COMMISSIONER OF INCOME TAX III vs. SURABHI SOFTWARE PEOPLES LTD.,

It 1,2 &3 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA Nos. 30112012.30412012 &30512012 CIT Through VETSUS HOME DEVELOPERS PVT LTD. Throueh ..... Respondent CORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE R.V.EASWAR ORDER o 23.05.2012 These three appeals by the Revenue impugn the order dated l6th September,20ll passed by the Income Tax Appellate Tribunal (for short, the tribunal) deleting penalty under Section 27lD of the Income Tax Act, 1961 (Act, for short). The appeals relate to the assessment years 2001-02, 2002-03 and 2003 -04. 2. The respondent-assessee is a company, which was subjected to survey under Section l33A on 28th March, 2006. Some group companies/associates were subjected to search and seizure operations under Section 132 of the Act and a document Annexure-t2 was found from the custody of Yogesh Gupta, a director of the respondent company. The said document is not signed by any person and has been Digitally Signed By:AMULYA Signature Not Verified

quoted in the assessment order. For the sake of completeness,-Fe are also reproducing the same:- "Dear Yogesh The following amount has been received by you/your company as the loan/advances for booking of flat for which you/your company have executed the promissory Note/Agreement/receipt and is still outstanding. You are therefore requested to clear the amount to avoid any \, Ila crcumstances. S.No. Date Amount (Rs.) Remarks 1 07.02.200r 5.00.000/- Cash 2 03.04.2001 6.00.000/- Cash J 15.05.2001 4.50.000i- Cash 4 15.07.2001 2,75,0001- Cash 5 22.08.2001 4,00,000/- Cash 6 10.08.2001 5,00,000/- Ritesh 7 0s.11 .2001 16,00,000/- Cash 8 07.r2.200r 5,00,000/- Cash 9 22.02.2002 5,00,000/- Cash 10 01.04.2002 2,00,0001- Cash 1t 01.01 .2002 5.00.000/- Cash t2 08.05.2004 r0.00.000/- S.V.H. Soft 13 20.05.2004 3,00,000/- Murari Lal t4 20.05.2004 2,00,0001- Mukesh Kumar

-'t o, li' o These payment has been received by cheque and has been shown as advance against booking in the balance sheet of your company. You are therefore requested to honour the commitments" 3. The Assessing Officer held that the aforesaid amounts should be treated as loan received/taken by the respondent-company Home Developers Pvt. Ltd. in cash in violation of Section 269-ss and had accordingly imposed penalty under Section 271D of the Act. 4. The cIT (Appeals) has deleted the said penalry and the tribunal affirmed the said decision. The reasons given by them are as under:- (i) Return of income filed by the assessee under Section l53A for the assessment years 2001-02 to 2003-04 have been accepted on the declared income. The figures tally with the returns of income filed under Section 139(l). No addition was made by the Assessing officer in the proceedings under section 153A read with Section 143(3). This aspect is partly relevant but does disclose/show that no addition on account of interest paidlpayable towards unaccounted loans/deposit was made. (ii) The document A-12 relied upon by the Assessing officer uses the words "loan as well as the advances for booking of flats". It was not verified whether the amounts received were cash loan or advances for booking of flats. Advances for booking of flats are not covered by Section 296-ss or 271 D. The document A-12 does not refer to or t,

Cy vestigation was t mention the name of the respondent-assessee. No in made who had written the said letter and whether the respondent assessee was recipient of any loan/deposit. (iii) The document was addressed to Yogesh Gupta, a director of the respondent company, who was also the director of several other companies, namely, Kriti Realtors (P) Ltd., Karsna Promotors (P) Ltd., Realtech Projects (P) Ltd. and Vivid Builder (P) Ltd. (iv) The document in question were not seized from the office of the respondent-assessee, but from Yogesh Gupta. 5. Learned counsel for the Revenue has relied on the statement of Yogesh Gupta recorded on 31't Muy, 2006. In the said statement Yogesh Gupta had disclosed and surrendered an amount of Rs.13.05 crores as additional income in the financial year 2005-06' This included Rs.2 crores in his own hand and Rs. 9.05 crores as income of Real Tech Projects Pvt. Ltd. Rs.2 crores was disclosed as undeclared income of Home Developers Pvt. Ltd. In the said statement in question Nos.ll and 12 Yogesh Gupta was asked to explain document A-12. Yogesh Gupta had stated that these were unaccounted "transactions" in cash. No question was put to state or furnish the details of the writer or recipient i.e. the details of the companies, which had received the said amounts. He was also not asked to specifu or state whether the amount received was on account of advances for flats

t or loan. Revenue was fully satisfied by the surrender made and closed their investigation. Thus, in the present case, there is doubt, but it is not established that the respondent-assessee had taken loan/deposit in cash. There is suspicion but this alone without funher verification and investigation cannot justiff the finding that the respondent-assessee had taken loan/deposit in cash. The findings recorded by the tribunal are not perverse. 6. In view of the aforesaid factual position, we do not think that the order passed by the tribunal requires any interference in exercise of power under Section 260A of the Act. Accordingly, the appeal is dismissed. 7. At this stage, leamed counsel for the appellant-Revenue submits that appeals of other years are pending before the tribunal. We express no opinion on other appeals, as the decision will depend on the facts of each case. L- | SANJIV I(HANNA, J. IrtJl '-Yl v'r-< '' R.V.EASWAR, J. MAY 23,2012 NA/ ,