M/S. PRESTIGE AVENUES LIMITED, HYD,HYDERABAD V. DCIT, CENTRAL CIRCLE-VII, HYDERABAD

ITA 741/HYD/2011

AI Insights

The case involves M/s. Prestige Avenues Limited, which appealed against the addition of Rs.70,93,332 to their income for the Assessment Year 2006-07. This addition was based on a discrepancy between the purchase price recorded in a registered sale deed and a higher price indicated in an unregistered agreement to sale and a money receipt, both seized during a search operation under section 132 of the Income Tax Act. The Tribunal examined the arguments and evidence presented, including the comparability of other transactions in the same locality, and upheld the addition, finding the unregistered documents to be credible evidence of the actual transaction value.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 28614 (ITAT-HYDERABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2006-2007
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: K.C.DEVDAS

Judgement Text

" आआआआ आआआआआआ आआआआआआ, आआआआआआआआ आआआ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘A’ Bench, Hyderabad BEFORE SHRI LALIET KUMAR, JUDICIAL MEMBER AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER आ.अपी.सं /ITA No.741/Hyd/2011 (निर्धारण वर्ा/Assessment Year:2006-07) M/s. Prestige Avenues Limited, Hyderabad. PAN:AADCP3698P Vs. Dy. Commissioner of Income Tax, Central Circle-VII, Hyderabad. (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri K.C. Devdas, C.A. रधजस् व द्वधरध/Revenue by:: Shri B. Bala Krishna, CIT-DR सुिवधई की तधरीख/Date of hearing: 07/11/2024 घोर्णध की तधरीख/Pronouncement: 06/01/2025 आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M. : This appeal is filed by M/s. Prestige Avenues Limited, Hyderabad (“the assessee”), feeling aggrieved by the order passed by the Learned Commissioner of Income Tax (Appeals), Hyderabad (“Ld. CIT(A)”), dated 15.02.2011 for the A.Y. 2006- 07. 2. At the outset, the Learned Authorised Representative (“Ld. AR”) submitted that the solitary ground in the appeal is on ITA No.741/Hyd/2011 2 account of addition of Rs.70,93,332/- made by the Learned Assessing Officer (“Ld. AO”) and sustained by the Ld. CIT(A). The brief facts with regard to the grounds are that the assessee had purchased 8 acres of land at Karkhal Pahad village of Mahboobnagar District @ Rs.40,000/- per acre on 20.03.2006 by a registered sale deed. During the search operation u/s.132 of the Act conducted on 30.11.2006 in the premises of the assessee, one deed of the agreement to sale was seized from the premises of the assessee. As per the seized deed of agreement to sale, the consideration decided per acre of land was Rs.12,22,222/-. One money receipt of Rs.30 lakhs was also seized from the assessee. The comparative chart of the party to the registered sale deed dated 30.11.2006, the deed of the agreement to sale is found at page no.11 of the order of Ld. AO. The Ld. AO found that the seller, survey number and the land area sold were same in both the deeds. He also found that one of the agreement holder and one of the purchaser to the deed of agreement to sale were the witness to the registered sale deed. Therefore relying on section 292C and 132(4A) of the Act, the Ld. AO made addition of Rs.70,93,332/- u/s.69A of the Act, being ITA No.741/Hyd/2011 3 the difference in the rate as per deed of agreement to sale and the rate as per registered sale deed. 3. Aggrieved with the order of Ld. AO the assessee filed appeal before the Ld. CIT(A). However, the Ld. CIT(A) agreed to the view of Ld. AO and uphold the addition. 4. Aggrieved by the order of Ld. CIT(A), the assessee is in appeal before us. The Ld. AR submitted that the name of the assessee was not there in the deed of agreement to sale as well as in the money receipt seized from the premises of the assessee. The deed of agreement to sale is not a registered document and therefore has no evidential value. He also submitted that in order to sell the property at higher rate, the seller sometime prepare forged agreement, which has nothing to do with the actual transaction. The Ld. AR also submitted that they have paid only the amount mentioned in the registered sale deed which has been registered before a sub-registrar, which is a government agency. A dealing which has been executed before a government agency cannot be disputed. He further submitted that they have produced before the Ld. AO as a comparable, one registered sale deed executed between the other independent party at the same time in the same locality from which also it can ITA No.741/Hyd/2011 4 be pursued that the market value of the land was Rs.4,000/- per acre and the assessee had negotiated with the seller at the relevant market value and paid the market value to the seller, no extra