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Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI ARUN KUMAR GARODIA & SHRI LALIET KUMAR
IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH : BANGALORE
BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER AND SHRI LALIET KUMAR, JUDICIAL MEMBER
ITA No.891/Bang/2018 Assessment Year : 2007-08 Dr. Ranjan Pai, The Assistant Commissioner Block No. 1B, Jakkur of Income Tax, Plantation Village, vs. Central Circle – 2 (2), Yelahanka Main Road Bangalore. Bangalore – 560 064. PAN: AGBPP2795G APPELLANT RESPONDENT & C.O. No. 19/Bang/2019 (in ITA No. 891/Bang/2018) (By Assessee) Assessee by : Shri S.K. Tulsiyan, Advocate Revenue by : Ms. Neera Malhotra, CIT (DR)
Date of hearing : 28.03.2019 Date of Pronouncement : 05.04.2019
O R D E R Per Shri Laliet Kumar, Judicial Member The present appeal has been filed by revenue being aggrieved by the order passed by the Commissioner on 08.12.2017 on the following three effective grounds. “2. Whether on facts & circumstances of the case the CIT(A) was correct in deleting the addition of Rs.4.5 Crore made by the AO when the connected transactions are recorded in the books of account of the assessee, even though the documents were seized in premises of third parties. 3. Whether on facts & circumstances of the case the CIT(A) was correct in accepting one cash transaction while not accepting the other cash transaction made by the assessee where seized material is available in this regard.
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 2 of 16 4. Whether on facts & circumstances of the case the CIT(A) was correct in relying on the decision in the case of Addl. CIT Vs. Lata Mangeshkar (97 ITR 696) and in the case DCIT, New Delhi Vs. Sri Jaswant Singh Chawala (ITR Nos. 3285, 3286/Del/2013 dated 20.03.2015 when facts of the two cases are distinguished for the instant case?”
The ld. AR for the assessee has also submitted that the assessee has filed a CO bearing no. 19/Bang/2019 for the following grounds. Tax effect relating Grounds of Appeal to each Ground of cross-objection
That, the Ld. CIT(A)-11, Bangalore erred in No Tax Effect not appreciating that a proceeding u/s.153A asaddition of the Act on an assessee is not maintainable ofRs.4,90,30,000/- 1. if there is no incriminating material found has been deleted pursuant to search u/s.132 of the Act u/s.292C and not conducted on such assessee. u/s.153A.
That, the Ld. CIT(A) erred in not appreciating that it is now a settled principle of law that in order ton exercise jurisdiction 2. u/s.153A of the Act for a particular -do- assessment year, such incriminating material found pursuant to search shall have to pertain to such relevant assessment year. That, the Ld. CIT(A) erred in not appreciating that third party documents found during the course of search conducted 3. on such third parties cannot be considered -do- as discovered from the assessee, thus vesting jurisdiction on the A.O. of the assessee for proceedings u/s.153A of the Act. That, the Ld. CIT(A) erred in not appreciating that a mere statement u/s.131 of the Act without there being any 4. incriminating material, found and seized -do- from the assessee, cannot vest jurisdiction on the A.O. of the assessee for proceedings u/s.153A of the Act. Total tax effect (see note below) Nil
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 3 of 16 3. The ld. AR had also filed an application for condonation of delay mentioning the reasons for not filing the CO within the period and has submitted that for the reasons mentioned in the application, the delay in filing this C.O. should be condoned. Per contra, the ld. DR has vehemently opposed for condonation of delay and relied upon three judgments of co-ordinate bench.
We have heard the rival contentions of the parties and perused the record. In our view, the assessee has given cogent reasons for not preferring the C.O. within the statutory period of time and we are convinced that the procedural aspect should not be road block for fair and just adjudication of the legal issues and accordingly, we condone the delay in filing the C.O. In our view, the judgments relied upon by the ld. DR of revenue are not germane to the issues before us as all the decisions of the Tribunal were in respect of delay in condonation of delay in filing of appeal and were not for delay in filing of CO. Moreover the decision of Hon’ble Supreme Court in the matter of Collector, Land Acquisition Vs. Mst. Katiji& Others as reported in (1987) 167 ITR 471(SC) was not considered by tribunal in any of these orders. .
