JOYOUS HOUSING LTD ( FORMERLY MANGAL SHRUSTI GRUH NIRMITI P.LTD ), MUMBAI V. DCIT CEN CIR 36, MUMBAI

ITA 4188/MUM/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 79534 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 1 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-07-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 24-03-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 24-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PADMAJA
• Keywords: Unexplained expenditure; Search and seizure; Document seized; Documents seized
• Section: 69C; 69; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH I, MUMBAI BEFORE D.KARUNAKAR RAO, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NOS. 4187 & 4188/MUM/2010 ASSESSMENT YEARS: 2005-06 & 2007-08 JOYOUS HOUSING LTD. (FORMERLY MANGAL SHRUSTI GRUH NIRMITI PVT. LTD. AKRUTI TRADE CENTRE ROAD NO. 7, MAROL MIDC, ANDHERI (E) MUBAI-400 093 PAN:AAACM 3076 H VS. DCIT, CEN CIR-36, AAYAKAR BHAVAN MUMBAI- 400 020 (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VIJAY MEHTA REVENUE BY : SMT. S. PADMAJA DATE OF HEARING : 02.06.2014 DATE OF PRONOUNCEMENT : 23.07.2014 O R D E R PER DR. STM PAVALAN, JM: THESE APPEALS FILED BY THE ASSESSEE ARE DIRECTED A GAINST THE ORDERS OF THE LD.CIT(A)-41, MUMBAI BOTH DATED 29.03.2010 FOR THE ASSESSMENT YEARS 2005-06 AND 2007-08 RESPECTIVELY. BOTH THE APPEAL ARE HEARD TOG ETHER AND DISPOSED OFF BY THIS COMMON ORDER. 2. IN THE APPEAL FOR THE ASSESSMENT YEAR 2005-06, T HE ASSESSEE HAS AGITATED THE DECISION OF THE LD.CIT(A) CONFIRMING THE ADDITION O F RS.20,00,000/- ON SUBSTANTIVE BASIS HOLDING THAT THE ASSESSEE HAD MADE UNACCOUNTE D PAYMENT OF RS.20,00,000/- FOR BORICHA LAND AT THE TIME OF ENTRY INTO DEED OF ASSIGNMENT ON 18.03.2005. 2.1 THE RELEVANT FACTS ARE THAT THE AO, IN HIS ASSE SSMENT ORDER HAD OBSERVED THAT THE ASSESSEE HAS FILED ITS RETURN OF INCOME ON 30.1 0.2007 DECLARING A TOTAL INCOME OF RS 22,64,000/-. A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT U/S 132 OF THE INCOME TAX ACT, 1961 IN AKRUTI GROUP OF CASES ON 10 .08.2006. ON PERUSAL OF ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 2 DOCUMENTS SEIZED FROM THE PREMISES OF GROUP CASES, IT WAS SEEN THAT THE PAGE NOS. 34, 36, 67 TO 69, 73, 76 TO 79 AND 82 OF ANNEXURE A -1 SEIZED FROM THE MAIN OFFICE OF THE GROUP AT 6 TH FLOOR, AKRUIT TRADE CENTRE, ROAD NO. 7 MIDC, MAROL ANDHERI (E), MUMBAI PERTAINED TO THE PROJECT AT TULSIWADI. M/S A KRUTI NIRMAN LTD, SUBMITTED THAT THE PAGES BELONG TO THE ASSESSEE COMPANY AS THE TUL SIWADI PROJECT WAS BEING CARRIED OUT BY IT. ACCORDINGLY, THE CASE OF THE ASS ESSEE COMPANY WAS DEEMED FIT FOR PROCEEDING U/S 153C OF THE ACT AS THE ASSESSMENT YE AR WAS PERTAINING TO THE PREVIOUS