SHRI. RAKESH NATWARLAL THAKKAR, THANE V. DCIT CC-1 THANE , THANE

ITA 7781/MUM/2019

AI Insights

The case involves Shri Rakesh Natwarlal Thakkar, who appealed against the order of the Commissioner of Income-tax (Appeals) which upheld the addition of Rs. 12,83,860 to his income for the assessment year 2012-2013. This amount was alleged to be unaccounted cash receipts from the sale of a flat. The Assessing Officer had made this addition based on documents seized during a search operation under section 132 of the Income-tax Act, 1961. The Tribunal found that the assessee failed to provide a credible explanation for the entries in the seized documents, which indicated unaccounted cash transactions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123324 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-06-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 22-05-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 16-12-2019
• Other Referred Cases: CIT v. P.V. Kalyanasundaram [2007] 294 ITR 49 (SC), Raj Homes S.V. Group in ITA no. 2408/Mum/2017
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Business income; Document seized; Corroborative evidences; Documents seized
• Section: 132; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D” MUMBAI BEFORE SHRI ABY T VARKEY (JUDICIAL MEMBER) AND SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) ITA No. 7781/MUM/2019 Assessment Year: 2012-2013 Shri Rakesh Natwarlal Thakkar, 13/5 th Floor, Kashima Co-op Society, Opp. Damani Estate, LBS Marg, Thane (West), Pin – 400602 Vs. DCIT Central Circle-1, 6 th floor, Room No. 10, A-Wing, Ashar IT Park, Road, No. 16-Z, Wagle Indl. Estate, Thane-400604 PAN No. AANPT 8579 J Appellant Respondent Assessee by : Mr. Dharan Gandhi Revenue by : Mrs. Riddhi Mishra, CIT–DR Date of Hearing : 23/05/2023 Date of pronouncement : 13/06/2023 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 13.09.2019 passed by the Ld. Commissioner of Income-tax (Appeals)-11, Pune, [in short ‘the Ld. CIT(A)’] for assessment year 2012-13, raising following grounds: 1. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income Tax erred in retaining the addition of a sum of Rs.12.83,860/- madesuby. the Deputy Commisioner of Income Tax as unaccounted cash receipts from sale of flat to one Suresh A. Jadhav based merely on selective scribbings in rough note de hors any corroborati not justified. 2. Alternatively and without prejudice to the above ground it is submitted that the learned CIT(A' erred in sustaining addition of the entire sum of Rs. 12,83,860/ receipts from sale is not justified, as only a reasonable percentage of such receipts should be considered as "income" and not the entire receipts as gross receipts cannot be income earned. 2. Briefly stated, facts of the case are that assessment year, the estate project namely “Aainaz Avenue” through his proprietary concern namely M/s SV Group Builders and Developers assessee was also running another proprietary concern R.N. Traders, which was For the year under consideration, the assessee filed return of income electronically on 23.01.2013 declaring total income at Rs.3,11,580/-. The return of income filed by the assessee w selected for scrutiny. The Assessing Officer observed that assessee was a part of ‘Thakkar Group the Income-tax Act, 1961 (in short ‘the Act’) 22.02.2012. The Assessing Officer, on the basis of doc seized during the course of search received unaccounted cash a flat. In view of no response/reply on the part of the assessee, the Commisioner of Income Tax as unaccounted cash receipts from sale of flat to one Suresh A. Jadhav based merely on selective scribbings in rough note de hors any corroborative findings which is legally not justified. Alternatively and without prejudice to the above ground it is submitted that the learned CIT(A' erred in sustaining addition of the entire sum of Rs. 12,83,860/-being alleged unaccounted cash receipts from sale of flat to Suresh A.Jadhav which is not justified, as only a reasonable percentage of such receipts should be considered as "income" and not the entire receipts as gross receipts cannot be income earned. Briefly stated, facts of the case are that during assessment year, the assessee was engaged in construction of real estate project namely “Aainaz Avenue” through his proprietary /s SV Group Builders and Developers assessee was also running another proprietary concern was engaged in wholesale trading of food grain. For the year under consideration, the assessee filed return of income electronically on 23.01.2013 declaring total income at . The return of income filed by the assessee w selected for scrutiny. The Assessing Officer observed that assessee Thakkar Group” on which a search action u/s 132 of tax Act, 1961 (in short ‘the Act’) was carried out on 22.02.2012. The Assessing Officer, on the basis of doc seized during the course of search concluded that assessee received unaccounted cash amounting to Rs.12,93,860/ a flat. In view of no response/reply on the part of the assessee, the Shri Rakesh N Thakkar 2 ITA No. 7781/Mum/2019 Commisioner of Income Tax as unaccounted cash receipts from sale of flat to one Suresh A. Jadhav based merely on selective scribbings in rough note ve findings which is legally Alternatively and without prejudice to the above ground it is submitted that the learned CIT(A' erred in sustaining addition of the entire sum of Rs. being alleged unaccounted cash of flat to Suresh A.Jadhav which is not justified, as only a reasonable percentage of such receipts should be considered as "income" and not the entire receipts as gross receipts cannot during relevant was engaged in construction of real estate project namely “Aainaz Avenue” through his proprietary /s SV Group Builders and Developers. The assessee was also running another proprietary concern namely M/s engaged in wholesale trading of food grain. For the year under consideration, the assessee filed return of income electronically on 23.01.2013 declaring total income at . The return of income filed by the assessee was selected for scrutiny. The Assessing Officer observed that assessee search action u/s 132 of was carried out on 22.02.2012. The Assessing Officer, on the basis of documents concluded that assessee amounting to Rs.12,93,860/-on sale of a flat. In view of no response/reply on the part of the assessee, the Assessing Officer, after analyzing the entries referred in the seized document, made addition of Rs.12,83,860/ additions as discussed in the impugned assessment order dated 31.03.2015. On further appeal, the Ld. CIT(A) in a detailed finding upheld the addition of Rs.12,83,860/ the Ld. CIT(A) on the issue in dispute, the assessee is in appeal before the Tribunal by way of raising grounds as reproduced above. 