The ITO, Ward-5(2)(3), Ahmedabad V. Smt. Madhvi R. Varma, Ahmedabad

ITA 3150/AHD/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8730 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 28-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Loose papers; Cost of acquisition
• Section: 143(3); 153A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA NO. 3150/AHD/2014 & CO NO. 332/AHD/2014 / ASSESSMENT YEAR: 2006-07 ITO, WARD 5 (2)(3), AHMEDABAD VS. SMT. MADHVI R. VARMA, HARIOM AVENUE, 31/B, NR. MUNICIPAL MARKET, NAVRANGPURA, AHMEDABAD PAN : ABLPV 7171 P ITA NO. 3213/AHD/2014 & CO NO. 333/AHD/2014 / ASSESSMENT YEAR: 2006-07 ITO, WARD 5 (2)(3), AHMEDABAD VS. SMT. SHITALDEVI M. VARMA HARIOM AVENUE, 31/B, NR. MUNICIPAL MARKET, NAVRANGPURA, AHMEDABAD PAN : AASPV 6479 N ITA NO. 3214/AHD/2014 & CO NO. 334/AHD/2014 / ASSESSMENT YEAR: 2006-07 ITO, WARD 5 (2)(3), AHMEDABAD VS. SHYAMLEE R. VARMA, HARIOM AVENUE, 31/B, NR. MUNICIPAL MARKET, NAVRANGPURA, AHMEDABAD PAN : ACPPV 6094 E / (APPELLANT) / (RESPONDENT/CROSS- OBJECTOR) REVENUE BY : SHRI MUDIT NAGPAL, SR. DR ASSESSEE BY : SHRI P.M. MEHTA WITH SHRI GULAB THAKOR, AR / DATE OF HEARING : 02/08/2017 / DATE OF PRONOUNCEMENT: 03/08/2017 / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE REVENUE HAS CHALLENGED SEPARATE ORDERS OF THE L D. CIT(A)-XVI, AHMEDABAD DATED 29.09.2014 PASSED ON THE RESPECTIVE APPEAL OF THE ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 2 AFORESAID THREE RESPONDENTS IN ASSESSMENT YEAR 2006 -07. ON RECEIPT OF NOTICE IN THE REVENUES APPEAL, ALL THE THREE RESPO NDENTS HAVE FILED CROSS- OBJECTION BEARING NOS. 332 TO 334/AHD/2014. 2. WITH THE ASSISTANCE OF THE LD. REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORD CAREFULLY. IT WAS POINTED OUT THAT THE ISSUES INVOLVED IN ALL THESE APPEALS ARE COMMON AND THEREFORE, WE PROCEED TO DEC IDE ALL THESE APPEALS BY THIS COMMON ORDER. 3. THE GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.39,35,166/- MADE IN THE HANDS OF EACH RESPONDENT IN THESE THREE APPEALS. IT IS PERTINENT TO OBSERVE THAT LD. ASSESSING OFFICER HAS MADE A DISCUSSION BY TAKING C OGNIZANCE OF THE ASSESSMENT ORDER PASSED IN THE FAMILY GROUP PERSONS WHICH IS REPRODUCED AS UNDER:- THE SEARCH & SEIZURE ACTION CARRIED OUT BY THE DEP ARTMENT ON 10.05.2006 IN THE SWAGAT GROUP. GROUP BUSINESS ACTIVITIES CONTRO LLED BY THREE VARMA BROTHERS NAMELY SHRI MAHESH, RAVI AND RAJNI R. VARM A, THE RESIDENCE OF ALL THREE BROTHERS ALSO COVERED IN THE SEARCH ACTION. D URING THE SEARCH PROCEEDINGS CARRIED OUT AT THE RESIDENCE PREMISES O F SHRI MAHESH VARMA SOME INCREMENTING PAPERS SEIZED WHICH WERE INVENTOR ISED AS PER ANNEXURE A-1. ASSESSMENT PROCEEDINGS IN THE CASE OF SHRI RAV I RAMLABHAYA VARMA