YEAR IN WHICH THE SEARCH WAS CONDUCTED. FU RTHER FACTS PERTAINING TO THE PRESENT APPEAL ARE THAT THE ASSESSEE HAD ENTERED IN TO AN AGREEMENT ON 18.03.2005 WITH JIVANLAL NARAYAN BORICHA, NATHBHAI NARAYAN BOR ICHA, TEJABHAI NARAYAN BORICHA, AND MS. SHAMU NARAYAN BORICHA IN RESPECT OF BORICHA LAND FOR A CONSIDERATION OF RS.51,00,000/-. IN THIS CONNECTION, RS.1,00,000/- W AS GIVEN ON SIGNING OF THE ASSIGNMENT DEED AND RS.50,00,000/- WAS PAYABLE ON O BTAINING APPROVAL FROM NCGM TO TRANSFER THE LEASE RIGHTS IN FAVOUR OF PURCHASER S. THE ASSESSE HAD SHOWN THIS BORICHA LAND IN HIS BOOKS OF ACCOUNT AS ADDITION IN THE WORKING PROGRESS FOR RS.1,00,000/- AND RS.50,00,000/- HAD BEEN SHOWN AS LIABILITY PAYABLE TO BORICHA IN RESPECT OF BORICHA LAND. THE ASSESSEE HAD SUBSTANTI ALLY ENTERED INTO TRANSFER OF ASSIGNMENT DEED ON 23.08.2005. DURING THE SEARCH AN D SEIZURE OPERATION IN THE PREMISES OF AKRUTI GROUP, DOCUMENTS AT PAGE NOS. 34 , 36, 67 TO 69, 73, 76 TO 79 AND 82 OF ANNEXURE A-1 WERE SEIZED. THE DOCUMENT AT PAG E 34 OF ANNEXURE-1 SEIZED FROM THE PREMISES OF THE SAID GROUP AND THE DETAILS OF THE CONTENT ARE GIVEN AS UNDER:- LAND COST 1. LOKHANDWALS & KATARIA 11.00 2. LOCAL RESIDENTS 11.00 3. STAMP DUTY ETC. 25.00 47.00 AS PER AGREEMENT 70.00 117.00 BORICHA 51 + 20 71.00 YAWALKAR 386.00 STAMP DUTY/ REGISTRATION THIS LAND HAD BEEN FURTHER SHOWN IN THE COST OF PRO JECT AT PAGE 36 SEIZED AND VALUE OF BORICHA LAND WAS ALLEGEDLY SHOWN AT RS.71 LAKHS AS ON 30.07.2005. IN ANOTHER ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 3 PAGE 67, DATED 28.11.2005, WHICH WAS SEIZED DURING THE YEAR, THE COST OF BORICHA LAND HAD BEEN SHOWN AT 71 LAKHS. ACCORDING TO THE A SSESSE, THE ACTUAL VALUE OF THE LAND WAS RS.51 LAKHS AND THE DEED OF ASSIGNMENT AS WELL AS TRANSFER DEED ENTERED SUBSEQUENTLY ENTERED WAS ONLY FOR THE SAME AMOUNT. BUT IN THE SEIZED PAPERS, THE VALUE OF LAND OF RS.51 LAKH AND ALSO THE SUBSEQUENT EXPENDITURE ESTIMATED AT RS.20 LAKH HAD BEEN SHOWN IN THE ESTIMATED COST OF THE BO RICHA LAND. ACCORDINGLY, IT WAS THE CONTENTION OF THE ASSESSEE THAT RS.51+20 APPEAR ING IN THE SEIZED PAPERS DENOTES THE BUDGETED OUTFLOW ON ACCOUNT OF BORICHA LAND IN THE FORM OF ESTIMATES AND THE ASSESSEE CONTINUED TO DO SO UP TO THE END O F THE PROJECT AND THE SAID BUDGET ESTIMATES CONTINUED TO BE PART OF THE BUDGET ED FIGURES FOR ALL COMPARATIVE STATEMENTS THAT WERE FORWARDED TO ALL THE ESTATE HO LDERS/CO-VENTURE OF THE COMPANY. HOWEVER, THE SAID CONTENTION WAS NOT ACCEPTED BY TH E AO AND THE AO HELD THAT THE SEIZED PAPERS SHOW THE BUDGETED AS WELL AS THE ACTU AL AMOUNT SPENT IN RELATION TO THE PROJECT. ACCORDINGLY, THE AO ADDED THE AMOUNT O F RS.20 LAKHS AS UN DISCLOSED INVESTMENT IN THE LAND BY INVOKING SECTION 