3. Before us, the assessee has filed Paper book containing pages 1 to 8. 4. The Ld. Counsel of the assessee supported the grounds raised by the assessee and submitted that the Ld. Assessing Officer has made addition on the basis of a is a rough noting of estima submitted that dehors on rough notes cannot be the sole basis for addition for undisclosed income. In support of contention of the Ld. Counsel of the assessee relied on the decisions of the ITAT in the case of Raj Homes S.V. Group in ITA no. 2408/Mum/2017 wherein the Tribunal has relied on the decision of Hon’ble Supreme Court Kalyanasundaram [2007] 294 ITR 49 (SC) 4.1 The Ld. Counsel further submi in the case of builders site,an estimated value after analyzing the entries referred in the seized made addition of Rs.12,83,860/- along with other additions as discussed in the impugned assessment order dated 31.03.2015. On further appeal, the Ld. CIT(A) in a detailed finding tion of Rs.12,83,860/-. Aggrieved with the finding of the Ld. CIT(A) on the issue in dispute, the assessee is in appeal before the Tribunal by way of raising grounds as reproduced above. Before us, the assessee has filed a fact sheet along with a book containing pages 1 to 8. The Ld. Counsel of the assessee supported the grounds raised by the assessee and submitted that the Ld. Assessing Officer has made addition on the basis of a scribbling in the loose sheet which is a rough noting of estimates. The Ld. Counsel of the assessee dehors any corroborative evidence, these scribbling on rough notes cannot be the sole basis for addition for undisclosed income. In support of contention of the Ld. Counsel of the assessee ecisions of the ITAT in the case of Raj Homes S.V. Group in ITA no. 2408/Mum/2017 wherein the Tribunal has relied of Hon’ble Supreme Court in the case of Kalyanasundaram [2007] 294 ITR 49 (SC). The Ld. Counsel further submitted that it is a normal practice in the case of builders that whenever a prospective buyer value is providedon a piece of the paper and Shri Rakesh N Thakkar 3 ITA No. 7781/Mum/2019 after analyzing the entries referred in the seized along with other additions as discussed in the impugned assessment order dated 31.03.2015. On further appeal, the Ld. CIT(A) in a detailed finding . Aggrieved with the finding of the Ld. CIT(A) on the issue in dispute, the assessee is in appeal before the Tribunal by way of raising grounds as reproduced above. fact sheet along with a The Ld. Counsel of the assessee supported the grounds raised by the assessee and submitted that the Ld. Assessing Officer has in the loose sheet which tes. The Ld. Counsel of the assessee corroborative evidence, these scribbling on rough notes cannot be the sole basis for addition for undisclosed income. In support of contention of the Ld. Counsel of the assessee ecisions of the ITAT in the case of Raj Homes S.V. Group in ITA no. 2408/Mum/2017 wherein the Tribunal has relied in the case of CIT v. P.V. tted that it is a normal practice prospective buyer visits the piece of the paper and explained to himwith property/flat. The Ld. C the flat under reference assessee, he explained the details of various charges for acquiring the flat. The ld. Counsel submitted that scribbling might be one of the said papers. 4.2 The Ld. Counsel further submitted that no defect whatsoever has been found in the books of accounts of the assessee in the preceding year and the succeeding year and the profit offered by the assessee has been accepted. 4.3 Further, the Ld. Counsel evidences have been found in the search or later and the addition has been made on the presumption. The Ld. Counsel of the assessee further submitted factual information arguments as under: 1. “A sum of Jadhav upto 31 accounts filed with the return of income and hence on 08/11/2011 the paper was not written or date is immaterial. 2. The paper also contains date 19th March, 2012 hence it was not written on 8th November, 2011 3. Area of the flat is 303.40 sq feet carpet and salable area given is 493.sq feet.The flat has a terrace of 330 with details of various charges for acquiring the . The Ld. Counsel submitted that when the buyer referencei.e. Mr. Suresh A. Jadhav explained the details of various charges for acquiring The ld. Counsel submitted that scribbling might be one of The Ld. Counsel further submitted that no defect whatsoever has been found in the books of accounts of the assessee in the preceding year and the succeeding year and the profit offered by the assessee has been accepted. Further, the Ld. Counsel of the assessee submitted that no evidences have been found in the search or later and the addition has been made on the presumption. The Ld. Counsel of the further submitted factual information arguments as under: A sum of Rs.3,55,000/- was only received from Suresh Jadhav upto 31 st March, 2012 as evident in the final accounts filed with the return of income and hence on 08/11/2011 the paper was not written or date is immaterial. The paper also contains date 19th March, 2012 hence it was not written on 8th November, 2011 Area of the flat is 303.40 sq feet carpet and salable area given is 493.sq feet.The flat has a terrace of 330 Shri Rakesh N Thakkar 4 ITA No. 7781/Mum/2019 details of various charges for acquiring the ounsel submitted that when the buyer of Jadhav, visited the explained the details of various charges for acquiring The ld. Counsel submitted that scribbling might be one of The Ld. Counsel further submitted that no defect whatsoever, has been found in the books of accounts of the assessee in the preceding year and the succeeding year and the profit offered by the of the assessee submitted that no evidences have been found in the search or later and the addition has been made on the presumption. The Ld. Counsel of the further submitted factual information and written was only received from Suresh March, 2012 as evident in the final accounts filed with the return of income and hence on 08/11/2011 the paper was not written or date is The paper also contains date 19th March, 2012 and hence it was not written on 8th November, 2011 Area of the flat is 303.40 sq feet carpet and salable area given is 493.sq feet.The flat has a terrace of 330 sg. feet and accordingly by adopting 50% area for the terrace area worked out is 658 sq. feet. It is difficult to get a price of 50% of sale price for terrace on 1st floor and hence it was merely a quotation given and working was done. Actual realization appears in books. Such quotation does not indicate any receipt or commitment. 