DCIT, New Delhi V. M/s K.K. Enterprises, New Delhi

ITA 2790/DEL/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58620 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 24-01-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 04-06-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: Y KAKKAR
• Assessee Lawyers: MRS SWEETY K OTHARI CAS
• Keywords: Search and seizure; Document seized; Question of law; Onus to prove; Documents seized; Revenue expenditure; Capital expenditure
• Section: 131; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH D : NEW DELHI) BEFORE SHRI U.B.S. BEDI, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NOS.2787 TO 2793/DEL./2010 (ASSESSMENT YEARS : 2001-02 TO 2007-08) DCIT, CENTRAL CIRCLE 1, VS. M/S. K.K. ENTERPRISES , NEW DELHI. S 1, 2 ND FLOOR, USHA CHAMBERS, 37 38, CENTRAL MARKET, ASHOK VIHAR, NEW DELHI. ` (PAN : AAAFK7804Q) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VINOD BINDAL & MRS. SWEETY KOTH ARI, CAS REVENUE BY : MS. Y. KAKKAR, DR ORDER PER BENCH : ALL THESE SEVEN APPEALS FILED BY THE REVENUE ARE D IRECTED AGAINST THE ORDER OF CIT (APPEALS)-I, NEW DELHI DATED 15.02.201 0 FOR ASSESSMENT YEAR 2001-02 AND DATED 23.03.2010 FOR THE ASSESSMENT YEA RS 2002-03 TO 2007-08. 2. GROUND NOS.1 & 7 IN ALL THE APPEALS, GROUND NO.6 IN ALL THE APPEALS EXCEPT IN ITA NO.2789/DEL/2010 AND GROUND NO.8 IN I TA NO.2789 ARE GENERAL IN NATURE AND DO NOT REQUIRE ANY ADJUDICATI ON, HENCE DISMISSED. ITA NOS.2787 TO 2793/DEL./2010 2 3. GROUND NO.2 IN ALL THE APPEALS IS SAME EXCEPT TH E DIFFERENCE OF DELETION OF AMOUNT, THEREFORE, WE ARE REPRODUCING ONLY GROUN D NO.2 FROM ITA NO.2787/DEL/2010 :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . CIT (A) HAS ERRED IN LAW AND FACTS OF THE CASE IN DELETING THE ADDITION ON ACCOUNT OF CANCELLATION CHARGES REALIZED FROM CLIEN TS DEFAULT IN PAYMENTS OF INSTALLMENTS EVEN THOUGH SUCH ENTRIES O F REALIZATION ARE RECORDED IN SEIZED MATERIAL AND THERE IS LITIGA TION BY THE ASSESSEE TO REALIZE THE SAME FROM DEFAULTERS IN THE COURTS OF LAW. IN DOING SO, THE LD. CIT (A) IGNORED CONTENTS OF SE IZED DOCUMENTS AND RATHER RELIED ON MERE ARGUMENT OF THE ASSESSEE THAT NO ENQUIRIES WERE MADE FROM CONCERNED PARTIES. 4. A SEARCH AND SEIZURE OPERATION CARRIED OUT IN TH E PREMISES OF THE ASSESSEE. NOTICES UNDER SECTION 153C WERE ISSUED. THE ASSESSEE FILED THE RETURN OF INCOME. THE ASSESSING OFFICER MADE THE A DDITION BY HOLDING AS UNDER :- 1. FROM THE DOCUMENTS SEIZED (PAGE -38) OF A21 IT IS NOTICED THAT ASSESSEE IS CHARGING 25% EARNEST MONEY AT CANC ELLATION OF THE BOOKING. ONE OF SUCH CASE WITH SH. KAILASH CHAN D KHANDELWAL WAS BROUGHT TO ASSESSEE KNOWLEDGE IN WHI CH THE ASSESSEE HAS FORFEITED RS.4,17,425/-. THEREFORE ASS ESSEE WAS ASKED TO SHOW WHY THE 25% OF THE TOTAL AMOUNT OF SH OP OF WHICH BOOKING HAVE BEEN CANCELLED MAY NOT BE ADDED TO ITS INCOME. IN HIS REPLY THE ASSESSEE HAS STATED THAT THAT IN FACT NO AMOUNT RELATING TO THE SAID CANCELLATION HAS ACTUAL LY BEEN FORFEITED. THE ASSESSEE FIRM HAS ONLY TAKEN THE STA ND TO DEFEND ITSELF IN COURT AGAINST THE PLAINTIFF CLAIMING TITL E OF THE BOOKED SPACE. DETAILS OF CANCELLATION OF BOOKING ARE FURNI SHED WHICH SHOW THAT NO AMOUNT HAS ACTUALLY BEEN FORFEITED FRO M ANYONE' ITA NOS.2787 TO 2793/DEL./2010 3 THE CONTENTION OF THE ASSESSEE DOES NOT HAVE ANY VA LUE AS THE SH. MANISH AGGARWAL HAS STATED BEFORE COURT IN THE CASE WITH SH. KAILASH CHAND KHANDEWAL AS UNDER: 'THAT THE SUIT IS FALSE AND FRIVOLOUS AND HAS BEEN FILED WITH OBLIQUE MOTIVE. IT IS SUBMITTED THAT THE PLAIN TIFFS DEFAULTED IN PAYMENT OF THE INSTALLMENTS. EVEN INSP ITE OF REPEATED DEMANDS, THE PLAINTIFFS FAILED TO PAY THE INSTALLMENTS WITH THE RESULT THAT THE BOOKING WAS CANCELLED AND THE EARNEST MONEY OF RS.417425/- WAS FORFEITED. ' PAGE NO. 85/A-2/S-1 'THE BOOKING WAS CANCELLED VIDE LETTER DATED 5.4.02 AND THE EARNEST MONEY TO THE EXTENT OF RS.417425/- STOO D FORFEITED IN TERMS OF THE BOOKING APPLICATION.' THEREFORE THE ARGUMENTS OF THE ASSESSEE DOES NOT CA RRY ANY WEIGHT IN VIEW OF ASSESSEE'S OWN ADMISSION OF THE F ACT HE FORFEITS EARNEST MONEY @ 25% OF THE VALUE OF SPACE/ FLAT. IT IS OF NO CONSEQUENCE AS TO WHETHER