENCE WI TH TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 11 REGARD TO THE UNDISCLOSED EXPENDITURE WHICH CAN BE ADDED U/S 69 OF THE INCOME - TAX ACT . IN OUR CONSIDERED VIEW, MATERIAL RELIED UPON BY THE AO FOR MAKING THE ADDITION WAS MERELY A CORRESPONDENCE WHICH AL ONE CANNOT LEAD TO THE INFERENCE THAT ASSESSEE HAD INCURRED SUCH EXPENDITURE. THIS CANNOT BE MADE BASIS FOR ADDITION MADE U/S 69 OF THE INCOME - TAX ACT WHILE FRAMING THE ASSESSMENT U/S 153 A OF THE INCOME - TAX ACT , 1961. THERE IS NO EVIDENCE GATHERED BY REVENUE FROM ANYWHERE, WHICH COULD ESTABLISH A BIT OF THE FACT THAT ASSESSEE HAS PAID ANYTHING MORE THAN WHATEVER RECORDED IN THE BOOKS OF ACCOUNT. THEREFORE, IN OUR CONSIDERED VIEW, SUCH ADDITION CANNOT BE SUSTAINED. 13.1 THE REVENUE HAS ALSO RAISED THE ISSUE OF ADMITTING ADDITIONAL EVIDENCE IN CONTRAVENTION OF RULE 46A OF THE INCOME - TAX RULES. OUR NOTICE WAS BROUGHT TO THE RELEVANT COPIES OF THE LEDGER ACCOUN T SHOWING PAYMENTS TO VARIOUS PARTIES ON WHICH TDS WAS DEDUCTED. THE CONFIRMATION OF THE ACCOUNT WAS ALSO FILED ALONG WITH LEDGER ACCOUNT. THESE EVIDENCES WERE PART OF THE ASSESSMENT RECORD AND IN OUR CONSIDERED VIEW, NOTHING NEW HAS BEEN BROUGHT INTO NOTI CE OF CIT(A). THEREFORE, THERE WAS NO VIOLATION OF RULE 46A OF INCOME - TAX RULES, 1962. THESE DOCUMENTS WERE FILED BEFORE THE ASSESSING OFFICER AND THIS WAS NOT FILED FOR THE FIRST TIME BEFORE THE CIT (A). THEREFORE, THE REVENUE'S CONTENTION IS NOT TENABLE. 13.2 WE DISMISS THIS GROUND OF REVENUE'S APPEAL AND ALLOW THE ASSESSEE'S GROUND OF APPEAL. [EXTRACTED FROM INDIANKANOON.ORG] 15. THIS ORDER WAS CHALLENGED BY REVENUE BEFORE HON'BLE DELHI HIGH COURT. HONBLE HIGH COURT IN ITA 400/2013 DATED 3/4/2014 FOR AY 2006 - 07 HELD AS UNDER: - THE REVENUE CLAIMS TO BE AGGRIEVED BY THE ORDER OF THE INCOME TAX APPELLATE TRIBUNAL (ITAT) WHICH ALLOWED THE ASSESSEES APPEAL. IT IS URGED THAT THE IMPUGNED JUDGMENT DISCLOSES ERRORS WHICH LED TO A SUBSTANTIAL QUESTION OF LAW PERTAINING TO THE INTERPRETATION OF SECTION 292 (C) OF THE INCOME TAX ACT, 1961 IN RESPECT OF THE MATERIALS SEIZED AND INFERENCE DRAWN BY THE INCOME TAX AUTHORITIES IN THE ASSESSEE?S CASE. THE ASSESSEE IS ENGAGED IN THE REAL ESTATE DEVELOPMENT BUSINESS. ITS PREMISES AS WELL AS THAT OF ITS DIRECTOR MR. RAKESH GARG WERE SUBJECT TO SEARCH AND SEIZURE PROCEEDINGS ON 31.07.2009. PURSUANT TO THESE, THE ASSESSEE WAS CALLED UPON TO FILE ITS R ETURNS UNDER SECTION 153A WHICH IT DID. THE ASSESSING OFFICER IN THE COURSE OF HIS ORDER WHILE FRAMING THE ASSESSMENT ADDED CERTAIN AMOUNTS, INTER ALIA, THE SUM OF `1,46,79,390/ - AND BASED UPON HIS CONCLUSION THAT THE DOCUMENTS SEIZED AND TAKEN INTO CUSTOD Y DURING THE SEARCH OPERATIONS IN THE PREMISES OF MR. RAKESH GARG POINTED TO COMMISSION AT THE RATE OF 4 - 6 % HAVING BEEN PAID BY THE ASSESSEE TO ITS BROKERS. THIS AMOUNT, ACCORDING TO