69 OF TH E ACT. THE AO MADE THE IMPUGNED ADDITION ON PROTECTIVE BASIS DURING THE YE AR UNDER CONSIDERATION AND THE SAME ON SUBSTANTIVE BASIS FOR THE YEAR 2006-07. ON APPEAL, THE LD.CIT(A) WAS OF THE VIEW THAT THE IMPUGNED PAYMENT OF RS.20,00,000/ - WAS PAID IN ASSESSMENT YEAR 2005-06 AND THEREFORE THE ADDITION MADE BY THE AO H AD BEEN CONFIRMED ON SUBSTANTIVE BASIS DURING THE YEAR UNDER CONSIDERATI ON. AGGRIEVED BY THE IMPUGNED ORDER, THE ASSESSEE IS IN APPEAL BEFORE US IN CONNE CTION WITH THE ASSESSMENT YEAR 2005-06. 2.2 HAVING HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD, THE ONLY ISSUE TO BE DECIDED BY US IS WHETHER THE CONSIDERAT ION PAID BY THE ASSESSEE FOR THE PURCHASE OF BORICHA LAND IS RS.71 LAKHS OR RS.51 LA KHS. TO STATE MORE SPECIFICALLY, WHETHER THE SEIZED MATERIALS/DOCUMENTS CAN BE THE B ASIS FOR PRESUMING THAT THE ASSESSEE HAS MADE THE IMPUGNED PAYMENT OF RS.20 LAK HS, WHICH IS IN EXCESS OF THE AGREED CONSIDERATION OF RS.51 LAKHS. FIRSTLY, AS REGARDS THE CONTENTION OF THE REVENUE THAT PAGE NOS. 34 TO 36, 69, 79 AND 82, IND ICATE THAT THE ASSESSEE COMPANY HAS PURCHASED BORICHA LAND FOR A TOTAL CONSIDERATIO N OF RS.71,00,000/-, WHICH IS EVIDENCING AT PAGE 34 AS (51+20), IT IS PERTINENT T O MENTION THAT THE SEIZED PAPER AT PAGE 34 DOES NOT CONTAIN ANY REFERENCE AS TO WHETHE R 71.00 WAS PAID OR PAYABLE ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 4 FOR THE BORICHA LAND. IT APPEARS THAT THE AO HAS HI MSELF ASSUMED THAT THE ASSESSEE COMPANY HAS PURCHASED BORICHA LAND FOR A TOTAL CONS IDERATION OF RS.71,00,000/-. IT IS OBSERVED THAT THE ASSESSEE COMPANY HAS GIVEN A S UBMISSION EXPLAINING THAT RS.51+20 DENOTE THE PAYMENTS TO BE MADE TO BORICHA. THE SAME INCLUDES AN AMOUNT OF RS.51 LAKHS, WHICH THE COMPANY HAS ALREAD Y AGREED TO PAY AND RS.20 LACS IS THE FURTHER OUTGO WHICH THE COMPANY EXPECTS IF T HERE IS ANY DISPUTE. THUS, THE AO HAS ONLY ASSUMED THAT THE SEIZED PAPER 34 CONTAINS A FIGURE OF 71 LAKHS WHICH IS THE AMOUNT ACTUALLY PAID FOR THE BORICHA LAND. THIS ASS UMPTION IS MADE WITHOUT APPRECIATING THE REPLY GIVEN BY THE ASSESSEE COMPAN Y. SECONDLY, THE PERUSAL OF THE ASSESSMENT ORDER REVEALS THAT THE AO HAS STATED THA T THE RELEVANT PAGES OF THE SEIZED DOCUMENTS ALSO CONTAINS THE BUDGETED ESTIMAT ES OF OTHER LANDS. FOR EXAMPLE, ON THE SAME SEIZED PAPER I.E. PAGE 34, AN AMOUNT OF 386 IS SHOWN AGAINST THE NAME OF YAWALKAR. HOWEVER, A FINAL MOU HAS BEEN ENTERED INTO BY THE ASSESSEE WITH ANIL N YAWALKAR AND M/S. SURAJ ESTATE DEVELOPERS PVT. LT D. FOR A TOTAL CONSIDERATION OF RS.3.76 CRORES ON 21.10.2004. IN THIS REGARD, THE A SSESSEE COMPANY HAS GIVEN SUBMISSION THAT RS.386 LAKHS ARE ESTIMATES OF PAYME NTS THAT WOULD HAVE TO BE MADE TO YAWALKAR ON ACCOUNT