The ld. DR in support of the revenue appeal has made the following submissions that Simultaneous search u/s. 132 was conducted on 12.04.2011 by the revenue at the residence of the assessee also done at the premises of Smt. Adlene Kagoo and Shri V. Rangrajan where some incriminating material was also found. Beside that some incriminating material were also found during the course of search at the premises of assessee . The ld. DR had submitted that based on the incriminating material found at the premises of Smt. Adlene Kagoo and Shri V. Rangrajan, the assessee had made the disclosure for an amount of Rs. 12,03,35,000/- before DDIT (Inv.). It was the case of the ld. DR that the seized material on the basis of which the disclosure was made, were not denied by the assessee. It was further submission of ld. DR that the
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 4 of 16 assessing officer has made addition of Rs. 3,08,35,000/- in Para 7 which was based on the seized material found in the premises of Smt. Adlene Kagoo which was not challenged by the assessee before ld. CIT(A) and lastly, it was submitted that the conduct of ld. CIT(A) for making the deletion of the amount of Rs. 4.50 Crores based on the seized material namely AK/PDP/12-Pg-125 was without any basis and was on account of some conjectures and surmises. 6. Our attention was drawn by ld. DR to Para 5.8 of the order of CIT (A) and on the basis of such Para, the ld. DR has submitted that the conclusion drawn by the ld. CIT(A) is not emanating from the record .It was submitted that the assessee cannot be allowed to admit ,same seized material on the basis of which disclosure were made and additions admitted by the assessee, and deny same the seized material when used for making the addition of of Rs. 4.50 Crores, under the circumstance when seized material was recovered on the same day from the same person, during the course of search simultaneously conducted and therefore, the revenue was right in making the addition based on the same of Rs. 4.50 Crores. 7. It was submitted that the document AK/PDP/12-Pg-125 was recovered from the premises of Smt. Adlene Kagoo and the said document was put up to the assessee, in this document the assessee had shown to have paid an amount of Rs. 4.50 Crores in cash for the purchases of Jakkur land. It was submitted that the entire action of ld. CIT (A) is without application of mind and was not based on any material available on the record. She submitted that the order of ld. CIT(A) is required to be set aside and the order of the AO is required to be upheld.
Per contra, the ld. Advocate for the assessee had vehemently opposed the appeal and had submitted that no incriminating material was recovered from the residential premises of the assessee or business premises of the assessee on the basis of which the addition was made to the tune of Rs. 4.50 Crores. The statement of the assessee was recorded u/s. 131 on 10.06.2011 wherein the assessee had denied of making any payment of Rs.
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 5 of 16 4.50 Crores in cash. He has also drawn our attention to page no. 55 of paper book where the assessee in response to the question 6 made the following submissions. “Q6. I am showing you page no. 44 of Annexure A/VR/Res/01 seized during the course of search at the residence of Shri V. Rangarajan on 12.4.2011 and I am also showing you page 125 Annexure AKP/PDP/12 seized during the search at the residence of Smt. Adlene Kagoo on 12.4.2011. Kindly go through the same and state whether the transactions reflected in these documents are recorded in your books of accounts? Ans. The details as recorded in page no. 125 and 44 referred above are as below. Entries for Rs.9.2 crores, Rs.4.42 crores and Rs.8.82 crores were payments made by Indiland Developers Bangalore Pvt. Ltd., under various agreements entered into with Shri P. Dayananda Pai by Indiland Developers Bangalore Pvt. Ltd., These payments are not related to above land purchase. With respect to entries for Rs.10.98 crores, Rs.9.9 crores, Rs.4.5 crores and Rs.2.15 crores I am unable to identify these transactions and these payments/receipts does not pertain to me.” ( emphasis supplied by us ) 9. The ld. A R had also submitted that the seized material recovered from the premises of the Smt. Adlene Kagoo was a document which cannot be used for the purpose of making addition and for that purpose, he has drawn our attention to the statement recorded u/s. 132(4) at page 59 in response to question 11 to the following effect. “Q.No.11. I am showing files containing loose sheets marked AK/PDP/8 to 20. The sheets contain number of payment & receipts from and to different persons in respect of property transactions of Sri Dayanand pai. Please go through the papers in each file and give details of the transactions. Also please state the reason as to why these papers relating to the transactions are kept at your residence? Ans: As informed already to Q No. 10 above I do not have any knowledge of the transactions undertaken by Shri Dayanand Pai recorded in the papers, These papers were handed over to me by Sri Dayanand Pai for keeping in safe custody. Hence they are available at my residence.”
On the basis of this answer, it was submitted that the document AK/PDP/12- Pg-125 was not recovered from the person who is authorized person to keep it . Smt. Adlene Kagoo has not stated that the said document was
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 6 of 16 written in her handwriting nor it is submitted by her that she knows about the contents of the document nor it was submitted by her that the said document was written in her presence by somebody else nor it was that she has knowledge about the contents of these documents. In fact Smt. Adlene Kagoo was never examined by the revenue authorities nor MR Dayanad Pai was also examined by the revenue authorities. The Pith and substance of the argument of the AR was that this document is not a legal piece of evidence and it is not incriminating material within the eyes of law and therefore it cannot be formed basis of making addition of Rs. 4.50 Crores.
The ld. AR had also submitted that these two sale deeds were executed on 30.03.2007 and 06.08.2009 in respect of jakkur land and the alleged cash payment reflected in AK/PDP/12-Pg-125 was made on 13.10.2006. It was submitted that the sale deed shows that the cheques mentioned in the sale deed were not the same cheques which was referred in AK/PDP/12-Pg-125. It was submitted that in the AK/PDP/12-Pg-125, the following details of the transactions were mentioned as on page 89A of the paper book.
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 7 of 16
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 8 of 16 12. The ld. AR had taken us to the sale deed on page nos. 90 and 105 and had submitted that the cheques mentioned in the said two sale deeds were not same cheques mentioned in the AK/PDP/12-Pg-125. It was further submitted that the seller vendor of these two lands from whom the lands were purchased were not examined or called by the revenue authority to confirm the receipt of the amount of Rs. 4.50 Crores. Lastly the ld. AR relies upon the three decisions namely
1) Addl. CIT vs. Lata Mangeshkar, (1974) 97 ITR 696 Bom 2) DCIT vs. Jaswant Singh Chawla in ITA Nos. 3285 & 3286/Del/2013 dated 20.03.2015 3) Pr. CIT vs. Meeta Gutgutia, [2018] 96 taxmann.com 468 (SC)
In rebuttal ld. DR had submitted that the decision relied upon by the assessee are distinguishable facts and therefore submitted that the appeal of the revenue is required to be allowed. We have heard the rival contentions of the parties and perused the record.
We have heard the rival contentions and perused the record. The basis of the addition made by the assessing officer is mentioned in paragraphs 8.2.5, 8.2.6 and 8.2.8 were to the following effect. “8.2.5It is here that the single entry of payment made in cash on 13/10/2006 amounting to Rs. 4.5 crores is found. The assessee was given an opportunity in the form of show cause notice dt. 21.01.2014 to explain the nature and content of the statement marked as AK/PDP/12-Pg-125 and show cause why the amount of Rs. 4,.50,00,000/- paid in cash along with the cheque payments made by M/s. Indiland Developers Bangalore Private Limited on his behalf should not be considered as unexplained income. 8.2.6 The assessee vide his reply dt. 24.02.2014 maintained his stand as taken before the office of DDIT – I (3), Bangalore that no such payments were made by him. The cheque payments reflected in the statement pertains to land transactions of that company i.e., M/s. Indiland Developers Private Limited for purchase and development other lands which is reflected in the ledger account. It has no relation with Jakkur Lands. Since the entries pertains to Jakkur Lands which is not the related the statement was to be held as erroneous.
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 9 of 16
8.2.8 The cheque transactions reflected in this statement have been recorded in the books of both parties i.e., Sri. Ranjan Pai Group and Sri. Dayanand Pai Group albeit as advance received against some other property account. It is a fact that Sri. Ranjan Pai has purchased Jakkur property from Sri. Dayanand Pai . This is evidenced by registered sale deed dt. 30.03.2007 wherein both Sri. Ranjan Pai and Smt. Shruti Pai have purchased 4 Acre 12.8 Guntas of land at Jakkur from M/s. Century Realtors a Dayanand Pai Group Concern. It is again a fact that 45,000 Sq ft. of land of the same Jakkur Property has been resold by Sri. Ranjan Pai to M/s. Legacy Dimora on 30.03.2007. M/s. Legacy Dimora is partnership firm in which Sri. Sanjay Shenoy, a nominee of Sri. Dayanand Pai is a partner. There are transactions between M/s. Indiland Developers Bangalore Private Limited and Sri. Dayanand Pai Group which is established by the ledger extract of M/s. Indiland Developers Bangalore Private Limited. As the cheque payments are against other property accounts, the entries found in the statement are not works of imagination or fiction. Since it is proved that part of transactions, carried out in cheque, which are reflected in the books of accounts are true, the seized evidence gains strength and is considered to be true and correct. The cheque payments which are true, though pertaining to other properties, establish the veracity of the document. Accordingly, other part of transaction carried out in cash shall also be held as true. Hence the payment made in cash of Rs. 4,50,00,000/- in lieu of purchase of immovable property at Jakkur is held as true and accordingly brought to tax as unexplained income for A.Y 2007-08.” 15. From the perusal of the above said paragraphs, it is clear that the basis of making addition of Rs. 4.50 Crores was the document seized from the premises of Smt. Adlene Kagoo (AK/PDP/12-Pg-125). First of all, we have to examine whether this document which was found in possession of Smt. Adlene Kagoo can form basis for making addition in the hands of the present assessee. For the purposes of making any document to be incriminating material, it is necessary that the document should be found from the lawful custody of a person who is lawfully and naturally responsible for possessing it. In the present case, as is clear from the answer given by Smt. Adlene Kagoo, it is clear that the document was neither written by her nor she is aware of the content, nor she is aware who had written the document and it is also not the case of the revenue that the assessee had taken and kept said document in the custody of Smt. Adlene
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 10 of 16 Kagoo. On the other hand, the sole case of the revenue is this that the said document was allegedly kept by Shri Dayananda Pai. To prove the live link by the revenue , the statement of Shri Dayananda Pai should have been recorded categorically mentioning that this document belonged to the present assessee. In fact, the assessee under statement u/s. 131 had denied of the execution of this document and also the content. In our view, the document is required to be proved in accordance with principle of Evidence Act as applicable in Income Tax proceedings, either by primary evidence or secondary evidence. In the present case, none has been done by the revenue to prove seizure of document and contents thereof, so as to enable revenue to build up its case for the purpose of treating the document to be incriminating document. The document relied upon by the revenue has not been proved by the revenue that it belong to the assessee nor it was proved that it contain incriminating material on the basis of which addition can be made. We also draw strength from the judgment of Hon’ble Supreme Court in the matter of vs. CBI vs V. C. Shukla ( 1998) 3 SCC 410 where the Hon’ble Supreme Court has laid down as under. “16. To appreciate the contentions raised before us by the learned counsel for the parties it will be necessary at this stage to refer to the material provisions of the Act. Section 3 declares that a fact a relevant to another when it is connected with the other in any of the ways referred to in the provisions of the Act relating to the relevancy of facts; and those provisions are to be found in sections 6 to 55 appearing in Chapter II. Section 5, with which Chapter Ii opens, expressly provides that evidence may be given in any suit or proceeding of the existence or non-existence of every fact in issue and the facts declared relevant in the aforesaid section, and of no others. Section 34 of the Act reads as under:- " Entries in books of account when relevant - Entries in book of account, regularly kept in the course of business, are relevant whenever they refer to a matter into which the court has to inquire but such statements shall not alone be sufficient evidence to charge any person with liability."
From a plain reading of the Section it is manifest that to make an entry relevant thereunder it must be shown that it has been made in a book, that book is a book of account and that book of account has been regularly kept in the course of business. From the above Section it is also manifest that even if the above requirements are fulfilled and the entry becomes admissible as relevant evidence, still, the statement made therein shall not alone be sufficient evidence, still, the statement made therein shall not along be sufficient evidence to charge any person with liability. It is thus seen that while the first part of the section speaks of the relevancy of the entry as evidence, the second park speaks, in a negative way, of its evidentiary value for charging a person with a liability. It will, therefore, be necessary for us to first ascertain whether the entries in the documents, with which we are concerned, fulfil the requirements of the above section so as to be admissible in evidence and if this question is answered in the affirmative then only its probative value need be assessed. 18. 'Book' ordinarily means a collection of sheets of paper or other material, blank, written, or printed, fastened or bound together so as to form a material whole. Loose sheets or scraps of paper cannot be termed as 'book' for they can be easily detached and replaced. In dealing with the work
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 11 of 16 'book' appearing in Section 34 in Mukundram vs. Dayaram [AIR 1914 Nagpur 44], a decision on which both sides have placed reliance, the Court observed:- " In its ordinary sense it signifies a collection of sheets of paper bound together in a manner which cannot be disturbed or altered except by tearing apart. The binding is of a kind which is not intended to the moveable in the sense of being undone and put together again. A collection of papers in a portfolio, or clip, or strung together on a piece of twine which is intended to be untied at will, would not, in ordinary English, be called a book............................... ................................I think the term "book" in S. 34 aforesaid may properly' be taken to signify, ordinarily, a collection of sheets of paper bound together with the intention that such binding shall be permanent and the papers used collectively in one volume. It is easier however to say what is not a book for the purposes of S. 34, and I have no hesitation in holding that unbound sheets of paper in whatever quantity, though filled up with one continuous account, are not a book of account within the purview of S. 34."
We must observe that the aforesaid approach is in accord with good reasoning and we are in full agreement with it. Applying the above tests it must be held that the two spiral note books (MR 68/91 and 71/91) and the two spiral pads (MR 69/91 and MR 70/91) are "books" within the meaning ofSection 34, but not the loose sheets of papers contained in the two files (MR 72/91 and MR 73/91).”]
In addition to the above, we may like to state that the assessee had admitted to disclose the amount of Rs. 12,03,35,000/- based on the document namely A/VR/Res/01-pgs 37,38 and 41 and page 127 of annexure AKP/PDP/15 Whereas the addition of Rs. 4.50 Crores were made on the basis of AK/PDP/12-pg 125. From the bare perusal of these documents , it is clear that both are different set of documents and are not part of the same series of documents. All the documents even as per the case of the revenue are loose document and are not forming part of the same book of account or diary. In case of the loose papers, each and every document is separate and distinct document and even if one document is admitted by the assessee then it will not lead to ipso facto conclusion that the document which are not admitted by the assessee or proved by the revenue as belonging to the assessee are required to be accepted. Further we would like to put on record that neither Smt. Adlene Kagoo has admitted this document nor the assessee admitted this document during the course of recording of statement reproduced herein above. Therefore onus of proving the document belonging to the assessee lies on the revenue to prove that the document belonged to the assessee and is correct hence it can be relied upon in accordance with law. In our view, the revenue has failed to discharge its onus.
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 12 of 16 17. We may mention that the best case of the revenue that amount of Rs. 4.50 Crores was paid as an on money for purchase of Jakkur land, admittedly this was allegedly paid on 13.10.2006 whereas the sale deed were executed on 30.03.2007 and also on 06.08.2009. This amount of Rs. 4.50 Crores can be said to be on money given by the assessee for the purchase of the said land, if the said money is paid subsequent or at the time of registration of sale deeds. Further we may bring on record that the details of cheques given in the sale deed dated 30.03.2007, as per para 2 of sale deed on page no. 96 of paper book, cheque of Rs. 2.60 Crores bearing no. 719275 drawn on ICICI Bank is dated 30.03.2007 and in respect of second property the cheque of Rs. 60 Lakhs was paid for which a separate receipt was executed. If we compare the two cheque amount, one is of Rs. 2.60 Crores and the other is of Rs. 60 Lakhs then it is clear that the annexure AK/PDP/12-pg 125 does not have either the figure of Rs. 2.60 Crores or the figure of Rs. 60 Lakhs. Moreover there was no date of 30.03.2007 mentioning the cheque no. 719275 in annexure AK/PDP/12-pg 125. In view of the above, the observation recorded by the assessing officer that the transactions carried out in cheque which were reflected in the books of account were true, the seized evidence gains strength is also not correct.
In view of the above, the conclusion drawn by the assessing officer was without any basis as neither the document AK/PDP/12-pg 125 was proved nor it pertains to the payment of on money on the jakkur land transactions nor the transactions were forming part of the sale transactions mentioned. In view of the above, the appeal of the revenue is without any merit and is liable to be dismissed and we accordingly dismiss the same.
Before parting, we examine the whole issue from a different angle. We examine from this angle that even if it is assumed that the contents of the seized document i.e. page 125 of AK/PDP/12 are correct as stated by the AO in the assessment order, whether the addition made by the AO is sustainable. We find that the entire case of the AO is on the basis of the
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 13 of 16 seized material enclosed by the AO with the assessment order as Annexure – 1. This is available on page 89A of the paper book being page 125 of Annexure AK/PDP/12 already reproduced above in Para 11 above.
We have already reproduced Para 8.2.8 of the assessment order in Para 14 above but at the cost of repetition, we reproduce it again for ready reference. This Para is as under:-
“8.2.8 The cheque transactions reflected in this statement have been recorded in the books of both parties i.e., Sri. Ranjan Pai Group and Sri. Dayanand Pai Group albeit as advance received against some other property account. It is a fact that Sri. Ranjan Pai has purchased Jakkur property from Sri. Dayanand Pai . This is evidenced by registered sale deed dt. 30.03.2007 wherein both Sri. Ranjan Pai and Smt. Shruti Pai have purchased 4 Acre 12.8 Guntas of land at Jakkur from M/s. Century Realtors a Dayanand Pai Group Concern. It is again a fact that 45,000 Sq ft. of land of the same Jakkur Property has been resold by Sri. Ranjan Pai to M/s. Legacy Dimora on 30.03.2007. M/s. Legacy Dimora is partnership firm in which Sri. Sanjay Shenoy, a nominee of Sri. Dayanand Pai is a partner. There are transactions between M/s. Indiland Developers Bangalore Private Limited and Sri. Dayanand Pai Group which is established by the ledger extract of M/s. Indiland Developers Bangalore Private Limited. As the cheque payments are against other property accounts, the entries found in the statement are not works of imagination or fiction. Since it is proved that part of transactions, carried out in cheque, which are reflected in the books of accounts are true, the seized evidence gains strength and is considered to be true and correct. The cheque payments which are true, though pertaining to other properties, establish the veracity of the document. Accordingly, other part of transaction carried out in cash shall also be held as true. Hence the payment made in cash of Rs. 4,50,00,000/- in lieu of purchase of immovable property at Jakkur is held as true and accordingly brought to tax as unexplained income for A.Y 2007-08.”
From the above Para of the assessment order, it comes out that this is the whole case of the AO that the cheque transactions reflected on this page i.e. page 125 of Annexure AK/PDP/12 are recorded in the books of both parties i.e. Sri Ranjan Pai Group and Sri Dayanand Pai Group albeit as advance received against some other property account. The AO has come to the conclusion that the cash payment of Rs. 4.5 crores on 13.10.2006 is
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 14 of 16 by the present assessee for Jakur Property. As per the AO also, the Jakur Property is evidenced by Registered sale deed dated 30.03.2007. Copy of this sale deed is available on pages 90 to 104 of the paper book. As per this Sale Deed, the consideration fixed is only Rs. 2.60 Crores and it is paid by a cheque No. 719275 dated 30.03.2007 of Rs. 2.60 Crores drawn on ICICI Bank. It is seen that this cheque mentioned in the Sale deed is not recorded in the seized material i.e. page 125 of AK/PDP/12. The agreed sale consideration as per this seized material i.e. AK/PDP/12 is Rs. 29.10 Crores after reducing some Charaka adjustments Rs. 10.98 crores and part property taken back Rs. 9.90 Crores. After that, there is the alleged entry of Cash Rs. 4.5 Crores and there are several other entries of Rs. 9.20 Crores on 12.07.2006 from the company M/s Indiland Developers, Rs. 4.42 Crores by cheque on 17.01.2007 from the same company and another cheque from the same company of Rs. 8.82 Crores on 01.02.2007 leaving a balance of Rs. 2.16 crores transferred to Charaka Account. There is no reference to these cheques in the sale deed dated 30.03.2007. As per the AO, these cheques are entered in the books of that company as advance payments for some other properties. Hence, it is not established that the alleged cash payment on 13.10.2006 of Rs. 4.5 Crores is received by the vendor from the present assessee because none of the other entries on this page are linked with the assessee or Jakkur Property. If this page considers cheque payments from the said company i.e. M/s Indiland Developers as payment for Jakkur lands than the cash payment may also be by the said company and it cannot be added in the hands of the present assessee. 22. Moreover, on pages 57 to 61 of the paper book is the copy of statement of Smt. Adeline Kagoo recorded on 12.04.2011 u/s 132 (4) and in this statement, the question No. 11 is about loose sheets marked as AK/PDP/8 to 20 and in reply, it was stated that as stated by her in reply to question no. 10, she has no knowledge of the transactions undertaken by Shri Dayanand Pai recorded in these papers. She also stated that the papers were handed over to her by Shri Dayanand Pai for keeping in safe custody and in this manner, these papers are available at her residence. In spite of this, neither
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 15 of 16 Mr. Dayanand Pai was examined by the AO nor the search Party nor the vendor was examined. The lady Smt. Adeline Kago was also not examined by the AO and conclusions were drawn by the AO and addition was made on this basis that the cheque payments shown on this page i.e. page 125 of AK/PDP/12 are true and therefore, it has to be accepted that the cash payment shown in the same page is also true and it is for Jakkur property. We have seen above that all the cheque payments noted on this page are about payment by the company M/s Indiland Developers. Hence there is no basis to hold that the cash payment is by the present assessee and not by that company particularly in view of this fact that name of the company is mentioned against cheque payments but no name is mentioned against entry of cash payment. No concerned person i.e. Shri Dayanand Pai, the lady Smt. Adeline Kago or the vendor were examined by the AO and the entries on this seized paper indicates that this cash payment may also be by the said company only because all cheque payments are admittedly by the company. 23. The discussion in this Para 22 also supports our view as noted in Para 18 above.
Since we had dismissed the appeal of the revenue, therefore we do not deem it necessary to decide the C.O. of the assessee as in our opinion, now it is academic in nature. 25. In the result, the appeal filed by the revenue is dismissed and the C.O. of the assessee is also dismissed as academic. Order pronounced in the open court on the date mentioned on the caption page.
Sd/- Sd/- (ARUN KUMAR GARODIA) (LALIET KUMAR) Accountant Member Judicial Member Bangalore, Dated, the 05th April, 2019. /MS/
ITA No. 891/Bang/2018 & C.O. No. 19/Bang/2019 Page 16 of 16
Copy to: 1. Appellant 4. CIT(A) 2. Respondent 5. DR, ITAT, Bangalore 3. CIT 6. Guard file By order
Assistant Registrar, Income Tax Appellate Tribunal, Bangalore.