THE AO, WAS NOT DISCLOSED AND HAD, THEREFORE, BEEN PAID OUT OF THE ASS ESSEES UNDISCLOSED INCOME. ON THE BASIS OF THESE INFERENCES, AMOUNTS WERE ADDED. THE ASSESSEE WAS GIVEN THE BENEFIT OF DEDUCTIONS ACTUALLY CLAIMED IN HIS BOOKS TOWARDS HIS EXPENSES. CONSEQUENTLY, GROSSING UP OF LIABILITY ON ACCOUNT OF TDS WAS ALSO ADDED BY THE AO. THE THIRD HEAD ON WHICH THE AO ADDED AMOUNT WAS THE SUM OF `28,28,000/ - SAID TO BE THE LOSS OF INTEREST INCOME DUE TO THE ADVANCE GIVEN TO THE ASSESSEES SISTER CONCERN. TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 12 THE COMMISSIONER OF APPEALS PARTLY ALLOWED THE ASSESSEES APPEAL SO FAR AS THE FIRST HEAD WAS CONCERNED AND ENTIRELY ALLOWED THE ADDITIONS ON ACCOUNT OF TDS. HOWEVER, AS REGARDS THE OTHER ASPECTS, THE FINDINGS OF THE AO WERE CONFIRMED AND THE APPEAL WAS REJECTED. ON THE THIRD ISSUE, CONCERNING THE ADDITION OF INTERE ST INCOME AS WELL, THE ASSESSEES ARGUMENTS PREVAILED WITH THE COMMISSIONER. BOTH THE PARTIES APPEALED TO THE ITAT. THE ASSESSEES APPEAL WAS ACCEPTED IN TOTALITY WHEREAS THE REVENUES WAS DISMISSED. THE REVENUE IMPUGNS THIS DECISION IN THE PRESENT PROCEEDINGS. IT IS URGED THAT THE AO S ORDER ADDING THE AMOUNT OF RS. 1,46,79,390/ - WAS BASED UPON THE FAIR ASSESSMENT OF THE MATERIALS WHICH SUGGESTED THAT IN FACT A HIGHER COMMISSION TO THE TUNE OF 4 - 6% HAD BEEN PAID. LEARNED COUNSEL FOR THE REVEN UE RELIED UPON THE MATERIALS IN THIS REGARD AND ALSO STATED THAT ON ACCOUNT OF SECTION 69 (C) READ WITH SECTION 292 (C), THE PRESUMPTION LOGICALLY DRAWN HAD TO BE SUSTAINED. HE ALSO POINTED OUT TO THE COMMISSIONER OF APPEALS DECISION WHICH HAS SUBSTA NTIALLY UPHELD THE AOS ORDER AND THAT THE TRIBUNAL FELL INTO ERROR IN DISTURBING THIS FINDING WHILST THERE CAN BE NO DISPUTE ABOUT THE REVENUES CONTENTIONS THE PRESUMPTION REQUIRED TO BE DRAWN IN LAW ON ACCOUNT OF THE STATUTORY PRESCRIPTION ARE TO BE COMPLIED WITH, YET THE FOUNDATIONAL FACTS NECESSARY FOR THE COURT OR TRIBUNAL TO SEEK RECOURSE TO SUCH STIPULATION IS ESSENTIAL. IN THE PRESENT CASE, APART FROM THE DEMANDS MADE BY THE FIVE NAMED COMMISSION AGENTS OR BROKERS FOR A HIGHER RATE OF COMMIS SION AT 4 - 6%, THERE WAS NO REASONABLE BASIS FOR THE REVENUE TO ASSUME OR CONCLUDE THAT IN FACT SUCH AMOUNTS, CONSTITUTING THE DIFFERENCE OF WHAT WAS REVEALED IN THE BOOKS AND WHAT WOULD ARISE ON ACCOUNT OF FULFILLMENT OF SUCH DEMANDS, WERE ACTUALLY PAID. HAD THERE BEEN ANY MATERIAL IN THE FORM OF EVEN THE VAGUEST DOCUMENTS OR LEDGER OR BOOK ENTRY IN SUPPORT OF THE REVENUES CONTENTIONS OR EVEN A STATEMENT UNDER SECTION 132 (4) OR ANY REPLY TO THE QUESTIONNAIRE WHICH WAS CIRCULATED IN THIS CASE, THE CONCL USIONS DRAWN WOULD HAVE FOUND SUPPORT IN LAW. IN THE ABSENCE OF THESE, THIS COURT IS OF THE OPINION THAT THE FINDINGS OF THE AO - AND THAT OF THE CIT TO THE EXTENT THAT THEY CONFIRM THEM - WERE CONJECTURAL AND NOT