OF THE ABOVE PROJECT. HOWEVE R, THE AGREEMENT HAS BEEN SUBSEQUENTLY FINALIZED FOR ONLY 376 LAKHS. HERE, TH E AO HAS NOT DISPUTED THAT A FIGURE OF 386 HAS BEEN WRITTEN BUT THE AGREEMENT IS ONLY FOR ONLY 376 LAKHS, SO THAT THE DIFFERENCE MUST BE ON ACCOUNT OF UNACCOUNTED IN VESTMENT. THE AO HAS ACCEPTED THE ASSESSEE COMPANYS CONTENTION THAT THE FIGURE M ERELY REPRESENTED A ROUGH ESTIMATE. THIRDLY, PAGE NO. 79 OF THE SEIZED PAPER DATED 16.05.2006 S HOWS THE BUDGETED AS WELL AS THE ACTUAL AMOUNT SPENT IN RELA TION TO THE TULSIWADI PROJECT. IN TERMS OF DATE, THIS IS THE LATEST PAPER IN RELATION TO ALL THE OTHER SEIZED PAPERS. THIS PAPER ALSO CLEARLY INDICATES THAT THE AMOUNT OF 71 IS SHOWN UNDER THE HEAD BUDGETED. FURTHER, AS AGAINST THE BUDGETED AMOUNT , ONLY AN AMOUNT OF RS.5 LACS IS SHOWN AS PAID. THUS IF THE SEIZED PAPER ITSELF SH OWN AN AMOUNT OF RS.5,00,000/- PAID, THEN THE INFERENCE WHICH IS DRAWN BY THE AO R EGARDING THE PAYMENT OF RS.20,00,000 IS TOTALLY INCORRECT. IF THE AO ACCEPT S ONE PART OF THE SEIZED PAPER AS TRUE, THEN HE ALSO HAS TO ACCEPT THE OTHER PART AS TRUE. FOURTHLY, IT IS RELEVANT TO STATE THAT DURING THE SEARCH, THERE IS NO DOCUMENT FOUND WHICH SHOWS THAT AN AMOUNT OF RS.20,00,000 IS PAID BY THE ASSESSEE CO MPANY. FURTHER NO UNDISCLOSED ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 5 CASH HAS BEEN FOUND ON THE BASIS OF WHICH THE AO CO ULD HAVE INFERRED THAT THE ASSESSEE COMPANY KEEPS UNACCOUNTED CASH FROM WHICH IT MAKES PAYMENTS WHICH ARE NOT RECORDED IN ITS BOOKS OF ACCOUNTS. ALSO, THERE ARE NO UNACCOUNTED CASH OR ANY INCRIMINATING DOCUMENTS FOUND WHICH CAN LEAD TO ANY SUCH CONCLUSION. IN VIEW OF THE AFOREMENTIONED DISCUSSION, WE ARE OF THE CON SIDERED VIEW THAT THE CONSIDERATION PAID BY THE ASSESSEE FOR THE PURCHASE OF BORICHA LAND IS ONLY RS.51 LAKHS AS PER THE AGREEMENT AND THE FIGURE MENTIONED AT PAGE 34 AS (51+20) OF THE SEIZED DOCUMENT REPRESENTS ONLY AN ESTIMATED BUDGET AS CONTENDED BY THE ASSESSEE. SINCE, THE LD.CIT(A) HAS NOT TAKEN COGNIZ ANCE OF THE CORRECT FACTS AFOREMENTIONED WHILE CONFIRMING THE ADDITION MADE B Y THE AO, THE IMPUGNED ORDER OF THE LD.CIT(A), IN OUR VIEW, DESERVES TO BE REVER SED. RESULTANTLY, THE IMPUGNED ADDITION OF RS.20 LAKHS MADE/CONFIRMED BY THE AO/LD .CIT(A) STANDS DELETED. 3. IN THE APPEAL FILED BY THE ASSESSEE FOR THE ASSE SSMENT YEAR 2007-08, THE ASSESSEE HAS AGITATED THE DECISION OF THE LD.CIT(A) CONFIRMING THE ADDITION OF RS.51,00,000/- MADE BY THE AO AS UNEXPLAINED EXPEND ITURE U/S 69C OF THE ACT. THE RELEVANT FACTS ARE THAT THE AO HAS MADE ADDITION OF RS.51,00,000/- ON ACCOUNT OF UNEXPLAINED EXPENDITURE U/S 69C ON THE BASIS OF PAG E -82 OF ANNEXURE A-1 SEIZED, WHICH IS REPRODUCED AS UNDER:- MANGAL SRUSHTI GRUH