U/S. 153A R.W.S, 143(3) OF THE I.T. ACT WAS COMPLE TED ON 31.12.2008 BY ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIR CLE-2(4), AHMEDABAD AND TOTAL ASSESSED INCOME OF RS.91,19,910/- WITH M ADE AN ADDITION OF TOTALING RS.89,32,989/- ON ACCOUNT OF VARIOUS ISSUE S. DURING THE ASSESSMENT PROCEEDINGS ON DEEP SCRUTINIZED OF SEIZED PAPERS AS PER ANNEXURE A-1, PAGE NO. 3 THE ASSESSING OFFICER ASCERTAINED THAT ON TH E SAID PAGE DETAILED MENTIONED RELATED TO LAND SALES AT THATTEJ BELONGS TO VARMA BROTHERS AND OTHER FAMILY MEMBERS IN WHICH THE TOTAL CONSIDERAT ION RECEIVED BY THE VARMA FAMILY MEMBERS OF RS. 2,36,11,000/- (11111000 [phone]) AS PER THE TABLE-I AND FABLE-2 DRAWN BY THE ASSESSEE IN SE IZED PAPERS IS BEING UTILIZED PARTLY FOR THE PURPOSE OF GHUMA LAND, OUT OF TOT AL SAID SALE CONSIDERATION I.E. RS. 2,36,00,000/- RECEIVED BY THE ASSESSEE G ROUP, ONLY RS. 60,00,000/- HAS BEEN DECLARED BY THE ASSESSEE GROUP AS A UNDISC LOSED INCOME RELATED TO SALE OF THALTEJ LAND. THEREFORE THE REMAINING BALAN CE OF RS.1,76,11,000/- ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 3 (23611000-6000000) REQUIRED TO BE TREATED AS CASH RECEIVED BY THE VARMA FAMILY MEMBERS ON ACCOUNT OF SALE OF THALTEJ LAND A ND ADDED BACK TO THE ALL SIX FAMILY MEMBERS IN EQUAL SHARE I.E. 1/6 (ONE SIX TH) OF RS. 1,76,11,000/- WHICH IS COMES AT RS. 29,35,166/- IN THE HAND OF EA CH MEMBERS INCLUDING THE THREE BROTHERS AND THEIR SPOUSE(WIVES). ACCORDINGLY , THE A.O. ADDITION MADE OF RS.29,35,166/- IN THE CASE OF SHRI RAVI RAMLABHA YA VARMA, SHRI MAHESH R. VARMA AND SHRI RAJNI R. VARMA BUT THE ADDITION W AS NOT MADE BY THE A.O. IN THE CASE OF WIVES OF THE ALL THREE BROTHERS AS THE CASE OF ALL THREE LADIES ARE NOT CENTRALIZED WITH THE CENTRAL CIRCLE. ACCORD INGLY, THE A.O. SENT INTIMATION TO THE CONCERNED ASSESSING OFFICERS OF T HE ALL THE THREE LADY MEMBERS VIDE LETTER DATED 04.02.2009 FOR FAKING NEC ESSARY ACTION AND MADE AN ADDITION OF RS. 29,35,166/- IN THE CASE OF EACH LADY MEMBERS. 4. ON THE BASIS OF ABOVE DISCUSSION, LD. ASSESSING OFFICER HAS MADE ADDITION OF RS.29,35,166/- IN THE HANDS OF EACH RES PONDENT. SIMILARLY, HE MADE ADDITION OF RS.10 LACS IN THE HANDS OF EACH AS SESSEE WHICH REPRESENTS 1/6 TH OF RS.60 LACS ALLEGED TO BE RECEIVED AS ADVANCE FO R SALE OF THE LAND. 5. ON APPEAL, LD. CIT(A) HAS DELETED THIS ADDITION. 