4. The learned CIT(A follows : "The first cash payment shown is Rs. 1,50,000/ subsequently it is shown that 8 drafts of Rs.49,000/ each totaling Rs.3,92,000/ balance of Rs.7,41,860/ drafts of Rs.49,000/ paid and another 4 drafts of Rs.49,000/ Rs. 1,96,000/ Rs.3,00,860/ Rs.49,000/ balance of Rs. 1,04,860/"_ From above conclusion arrived at it is evident that payments are made by draft.In such a case the payment cannot be said as unaccounted or in cash. The conclusion arrived at is totally incorrect as there can not be payment b projections/ estimates/jottings made if any can not lead to a conclusion that payment was made by bank draft sg. feet and accordingly by adopting 50% area for the terrace area worked out is 658 sq. feet. It is difficult to get a price of 50% of sale price for terrace on 1st floor and hence it was merely a quotation given and working was done. Actual realization appears in books. Such quotation does not indicate any receipt or commitment. The learned CIT(A) on page 6 of his order states as follows : "The first cash payment shown is Rs. 1,50,000/ subsequently it is shown that 8 drafts of Rs.49,000/ each totaling Rs.3,92,000/- has been paid leaving a balance of Rs.7,41,860/- to be paid and subsequently drafts of Rs.49,000/-totaling Rs.2,45,000/ paid and another 4 drafts of Rs.49,000/- each totaling Rs. 1,96,000/- has been paid leaving a balance of Rs.3,00,860/ - which is again paid by 4 drafts of Rs.49,000/- each totaling Rs. 1,96,000/ balance of Rs. 1,04,860/"_ From above conclusion arrived at it is evident that payments are made by draft.In such a case the payment cannot be said as unaccounted or in cash. The conclusion arrived at is totally incorrect as there can not be payment by draft and same is unaccounted. The projections/ estimates/jottings made if any can not lead to a conclusion that payment was made by bank draft Shri Rakesh N Thakkar 5 ITA No. 7781/Mum/2019 sg. feet and accordingly by adopting 50% area for the It is difficult to get a price of 50% of sale price for terrace on 1st floor and hence it was merely a quotation given and working was done. Actual realization appears in books. Such quotation does not indicate any receipt or ) on page 6 of his order states as "The first cash payment shown is Rs. 1,50,000/- and subsequently it is shown that 8 drafts of Rs.49,000/- has been paid leaving a to be paid and subsequently 5 totaling Rs.2,45,000/- has been each totaling has been paid leaving a balance of which is again paid by 4 drafts of each totaling Rs. 1,96,000/- leaving a From above conclusion arrived at it is evident that payments are made by draft.In such a case the payment cannot be said as unaccounted or in cash. The conclusion arrived at is totally incorrect as there can not y draft and same is unaccounted. The projections/ estimates/jottings made if any can not lead to a conclusion that payment was made by bank draft and that to unaccounted. Hence there was no cash payment as presumed. 5. It may further be noted that the appella received booking amount for some flats agreed to be sold and construction has just commenced. Sales have been effected in A.Y.2014 there was no sale made in this year and hence there can not be any income which had ar consideration for sale to said Mr.Suresh Jadhav has been received in F.Y.2011 cheques on various dates. Therefore presumption that sum of Rs. 12,83,860/ not betrue. 6. Your attention i case of CIT V. P.V.Kalyansundaram (2007) reported at 294 IT 49 which makes it clear that the addition solelv based on loose paper scribbling de horce any corroborate finding is not justified. 7. Moreover as evident in t was made by uncle of the appellant of Rs.5,00,000/ behalf of appellant. Appellant noticed that there was no such discrepancy is his records. He therefore did not offer any additional income and addition of Rs.5,00,000/ by CIT(A)in his order. This also establishes that there was no cash consideration. 5. On the contrary, the Ld. Departmental Representative (DR) referred to the said seized and that to unaccounted. Hence there was no cash payment as presumed. It may further be noted that the appellant has merly received booking amount for some flats agreed to be sold and construction has just commenced. Sales have been effected in A.Y.2014-15, A.Y.2015-16 and hence there was no sale made in this year and hence there can not be any income which had arisen in this year as consideration for sale to said Mr.Suresh Jadhav has been received in F.Y.2011-12, 12-13 and 13 cheques on various dates. Therefore presumption that sum of Rs. 12,83,860/- was received in this year can not betrue. Your attention is drawn to the attached judgment in the case of CIT V. P.V.Kalyansundaram (2007) reported at 294 IT 49 which makes it clear that the addition solelv based on loose paper scribbling de horce any corroborate finding is not justified. Moreover as evident in the order of CIT(A) a declaration was made by uncle of the appellant of Rs.5,00,000/ behalf of appellant. Appellant noticed that there was no such discrepancy is his records. He therefore did not offer any additional income and addition of Rs.5,00,000/- made by A.O was directed to be deleted by CIT(A)in his order. This also establishes that there was no cash consideration.” On the contrary, the Ld. Departmental Representative (DR) referred to the said seized document, which was inventories Shri Rakesh N Thakkar 6 ITA No. 7781/Mum/2019 and that to unaccounted. Hence there was no cash nt has merly received booking amount for some flats agreed to be sold and construction has just commenced. Sales have 16 and hence there was no sale made in this year and hence there isen in this year as consideration for sale to said Mr.Suresh Jadhav has 13 and 13-14 by cheques on various dates. Therefore presumption that was received in this year can s drawn to the attached judgment in the case of CIT V. P.V.Kalyansundaram (2007) reported at 294 IT 49 which makes it clear that the addition solelv based on loose paper scribbling de horce any he order of CIT(A) a declaration was made by uncle of the appellant of Rs.5,00,000/- on behalf of appellant. Appellant noticed that there was no such discrepancy is his records. He therefore did not offer any additional income and addition of made by A.O was directed to be deleted by CIT(A)in his order. This also establishes that there On the contrary, the Ld. Departmental Representative (DR) inventoriesed by the search team at page No. 9 TB-2, which contains details of cash receipts Rs.12,83,860/- for flat No. 1 and sold @ Rs.3800/ computed at Rs.25,00,400/ contains details of ratio of 60:40 and accordingly has been bifurcated into Rs.15,00,240/- and (40% sale amount + development charge, legal charge, parking etc. mentioned on the page). The Ld. DR submitted that there are following corroborative  Page No. 7 of loose paper bundle No.1 is the saleable area statement. Area of 658 sq.ft matches with the area mentioned in Page No. 9 referred above for Flat No. 1, Ground Floor.  