NIRMITI LTD TULS IWADI PROJECT SL NO. PARTICULARS BUDGETED SPENT TILL DATE 1 LAND COST LOKHANDWALA KATARI LOCAL RESIDENT STAMP DUTY ETC. AS PER AGREEMENT (A) BORICHA LAND YAWALKAR/SURAJ ESTATE DEVELOPERS STAMP DUTY & REGISTRATION (B) 1100 1100 2500 7000 11700 71 376 50 497 12197 225 324 5 5 199 11 ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 6 (A+B) CONSTRUCTION COST FOR TENANTS @ 1250 SQ.FT. FOR 1689000 SQ.FT. FOR SALE @ 2500 PER SQ.FT. FOR 1050000 SQ.FT. 21113 26250 47363 431 2 OVERHEAD EXPENSES 600 125 3 CONTINGENCIES @ 3% OF CONSTRUCTION COST 1421 4 LEGAL COST @2% OF CONSTRUCTION COST 947 77 5 BMC/SRA CHARGES @ RS.410 PER SQ. FT. OF TOTAL CONSTRUCTION AREA OF SALE BLDGE. @ RS.150 PER SQ.FT. OF TOTAL CONSTRUCTION AREA OF TENANT BLDG. 4305 2534 6839 193 6 ALTERNATE ACCOMMODATION @ RS.110000 FOR 1100 TENANTS 1250 7 SELLING COST @ RS.160 PER SQ.FT. ON SALABLE AREA OF 1050000 SQ.FT. TOTAL COST (I) LESS RECEIVED FROM DLF BALANCE EXPENSES TILL DATE REQUIRED NOW LESS: RECEIVED FROM DLF TOTAL FUNDS REQUIRED 1596 225 1640 72256 1821 1328 493 1596 1328 268 ACCORDING TO THE AO, THIS SEIZED PAPER AT PAGE-82, VOUCHES FOR THE TOTAL CONSTRUCTION COST AT RS.4,31,00,000/- WHEREAS THE TOTAL OF PAYME NTS RECORDED IN THE REGULAR BOOKS IS ONLY 380 LAKHS UP TO 02.05.2006. THEREFORE , THE AO WAS OF THE VIEW THAT THE ASSESSEE HAD FAILED TO EXPLAIN THE SOURCE OF EX PENDITURE OF RS.51,00,000/- AND ACCORDINGLY MADE THE IMPUGNED ADDITION U/S 69C OF A CT. ON APPEAL, THE LD.CIT(A) UPHELD THE ADDITION MADE BY THE AO. AGGRIEVED BY TH E IMPUGNED ORDER, THE ASSESSEE HAS FILED THIS APPEAL BEFORE US, WHICH IS PERTAINING TO THE ASSESSMENT YEAR 2007-08. 3.2 HAVING HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL ON RECORD, IT IS PERTINENT TO MENTION THAT ON THE BASIS OF THE SEIZE D PAPERS, THE ASSESSEE RECONCILED ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 7 THE PAYMENTS AS SHOWN ON SEIZED PAPER 82 WITH THE B OOKS OF ACCOUNT AS ON 30.04.2006. WHILE RECONCILING THE AMOUNTS, A DIFFER ENCE OF RS.51 LAKHS HAS BEEN FOUND UNDER THE HEAD CONSTRUCTION EXPENSES. THE S EIZED PAPERS HAVE SHOWN AN AMOUNT OF 431 LAKHS, WHILE THE BOOKS OF ACCOUNTS SH OWED ONLY 380 LAKHS. THUS, THE AO ADDED THE DIFFERENCE OF RS.51 LAKHS AS UNEXPLAIN ED EXPENDITURE U/S 69C ON THE REASONING THAT THE AMOUNT IS ACTUALLY PAID AND THE SAME HAS BEEN CONFIRMED BY THE LD.CIT(A). IN THIS CONNECTION, IT IS PERTINENT TO M ENTION THAT THE TULSIWADI PROJECT IS A REHABILITATION PROJECT, WHICH HAS THREE PRINCIPAL STAKE HOLDERS, NAMELY, (I) DLF GROUP WHICH IS THE FINANCIAL CO-VENTURER, (II) SHAP OORJI PALLOONJI GROUP WHICH IS THE ORIGINAL CO-DEVELOPER (III) CO-VENTURER OF THE PROJ ECT, AND AKRUTI GROUP WHICH IS THE WORKING CO-VENTURER AND IN