6. BEFORE US, AT THE VERY OUTSET LD. COUNSEL FOR TH E ASSESSEE(S) SUBMITTED THAT IN THE CASE OF ASSESSEES HUSBANDS VIZ. SHRI R AVI RAMLABHAYA VARMA, SHRI MAHESH R. VARMA AND SHRI RAJNI R. VARMA THIS I DENTICAL ISSUE WAS CONSIDERED WHEREIN REMAINING 1/6 TH PORTION WAS ADDED. IN OTHER WORDS, OUT OF TOTAL AMOUNT, THE ASSESSING OFFICER HAS ADDE D 1/6 TH IN EACH HAND OF THE SIX INDIVIDUALS, I.E. HUSBANDS & WIVES. THE TR IBUNAL HAS HELD THAT THE LAND DID NOT BELONG TO THE INDIVIDUAL, RATHER IT BE LONGS TO THE HUFS. SIMILARLY, THE TRIBUNAL HAS HELD THAT THE LAND WAS NOT SOLD DURING THIS YEAR; RATHER IT WAS SOLD IN ASSESSMENT YEAR 2007-08. THE ADVANCE RECEIVED BY THE HUFS AND FORFEITED BY THE VENDOR WOULD GO TO REDUCE THE COST OF ACQUISITION WHEN CAPITAL OR BUSINESS GAIN WOULD BE COMPUTED ON SALE OF THAT LAND. THE DISCUSSIONS MADE BY THE TRIBUNAL READ AS UNDER:- 73. AFTER GOING THROUGH RIVAL SUBMISSIONS AND MATE RIAL ON RECORD, WE FIND THAT THE FIRST QUESTION WHICH ARISES IN THIS CASE I S WHETHER THE LAND AT THALTEJ ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 4 BELONGS TO THE INDIVIDUALS OR THEIR HUF THAT IS, MA HESH R VARMA HUF, RAJNI R VARMA HUF AND RAVI R VARMA HUF. IN ORDER TO KNOW AS TO WHO WAS THE OWNER OF THE THALTEJ LAND, THE LD. AUTHORIZ ED REPRESENTATIVE WAS ASKED BY CIT(A) TO FURNISH THE COPIES OF PURCHASE D EEDS ETC TO ESTABLISH THAT THE SURVEY NUMBER 147 AND 150 ARE INHERITED BY THE APPELLANTS FROM THEIR FOREFATHERS. AFTER EXAMINING THE DETAILS FILED BY T HE LD. AUTHORIZED REPRESENTATIVE. IT IS NOTICED THAT THE AGRICULTURAL LAND BEARING SURVEY NUMBER 150 WAS PURCHASED BY THE GRANDFATHER SHRI KH ANCHAND VARMA BEFORE HIS DEATH IN 1961. SHRI KHANCHAND VARMA HAD THREE SONS NAMELY SHRI RAMLABHAYA K VARMA, ISHWARDAS K VARMA AND SHRI SANT ARAM K VARMA. VIDE RELEASE DEED DATED 28/4/1997, SHRI SANTARAM K VARMA AND ISHWARDAS K VARMA RELEASED THEIR RIGHTS IN SURVEY NUMBER 150 IN FAVOUR OF THEIR BROTHER SHRI RAMLABHAYA K VARMA. THE RELEVANT ENTRY HAS BEE N MADE IN THE RECORDS ON 30/4/1997. 74. SHRI RAMLABHAYA K VARMA HAD FIVE SONS NAMELY MU KESH R VARMA, MAHESH R VARMA, MAHENDRA R VARMA, RAJNI R VARMA AND RAVI R VARMA. THE LAND BEARING SURVEY NUMBER 147 AT THALTEJ WAS P URCHASED BY SHRI RAMLABHAYA K VARMA ON 27/10/1988. BEFORE HIS DEATH ON 9/3/1997 A WILL WAS MADE BY HIM WHICH WAS EXECUTED ON 9/1/1997. AS PER THIS WILL, THE MOVABLE AND IMMOVABLE PROPERTIES OF SHRI RAMLABHAYA K VARMA WAS TO BE GIVEN TO HIS LEGAL HEIRS. THE PROPERTY OF THALTEJ L AND WAS TO BE EQUALLY DISTRIBUTED AMONG HIS FIVE SONS NAMELY MUKESH, MAHE SH, MAHENDRA, RAJNI AND RAVI VARMA.VIDE DECLARATION DATED 14/12/2002 SH RI MUKESH R VARM'A, MAHENDRA R VARMA AND MADHU BEN R VARMA DAUGHTER OF RAMLABHAYA K VARMA RELEASED THEIR RIGHTS IN FAVOUR OF MAHESH R V ARMA, RAJNI R VARMA AND RAVI R VARMA. THEIR NAMES WERE DELETED FROM THE RECORDS OF THE TALATI ON 1/1/2003 AS PER THE FORM NUMBER 6 THE STATEMEN T OF RIGHTS. THE RIGHTS OF RECORDS IN FORM NUMBER 6 OF SURVEY NUMBER 147 AN D 150 WAS PRODUCED BEFORE CIT(A). THE COPIES OF DECLARATION AND RELEAS E DEEDS WERE ALSO FILED BEFORE HIM. IN VIEW OF THE ABOVE FACTS, IT WAS FOUN D THAT THE LAND AT THALTEJ BEARING SURVEY NUMBER 147 AND 150 WAS NEVER PURCHAS ED BY THE APPELLANTS BUT WAS INHERITED BY THEM FROM THEIR FATHER SHRI RA MLABHAYA K VARMA AS DISCUSSED ABOVE. 