BASED ON ANY MATERIAL. IN THESE CIRCUMSTAN CES, THE PRESUMPTIONS WHICH THE REVENUE FALLS BACK UPON UNDER SECTION 292C DO NOT SUPPORT ITS CASE IN THE PRESENT CIRCUMSTANCES. FOR THE SAME REASON, THE FAILURE TO GROSS UP ON ACCOUNT OF THE ADDITION OF THE NOTIONAL INCOME AND THE CONSEQUENTIAL LIABILIT Y TO DEDUCT TAX FOR TDS PURPOSES TOO COULD NOT HAVE BEEN CAST UPON THE ASSESSEE. WE, THEREFORE, CONFIRM THE FINDINGS OF THE TRIBUNAL ON THE FIRST AND SECOND ASPECT. SO FAR AS THE THIRD ASPECT GOES, THERE WAS NO DISPUTE THAT THE FUNDS DEPLOYED BY THE ASS ESSEE TO ITS SUBSIDIARIES OR SISTER CONCERNS WAS NOT BORROWED FUNDS BUT ITS SHARE CAPITAL AND OTHER SURPLUS THAT HAD BEEN GENERATED IN THE C OURSE OF THE BUSINESS. IN THESE CIRCUMSTANCES, IT IS SETTLED THAT IN SUCH CIRCUMSTANCES, THE FUNDING BY THE PARENT OR HOLDING COMPANY TO THE SISTER CONCERN OR SUBSIDIARY TO ADVANCE ITS BUSINESS OBJECTIVE WOULD FALL WITH IN THE FRAMEWORK OF LEGITIMATE EXPENDITURE. THE TRIBUNAL THEN APPLIED THE SETTLED LAW IN THE CASE. WE FIND NO REASON TO INTERFERE WITH THAT CONCLUSION. FOR THE ABOVE REASONS, THIS COURT IS OF THE OPINION THAT NO SUBSTANTIAL QUESTION OF LAW ARISES FOR CONSIDERATION. THE APPEAL IS ACCORDINGLY DISMISSED. [EXTRACTED FROM DELHIHIGHCOURT.NIC.IN ] TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 13 16. THEREFORE, AS ON THE IDENTICAL FACTS AND CIRCUMSTANCES THE ORDER OF THE COORDINATE BENCH HAS BEEN CONFIRMED BY THE HON'BLE HIGH COURT , THEREFORE , NOW THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE ABOVE DECISION OF THE HONOURABLE HIGH COURT. IN VIEW OF THIS SOLITARY FACT THE APPEAL OF THE ASSESSEE FOR ALL THESE IMPUGNED ASSESSMENT YEAR DESERVES TO BE ALLOWED. 17. FURTHER, COMING TO THE FACTS OF THE CASE IT IS APPARENT THAT ASSESSEE IS A BUILDER AND DEVELOPER SELLING THE REAL ESTATE AND REAL ESTAT E IS SOLD BY SOLICITING THE CUSTOMER THROUGH VARIOUS BROKERS. NATURALLY, FOR SUCH SERVICES THE COMMISSION EXPENDITURE IS REQUIRED TO BE INCURRED FOR THE SAME. AS IT IS APPARENT THAT THE ASSESSEE IS A LARGE DEVELOPER IT HAS ENGAGED MANY SUCH BROKERS WHO PRO VIDE SUCH SERVICES TO THE ASSESSEE. THE SEIZED DOCUMENT FOUND DURING THE COURSE OF THE SEARCH PERTAINING TO AY 2007 - 08 TO AY 2009 - 10 ARE ATTACHED IN THE PAPER BOOK AT PAGE NO. 261 TO 306 OF THE PAPER BOOK. THESE ARE THE SEIZED DOCUMENTS FOR THESE THREE AS SESSMENT YEARS SIMILAR TO THE SEIZED DOCUMENTS FOR AY 2006 - 07 WHERE THE HONOURABLE HIGH COURT HAS ALREADY DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. ON PERUSAL OF THOSE DOCUMENTS IT IS APPARENT THAT IN ALL THE BILLS RAISED BY THE BROKERS THE SERVI CE TAX @ 10.2 % HAS BEEN CHARGED BY THE BROKERS STATING THEIR SE RVICE TAX REGISTRATION NUMBER. AT THAT RELEVANT TIME THE SERVICES TAX WAS PAYABLE BY THE REAL ESTATE AGENTS ON RECEIPT BASIS BUT THE BILLS ETC ARE REQUIRED TO BE MAINTAINED . THEREFORE , IT CANNOT BE INFERRED THAT THE BROKERS HAVE CHARGED THE SERVICE TAX BY PREPARING THE BILLS , CHARGING THE SERVICE TAX STATING THE SERVICE TAX REGISTRATION NUMBER AND THEN NOT REC ORDING IT IN THE BOOKS OF ACCOUNTS. FURTHER , IT IS NOT THE CASE OF THE L D AO THAT ASSESSEE HAS PAID TO THOSE BROKERS AND THOSE BROKERS HAVE RECORDED THESE TRANSACTIONS IN THE THEIR BOOKS OF ACCOUNTS. THER E FORE , FOR THIS REASON ALSO THE EXPLANATION OF THE ASSESSEE , IN ABSENCE OF ANY CONTRARY EVIDENCES FOUND , THAT THESE ARE THE ESTIMATED BILLS WHICH HAS NOT AT ALL MATERIALIZED AND THEREFORE THEY ARE NOT ACTED UP ON IS PLAUSIBLE. HE ALS O SUBMITTED THAT WHEREVER THESE BILLS ARE ACTED UP ON , THOSE TRANSACTIONS ARE SUPPORTED BY THE FACTUM OF SALES OF THE REAL E STATE. 18. WE FURTHER REFER TO SOME OF THE SEIZED DOCUMENTS WHICH ITSELF SHOWS THAT SAME HAS BEEN PAID BY THE CHEQUE TO THE BROKERS. SUCH INSTANCES ARE AVAILABLE AT PAGE NO 259, 264, 265, 267, 269, 271, 272 , ETC. THEREFORE IT CANNOT BE INFERRED THAT THE SEIZ ED DOCUMENTS ARE THE BILLS OF THE BROKERS FOR WHICH ASSESSEE HAS INCURRED THE LIABILITY FOR SALE OF REAL ESTATE. SOME OF THE BILLS ARE ALSO PAID BY CHEQUES . THEREFORE, IT IS NOT THE DISPUTE OF THE REVENUE THAT THESE CHEQUE PAYMENTS ARE NOT RECORDED IN T HE BOOKS OF ACCOUNTS OF APPELLANT . TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 14 19. ON EXAMINATION OF THE VARIOUS DEMANDS RAISED BY THE BROKERS , IT IS ALSO NOTED THAT THERE ARE SEVERAL CANCELLATIONS OF THE SALE OF PLOTS WITHOUT NO OBJECTION CERTIFICATE AND THEREFORE NO COMMISSION IS PAYABLE ON SUCH PLOTS ON WHICH NO OBJECTION CERTIFICATES HAVE BEEN ISSUED FOR REFUNDS. THIS SHOWS THAT REAL ESTATE IS NOT AT ALL SOLD, SO THERE CANNOT BE ANY QUESTION OF PAYMENT OF BROKERAGE. FURTHER , IT IS ALSO APPARENT THAT NO COMMISSION IS PAYABLE ON SALE OF PLOTS ON WHICH NO INSTALLMENTS OF PURCHASE CONSIDERATION HAS BEEN FULLY RECEIVED. THERE ARE SEVERAL SUCH INSTANCES MENTIONED IN THE SEIZED DOCUMENTS. SPECIFIC REFERENCE IS AT PAGE NUMBER 267 AND 269 OF THE PAPER BOOK. 20. IT IS ALSO APPARENT THAT SOME SPECIFIC TRANSACTIONS A RE CARRIED OUT THROUGH ONE BROKERS BUT THE BILLS OR THE DEMAND HAS BEEN RAISED BY ANOTHER BROKER. THEREFORE , THERE ARE DUPLICATIONS. SUCH INSTANCES ARE MENTIONED AT PAGE NUMBER 271 OF THE PAPER BOOK. 21. AS THE DOCUMENTS HAVE BEEN FOUND DURING THE COURSE OF SEARCH THEREFORE THERE WOULD ALWAYS BE A PRESUMPTION ABOUT THE OWNERSHIP, TRUTHFULNESS OF ITS CONTENTS AND REGULARITY OF SUCH DOCUMENTS WITH RESPECT TO SIGNATURES, HAND WRITING OR PROPER EXECUTION. SEC TION 292C , PROVIDES THAT: - 292C. PRESUMPTION AS TO ASSETS, BOOKS OF ACCOUNT, ETC (1) WHERE ANY BOOKS OF ACCOUNT, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING ARE OR IS FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE OF A SEARCH UNDER SECTION 132, IT MAY, IN ANY