THE CONCERNED COMPANY IS MS MANISH BUILDWELL OR KK ENTERPRISES OR GOURI CONSTRU CTION OR ABHINAV CONSTRUCTION OR MANISH ENTERPRISES. PERUSAL OF THEIR BOOKING FORMS SEIZED DURING THE COURSE OF SEARCH RE VEAL THAT THEY ARE ALL IDENTICAL TO EACH OTHER AND IN EACH IT IS MENTIONED THAT IN THE EVENT OF CANCELLATION, CANCELLATION CHA RGES WOULD BE LEVIED. THEREFORE IT IS CLEAR THAT IT IS THE POLICY OF THE GROUP THAT SUCH CHARGES ARE BEING LEVIED AND THE PRESUMPTION I S THAT THE ASSESSEE IS DEDUCTING CANCELLATION CHARGES IN RESPE CT OF ALL CANCELLATIONS. OTHERWISE WHY SHOULD THEY REFUSE TO PAY BACK THE MONEY TO SHRI K.C.KHANDELWAL? THEREFORE ADDITION OF RS.14,91,250/- BEING 25% OF THE TOTAL VALUE OF FLAT /SPACE WHOSE BOOKING HAS BEEN CANCELLED DURING THIS ASSESSMENT Y EAR AMOUNTING TO RS.5965000/- IS ADDED 10 INCOME OF THE ASSESSEE. 5. THE CIT (A) HAS GRANTED THE RELIEF BY HOLDING AS UNDER :- 4.3 I HAVE PERUSED THE ASSESSMENT ORDER AND SUBMIS SION AND EVIDENCES PLACED ON RECORD BY THE APPELLANT. ON PE RUSAL OF THE EVIDENCES, IT IS SEEN THAT SEIZED PAGE REFERRED TO BY THE ASSESSING ITA NOS.2787 TO 2793/DEL./2010 4 OFFICER IS A LETTER TO M/S. USHA CONSTRUCTION CO. B Y MR. PARMOD AHLAWAT REQUESTING FOR CANCELLATION OF PLOT. THE S AME IS NOT CONCERNED WITH THE ASSESSEE AT ALL AS BOTH THE PART IES MENTIONED IN THE SAID LETTER ARE SEPARATE ENTITIES. IN THE SA ID LETTER, THE BUYER HAS REQUESTED TO CHARGE CANCELLATION CHARGES AND RE FUND THE MONEY. HOWEVER, THIS PAGE DOES NOT SUGGEST' THAT TH E AMOUNT WAS REFUNDED TO THE SAID BUYER AFTER CHARGING CANCE LLATION CHARGES BY THE SAID PARTY OR THAT THE CANCELLATION CHARGES RECEIVED, IF ANY, WERE NOT RECORDED IN THE BOOKS OF ACCOUNT OR THE SAME WERE RECEIVED IN CASH OUT OF THE REGULAR BOOKS . THUS NO ADVERSE COGNIZANCE OF THE SAID PAGE CAN BE TAKEN AG AINST THE ASSESSEE IN ANY MANNER. 4.3.1 FURTHER, THE ASSESSEE FILED CONFIRMATIONS FRO M ALL THE BUYERS WHOSE BOOKINGS WERE CANCELLED DURING THE YEA R UNDER CONSIDERATION WHEREIN THEY CONFIRMED THE RECEIPT OF THE ENTIRE BOOKING MONEY THROUGH ACCOUNT PAYEE CHEQUES WITHOUT DEDUCTION OF ANY CANCELLATION CHARGES. ON PERUSAL O F THE REQUEST LETTERS AND CONFIRMATIONS / RECEIPTS FROM THE BUYER S, IT IS SEEN THAT ENTIRE BOOKING AMOUNT WAS PAID TO THEM WITHOUT DEDUCTION OF ANY CANCELLATION CHARGES. THE ONUS TO PROVE THAT NO CANCELLATION CHARGES WERE RECEIVED FROM THE BUYERS ON CANCELLATION OF I BOOKING OUTSIDE THE BOOKS OF ACCO UNT WAS NOT ON THE ASSESSEE BUT ON THE REVENUE AS THE REVENUE W AS ALLEGING SO. HOWEVER, THE ASSESSEE HAS DISCHARGED ITS ONUS B Y FILING THEIR CONFIRMATIONS CONTAINING THE NAMES AND ADDRESSES OF THE BUYERS AND THE ONUS SHIFTED ON THE ASSESSING OFFICER TO PR OVE IT OTHERWISE. HOWEVER, NO ADVERSE EVIDENCE HAS BEEN BR OUGHT ON RECORD BY THE ASSESSING OFFICER TO SUBSTANTIATE HIS CONTENTION REGARDING RECEIPT OF CANCELLATION CHARGES BY THE AS SESSEE IN ANY MANNER OUTSIDE THE BOOKS OF ACCOUNT. NO ADVERSE MAT ERIAL HAS BEEN BROUGHT ON RECORD BY THE ASSESSING OFFICER EVE N IN THE REMAND PROCEEDINGS TO PROVE HIS CONTENTION. 4.3.2 THERE IS A CLAUSE IN THE BOOKING FORM REGARDI NG RECOVERY OF THE CANCELLATION CHARGES BUT IT IS THE SOLE DISC RETION OF THE DEVELOPER TO CHARGE THE SAME FROM THE BUYER. IT IS A CONTRACT BETWEEN THE TWO PARTIES WHOSE TERMS AND CONDITIONS CAN BE AMENDED AS PER MUTUAL CONSENT. IN CASE OF THE ASSES SEE, THE EVIDENCES PLACED ON RECORD SUGGEST THAT THE DEVELOP ER REFUNDED THE ENTIRE MONEY WHICH SHOWS THAT NO CANCELLATION C HARGES WERE DEDUCTED BY IT TO MAINTAIN ITS GOODWILL IN THE MARK ET SO THAT THE ITA NOS.2787 TO 2793/DEL./2010 5 INVESTOR ALWAYS COME FORWARD TO PUT IN HIS MONEY IN THE PROJECTS BEING DEVELOPED BY THE ASSESSEE. 