75. IN SUPPORT OF THE EXISTENCE OF HUF, THE COPIES OF ORIGINAL RETURN OF INCOME FOR ASSESSMENT YEAR 2005 - 2006, 2006 - 2007 AND 2007 - 2008 WAS FILED BY THE AR IN RESPECT OF THE FOLLOWING ENTITIE S : 1. RAMLABHAYA K VARMA HUF PROPRIETOR OF HARIOM CORP ORATION ENGAGED IN THE BUSINESS OF COMMISSION AND FINANCE. 2. MAHESH R VARMA HUF 3. RAJNI R VARMA HUF AND ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 5 4. RAVI R VARMA HUF 5. KHANCHAND LADHARAM HUF PROPR IETOR OF KISHORE CORPORATION FOR ASSESSMENT YEARS 2005-06 FILED ON 3 1/8/2005 AND ASSESSMENT YEAR 2006-07 FILED ON JULY 2006. FROM THE ABOVE, IT WAS FOUND CLEAR THAT THE HUF OF SHRI MAHESH R VARMA, RAJNI R VARMA AND RAVI R VARMA WERE IN EXISTENCE. T HIS REASONED FINDING OF CIT(A) IS UPHELD BY US. 76. THE NEXT QUESTION AROSE AS TO WHO WAS ASSESSABL E ENTITY IN RESPECT OF THE SALE OF SURVEY NUMBER 147/150. ACCORDING TO THE ASS ESSING OFFICER SINCE THE ABOVE MENTIONED LAND WAS STANDING IN THE NAME OF TH E THREE BROTHERS AND THEIR WIVES, THE SALE PROCEEDS OF THE LAND WAS ASSE SSABLE IN THEIR INDIVIDUAL CAPACITY. ANOTHER ARGUMENT OF THE ASSESSING OFFICER WAS THAT THE SALE PROCEEDS OF THE PART OF SAME LAND IN SUBSEQUENT YEA RS HAD BEEN SHOWN IN THE RETURNS OF THE INDIVIDUALS NAMELY THE THREE BROTHER S AND THEIR WIVES IN EQUAL RATIO. THE ARGUMENT OF AUTHORIZED REPRESENTATIVE WA S THAT SINCE THE LAND BEARING SURVEY NUMBER 147 AND 150 WAS INHERITED LAN D, THE SAME BELONGS TO THE HUF OF MAHESH R VARMA, RAJNI R VARMA AND RAVI R VARMA AND NOT TO THE INDIVIDUALS. AT THE TIME OF APPELLATE PROCEEDIN GS, AUTHORIZED REPRESENTATIVE ADMITTED THAT IT WAS A MISTAKE ON TH E PART OF THE ASSESSEES TO SHOW THE SALE PROCEEDS OF THE LAND IN SUBSEQUENT YE ARS IN INDIVIDUAL HANDS AS AGAINST IN THE BANDS OF THE HUF WHICH DOES NOT CHAN GE THE LEGAL SITUATION ON THE ISSUE THAT LAND IN QUESTION BELONG TO RESPECTIV E HUFS. 77. ONCE THE LAND WAS NOT SOLD TO BHAVESH CHANDULAL , THE PERSON MENTIONED IN THE SEIZED PAPER, COULD THE CASH AMOUNT RECEIVED FROM HIM AGAINST THE SALE OF THE LAND, BE TAXED AS UNACCOUNTED INCOME OF THE SELLER. AS STATED ABOVE, THE PART OF THE THALTEJ LAND WAS AGREED TO BE SOLD TO O NE BHAVESH CHANDULAL. AGAINST THE SALE OF THE LAND SOME AMOUNT WAS RECEIV ED FROM BIM. HOWEVER, THE LAND COULD NOT BE FINALLY SOLD TO HIM BECAUSE H E WANTED THE LAND TO BE DEVELOPED IN A PARTICULAR WAY WHICH WAS NOT POSSIBL E AS PER THE RULES AND REGULATIONS OF AUDA. THE APPELLANT THEREFORE, FORFE ITED AN AMOUNT OF RS. 