amount had been paid by the assessee to the seller in excess of the amount mentioned in the registered sale deed. He further argued that the Ld. AO had made addition only relying on an unregistered document, to which the assessee was not a party. The assessee had made a request before the Ld. AO for cross-examination of the parties referred in the deed of agreement to sale, which was not provided by the Ld. AO. The Ld. AO also did not able to brought on record any comparable case, justifying the sale value recorded in the deed of agreement to sale. The Ld. AO also did not brought any evidence on record regarding payment of any on money by the assessee. Therefore consolidating all their grounds, finally the Ld. AR submitted that the addition made by the Ld. AO is without any concrete evidence and is liable to be deleted. 5. Per contra, the Ld. DR relied on the orders of revenue authorities and reiterated to dismiss the appeal of the assessee. 6. We have heard the rival contentions and also gone through the record in the light of the submissions made on either side. ITA No.741/Hyd/2011 5 The Ld. CIT(A) and the Ld. AO have brought on record the clinching evidence found during the course of search from the premises of the assessee. These evidences found during the course of search clearly show that there was a pre-agreement with respect to the same piece of land which was the subject matter of assessment and in the said piece of evidence / agreement, the value of the land has been mentioned as Rs. 12,22,222/- per acre. However, it is the case of the assessee that the land and the document though found in the premises cannot be considered for the purpose of evidence. However, the fact remains that during the course of search, these documents were found from the possession of assessee which clearly shows that previous agreement in respect of same piece of land was for a consideration of Rs. 12,22,222/-. Furthermore, it is found that the survey number and the land area sold were same in both the deeds. It is also found that one of the agreement holder and one of the purchaser to the deed of agreement to sale were the witness to the registered sale deed. The clear chain of the documents found from the premises of the assessee and the one which was registered in favour of the assessee clearly show that the value of the land has been shown at a low consideration as ITA No.741/Hyd/2011 6 against the other consideration mentioned in the agreement to sale. 7. The argument of the assessee before us was that the contents of the registered document cannot be disputed with the help of the other documents found from the possession of the assessee. It will be sufficient to note that the onus is on the assessee to prove that the contents of the documents found in the premises of the assessee were incorrect. It is not the case of the assessee that the documents were planted by the Revenue or the sale consideration mentioned therein was incorrect. On the contrary, the document which is available on record clearly shows that it was an agreement between two independent parties with respect to the same land wherein the higher consideration was mentioned and which was more than the value mentioned in the registered document. 8. It is the case of the assessee that the addition cannot be made on the basis of surmises and conjectures and in derogation of the registered documents. It is correct that the contents of the registered documents should not be lightly disturbed. However, in the present case, as mentioned hereinabove, there is unrebutted evidence which clearly shows that the consideration ITA No.741/Hyd/2011 7 for the sale of land was far more than the consideration mentioned in the sale deed. The proposition that the contents of a registered document cannot be disturbed is not an absolute proposition of law and can be revisited in the case of contrary reliable evidence found during the course of search or brought on record by the Ld. AO. Therefore, in our considered opinion, the value recorded under the agreement to sale can not be denied by the assessee and the addition made by the Ld. AO can not be treated as unjustified. Accordingly, we uphold the addition made by the Ld. AO. 9. In the result, the appeal of the assessee is dismissed. Order pronounced in the open Court on 6th Jan., 2025. Sd/- Sd/- (LALIET KUMAR) (MADHUSUDAN SAWDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad. Dated: 06.01.2025. * Reddy gp ITA No.741/Hyd/2011 8 Copy of the Order forwarded to : 1. M/s. Prestige Avenues Limited, Rao & Sai Advocates and Tax Consultants, 6-3-570/1&2, Rock Vista, Rockdale Compound, Somajiguda, Hyderabad. 2. DCIT, Central Circle-VII, Hyderabad. 3. Pr.CIT, Hyderabad. 4. DR, ITAT, Hyderabad. 5. Guard file. BY ORDER, "