4.3.3 ON READING THE STATEMENT OF MR. MANISH AGGARW AL GIVEN IN THE LEGAL SUIT FILED BY ONE MR. KAILASH CHAND KH ANDELWAL, IT IS SEEN THAT MR.MANISH AGGARWAL STATED THAT THE SAI D PLAINTIFF, I.E. MR. K. C. KHANDELWAL DEFAULTED IN PAYMENT OF I NSTALLMENTS INSPITE OF THE REPEATED DEMANDS AND THEREFORE THE B OOKING WAS CANCELLED AND THE EARNEST MONEY OF RS.4,17,425/- WA S FORFEITED. THUS IT WAS A SPECIFIC CASE OF FORFEITURE OF BOOKIN G AMOUNT DUE TO NON-PAYMENT OF INSTALLMENTS AND NOT OF CANCELLAT ION. IN THE SAID CASE, THE MR. KHANDELWAL NEVER APPLIED FOR CAN CELLATION AND CONSEQUENT REFUND. I AGREE WITH THE CONTENTION THAT FORFEITURE OF THE BOOKING AMOUNT DUE TO NON-FULFILLMENT OF STIPUL ATED CONDITIONS IS DIFFERENT FROM CHARGING ANY AMOUNT AG AINST CANCELLATION AND THE SAME CANNOT BE EQUATED. EVEN T HE SAID STATEMENT OF MR. MANISH AGGARWAL DOES NOT SUGGEST T HAT THE SAID AMOUNT WAS TAKEN AS CANCELLATION CHARGES. IT DOES N OT SUGGEST THAT CANCELLATION CHARGES WERE RECOVERED FROM EACH BUYER AT THE TIME OF CANCELLATION AND WERE NOT RECORDED IN THE B OOKS OF ACCOUNT. THE STATEMENT HAS BEEN GIVEN IN REFERENCE TO A PARTICULAR CASE OF FORFEITURE AND IT CANNOT BE EXTE NDED TO APPLY TO EACH AND EVERY CASE OF CANCELLATION ON PRESUMPTIONS . MERE STATEMENT IN CIVIL SUIT CANNOT BE ADOPTED AS A BASI S TO MAKE ANY ASSUMPTION UNLESS THERE IS AN EVIDENCE TO SUBSTANTI ATE THE SAME AS HAS BEEN HELD IN THE CASE OF CIT V S NARESH KHAT TAR REPORTED AT 261 ITR 664 (DELHI- HC). THUS ADDITION CANNOT BE MADE ONLY ON THE BASIS OF STATEMENT IN THE CIVIL SUIT GIVEN I N ENTIRELY DIFFERENT CONTEXT IN THE ABSENCE OF ANY EVIDENCE BR OUGHT ON RECORD BY THE ASSESSING OFFICER TO REBUT THE FACTS. 4.3.4 IN VIEW OF THE OVERALL EVIDENCES, IT WAS SEEN THAT NO CANCELLATION CHARGES WERE TAKEN BY THE APPELLANT FR OM THE BUYERS OUTSIDE THE BOOKS OF ACCOUNT. THE AMOUNT WAS FORFEI TED ONLY WHEN THE BUYER WAS NEITHER PAYING INSTALLMENTS NOR REQUESTING FOR CANCELLATION OF BOOKING AS EXPLAINED HEREIN ABO VE. WHEN THE AMOUNT IS FORFEITED THE SAME WAS DULY DECLARED AS I NCOME IN THE BOOKS OF ACCOUNT. UNDISPUTEDLY NO EVIDENCE WAS FOUN D DURING THE COURSE OF SEARCH TO SUGGEST THAT ANY CANCELLATI ON CHARGES WERE RECEIVED BY THE ASSESSEE OUTSIDE THE BOOKS OF ACCOUNT AS NOTHING HAS BEEN MENTIONED IN THE ASSESSMENT ORDER. IT IS CLEARLY EVIDENT FROM THE ASSESSMENT ORDER THAT THE ADDITION HAS BEEN ITA NOS.2787 TO 2793/DEL./2010 6 MADE ON PRESUMPTION BY APPLYING A RATE OF 25% ON AL L THE CANCELLATION THOUGH NO INCRIMINATING MATERIAL HAS B EEN FOUND TO SUGGEST SO. IN THE ABSENCE OF ANY SUCH EVIDENCE FOU ND DURING THE COURSE OF SEARCH AND NO ADVERSE MATERIAL BROUGHT ON RECORD BY THE ASSESSING OFFICER SUGGESTING THE RECEIPT OF CAN CELLATION MONEY OUT OF BOOKS OF ACCOUNT AND IN VIEW OF THE EV IDENCES PLACED ON RECORD BY THE APPELLANT THAT NO CANCELLAT ION CHARGES WERE RECEIVED BY THE APPELLANT, NO ADVERSE COGNIZAN CE CAN BE TAKEN AGAINST THE ASSESSEE MERELY ON PRESUMPTION AN D SURMISES. 6. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE. LEAR NED DR RELIED ON THE ORDER OF ASSESSING OFFICER. LEARNED AR RELIED ON THE ORDER OF CIT (A). FROM THE FACTS OF THE CASE, WE HOLD THAT THE PAPER SEIZED REFERRED TO BY THE ASSESSING OFFICER FOR MAKING THE ADDITION IS A LETT ER TO USHA CONSTRUCTION COMPANY BY PARMOD AHLAWAT REQUESTING FOR CANCELLATI ON OF PLOT. THE PERSONS MENTIONED IN THE LETTER ARE SEPARATE ENTITI ES. THIS PAPER ALSO DOES NOT SUGGEST THAT THE AMOUNT WAS REFUNDED TO THE BUYER A FTER CHARGING CANCELLATION CHARGES BY THAT PARTY AND ASSESSEE HAS RECEIVED ANY CANCELLATION CHARGES. THE ASSESSING OFFICER HAS PRESUMED BY APPLYING A RA TE OF 25% ON ALL THE CANCELLATION THOUGH NO INCRIMINATING DOCUMENTS HAVE BEEN FOUND DURING THE SEARCH. IN ABSENCE OF ANY SUCH EVIDENCE, NO ADVERS E INFERENCE CAN BE DRAWN WHICH CAN ATTRACT THE ADDITIONS ON THIS COUNT. 6.1 ON THE SIMILAR FACTS, THE ITAT IN THE CASE OF S ISTER CONCERN IN ITA NO.3062/DEL/2010 IN THE CASE OF DCIT VS. MANISH BUI LDWELL PVT. LTD. VIDE ORDER DATED 22.12.2010 HAS DECIDED THE ISSUE IN FAV OUR OF THE ASSESSEE BY HOLDING AS UNDER ITA NOS.2787 TO 2793/DEL./2010 7 17. APROPOS THE FIRST ISSUE ABOUT NOTIONAL ADDITIO N OF CANCELLATION CHARGES, WE FIND NO INFIRMITY IN THE ORDER OF CIT(A), IN AS MUC H AS THE ADDITION HAS BEEN MADE BY AO ON THE GROUND THAT ASSESSEE SHOULD HAVE CHARGED THE CANCELLATION CHARGES FROM CUSTOMERS WHO CANCELLED THEIR BOOKINGS . IN OUR VIEW THE ASSESSING OFFICER CANNOT STEP INTO THE SHOES OF BUS INESSMAN AND REVIEW THE BUSINESS EXPEDIENCY OF THE ASSESSEES DECISION OF N OT CHARGING CANCELLATION CHARGES. ASSESSEE CONTENDS IT TO BE IN THE INTERES T