PROCEEDING UNDER THIS ACT, BE PRESUMED (I) THAT SUCH BOOKS OF ACCOUNT, OTHER DOCUMENTS, MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING BELONG OR BELONGS TO SUCH PERSON ; (II) THAT THE CONTENTS OF SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS ARE TRUE ; AND (III) THAT THE SIGNATURE AND EVERY OTHER PART OF SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS WHICH PURPORT TO BE IN THE HANDWRITING OF ANY PARTICULAR PERSON OR WHICH MAY REASONABLY BE ASSUMED TO HAVE BEEN SIGNED BY, OR TO BE IN THE HANDWRITING OF, ANY PARTICULAR PERSON, ARE IN THAT PERSONS HANDWRITING, AND IN THE CASE OF A DOCUMENT STAMPED, EXECUTED OR ATTESTED, THAT IT WAS DULY STAMPED AND EXECUTED OR ATTESTED BY THE PERSON BY WHOM IT PURPORTS TO HAVE BEEN SO EXECUTED OR ATTESTED. (2) WHERE ANY BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS HAVE BEEN DELIVERED TO THE REQUISITIONING OFFICER IN ACCORDANCE WITH THE PROVISIONS OF SECTION 132A, THEN, THE PROVISIONS OF SUB - SECTION (1) SHALL APP LY AS IF SUCH BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS WHICH HAD BEEN TAKEN INTO CUSTODY FROM THE PERSON REFERRED TO IN CLAUSE (A) OR CLAUSE (B) OR CLAUSE (C), AS THE CASE MAY BE, OF SUB - SECTION (1) OF SECTION 132A, HAD BEEN FOUND IN THE POSSESSION OR C ONTROL OF THAT PERSON IN THE COURSE OF A SEARCH UNDER SECTION 132. TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 15 22. ACCORDING TO THAT SECTION A PRESUMPTION IS AVAILABLE TO THE ASSESSING OFFICER WITH RESPECT TO THE DOCUMENTS FOUND DURING THE COURSE OF SEARCH SAME CAN BE USED IN THE ASSESSMENT PROCEEDINGS ALSO. BUT SUCH PRESUMPTION IS RESTRICTED TO THE OWNERSHIP OF THE DOCUMENTS, TRUTHFULNESS OF THE CONTENTS AND IRREGULARITY OF SUCH DOCUMENTS. IT IS ALSO THE FACT THAT IT IS NEVER BEEN DENIED BY ASSESSEE THAT THIS DOCUMENTS BELONGS TO THE ASSESSEE OR TRUTH FULNESS OF SUCH DOCUMENTS. ON EXAMINATION OF THIS DOCUMENTS , THE LEARNED ASSESSING OFFICER HAS MADE AN ADDITION IN THE HANDS OF THE ASSESSEE STATING THAT ASSESSEE HAS MADE PAYMENT OF THIS SUM TO THE VARIOUS BROKERS AS COMMISSION. HOWEVER , NONE OF THE DOCUM ENTS SEIZED BY THE INCOME TAX DEPARTMENT DURING THE COURSE OF SEARCH , SHOWS THAT ANY PAYMENT HAS BEEN MADE TO THIS BROKERS OUT OF THE BOOKS OF ACCOUNTS. THEREFORE , THESE TRUTHFULNESS THAT ASSESSEE HAS MADE PAYMENT TO THE BROKERS WHICH IS NOT FOUND RECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE IS NOT COMING OUT FROM THE SEIZED DOCUMENTS. ASSESSEE HAS NEVER DENIED THAT IT IS WORKING WITH THESE BROKERS BUT HAS STATED THAT THESE ARE MERELY AN ESTIMATES WHICH CAN BE VERIFIED FROM THE ACTUAL SALES MADE BY THE ASSESSEE . IT CAN NEVER BE THE CASE THAT ASSESSEE HAS SOLD THE PROPERTY THROUGH BROKER WHICH IS MENTIONED IN THIS DOCUMENTS AND NO BROKERAGE IS RECORDED BY THE ASSESSEE IN ITS BOOKS OF ACCOUNTS. IT IS ALSO NOT THE CASE OF THE REVENUE THAT THE PROPERTIES SOLD BY THE ASSESSEE AND SOME BROKEN HIS CLAIMED BROKERAGE IN THIS DOCUMENTS AND WHICH IS NOT RECORDED IN THE BOOKS OF ACCOUNTS OF ASSESSEE . NO SUCH INSTANCES BEEN BROUGHT ON RECORD BY THE REVENUE. 