The amount under 'A' matches with the actual agreement value for the flat, clearly showing that the amount under 'B' is on money received for the  As per calculation under 'A', it reduces 551 written below the digits '500° of 1500240/ balance amount of 949240/ entry of Rs. 1,96,000/ by chq' (implying return by cheque), re balance amount of 11,45,240/ an amount of Rs.551000 been returned) = Rs.355000/ what has been claimed to have been received from Suresh Jadhav as per assessee's submission (re 1 on pg 2 of the Fact Sheet filed by the assessee before the Hon ble ITAT on 26.07.2021). 5.1 The Ld. DR further submitted that the document 08.11.2011 as noted on the document itself page No. 9 of Bundle No. 1 seized from party which contains details of cash receipts of for flat No. 1, Ground floor having area sold @ Rs.3800/- per sq feet; and therefore,sale Rs.25,00,400/-. The Ld. DR submitted that this page contains details of ratio of 60:40 and accordingly, the sale amount has been bifurcated into category “A”i.e. by cheque, and category “B” i.e. by cash, of Rs.12,8 (40% sale amount + development charge, legal charge, parking etc. mentioned on the page). The Ld. DR submitted that there are following corroborative evidences: Page No. 7 of loose paper bundle No.1 is the saleable area statement. Area of 658 sq.ft. mentioned therein matches with the area mentioned in Page No. 9 referred above for Flat No. 1, Ground Floor. The amount under 'A' matches with the actual agreement value for the flat, clearly showing that the amount under 'B' is on money received for the As per calculation under 'A', it reduces 551 written below the digits '500° of 1500240/-, resulting in balance amount of 949240/-. Thereafter, there is an entry of Rs. 1,96,000/- with before it and remark 'Ret by chq' (implying return by cheque), re balance amount of 11,45,240/-. This shows receipt of an amount of Rs.551000 - Rs. 196000 (which has been returned) = Rs.355000/- which is the same as what has been claimed to have been received from Suresh Jadhav as per assessee's submission (re 1 on pg 2 of the Fact Sheet filed by the assessee before the Hon ble ITAT on 26.07.2021). The Ld. DR further submitted that the document as noted on the document itself and there has been Shri Rakesh N Thakkar 7 ITA No. 7781/Mum/2019 Bundle No. 1 seized from party of on money of having areaof 658 sq. ft. sale amount was . The Ld. DR submitted that this page the sale amount ”i.e. by cheque, of of Rs.12,83,860/- (40% sale amount + development charge, legal charge, parking etc. mentioned on the page). The Ld. DR submitted that there are Page No. 7 of loose paper bundle No.1 is the saleable . mentioned therein matches with the area mentioned in Page No. 9 The amount under 'A' matches with the actual agreement value for the flat, clearly showing that the amount under 'B' is on money received for the same. As per calculation under 'A', it reduces 551 written , resulting in . Thereafter, there is an with before it and remark 'Ret by chq' (implying return by cheque), resulting in . This shows receipt of Rs. 196000 (which has which is the same as what has been claimed to have been received from Suresh Jadhav as per assessee's submission (refer pt 1 on pg 2 of the Fact Sheet filed by the assessee before The Ld. DR further submitted that the document is dated and there has been regular reduction in the amounts ment which implies receipt of cash Further, she refuted the claim of the assessee that the document also contains date of 08.11.2011. The Ld. DR submitted that the date 19.03.2012 is the date of the seizure of the document and date has been marked below the signature of the witnesses of the search. 5.2 Further refuting the arguments of the Ld. Counsel of the assessee that there was no corroborative evidence, she submitted that the document is a entire transaction in clear term. The clear evidence of receipt of cash against sale of property for which the cheque amount mentioned on the page matches with the actual agreement value of the flat G cheque and cash amount equals the rate per sq. ft. mentioned the page for an area of 658 sq. ft. which also tallies with the saleable area mentioned in the saleable area statement page No. 7 of the bundle No. 1 seized from the assessee. The clearly shows receipt of Rs.3.55 lakhs against the cheq component i.e. Rs.5.51 laksh and this is same as the amount stated to have been received by the assessee in his submission. She further submitted that the assessee has not refuted before the AO or before the Ld. CIT(A). As regards the decision in in the amounts mentioned under receipt of cash against “B” category in installments. she refuted the claim of the assessee that the document of 19.03.2012 and hence it was not 08.11.2011. The Ld. DR submitted that the date 19.03.2012 is the date of the seizure of the document and date has been marked below the signature of the witnesses of the search. Further refuting the arguments of the Ld. Counsel of the assessee that there was no corroborative evidence, she submitted that the document is a self-contained live document showing the entire transaction in clear term. The noting on the documents evidence of receipt of cash against sale of property for which the cheque amount mentioned on the page matches with the actual agreement value of the flat G-1. The total sale amount inclusive of cheque and cash amount equals the rate per sq. ft. mentioned the page for an area of 658 sq. ft. which also tallies with the saleable area mentioned in the saleable area statement page No. 7 of the bundle No. 1 seized from the assessee. The clearly shows receipt of Rs.3.55 lakhs against the cheq component i.e. Rs.5.51 laksh – 1.96 (cheuqe returned) = 3.55 lakhs and this is same as the amount stated to have been received by the assessee in his submission. She further submitted