THE COURSE OF CONSTRUCTI ON OF ITS ABOVE PROJECT AT TULSIWADI KEEPS REQUIRING FUNDS FROM THE STAKE HOLD ERS. THE ASSESSEE COMPANY INCURS THE EXPENSES THROUGH ITS OWN RESOURCES OR TH OROUGH ITS OPERATING CO-VENTURER, M/S. AKRUIT NIRMAN LTD. WHICH ARE THEN REFUNDED BY ITS FINANCIAL PARTNER AS PER THE UNDERSTANDING BETWEEN THE CO-VENTURERS. CONSIDERING THAT THE EXPENSES HAVE BEEN INCURRED, THE ASSESSEE HAS SHOWN THE EXPENSES SPEN T TILL DATE IN THE STATEMENTS THAT ARE MADE AND FORWARDED TO EACH OF THE STAKEHOL DERS/ CO-VENTURER. IN THIS CONTEXT, IT IS RELEVANT TO STATE THAT THE FIGURE IS AN ESTIMATE, WHICH IS SUPPORTED BY THE FACT THAT WHILE ALL BALANCES AS PER LOOSE PAPER MATCH PERFECTLY WITH THE TRIAL BALANCE OF THAT PERIOD, THE DIFFERENCE OF EXACTLY R S.51 LAKHS IS IN CONSTRUCTION EXPENSES ALONG, WHICH IS AN ONGOING AND CONTINUOUS EXPENSE FOR THE COMPANY, FOR WHICH THE CONSTRUCTION WORK IS DONE BY THE CONTRACT OR AND BILL FOR THE SAME IS TO BE RAISED BY HIM. THE PERUSAL OF THE RECORDS FURTHER S UPPORTS THAT THE AMOUNT UNDER THE COLUMN SPENT TILL DATE NOT ONLY INCLUDES THE AMOUNT WHICH IS ACTUALLY PAID, BUT IT ALSO INCLUDES THE AMOUNT OF LIABILITY WHICH IS I NCURRED BUT NOT YET PAID. THUS, THE DIFFERENCE OF 51 LAKHS IS ALSO AN EXPENSE WHICH THO UGH WAS ONLY INCURRED BUT NOT PAID. THE AMOUNT WAS ON ACCOUNT OF CONSTRUCTION EXP ENSES ALONE, WHICH IS AN ONGOING AND CONTINUOUS EXPENSE FOR THE COMPANY, FOR WHICH THE CONSTRUCTION WORK IS DONE BY THE CONTRACTOR AND BILL FOR THE SAME IS TO BE RAISED BY HIM. THUS, THE AMOUNT IS KNOWN BY THE ASSESSEE TO BE PAID TO THE C ONTRACTOR BUT SINCE THE BILL IS NOT RAISED, THE AMOUNT IS NOT RECORDED IN THE BOOKS OF ACCOUNTS. FURTHER, IT IS OBSERVED THAT NO UNDISCLOSED CASH HAS BEEN FOUND ON THE BASIS OF WHICH THE AO ITA NOS. 4187 & 4188/MUM/2010 JOYOUS HOUSING LTD. ASSESSMENT YEARS: 2005-06 & 2007-08 8 COULD HAVE INFERRED THAT THE ASSESSEE COMPANY KEEPS UNACCOUNTED CASH FROM WHICH IT MAKES PAYMENTS WHICH ARE NOT RECORDED IN ITS BOO KS OF ACCOUNTS. THUS, THE AMOUNT OF DIFFERENCE IS ONLY DUE TO AN ACTUAL LIABI LITY OF 51 LAKHS WHICH HAS NOT ACTUALLY BEEN PAID BUT IS TO BE PAID SUBSEQUENTLY. IN VIEW OF THAT MATTER, WE DO NOT FIND ANY JUSTIFIABLE REASON ON THE PART OF THE AUTH ORITIES BELOW TO MAKE/CONFIRM THE IMPUGNED ADDITION BY INVOKING SECTION 69C OF ACT AN D HENCE THE SAME STANDS DELETED. 4. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASSESS EE ARE ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 2 3 RD DAY OF JULY, 2014. SD/- SD/- (D. KARUNAKAR RAO) (DR. S.T.M.PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 23.07.2014. *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR I BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.