OF MARKET REPUTATION AND CUSTOMERS RELATIONS. IT HAS NOT BEEN ALLEGED THAT ASSESSEE HAVE RECEIVED CANCELLATION CHARGES AND DID NOT DISCLOSE IN THE BO OKS. ASSESSEE HAVING NOT RECEIVED ANY SUCH CHARGES CIT(A) HAS RIGHTLY DELETE D THIS ADDITION. IT IS ALSO NOTICED THAT THE ASSESSEE HAS FILED CONF ORMATION FROM ALL THE BUYERS WHOSE BOOKING WERE CANCELLED DURING THE YEAR UNDER CONSIDERATION. ALL THESE BUYERS HAVE CONFIRMED THE RECEIPT OF THE ENTIRE BOO KING AMOUNT THROUGH ACCOUNT PAYEE CHEQUES WITHOUT DEDUCTING ANY CANCELL ATION CHARGES. SINCE THE ASSESSEE HAS DISCHARGED ITS ONUS BY FILING THEIR CO NFIRMATIONS FROM THE BUYERS IN RESPECT OF THE AMOUNT RECEIVED AFTER CANCELLATIO N WITHOUT CHARGING ANY CANCELLATION CHARGES, THEREFORE, IN OUR CONSIDERED VIEW, THE CIT (A) WAS JUSTIFIED IN DELETING THE ADDITION MADE BY THE ASSE SSING OFFICER ON THIS COUNT. WE DISMISS GROUND NO.2 IN ALL THE REVENUE APPEALS. 7. GROUND NO.3 IN ITA NOS.2787/DEL/2010 AND 2789/DE L/2010 FOR ASSESSMENT YEARS 2001-02 AND 2003-04 RESPECTIVELY I S RELATED TO THE DELETION OF ADDITION OF RS.66,7224/- FOR AY 2001-02 AND RS.1 ,51,928/- FOR AY 2003- 04 MADE ON ACCOUNT OF REALIZATION OF STATUTORY GROU ND RENT AND INTEREST THEREON ON BEHALF OF THE ASSESSEE. THE GROUND IN I TA NO.2787/DEL/2010 READ AS UNDER :- 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED IN LAW AND FACTS OF THE CASE IN DELETING THE ADDITION OF RS.66,724/- ON ACCOUNT OF REALIZATION OF STATUTORY GROUND RENT AND INTEREST THEREON ON BEHALF OF DDA DESPITE FAILURE OF THE ASSESSEE TO PA Y THE SAME TO DDA. ITA NOS.2787 TO 2793/DEL./2010 8 8. LEARNED DR RELIED ON THE ORDER OF THE ASSESSING OFFICER. LEARNED AR RELIED ON THE ORDER OF CIT (A) AND ALSO SUBMITTED T HAT THIS ISSUE IS ALSO COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. MANISH BUILDWELL (P) LTD. IN ITA NO.928/2011 VIDE ORDER DATED 15.11.2011. 9. WE HAVE HEARD BOTH THE SIDES. IN THE ASSESSEES CASE, THE ISSUE IS REGARDING THE CALCULATION OF GROUND RENT AND INTERE ST THEREON FROM THE BUYERS AND THEN PAID TO THE DDA AND THE CASE RELIED UPON B Y THE ASSESSEE, THE ISSUE WAS REGARDING CALCULATION OF REGISTRATION AND ELECT RIFICATION CHARGES ON BEHALF OF THE DDA WHEREAS THE HON'BLE HIGH COURT HAS NOT A DMITTED THE QUESTION BY HOLDING THAT NO QUESTION OF LAW CAN BE SAID TO ARIS E FROM THE ORDER OF THE ITAT. THE REGISTRATION AND ELECTRIFICATION CHARGES WERE RECOVERABLE FROM THE BUYERS BY THE ASSESSEE. THE HON'BLE HIGH COURT IN T HE AFORESAID CASE HAS HELD AS UNDER : 11. QUESTION NO.5 RELATES TO THE ADDITION OF RS.3, 82,94,536/- BEING STAMP DUTY AND IN PARAGRAPH 7 OF THE ASSESSME NT ORDER. THE ASSESSING OFFICER STATED THAT THE SEIZED DOCUME NTS REVEALED THAT THE ASSESSEE WAS CHARGING REGISTRATION CHARGES @ 7% AND WAS SHOWING THE SAME AS LOANS AND ADVANCES RECOVERA BLE FROM THE CUSTOMERS. ACCORDING TO HIM THIS WAS A WRONG ME THOD OF ACCOUNTING. A SIMILAR PROCEDURE WAS FOUND TO HAVE B EEN ADOPTED BY THE ASSESSEE IN RESPECT OF ELECTRIFICATION CHARG ES WHICH WERE CHARGED @ 15% AND SHOWN TO BE RECOVERABLE AS LOANS AND ADVANCES. ACCORDING TO THE ASSESSING OFFICER THESE WERE NOT ITEMS OF REVENUE EXPENDITURE SINCE THEY RELATED TO THE FLATS/SPACE AND FORMED PART OF THE COST THEREOF AND THEREFORE T HEY WERE NOT ITA NOS.2787 TO 2793/DEL./2010 9 ADJUSTABLE AGAINST THE REVENUE OF THE ASSESSEE. ACC ORDING TO THE ASSESSING OFFICER THESE ITEMS OF EXPENDITURE COULD BE CAPITALIZED AND ADDED AS PART OF THE WORK IN PROGRESS. ON THESE FACTS HE CALLED UPON THE ASSESSEE TO EXPLAIN WHY THE REGISTR ATION AND ELECTRIFICATION CHARGES COLLECTED FROM CUSTOMERS CA NNOT BE ADDED AS REVENUE RECEIPTS. THE ASSESSEE SUBMITTED THAT AC CORDING TO THE SYSTEM OF ACCOUNTING FOLLOWED, THE REGISTRATION AND ELECTRIFICATION CHARGES WERE NOT INCLUDED EITHER IN THE COST OF LAND OR IN THE WORK IN PROGRESS OR AS COST OF THE P ROJECT AND THEY WERE RIGHTLY SHOWN TO BE RECOVERABLE FROM THE BUYER S. IT WAS ALSO EXPLAINED THAT IN CASE THERE IS ANY SURPLUS OF THE REGISTRATION AND ELECTRIFICATION CHARGES COLLECTED FROM THE CUST OMERS OVER THE AMOUNTS PAID TO THE STATE GOVERNMENT, THE SURPLUS W OULD BE SHOWN AS INCOME IN THE YEAR OF RECEIPT. THE ASSESSI NG OFFICER REJECTED THE EXPLANATION ON THE GROUND THAT REVENUE RECEIPTS AND CAPITAL EXPENDITURE CANNOT BE ADJUSTED AGAINST EACH OTHER. HE, THEREFORE, ADDED THE AMOUNT OF RS.3,82,94,536/- AS THE ASSESSEES INCOME. 