that the refuted the documents and its contents before the AO or before the Ld. CIT(A). As regards the decision in Shri Rakesh N Thakkar 8 ITA No. 7781/Mum/2019 ioned under category “B”, against “B” category in installments. she refuted the claim of the assessee that the document 19.03.2012 and hence it was not written on 08.11.2011. The Ld. DR submitted that the date 19.03.2012 is the date of the seizure of the document and date has been marked Further refuting the arguments of the Ld. Counsel of the assessee that there was no corroborative evidence, she submitted live document showing the on the documents is evidence of receipt of cash against sale of property for which the cheque amount mentioned on the page matches with the actual 1. The total sale amount inclusive of cheque and cash amount equals the rate per sq. ft. mentioned on the page for an area of 658 sq. ft. which also tallies with the saleable area mentioned in the saleable area statement seized at page No. 7 of the bundle No. 1 seized from the assessee. The noting clearly shows receipt of Rs.3.55 lakhs against the cheque returned) = 3.55 lakhs and this is same as the amount stated to have been received by the assessee in his submission. She further submitted that the and its contents either before the AO or before the Ld. CIT(A). As regards the decision in the case of P.V. Kalyanasundaram (supra) and Raj Home (supra), the Ld. DR submitted that same are distinguishable on facts. Further, the Ld. DR submitted that the Ld. Counsel of the asse submitted that assessee follows completed contract method therefore no addition could have been made for the year under consideration, she submitted that neither raised before the Assessing Officer or the Ld. CIT(A) filed before the Tribunal and therefore, assessee cannot surprise the respondent by way of raising a fresh argument suddenly. She further submitted that the onus was on the assessee to make such claim before the AO was not taxable in the year under consideration and same should have been taxed into the year of the completion of the project. The Assessing Officer could have added the addition on protective basis if so required in the year of completion also. As the assessee has not taken any such stand of completed contract method and therefore now assessee cannot be allowed to an argument to defeat the provisions of law when now such an action in the hands of the assessee wou by limitation. 6. We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The issue in dispute involved is whether the assessee has received cash component on sale of flat No. 1 at gr the case of P.V. Kalyanasundaram (supra) and Raj Home (supra), the Ld. DR submitted that same are distinguishable on facts. Further, the Ld. DR submitted that the Ld. Counsel of the asse submitted that assessee follows completed contract method therefore no addition could have been made for the year under he submitted that neither any such ground was raised before the Assessing Officer or the Ld. CIT(A) led before the Tribunal and therefore, the Ld. Counsel of the assessee cannot surprise the respondent by way of raising a fresh . She further submitted that the onus was on the assessee to make such claim before the AO that not taxable in the year under consideration and same should have been taxed into the year of the completion of the project. The Assessing Officer could have added the addition on protective basis if so required in the year of completion also. As during the assessee has not taken any such stand of completed contract method and therefore now assessee cannot be allowed to an argument to defeat the provisions of law when he is cau now such an action in the hands of the assessee wou We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The issue in dispute involved is whether the assessee has received cash component on sale of flat No. 1 at ground floor , which was sold Shri Rakesh N Thakkar 9 ITA No. 7781/Mum/2019 the case of P.V. Kalyanasundaram (supra) and Raj Home (supra), the Ld. DR submitted that same are distinguishable on facts. Further, the Ld. DR submitted that the Ld. Counsel of the assessee submitted that assessee follows completed contract method therefore no addition could have been made for the year under any such ground was raised before the Assessing Officer or the Ld. CIT(A) nor has been Ld. Counsel of the assessee cannot surprise the respondent by way of raising a fresh . She further submitted that the onus was on that said amount not taxable in the year under consideration and same should have been taxed into the year of the completion of the project. The Assessing Officer could have added the addition on protective basis during assessment, the assessee has not taken any such stand of completed contract method and therefore now assessee cannot be allowed to take such he is caught, as now such an action in the hands of the assessee would be barred We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The issue in dispute involved is whether the assessee has received cash , which was sold to Shri Suresh Jadhav. The Ld. Assessing Officer has relied on the seized document found from the assessee. The Ld. Assessing Officer asked the assessee to explain the contents of the said seized paper but no reply/response file Officer. The Ld. Assessing Officer analyzed all the entries appearing in the said seized papers. For ready reference a scan copy of the said seized paper is reproduced as under: Shri Suresh Jadhav. The Ld. Assessing Officer has relied on the seized document found from the assessee. The Ld. Assessing Officer asked the assessee to explain the contents of the said seized paper but no reply/response filed by the assessee before the Assessing Officer. The Ld. Assessing Officer analyzed all the entries appearing in the said seized papers. For ready reference a scan copy of the said seized paper is reproduced as under: Shri Rakesh N Thakkar 10 ITA No. 7781/Mum/2019 Shri Suresh Jadhav. The Ld. Assessing Officer has relied on the seized document found from the assessee. The Ld. Assessing Officer asked the assessee to explain the contents of the said seized paper d by the assessee before the Assessing Officer. The Ld. Assessing Officer analyzed all the entries appearing in the said seized papers. For ready reference a scan copy of the 6.1 The typed version of the seized d as under: Flat No. 1 60+40 658 x 3800 Dev. Charge R.C. Legal Charge Parking B 12,83,860/- 50,000 11,33,860/- 3,92,000 7,41,860/- 2,45,000/- 1,96,001/- 3,00,860/- -196,000/- 49x4 