23. THE ADDITION HAS BEEN MADE BY THE LD AO U/S 69C OF THE ACT HOLDING THAT ASSESSEE HAS INCURRED EXPENDITURE OF BROKERAGE WHICH IS NOT ACCOUNTED FOR IN THE BOOKS OF THE ASSESSEE. THE PROVISIONS OF SECTION 69C OF THE ACT PROVIDES AS UNDER: - 69C. UNEXPLAINED EXPE NDITURE, ETC. WHERE IN ANY FINANCIAL YEAR AN ASSESSEE HAS INCURRED ANY EXPENDITURE AND HE OFFERS NO EXPLANATION ABOUT THE SOURCE OF SUCH EXPENDITURE OR PART THEREOF, OR THE EXPLANATION, IF ANY, OFFERED BY HIM IS NOT, IN THE OPINION OF THE ASSESSING OFFICER , SATISFACTORY, THE AMOUNT COVERED BY SUCH EXPENDITURE OR PART THEREOF, AS THE CASE MAY BE, MAY BE DEEMED TO BE THE INCOME OF THE ASSESSEE FOR SUCH FINANCIAL YEAR. 24. TO INVOKE THE PROVISIONS OF SECTION 69C OF THE ACT THE LD AO IS FIRST REQUIRE TO PROVE THAT ASSESSEE HAS INCURRED ANY EXPENDITURE. IN THE PRESENT CASE FROM THE SEIZED DOCUMENTS THE BROKERS HAVE RAISED THE ESTIMATE OF THE BROKERAGE OF SEVERAL REAL ESTATE OF THE ASSESSEE. IN NONE OF THE SEIZED DOCUMENTS IT IS FOUN D THAT ASSESSEE HAS ACCEPTED THE FACTUM OF PAYMENT TO BE MADE TO THOSE BROKERS. MERELY THE SEIZURE OF THE BILLS OR ESTAIMET WITHOUT EVIDENCE OF ACCEPTANCE OF THOSE BILLS , IT CANNOT BE SAID THAT ASSESSEE HAS INCURRED THE EXPENDITURE. THERE IS TO BE OB LIGATION OF PAYMENT BY THE ASSESSEE. THEREFORE, THESE DO NOT SHOW THAT ASSESSEE HAS INCURRED OR TAKEN THE TRUE ZONE BUILDWELL PVT. LTD VS. DCIT, ITA NO. 2092, 2093 AND 2094/DEL/2012 (ASSESSMENT YEAR: 2007 - 08 TO 2009 - 10) PAGE | 16 LIABILITY OF PAYMENT OF THIS EXPENDITURE. FURTHER, THE ASSESSEE HAS OFFERED AN EXPLANATION THAT WHAT THESE DOCUMENTS ARE PERTAINING TO. IN VIEW OF ABO VE FACTS WHERE IT IS NOT PROVED THAT ASSESSEE HAS INCURRED ANY EXPENDITURE OF BROKERAGE THERE IS NO QUESTION OFFERING ANY EXPLANATION ABOUT THE SOURCE OF SUCH EXPENDITURE. IN VIEW OF THIS THE PROVISIONS OF SECTION 69C ON THE BASIS OF SEIZED DOCUMENTS PRODU CED BEFORE US DO NOT ARISE. 25. IN VIEW OF THE ABOVE FACTS, AND RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF ASSESSEE FOR AY. 2006 07, WE REVERSE THE FINDING OF THE LOWER AUTHORITIES AND DIRECT THE LEARNED AO TO DELETE T HE ADDITION OF UNACCOUNTED PAYMENT OF BROKERAGE TO THE VARIOUS BROKERS FO R ASSESSMENT YEAR 2007 08, 2008 09 AND 2009 10 OF RS. 599130/ - , RS. 1,89,87,400/ - AND RS. 5,58,149/ - RESPECTIVELY. 26. ACCORDINGLY APPEAL OF ASSESSEE IN RESPECT OF THE ABOVE GROUNDS FOR ALL THESE THREE YEARS ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 3 / 0 9 / 2018 . - S D / - - S D / - ( DIVA SINGH ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 3 / 0 9 / 2018 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI