DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1), CHENNAI vs. RADIANCE REALTY DEVELOPERS INDIA LTD., CHENNAI

ITA 2979/CHNY/2024Status: DisposedITAT Chennai02 May 2025AY 2017-18Bench: SHRI ABY T. VARKEY, JUDICIAL MEMBER AND\nSHRI AMITABH SHUKLA, ACCOUNTANT MEMBER\nITA Nos.2978 - 2984/Chny/2024\n&\nCO Nos.11-17/Chny/2025\nनिर्धारण वर्ष/Assessment Years: 2016-17 to 2022-23\n\nThe DCIT,\nCentral Circle-2(1),\nChennai.\nM/s Radiance Realty-\nDevelopers India Ltd.,\nRadiance Towers, 1st Floor,\n33 Feet Road, Anna Salai,\nGuindy, Chennai – 600 032.\n[PAN: AACCN5152H]\n(अपीलार्थी/Appellant)\n(प्रत्यर्थी/Respondent/Cross\nObjector)\n\nITA Nos.2971 - 2972/Chny/2024\nनिर्धारणवर्ष/66 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the addition made on account of unaccounted cash collected from customers for the sale of flats was not valid. The Tribunal noted that while the AO relied on statements recorded under Section 132(4) and other evidence, the core of the addition was based on admissions made during a survey under Section 133A. Citing the case of CIT v. Dhingra Metal Works (328 ITR 284), the Tribunal emphasized that statements recorded under Section 133A do not have conclusive evidentiary value, as the survey officer is not authorized to administer an oath. The judgment in Dhingra Metal Works highlighted that admissions, while important, are not conclusive and can be rebutted. The Tribunal found that the assessee had not made any admission under Section 132(4) that carried evidentiary value and that the addition could not be made solely on the basis of statements obtained during a survey. Therefore, the order of the Ld. CIT(A) deleting the addition was upheld. The grounds raised by the Revenue and the cross-objections of the assessee concerning this issue were dismissed. Regarding the validity of reassessment under Section 148, the assessee did not seriously contest these grounds, and they were dismissed as not pressed.

What were the facts?

The Income Tax Appellate Tribunal (ITAT) heard cross-appeals by the Revenue and the assessee, M/s Radiance Realty Developers India Ltd., concerning assessment years 2016-17 to 2022-23. These appeals stemmed from orders passed by the Dy. CIT, Central Circle-2(1), Chennai, which were subsequently challenged before the Learned CIT(A). A search under Section 132 of the Income Tax Act, 1961, was conducted on the assessee on February 14, 2023. Following the search, the Assessing Officer (AO) issued notices under Section 148 for AYs 2016-17 to 2021-22, leading to assessments under Section 147/143(3). For AY 2022-23, a scrutiny assessment under Section 143(3) was completed. The dispute involves several additions and disallowances made by the AO.

What were the issues?

1. Whether the addition made on account of unaccounted cash collected from customers for sale of flats is valid, considering the evidence and statements recorded during the search and survey operations. Assessee's Contention: The assessee argued that the addition was based on statements recorded under Section 133A of the Act, which lack evidentiary value. They relied on the decision in CIT v. Dhingra Metal Works (328 ITR 284) to support the contention that statements recorded during a survey do not have conclusive evidentiary value, especially when the assessee can explain discrepancies. The assessee also contended that the initial explanation of 'EB' as 'Extra Budget' was later twisted. Revenue's Contention: The Revenue's grounds of appeal relate to the deletion of additions made by the AO concerning unaccounted cash collected from customers. The AO's additions were based on electronic data seized during the search, including excel sheets and WhatsApp conversations, and sworn statements recorded under Section 132(4) from employees, which indicated 'EB' referred to cash payments not recorded in the books. The AO also confronted the CFO who admitted 'EB' meant unaccounted cash receipts. 2. Whether the reassessment proceedings under Section 148 of the Act are valid. Assessee's Contention: The assessee's grounds of cross-objection regarding the validity of reassessment under Section 148 were not pressed during the hearing. Revenue's Contention: Not recorded.

Which sections of the Income-tax Act were involved?

Section 132,Section 148,Section 147,Section 143(3),Section 133A,Section 132(4),Section 43CA,Section 40A(3),Section 37

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH: CHENNAI

Before: SHRI ABY T. VARKEYAND

PER AB

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 132

All 14,598 judgments and leading authorities on Section 132 →

Recent GST High Court judgments

Search GST case law →