1,04,860/- Bal 6.2 According to the assessee scribbling noted at the time of inquiry by the buyer and same are only estimate explained at the time of meeting with the buyer. Whereas, the lower authorities and observed that the total amount of sale recorded in the registered sale agreement is matching with the amount mentioned against “A” category of amount. seized document also matches with the The Ld. DR further submitted to have been received by the assessee from the said customer way of cheque and referred in books of accounts also matches with the working of balance amount exp The typed version of the seized document is also reproduced Flat No. 1 Ground FLR 08/11/11 25,00,400 98,700 30,000 5,000 1,50,000 A 15,00,240/- 55/- 9,49,240/- 49x8 + 1,98,000 11,45,240/- 49x5 49x4 49x4 Bal According to the assessee, the above entries are rough noted at the time of inquiry by the buyer and same are timate explained at the time of meeting with the buyer. Whereas, the lower authorities have analyzed the above documents and observed that the total amount of sale recorded in the registered sale agreement is matching with the amount mentioned category of amount. The area of the flat noted in the seized document also matches with the registered sale document. submitted that amount of Rs.3.55 lakhs claimed to have been received by the assessee from the said customer and referred in books of accounts also matches with the working of balance amount explained by her as under: Shri Rakesh N Thakkar 11 ITA No. 7781/Mum/2019 ocument is also reproduced the above entries are rough noted at the time of inquiry by the buyer and same are timate explained at the time of meeting with the buyer. analyzed the above documents and observed that the total amount of sale recorded in the registered sale agreement is matching with the amount mentioned The area of the flat noted in the registered sale document. that amount of Rs.3.55 lakhs claimed to have been received by the assessee from the said customer by and referred in books of accounts also matches with lained by her as under:  The noting the chequecomponent i.e Rs.5.51 L Returned) = 3.55L. This is sameas the amount stated to have been received by the assessee in his submission. 6.2 Further, the ratio of the amount to be received cash ( i.e. 60:40) has also been recorded accordingly, the total sale price of the flat has been bifurcated in category “A” and category concluded that category of cheque and category received by way of cash. The area of the flat recorded in the registered sale deed agreement the area of the flat recorded in the seized paper. Further the component of “B” category of the payment i.e. cash payment been reduced after making each installment of payment analysis of seizedpaper agreement of the flat, which goes under “B” category i.e.12,83,860/ component on the sale of the flat received by the assessee. 6.3 Before us, the Ld. Counsel of the assessee during the course of search no statement u/s 132(4) of the Act has been recorded and assessee has not no addition could have been made on the basis of the assessment proceedings. We are unable to agree with the assessee on this aspect. D noting clearly shows receipt of 3.55 L against the chequecomponent i.e Rs.5.51 L - 1.96 L (Chq Returned) = 3.55L. This is sameas the amount stated to have been received by the assessee in his submission. Further, the ratio of the amount to be received has also been recorded in said seized paper and the total sale price of the flat has been bifurcated in and category “B” payments. The Assessing Offi that category “A” amount, is amount to be received way of cheque and category “B” amount, is the amount to be received or of cash. The area of the flat recorded in the registered sale deed agreement i.e. 658 sq. ft., also the area of the flat recorded in the seized paper. Further the category of the payment i.e. cash payment after making each installment of payment paper getscorroborated with the , which goes to prove that the amount recorded category i.e.12,83,860/- is in the nature of the cash the sale of the flat received by the assessee. Before us, the Ld. Counsel of the assessee during the course of search no statement u/s 132(4) of the Act has been recorded and assessee has not been questioned no addition could have been made on the basis of the assessment proceedings. We are unable to agree with the Ld. Counsel of the on this aspect. During the course of the assessment Shri Rakesh N Thakkar 12 ITA No. 7781/Mum/2019 receipt of 3.55 L against 1.96 L (Chq Returned) = 3.55L. This is sameas the amount stated to have been received by the assessee in his Further, the ratio of the amount to be received by cheque and said seized paper and the total sale price of the flat has been bifurcated in payments. The Assessing Officer has ” amount, is amount to be received way ” amount, is the amount to be received or of cash. The area of the flat recorded in the also matches with the area of the flat recorded in the seized paper. Further the category of the payment i.e. cash payment, has after making each installment of payment. The corroborated with the registered sale that the amount recorded is in the nature of the cash the sale of the flat received by the assessee. Before us, the Ld. Counsel of the assessee submitted that during the course of search no statement u/s 132(4) of the Act has ed and therefore no addition could have been made on the basis of the assessment Ld. Counsel of the uring the course of the assessment proceedings, the Assessing Officer has duly provided opportunity to explain the entries, however the assessee not a case where the opportunity to explain before the Assessing Officer. It may not mandatorily question the during the statement u/s 132(4) of the Act proceedings and non does not debar the Assessing officer basis of the documents seized during the course of the search. 