60 LACS AND RETURNED THE BALANCE AMOUNT TO HIM. THE AM OUNT OF RS. 60 LACS HAS BEEN SHOWN BY THE THREE HUF OF SHRI MAHESH VARMA, R AJNI VARMA AND RAVI VARMA IN THEIR RETURN OF INCOME IN EQUAL PROPORTION OF RS.20 LACS EACH. THE PORTION OF THE LAND WAS SUBSEQUENTLY SOLD TO CHANDR AKANT K SHAH ON 1/2/2007, A COPY OF SALE DEED WAS ALSO PRODUCED BEF ORE CIT(A) AT FIRST APPELLATE STAGE. IN THIS BACKGROUND, CIT(A) OBSERVE D THAT SINCE THE SALE WAS NOT FINALLY MADE TO SHRI BHAVESH CHANDULAL, THE CAS H AMOUNT RECEIVED AGAINST THE SALE OF THE LAND COULD NOT BE TAXED IN THE HANDS OF THE SELLER PARTICULARLY WHEN THE PORTION OF SAME LAND HAS BEEN SOLD TO SOMEBODY ELSE, THAT IS, SHRI CHANDRAKANT K SHAH IN SUBSEQUENT YEAR . THEREFORE, THE AMOUNTS RECEIVED FROM SHRI BHAVESH CHANDULAL AGAINST THE SA LE OF THE THALTEJ LAND COULD NOT BE TAXED UNLESS THE LAND HAS BEEN FINALLY SOLD TO HIM. SINCE IN THIS ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 6 CASE, THE LAND HAS NOT BEEN SOLD TO SHRI BHAVESH CH ANDULAL BUT TO SHRI CHANDRAKANT K SHAH, THE AMOUNT RECEIVED FROM SHRI B HAVESH CHANDULAL COULD NOT BE TREATED AS UNACCOUNTED INCOME OF THE A PPELLANTS. HAD THE ASSESSING OFFICER ESTABLISHED THAT THE PAYMENTS WER E MADE BY SHRI BHAVESH CHANDULAL BUT THE LAND WAS REGISTERED IN THE NAME O F SHRI CHANDRAKANT K SHAH AT THE INSTRUCTIONS OF SHRI BHAVESH CHANDULAL, THEN ONLY THE AMOUNT RECEIVED FROM HIM COULD HAVE BEEN TAXED IN THE HAND S OF THE SELLERS. IT WAS ADMITTED BY THE ASSESSING OFFICER THAT AN AMOUNT OF RS. 25 LACS WAS RECEIVED BY CHEQUE AGAINST THE SALE OF THALTEJ LAND . THIS AMOUNT WAS STATED TO HAVE BEEN RECEIVED BY THE BIGGER HUF NAMELY KISHORE CORPORATION A PROPRIETARY CONCERN OF KHANCHAND VARMA HUF, THE GRA NDFATHER OF THE APPELLANTS ON 12/9/2005, WHICH WAS RETURNED BACK DU RING THE PERIOD 22/3/2006 TO 30/3/2006. FURTHER, 17,503 SQ. MTR. OF LAND OF SURVEY NUMBER 147 HAS BEEN SOLD TO SHRI CHANDRAKANT K SHAH ON 1/2 /2007 FOR RS. 60 LACS. AS PER THE SALE DEED, THE CHEQUES OF RS. 10 LACS EA CH HAS BEEN PAID TO SHRI RAJNI R VARMA, MAHESH R VARMA, RAVI R VARMA AND THE IR WIVES NAMELY MADHVI VARMA, SHYAMALINA VARMA AND SHEETAL VARMA BY SHRI CHANDRAKANT K SHAH. THE CASE OF THE ASSESSING OFFIC ER WAS THAT SINCE THE SALE PROCEEDS OF THE LAND HAD BEEN EQUALLY DISTRIBU TED BY THE ABOVE-MENTIONED SIX MEMBERS OF VARMA FAMILY, THE AMOUNT RECEIVED FR OM BHAVESH CHANDULAL WAS ALSO REQUIRED TO BE ASSESSED AMONG THE SAME SIX MEMBERS IN EQUAL PROPORTION. AS HELD ABOVE THAT THE LAND IN QUESTION HAS BEEN INHERITED BY THE HUF OF THREE BROTHERS, THE SALE PROCEEDS OF THE LAN D WAS TAXABLE IN THE HANDS OF THEIR HUF AND NOT IN THE INDIVIDUAL CAPACITY. TH E ASSESSING OFFICER WAS THEREFORE RIGHTLY DIRECTED