12. ON APPEAL THE CIT (A) RECORDED THE FOLLOWING FI NDINGS:- A) THE ASSESSEE DECLARED THE AMOUNT AS ADVANCES REC OVERABLE IN ITS BALANCE SHEET. B) THE ELECTRIFICATION AND REGISTRATION CHARGES DID NOT REPRESENT CAPITAL EXPENDITURE BECAUSE THEY WERE INCURRED IN R ELATION TO THE CONSTRUCTION OF THE MALL PROJECT WHICH WAS STOCK-IN -TRADE FOR THE ASSESSEE AS HE IS ENGAGED IN THE BUSINESS OF DEVELO PING AND SELLING REAL ESTATE. C) THE AMOUNT PAID HAS NOT BEEN CLAIMED AS EXPENSES IN THE PROFIT AND LOSS ACCOUNT AND WAS SHOWN IN THE ASSET SIDE OF THE BALANCE SHEET AS RECOVERABLE FROM THE CUSTOMERS. D) WHEN THE REGISTRATION AND ELECTRIFICATION CHARGE S ARE RECOVERED FROM THE BUYER LATER THEY ARE DULY RECORD ED IN THE BOOKS OF ACCOUNTS. THIS IS AT THE TIME OF HANDING O VER POSSESSION OR EXECUTION OF SALE DEEDS. NEITHER THE PAYMENT OF THE REGISTRATION AND ELECTRIFICATION CHARGES NOR THE RE COVERY THEREOF FROM THE BUYERS IS SHOWN IN THE PROFIT AND LOSS ACC OUNT AND THUS THERE IS NO REVENUE EFFECT. ITA NOS.2787 TO 2793/DEL./2010 10 E) THE FINDING OF THE AO THAT THE CAPITAL EXPENDITU RE HAS BEEN ADJUSTED AGAINST REVENUE RECEIPTS IS NOT FACTUALLY CORRECT SINCE NO SUCH ADJUSTMENT HAS BEEN MADE IN THE BOOKS OF ACCOU NTS. 13. ON THE ABOVE FACTUAL FINDINGS, THE CIT (A) DELETED THE ADDITION OF RS.3,82,94,536/-. 14. ON APPEAL BY THE REVENUE TO THE TRIBUNAL IT WAS HELD THAT THE ASSESSEE COULD HAVE ADOPTED TWO WAYS OF RECORDI NG THE TRANSACTION EITHER BY CREDITING THE AMOUNT RECEIV ED FROM THE BUYERS IN THE COST OF THE PROJECT ACCOUNT AND CLAIM ING THE PAYMENT OF THE REGISTRATION AND ELECTRIFICATION CHA RGES AS AN EXPENSE ON THE DEBIT SIDE OR TO MAKE AN ENTRY IN SU CH A MANNER THAT THE AMOUNT IS SHOWN AS RECOVERABLE FROM THE BU YERS, CREDIT THE ACCOUNT WITH RECOVERIES MADE FROM THE BUYERS AN D IF THERE IS ANY SURPLUS OF THE RECOVERIES OVER AND ABOVE THE AM OUNT SHOWN AS RECOVERABLE, OFFER THE SAME FOR INCOME TAX. THE TRIBUNAL HELD THAT THE ASSESSEE HAS ADOPTED THE SECOND OF THESE T WO METHODS AND BOTH THE METHODS WERE ACCEPTABLE. IT WAS ALSO F OUND BY THE TRIBUNAL THAT WHEN THE ASSESSEE PAID THE REGISTRATI ON AND ELECTRIFICATION CHARGES THEY WERE NOT CLAIMED AS DE DUCTION IN THE PROFIT AND LOSS ACCOUNT. ON THESE FINDINGS OF FACT THE TRIBUNAL AGREED WITH THE CIT(A) THAT THE AMOUNT CANNOT BE AD DED. 15. THE AFORESAID DISCUSSION WOULD SHOW THAT THE DE CISION OF THE TRIBUNAL IS BASED ON FACTUAL FINDINGS RECORDED BY T HE CIT (A) WITH WHICH IT AGREED. NO MATERIAL WAS BROUGHT BEFOR E THE TRIBUNAL OR BEFORE US TO DISTURB THE FACTUAL FINDIN GS RECORDED BY THE AFORESAID AUTHORITIES. THE DECISION OF THE TRIB UNAL IS NOT THEREFORE OPEN TO THE CHALLENGE AS BEING PERVERSE. FURTHER SINCE THE TRIBUNALS DECISION IS BASED ON FINDINGS OF FAC T RECORDED ON THE BASIS OF THE ENTRIES MADE IN THE BOOKS OF ACCOU NTS, NO QUESTION OF LAW CAN BE SAID TO ARISE FROM THE ORDER OF THE TRIBUNAL ON THIS POINT. QUESTION NO.5 IS THEREFORE NOT ADMITTED. FACTS OF ASSESSEES CASE ARE SIMILAR TO THE FACTS O F MANISH BUILDWELL (P) LTD.S CASE. IN VIEW OF THIS, RESPECTFULLY FOLLOWING THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT, CITED SUPRA, WHICH IS IN THE CASE OF ASSESSEES SISTER CONCERN, WE SUSTAIN THE ORDER OF CIT (A). THE SIMI LAR PAYMENT COLLECTED ON ITA NOS.2787 TO 2793/DEL./2010 11 BEHALF OF THE DDA AND PAID TO DDA WERE HELD TO BE N OT TAXABLE IN THE CASE OF THE ASSESSEE AND THE HON'BLE HIGH COURT HAS HELD TH AT THE FACTUAL FINDINGS RECORDED IN THE ORDER OF THE TRIBUNAL HAS NOT BEEN DISLODGED, THEREFORE, THE ORDER OF THE TRIBUNAL CANNOT BE SAID TO BE PERVERSE . THE FINDINGS OF THE TRIBUNAL WERE RECORDED ON THE BASIS OF ENTRIES MADE IN THE BOOKS OF ACCOUNT AND NO QUESTION OF LAW HAS ARISEN FROM THE ORDER OF THE ITAT AND HON'BLE HIGH COURT DID NOT ADMIT THE QUESTION. SINCE THE F ACTUAL POSITION IS THE SAME, WE FIND NO MERITS IN THIS GROUND OF REVENUES APPEA L WHICH IS ACCORDINGLY DISMISSED. 