6.4 Further, the Ld. Counsel of the assessee submitted that the Assessing Officer has not cross ex therefore, no addition could have been made relying on the decision in the case of Hon’ble High Court of Gujarat K. Shah [2008] 307 ITR 137 (Gujarat) of the said case are distinguishab question did not indicate any referredtransaction in respect of flat seized document. Further in support of claim that no addition could have been made on th corroborating material, the Ld Counsel Punjab and Haryana High Court in the case of ACIT [2020] 120 taxmann.com 314 (Punjab and Haryana) However, the facts of the said case, the assessee was broker only and no addition was made in the proceedings, the Assessing Officer has duly provided opportunity to explain the entries, however the assessee did not respond. not a case where the assessee has not been opportunity to explain before the Assessing Officer. It may not question the assessee on each and every paper during the during the statement u/s 132(4) of the Act in course of search and non-recording of statement u/s 132(4) of the Act the Assessing officer for making assessment on the basis of the documents seized during the course of the search. Further, the Ld. Counsel of the assessee submitted that the Assessing Officer has not cross examined the purchaser and therefore, no addition could have been made relying on the decision in the case of Hon’ble High Court of Gujarat CIT v. Maulikkumar K. Shah [2008] 307 ITR 137 (Gujarat). But we note that t of the said case are distinguishable as in said case the paper in question did not indicate any transaction, whereas in instant case in respect of flat has been duly recorded seized document. Further in support of claim that no addition could have been made on the basis of seized paper without any corroborating material, the Ld Counsel relied on the decision of the Punjab and Haryana High Court in the case of Navneet Jhamb ACIT [2020] 120 taxmann.com 314 (Punjab and Haryana) However, the facts of the said case are also distinguishable the assessee was broker only and no addition was made in the Shri Rakesh N Thakkar 13 ITA No. 7781/Mum/2019 proceedings, the Assessing Officer has duly provided opportunity to not respond. So it is en provided any opportunity to explain before the Assessing Officer. It may not be on each and every paper during in course of search u/s 132(4) of the Act, for making assessment on the basis of the documents seized during the course of the search. Further, the Ld. Counsel of the assessee submitted that the the purchaser and therefore, no addition could have been made relying on the decision CIT v. Maulikkumar But we note that the facts in said case the paper in transaction, whereas in instant case has been duly recorded in the seized document. Further in support of claim that no addition could seized paper without any relied on the decision of the Navneet Jhamb v. ACIT [2020] 120 taxmann.com 314 (Punjab and Haryana). case are also distinguishable. In said the assessee was broker only and no addition was made in the hand of the seller or the managing director of the seller company. In the said case, the seller purchaser was Shri G.L. Verma the assessee arising from th income, whereas, in case before us, the registered sale amount matches with the cheque component noted in seized paper. facts in the case of Raj Homes SV group Tribunal has relied in the case of P.V. Kalyanasundaram (supra) are also distinguishable as in the instant case registered sale agreement is one of the corroborative cheque component of the the property i.e. flat sold by the assessee. The said registered agreement being one of the Ld. Counsel of the assessee are distinguishable. The Ld. Counsel further submitted that no cash was found during the course of search at the premises of the assessee. We reject this contention of the Ld. Counsel of the assessee of seized material, cash prior to the date of seized paper i.e. that same should be found from the assessee search. Further, the Ld. Counsel of the assessee submitted that the said paper is not in the hand writing of the assessee. of the Ld. Counsel of the assessee is submission that there was a practice of making such noting on estimate basis during booking of sale of flat. Further, per hand of the seller or the managing director of the seller company. In the said case, the seller was M/s Indo American Electricals Ltd. and as Shri G.L. Verma and no profit or loss was shown by arising from those transactions in his return of , whereas, in case before us, the registered sale amount matches with the cheque component noted in seized paper. e of Raj Homes SV group (supra) wherein Tribunal has relied in the case of P.V. Kalyanasundaram (supra) are also distinguishable as in the instant case registered sale agreement is one of the corroborative pieces of evidencewhich omponent of the same amount as well as other details of the property i.e. flat sold by the assessee. The said registered one of corroborative evidence, decisions the Ld. Counsel of the assessee are distinguishable. The Ld. further submitted that no cash was found during the course of search at the premises of the assessee. We reject this contention of the Ld. Counsel of the assessee becauseas per noting material, cash has been received in installments, the date of seized paper i.e. 18/11/2012. It is not necessary that same should be found from the assessee during the course of . Further, the Ld. Counsel of the assessee submitted that the in the hand writing of the assessee. of the Ld. Counsel of the assessee is contradictory to his own submission that there was a practice of making such noting on estimate basis during booking of sale of flat. Further, per Shri Rakesh N Thakkar 14 ITA No. 7781/Mum/2019 hand of the seller or the managing director of the seller company. In American Electricals Ltd. and no profit or loss was shown by se transactions in his return of , whereas, in case before us, the registered sale amount matches with the cheque component noted in seized paper. The supra) wherein the Tribunal has relied in the case of P.V. Kalyanasundaram (supra) are also distinguishable as in the instant case registered sale agreement which establish the amount as well as other details of the property i.e. flat sold by the assessee. The said registered evidence, decisions relied by the Ld. Counsel of the assessee are distinguishable. The Ld. further submitted that no cash was found during the course of search at the premises of the assessee. We reject this becauseas per noting installments, which is t is not necessary during the course of . Further, the Ld. Counsel of the assessee submitted that the in the hand writing of the assessee. This argument contradictory to his own submission that there was a practice of making such noting on estimate basis during booking of sale of flat. Further, per the provisions of section 132(4 the course of the search from the premises of the assessee is presumed to be belonging to him and in his hand writing relevant provision is reproduced as under for ready reference: “(4A) 2 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, it may be presumed (i) that such books of account, other 