TO ASSESS THE SALE PROCE EDS RECEIVED FROM SHN CHANDRAKANT K SHAH IN THE HANDS OF THE RAJNI R VARM A HUF, MAHESH R VARNIA HUF AIIDRAYI R VARMA HUF IN EQUAL PROPORTION . AS THE SALE OF THE LAND COULD NOT BE FINALLY MADE TO SHRI BHAVESH CHAN DULAL, THE AMOUNT RECEIVED FROM HIM COULD NOT BE TAXED EITHER IN THE HANDS OF HUF OR INDIVIDUALS. HOWEVER, THE ASSESSING OFFICER WAS LEF T FREE TO INVESTIGATE THE ACTUAL SALE PROCEEDS OF SURVEY NUMBER 147 FINALLY S OLD TO CHANDRAKANT K SHAH ON THE BASIS OF THE ENTRIES MADE IN THE SEIZED PAPERS WHICH INDICATES THE CASH PORTION OF RS.2.36 CRORES OVER AND ABOVE THE C HEQUE AMOUNT OF RS. 25 LACS. HE MIGHT HAVE TAKEN INTO CONSIDERATION THE FA CT THAT IN THE LAST QUARTER OF 2005 THE TOTAL SALE CONSIDERATION OF SURVEY NUMB ER 147 WAS TO THE TUNE OF RS. 2.61 CRORES. THIS REASONED FACTUAL FINDING OF C IT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 78. THE NEXT ISSUE IS REGARDING WHETHER THE ENTRIES MADE IN BOTH THE TABLES IN THE SEIZED PAPER REPRESENT THE AMOUNT RECEIVED FROM BHAVESH CHANDULAL OR THE LOWER TABLE WAS IN RESPECT OF THE TRANSACTIONS IN RESPECT OF ANOTHER LAND AT GHUMA WHICH WAS DEVELOPED BY THE GROUP COMPANY OF T HE APPELLANTS NAMELY RALSON INFRASTRUCTURE PVT LTD. ACCORDING TO THE ASS ESSING OFFICER THE TRANSACTIONS IN BOTH THE TABLES WERE IN CONTINUATIO N OF THE SAME LAND DEAL ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 7 BEARING SURVEY NUMBER- 147 AT THALTEJ. WHEREAS, THE CASE' OF THE APPELLANT WAS THAT THE LOWER TABLE DID NOT REPRESENT THE TRAN SACTIONS OF THALTEJ LAND BUT REPRESENTS THE RECEIPT FROM THE MEMBERS OF HARIOM V ILLA AND EXPENDITURES THERE, ON INCURRED BY RALSON INFRASTRUCTURE PVT LTD . ON THE PERUSAL OF THE TRANSACTIONS, CIT(A) RIGHTLY AGREED WITH THE ASSESS ING OFFICER THAT THE TRANSACTIONS MENTIONED IN BOTH THE TABLES ARE IN CO NTINUATION. THIS WAS EVIDENT FROM THE FACT THAT THE TABLE NUMBER-1 REFER RED TO BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER REPRESENTS REC&IPT OF CASH AND CHEQUE ON THE LEFT SIDE FROM BHAVESH CHANDULAL. IN THE RIGHT HAND SIDE OF THIS TABLE THE APPLICATION OF THE SAID AMOUNTS HAD BEEN MENTIONED UP TO NOVEMBER 2005. IN THE SECOND TABLE'THE FIRST ENTRY OF RUPEES 2 LAC S REPRESENTS THE CLOSING BALANCE OF THE FIRST TABLE AND WAS SHOWN AS CARRIED FORWARD BALANCE IN THE SECOND TABLE. IN THE LEFT SIDE OF THE SECOND TABLE, THE NAME OF BHAVESH CHANDULAL WAS APPEARING ALONG WITH THE DATES OF AMO UNT RECEIVED FROM HIM. ON THE RIGHT HAND SIDE OF THIS SECOND TABLE, THE AP PLICATION OF MONEY RECEIVED FROM BHAVESH CHANDULAL HAD BEEN MENTIONED FOR THE M ONTH OF DECEMBER 2005 AND JANUARY 2006. AGAINST THE TOTAL OF 125 (WH ICH REPRESENTS 1.25 CRORES), THE NAME OF SHRI BHAVESH CHANDULAL WAS APP EARING. THIS MEANS THAT IN THE SECOND TABLE TOTAL AMOUNT OF RS. 1.25 CRORES HAD BEEN RECEIVED FROM BHAVESH CHANDULAL. THEREFORE, CIT(A) RIGHTLY HELD T HAT THE TRANSACTIONS IN FIRST AND SECOND TABLE WERE IN CONTINUATION. IN FAC T THE NAME OF GHUMA LAND WAS APPEARING ON THE RIGHT HAND SIDE OF THIS TABLE WHICH ONLY PROVES THAT THE MONEY RECEIVED FROM BHAVESH CHANDULAL HAS BEEN INVE STED OR UTILISED FOR THE EXPENSES OF GHUMA PROPERTY. IT DID NOT GIVE THE DET AILS OF THE MEMBERS CONTRIBUTIONS OR THE EXPENDITURE IN RESPECT OF HARI OM VILLA WHICH WAS DEVELOPED BY RALSON INFRASTRUCTURE PVT LTD AT GHUMA . 79. IN SUM AND SUBSTANCE, IT WAS HELD THAT THE SURV EY NUMBER 147 AND 150 AT THALTEJ WAS OWNED BY THE HUF OF SHRI RAJNI VARMA , MAHESH VARMA AND RAVI VERMA AND NOT BY THE SIX INDIVIDUALS AS HELD B Y THE AO IN THE ASSESSMENT ORDER. THE SALE PROCEEDS WERE ACCORDINGL Y TAXABLE IN THE HANDS OF RAJNI VARMA HUF, MAHESH VARMA HUF AND RAVI VERMA HU F ON SUBSTANTIVE BASIS. IN FACT THE APPELLANTS HAVE RIGH TLY SHOWN THE FORFEITURE INCOME OF RS. 60 LACS IN EQUAL PROPORTION IN THE HA NDS OF THE THREE HUF, SINCE THE LAND WAS NOT SOLD TO BHAVESH CHANDULAL, T HE CASH RECEIVED FROM HIM AGAINST THE SALE OF THE LAND COULD NNOT BE TAXED. T HE SALE PROCEEDS WAS TAXABLE ONLY WHEN THE LAND WAS FINALLY SOLD TO SHRI CHANDRAKANT K SHAH IN THE HANDS OF THE THREE HUF IN ASSESSMENT YEAR 2007- 2008. THE ADDITION OF RS. 29,35,166 MADE ON ACCOUNT OF ENTRY ON THE LOOSE PAPERS AND ADDITION OF RS. 10 LAKH TOWARDS THE SALE OF BLOCK OF LAND BEARI NG SURVEY NUMBER 150 AT THALTEJ MADE IN THE CASE OF THE INDIVIDUAL APPELLAN TS WAS RIGHTLY DIRECTED TO BE DELETED. THE FORFEITURE INCOME OF RS. 60 LACS WA S TAXABLE IN THE HANDS OF THREE HUFS OF RAJNI VARMA HUF, MAHESH VARMA HUF AND RAVI VARMA HUF IN EQUAL PROPORTION OF RS. 20 LACS EACH ON SUBS TANTIVE BASIS. ITA NOS. 3150, 3213, 3214 & CO NOS. 332, 333, 334/AH D/2014 ASSESSEE : MADHVI, SHITALDEVI & SHYAMLEE VARMA FOR AY: 2006-07 8 7. RESPECTFULLY FOLLOWING THE ABOVE FINDINGS OF THE CO-ORDINATE BENCH, WE ARE OF THE VIEW THAT THE ADDITIONS MADE IN THE H ANDS OF EACH ASSESSEE ARE NOT SUSTAINABLE. 8. SO FAR AS THE CROSS-OBJECTIONS ARE CONCERNED, TH E LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS THE CROSS-OBJECTIONS; HENCE REJECTED. 9. IN THE RESULT, ALL THE APPEALS FILED BY THE REVE NUE AND THE CROSS- OBJECTIONS FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 3 RD AUGUST, 2017 AT AHMEDABAD. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 03/08/2017 BIJU T., SR.PS ! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ' / CONCERNED CIT 4. ' ( ) / THE CIT(A) 5. % , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) ', / ITAT, AHMEDABAD