10. GROUND NO.4 IN ITA NOS.2787/DEL/2010 & 2789/DEL /2010 AND GROUND NO.3 IN ITA NOS.2788/DEL/2010 & 2790/DEL/2010 TO279 3/DEL/2010 ARE SIMILAR AND ACCORDINGLY, GROUND NO.4 FROM ITA NO.27 87/DEL/2010 IS REPRODUCED AS UNDER :- 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED IN LAW AND FACTS OF THE CASE IN DELETING THE ADDITION OF RS.5,00,000/- ON ACCOUNT OF INTEREST ON ACCOUNT OF DELAYED PAYMENTS EVEN THOUGH SUCH ENTRIES OF REALIZATION AR E RECORDED IN SEIZED MATERIAL AND IN DOING SO, LEARNED CIT (A) IG NORED CONTENTS OF SEIZED DOCUMENTS AND SPECIFIC INSTANCES OF CHARG ING OF INTEREST FROM PERSONS WHO HAD DEPOSED BEFORE DIRECTORATE OF INCOME TAX (INVESTIGATION) AND RATHER RELIED ON MERE ARGUMENT OF THE ASSESSEE THAT NO ENQUIRIES WERE MADE FROM CONCERNED PARTIES. 11. THE ASSESSING OFFICER MADE THE ADDITION BY HOLD ING AS UNDER :- PAGE NO. 39 OF THIS ANNEXURE REFLECTS THE CALCULA TION OF INTEREST CHARGED AGAINST SHOP/SPACE NO. 8-5 & 6 (4) IN USHA CONSTRUCTION CO. THE TOTAL AMOUNT OF INTEREST CHARG ED AGAINST THIS SHOP/SPACE HAS BEEN SHOWN RS.227300/-. ITA NOS.2787 TO 2793/DEL./2010 12 THUS FROM THESE DOCUMENTS IT IS QUITE CLEARS THAT T HE ASSESSEE GROUP IS HAVING THE PRACTICE OF CHARGING INTEREST P AYMENTS ON DELAYED PAYMENTS OF GROUND RENT AND INSTALLMENTS. M OREOVER THE FACT OF LIABILITY TO PAY INTEREST ON DELAYED PAYMEN TS IS ALSO GIVEN ON THE BOOKING FORMS OF THE ASSESSEE COMPANY. THE S UMMONS U/S 131 OF I T ACT WERE ALSO ISSUED BY THE INVESTIG ATION WING TO SOME OF THE PERSONS WHO HAVE PAID INTEREST AS PER T HESE ABOVE ANNEXURES. THEY WERE ASKED TO APPEAR PERSONALLY BEF ORE THE WING. BUT ONLY ONE PERSON SHRI JAIDEEP APPEARED BEF ORE THE DEPARTMENT. HIS STATEMENT WAS ALSO RECORDED ON OATH U/S 131 OF I T ACT, ON 3.8.07. IN HIS STATEMENT RECORDED AND VID E REPLY TO QUESTION NO. 5 HE HAS ADMITTED THAT HE HAS PAID INT EREST OF RS.6500/- IN CASH FOR WHICH NO RECEIPT WAS ISSUED. THE ASSESSES WAS ASKED TO FURNISH DETAILS OF DELAY ED PAYMENTS AND INTEREST CHARGES ON SUCH DELAYED PAYME NTS. HE SUBMITTED THAT NO SUCH INTEREST ON DELAYED PAYMENTS IS CHARGED. HOWEVER, THE SEIZED MATERIALS PRESENT A DIFFERENT S TORY. IN THE LIGHT OF THESE EVIDENCES COLLECTED WE THEREFORE HOL D THAT THE ASSESSEE HAS CHARGED INTEREST ON DELAYED PAYMENTS A ND IN THE ABSENCE OF ANY DATA BEING FURNISHED BY THE ASSESSEE AND CONSIDERING THE QUANTUM REFLECTED IN THE SEIZED DOC UMENTS MENTIONED ABOVE, WE ESTIMATE THE SAME TO BE RS.5,00 ,000/- PER ANNUM. THE SAME IS ADDED TO THE INCOME OF THE ASSES SEE. CIT (A) DELETED THE ADDITION BY HOLDING AS UNDER :- 6.3 I HAVE PERUSED THE ASSESSMENT ORDER AND SUBMIS SIONS OF THE APPELLANT. ON PERUSAL OF THE SEIZED MATERIAL IT WAS SEEN THAT PAGES 1, 19, 20 OF ANNEXURE -4 AND PAGE NO. 39 OF T HE ANNEXURE A-21 DO NOT BELONG TO THE APPELLANT BUT TO OTHER AS SESSEES OF THE GROUP AND THEREFORE NO ADVERSE COGNIZANCE CAN BE TA KEN AGAINST THE ASSESSEE FOR THE SAID PAGES. PAGE 13 SHOWS CALC ULATIONS MADE FOR PAYMENT OF ADVANCE TAX AND THE AMOUNT OF GROSS PROFIT COMPUTED ON SALE OF PROPERTY HAS BEEN WRONGLY CONST RUED AS INTEREST BY THE ASSESSING OFFICER WHICH IS NOT CORR ECT. THE ONLY RELEVANT PAGE IS PAGE 15 WHICH SHOWS CALCULATION OF INTEREST OF RS.49,783/- FOR SOME PROPERTY AT PLOT 2 OF THE APPE LLANT. ON PERUSAL OF THE SAID PAGE, IT APPEARS THAT THE SAID CALCULATION HAS BEEN MADE AT ONE GO AND NOT ON REGULAR INTERVALS OF TIME AND THEREFORE IT APPEARS TO BE MADE AT THE TIME OF SETT LING THE ACCOUNT WITH BUYER WHEN THEY WERE NOT PAYING THE INSTALLMEN T OR WERE ITA NOS.2787 TO 2793/DEL./2010 13 DELAYING IN MAKING THE PAYMENTS. THE SAID CALCULATI ONS MENTION THE AMOUNT DUE AND RECEIVED AND THE BALANCE AND SOM E AMOUNT OF INTEREST BUT IT DOES NOT MENTION ON THE SAID PAG E THAT THE INTEREST HAS BEEN RECEIVED FROM THEM. 6.3.1 FURTHER, THE ASSESSEE PRODUCED CONFIRMATIONS FROM THE BUYERS THAT NO INTEREST WAS CHARGED FROM THEM. THUS THE ONUS OF THE ASSESSEE GOT DISCHARGED AND SHIFTED ON THE ASSE SSING OFFICER TO PROVE OTHERWISE. HOWEVER, THE ASSESSING OFFICER DID NOT BRING ANY EVIDENCE ON RECORD TO PROVE OTHERWISE EVEN IN T HE REMAND PROCEEDINGS. THUS THE ASSESSING OFFICER FAILED TO D ISCHARGE THE ONUS SHIFTED ON HIM. I AGREE WITH THE CONTENTION OF THE APPELLANT THAT THE STATEMENT OF MR. JAIDEEP RECORDED AT THE B ACK OF THE APPELLANT CANNOT BE RELIED UPON WITHOUT GIVING AN O PPORTUNITY TO THE APPELLANT. THE ASSESSING OFFICER DID NOT GIVE T HE ASSESSEE AN OPPORTUNITY TO CROSS-EXAMINE MR. JAIDEEP EVEN IN TH E REMAND PROCEEDINGS. IN VIEW OF THE SAME, NO ADVERSE COGNIZ ANCE OF HIS STATEMENT CAN BE TAKEN AGAINST THE ASSESSEE. 6.3.2 THE ASSESSING OFFICER ASKED THE VOLUMINOUS DE TAILS ON 24/12/2008 REGARDING THE DELAYED PAYMENTS AND THERE FORE, THE ASSESSEE WAS UNABLE TO PRODUCE THE SAID DETAILS. HO WEVER, EVEN IF THE DETAILS WOULD HAVE BEEN SUBMITTED, ADDITION COULD HAVE BEEN MADE FOR THAT INTEREST WHICH HAS BEEN MENTIONE D IN THE SEIZED MATERIAL. THE ASSESSING OFFICER CANNOT MAKE ADDITIONS ON PRESUMPTIONS AND SURMISES EVEN IN ASSESSMENTS MADE U/S 153A. EVEN WHILE MAKING ASSESSMENTS U/S 153A, ADDITIONS C AN BE MADE ONLY ON THE BASIS OF SEIZED MATERIAL AND NOT O N THE BASIS OF PRESUMPTION OR SURMISES. THEREFORE THE ADDITIONS OF RS. 5 LACS MADE BY THE ASSESSING OFFICER IN EACH YEAR ON ACCOU NT OF INTEREST ON DELAYED PAYMENTS CANNOT BE SUSTAINED. 6.3.3 HOWEVER, PAGE 15 MENTIONS FIGURE OF INTEREST AT RS.49,783/-REGARDING THE PROPERTY HELD BY MR. JAIDE EP. MR. JAIDEEP STATED IN HIS STATEMENT RECORDED BEFORE THE INVESTIGATION WING TO HAVE PAID RS. 6,500/- AS INTEREST. THUS THE STATEMENT OF MR. JAIDEEP DOES NOT CORROBORATE WITH THE SEIZED MA TERIAL AND SHOWS THAT INTEREST OF RS. 49,783/- HAS ALSO NOT BE EN RECEIVED BY THE APPELLANT. STATEMENT OF MR. JAIDEEP CANNOT BE RELIEF UPON AS NO OPPORTUNITY TO CROSS-EXAMINATION HAS BEEN GIVEN TO THE APPELLANT. THUS NO ADDITION CAN BE MADE FOR THE SA ID AMOUNT. ITA NOS.2787 TO 2793/DEL./2010 14 THUS THE ADDITION OF RS.5,00,000/- MADE ON ESTIMATE D BASIS MERELY ON PRESUMPTIONS IS HEREBY DELETED. 12. WE HAVE HEARD BOTH THE SIDES AND FROM THE RECOR D, WE FIND THAT THIS ADDITION WAS MADE ON THE BASIS OF STATEMENT OF JAID EEP RECORDED BY INVESTIGATION WING ON 3.08.2007 WHEREIN HE HAS ADMI TTED TO HAVE PAID INTEREST OF RS.6,500/- IN CASH TO THE ASSESSEE. TH E CIT (A) GRANTED THE RELIEF ON THE GROUND THAT THE STATEMENT RECORDED BEFORE TH E INVESTIGATION WING DOES NOT CORROBORATE WITH THE SEIZED MATERIAL WHERE THE INTEREST PAYMENT SHOWN AS RS.49,783/- WHEREAS JAIDEEP ONLY ADMITTED RS.6,500/ - AS INTEREST. FURTHER, THE STATEMENT OF JAIDEEP CANNOT BE RELIED UPON AS NO OP PORTUNITY OF CROSS EXAMINE HAS BEEN GIVEN TO THE ASSESSEE. WE FIND HAT THE A SSESSING OFFICER MADE AN ADDITION OF RS.5 LACS. THE SEIZED MATERIAL SHOWN T HAT THE JAIDEEP PAID INTEREST OF RS.49,783/- AND HE ADMITTED IN THE STATEMENT OF RS.6,500/-. THE CIT (A) DELETED THE ADDITION THAT NO OPPORTUNITY WAS PROVID ED TO CROSS EXAMINE. CONSIDERING ALL THESE FACTS AND IN THE INTEREST OF JUSTICE AND EQUITY, WE FIND IT PROPER TO RESTORE THE ISSUE TO THE FILE OF THE ASSE SSING OFFICER WITH A DIRECTION TO DECIDE THE ISSUE AFRESH AFTER PROVIDING OPPORTUN ITY OF BEING HEARD AND ALSO, IF DESIRE, TO CROSS EXAMINE JAIDEEP. ACCORDINGLY, THIS GROUND OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 13. IN GROUND NO.5 IN ITA NOS.2787/DEL/2010 & 2789/ DEL/2010 AND GROUND NO.4 IN ITA NOS.2788/DEL/2010 & 2790/DEL/201 0 TO2793/DEL/2010 ITA NOS.2787 TO 2793/DEL./2010 15 ARE SIMILAR EXCEPT THE DIFFERENCE IN AMOUNT AND ACC ORDINGLY, GROUND NO.5 FROM ITA NO.2787/DEL/2010 IS REPRODUCED AS UNDER :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . CIT (A) HAS ERRED IN LAW AND FACTS ON THE CASE IN DELETING THE ADDITION OF RS.9,40,790/- ON ACCOUNT OF REGISTRATION AND ELECTR IFICATION CHARGES RECEIVED FROM CLIENTS ON THE GROUND THAT SU CH EXPENDITURE ARE REVENUE IN NATURE WHEREAS AO HELD S UCH PAYMENTS AS CAPITAL EXPENDITURE. 14. IN THE ABOVE GROUND, THE ISSUE IS AGAINST THE D ELETION OF ADDITION MADE ON ACCOUNT OF REGISTRATION AND ELECTRIFICATION CHAR GES RECEIVED FROM CLIENTS. THESE AMOUNTS ARE SHOWN AS RECOVERY IN ITS BALANCE SHEET. THESE AMOUNTS WERE NEVER CLAIMED AS REVENUE EXPENDITURE BY THE AS SESSEE. THIS AMOUNT OF RS.9,40,790/- WAS RECTIFIED ALSO BY PASSING AN ORDE R UNDER SECTION 154 BY THE CIT (A) IN VARIOUS YEARS. THE LEARNED AR SUBMITTED THAT THIS ISSUE IS FULLY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F ITAT IN ITA NO.2062/DEL/2011 AT PARA 19. HE ALSO PLEADED THAT THE DECISION HAS BEEN CONFIRMED BY THE HON'BLE DELHI HIGH COURT IN THE CA SE OF CIT VS. MANISH BUILDWELL (P) LTD., CITED SUPRA, WHEREIN THE HON'BL E DELHI HIGH COURT HAS HELD THE ISSUE VIDE PARAS 11 TO 15 OF THE ORDER, WH ICH ARE REPRODUCED ABOVE IN THIS ORDER. 15. WE HAVE HEARD BOTH THE SIDES AND FIND THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF HON'BL E DELHI HIGH COURT IN THE CASE OF CIT VS. MANISH BUILDWELL (P) LTD., CITED SU PRA. RESPECTFULLY FOLLOWING THE SAME, WE DISMISS THIS GROUND RELATED TO THIS ISSUE. ITA NOS.2787 TO 2793/DEL./2010 16 16. GROUND NO.5 IN ITA NOS.2788/DEL/2010 & 2790/DEL /2010 TO 2793/DEL/2010 AND GROUND NO.6 IN ITA NO.2789/DEL/20 10 ARE SIMILAR EXCEPT THE DIFFERENCE IN AMOUNT AND, THEREFORE, FOR THE SA KE OF BREVITY, WE REPRODUCE GROUND NO.5 IN ITA NO.2788/DEL/2010 AS UNDER :- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . CIT (A) HAS ERRED IN LAW AND FACTS ON THE CASE IN DELETING THE ADDITION OF RS.1,92,513/- TOWARDS UNDISCLOSED TRANSFER CHARGES AS RECORDED IN SEIZED DOCUMENTS HOLDING THAT THERE WAS NO EVIDE NCE OF SUCH RECEIPTS AND AO DID NOT CONFRONT THE CONCERNED PART IES. IN DOING SO, LEARNED CIT (A) IGNORED THE FACTS THAT SE IZED DOCUMENTS ARE SUBSTANTIAL EVIDENCE OF SUCH RECEIPTS AND IT IS IN THE MUTUAL BENEFIT OF THE ASSESSEE AND ITS CLIENTS TO DENY SUCH PAYMENTS IF CONFRONTED. 17. IN THIS GROUND, THE REVENUE HAS RAISED THE ISSU E REGARDING THE UNDISCLOSED TRANSFER CHARGES OF 3.6%. 18. WE HAVE HEARD BOTH THE SIDES. WE HAVE ALSO GON E THROUGH THE SEIZED MATERIAL ON WHICH THE ADDITION HAS BEEN MADE. THIS ISSUE HAS ALSO BEEN CONSIDERED IN THE CASE OF CIT VS. MANISH BUILDWELL (P) LTD., CITED SUPRA. IN PARA 10, THE HON'BLE DELHI HIGH COURT HAS DECIDED T HE ISSUE AS UNDER :- 10. SO FAR AS THE QUESTION NO.4 IS CONCERNED, IT I S SEEN THAT BEFORE THE ASSESSING OFFICER, IN RESPONSE TO A QUER Y RAISED BY HIM, THE ASSESSEE SUBMITTED THAT MERELY ON THE BASI S OF THE SEIZED MATERIAL SHOWING ONE TRANSACTION IN RESPECT OF WHICH THE ASSESSEE HAD RECEIVED TRANSFER CHARGES AT 3.6% OF T HE COST OF THE SHOP IT SHOULD NOT BE ASSUMED THAT SIMILAR TRANSFER CHARGES HAD BEEN RECEIVED FROM ALL CUSTOMERS IN WHOSE CASES SUC H TRANSFERS WERE EFFECTED. THE ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION AND PROCEEDED TO MAKE AN ADDITION OF RS. 2,19,701/- AT 3.6% OF RS. 61,02,800/- WHICH WAS THE VALUE OF F LATS/SPACE TRANSFERRED DURING THE RELEVANT ACCOUNTING YEAR. TH E CIT (A) ITA NOS.2787 TO 2793/DEL./2010 17 HELD ON A PERUSAL OF THE SEIZED RECEIPT THAT IT MEN TIONED THE NAMES OF ONLY THE SELLER AND THE PURCHASER AND THE NAME OF THE ASSESSEE WAS NOT MENTIONED THEREIN EITHER AS RECIPI ENT OR PAYER. HE ALSO FOUND THAT THE RECEIPT DID NOT MENTION ANY TRANSFER CHARGES BEING RECEIVED BY THE ASSESSEE. IT WAS FOU ND TO MENTION THAT ALLIED CHARGES WERE TO BE PAID BY THE BUYERS FROM WHICH THE CIT (A) CONCLUDED THAT THE RECEIPT CANNOT BE TA KEN AS EVIDENCE FOR ACTUAL PAYMENT OF ANY TRANSFER CHARGES TO THE ASSESSEE. IN THIS VIEW OF THE MATTER AND FOR LACK O F ANY EVIDENCE HE DELETED THE ADDITION. IN THE APPEAL FILED BY THE REVENUE TO THE TRIBUNAL WE DO NOT FIND ANY GROUND TAKEN TO CHALLEN GE THE DECISION OF THE CIT (A) TO DELETE THE ADDITION OF R S.2,19,701/-. THE ORDER OF THE TRIBUNAL ALSO DOES NOT SHOW THAT A NY ADDITIONAL GROUND WAS FILED BY THE REVENUE WHICH WAS ADMITTED AND ADJUDICATED UPON. IN THIS VIEW OF THE MATTER, QUEST ION NO.4 DOES NOT ARISE FROM THE ORDER OF THE TRIBUNAL AND WE, TH EREFORE, DECLINE TO ADMIT THE SAME. SINCE THE HON'BLE HIGH COURT ON THE SAME FACTS AND CIRCUMSTANCES ALLOWED THE CLAIM OF THE ASSESSEE, WE FIND NO FAULT IN THE ORDER OF THE CIT (A). THEREFORE, THIS GROUND IS ALSO DISMISSED. 19. IN THE RESULT, THE APPEALS OF THE REVENUE ARE P ARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 31 ST DAY OF JANUARY, 2012. SD/- SD/- (U.B.S. BEDI) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 31 ST DAY OF JANUARY, 2012/TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-I, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.