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 the handwriting of, any particular person, are in that person' s 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 6.5 This presumption to produce a report from hand writing expert that said paper is not in his hand writing and the said paper, but no such documentary evid provisions of section 132(4A) of the Act any documen the course of the search from the premises of the assessee is presumed to be belonging to him and in his hand writing relevant provision is reproduced as under for ready reference: 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, it may be presumed- that such books of account, other documents, money, bullion, jewellery or other valuable article or thing belong or belongs to such person; that the contents of such books of account and other documents are true; and 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 the handwriting of, any particular person, are in that person' s 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.]” his presumption is rebuttable and onus was on the assessee to produce a report from hand writing expert that said paper is not in his hand writing and provide name of the person who has no such documentary evidences Shri Rakesh N Thakkar 15 ITA No. 7781/Mum/2019 ) of the Act any document found during the course of the search from the premises of the assessee is presumed to be belonging to him and in his hand writing. The relevant provision is reproduced as under for ready reference: 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 documents, money, bullion, jewellery or other valuable article or thing belong or that the contents of such books of account and other 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 person' s 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 onus was on the assessee to produce a report from hand writing expert that said paper is not name of the person who has written s have been filed except this argument Counsel of the assessee submitted that the assessee is following project completion method so no business income can be assessed in this assessment year as the project was years. We are of the opinion that no such ground has been raised by the assessee and therefore, the Ld. Counsel of the assessee cannot surprise the respondent i.e. the ld. DR by way of raising this arguments at last moment documentary evidence in support of his contention argument was not raised or the Ld. CIT(A).The Ld. DR submittedhad raised by the assessee before the As could have taken care of the argument and could have assessed the addition in the year of the completion on the basis of the protective basis. We agree with the contention of the Ld. DR and therefore, we reject this contention has submitted that this document is not a dumb document and been properly analys amount recorded under category component on sale registered in favor recording any statement or any inquiry from the buyer render the addition when the entries recorde with registered sale agreement. this argument, hence same is rejected. Further, the Ld. Counsel of the assessee submitted that the assessee is following project completion method so no business income can be assessed in this assessment year as the project was completed in subsequent years. We are of the opinion that no such ground has been raised by the assessee and therefore, the Ld. Counsel of the assessee cannot surprise the respondent i.e. the ld. DR by way of raising this at last moment. The Ld. Counsel has not filed any documentary evidence in support of his contention argument was not raised at the stage either of the Assessing Officer The Ld. DR submittedhad such an raised by the assessee before the Assessing Officer could have taken care of the argument and could have assessed the addition in the year of the completion on the basis of the protective basis. We agree with the contention of the Ld. DR and therefore, we reject this contention of the Ld. Counsel of the assessee. The Ld. DR has submitted that this document is not a dumb document and analysed with supporting corroborative evidence. The amount recorded under category ‘B’ is conclusive to be cash on flat at ground floor, which has been in favor Shri Suresh Jadhav. In our recording any statement or any inquiry from the buyer the addition as not in accordance with law, particularly when the entries recorded in the seized documentsare corroborated with registered sale agreement. In view of the above Shri Rakesh N Thakkar 16 ITA No. 7781/Mum/2019 is rejected. Further, the Ld. Counsel of the assessee submitted that the assessee is following project completion method so no business income can be assessed completed in subsequent years. We are of the opinion that no such ground has been raised by the assessee and therefore, the Ld. Counsel of the assessee cannot surprise the respondent i.e. the ld. DR by way of raising this Counsel has not filed any documentary evidence in support of his contention also. This the stage either of the Assessing Officer n argument was sessing Officer , the Revenue could have taken care of the argument and could have assessed the addition in the year of the completion on the basis of the protective basis. We agree with the contention of the Ld. DR and therefore, we of the Ld. Counsel of the assessee. The Ld. DR has submitted that this document is not a dumb document and has with supporting corroborative evidence. The is conclusive to be cash which has been Shri Suresh Jadhav. In our opinion, not recording any statement or any inquiry from the buyer, also cannot as not in accordance with law, particularly are corroborated In view of the above discussion, we uphold the finding of the Ld. CIT(A) on the issue in dispute. Accordingly, the grounds raised by the assessee are dismissed. 7. In the result, th Order pronounced in the open Court on Sd/ (ABY T VARKEY JUDICIAL MEMBER Mumbai; Dated: 13/06/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// ld the finding of the Ld. CIT(A) on the issue in dispute. Accordingly, the grounds raised by the assessee are dismissed. In the result, the appeal of the assessee is dismissed. nounced in the open Court on 13/06/2023. Sd/- Sd/ ABY T VARKEY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Shri Rakesh N Thakkar 17 ITA No. 7781/Mum/2019 ld the finding of the Ld. CIT(A) on the issue in dispute. Accordingly, the grounds raised by the assessee are dismissed. e appeal of the assessee is dismissed. /06/2023. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai