NEELRATNA ENTERPRISE LLP,RAJKOT vs. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL -1,, RAJKOT

The relevant material facts, as culled out from the material on record, are as follows. The assessee is an LLP engaged in Real Estate business. As per the Income-tax Return for AY 2019-20 filed on 17-08-2019, the total income has been declared at NIL. A Search, Seizure and Survey action was carried out by the office of DDIT (Inv.), Unit-1, Rajkot in the case of leading to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP real estate builders of Rajkot and their key associates on 24.08.2021. Four different groups were covered in the operation including Praful Gangdev Group of Rajkot. All the four groups are in the business of real estate and are mainly concentrated in and around Rajkot. A total of forty-three (43) premises were covered, out of which 32 premises were covered under section 132 of the Income Tax Act 1961 and the other 11 premises were covered u/s 133A of the Income Tax Act 1961. The premises covered were a mix of residential and business premises of their related entities, their family members, key associates and employees. Gangdev group has completed several Real estate projects in Rajkot. The main person of the group is Shri Praful Gangdev who takes key decisions and is helped by several other partners. The partners vary for each project but Shri Kinjan Faldu, Shri Chandresh Panara, Shri Siddharth Gangdev are the key partners of Shri Praful Gangdev. The Gangdev group has completed projects like The Spire, The Spire-2, Trinity Towers in the city of Rajkot. Important family members, offices, key associates and employees were also covered in the search and survey operation to get hold of important incriminating evidences. Details of following unaccounted transactions pertaining to project "The Spire-2" developed by the assessee -firm M/s Neelratna Enterprise LLP have been recovered from the material seized during the search operation. Unaccounted receipts of Rs. 42,74,25,284/- against sale of units of the project of which Rs. 73,91,551/- have been returned on account of cancellation or excess receipt. As details regarding unaccounted part of the aforementioned transactions pertaining to the assessee have been gathered from the seized material during the search operation, a notice under section 148 of the Act has been issued on 22-07-2022 to the assessee after to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP following due procedure as per the Act and with prior approval of the specified authority as per section 151 of the Act. In response to the notice issued under section 148, the assessee has filed an income tax return on 10- 08-2022 declaring total income at NIL. Subsequently, a notice u/s 143(2) of the Income-tax Act has been issued and served on 02-09-2022 on the e-filing portal of the Assessee. Subsequently, notices u/s 142(1) have been issued from time to time seeking primary as well as further details from the assessee for carrying out the assessment. In view of natural justice, the images of original seized material pertaining to the assessee have been supplied and discussed in the notices issued u/s 142(1) of the Act.

In respect of unaccounted receipts against sale of units of the project, “The Spire – 2,” the AO observed that "The Spire 2" is a fully commercial project developed by M/s Neelratna Enterprise LLP. During the course of recording of the statement of Shri Praful Gangdev at his residential premises under section 132(4) of the Income-tax Act, 1961, he categorically accepted taking on-money in cash for the sale of real estate property. During the course of search at the residence of Shri Praful Narendrabhai Gangdev; 3 iPhones, 5 Pen drives and 2 laptops were found and mirror imaging of the same along with e-mails, Google drive was taken, which was subsequently seized in hard drive inventoried as per Annexure A as A-11, A-12 & A-13. During the analysis of the digital data of the above mentioned devices, one excel file named "THE SPIRE 2 INSTALLMENT AMOUNT SHEET" from Google drive was found. Excel Sheet named "Sheet1" of this excel file contains data of month-wise instalments of showrooms/shops/offices & total of the individual entries of each row is entered in the last column of the to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP excel sheet. The amount maintained in the excel sheet named Sheet1 of the excel file named "THE SPIRE 2 INSTALLMENT AMOUNT SHEET" represent the on money received from the buyers in lieu of Showrooms/shops/offices of project The Spire 2. The sale considerations have been received in instalments. The screen shots of the starting rows & columns and last rows & columns of the excel sheet named Sheet1 of the excel file named THE SPIRE 2 INSTALLMENT AMOUNT found at the residential premises of Shri Praful N. Gangdev. Screen shots of starting rows & columns of the excel sheet named Sheet 1 of the excel file named THE SPIRE 2 INSTALLMENT AMOUNT, screen shots of last rows & columns of the excel sheet named Sheet1 of the excel file named THE SPIRE 2 INSTALLMENT AMOUNT and screen shots of last rows & columns of the excel sheet named Sheet1 of the excel file named THE SPIRE 2 INSTALLMENT AMOUNT are pasted in the assessment order. As per the above screen shots of excel sheet named Sheet1, it is clear that details of unit wise on money receipts for the project The Spire 2 are maintained in this excel sheet. Furthermore, some images of diaries as recovered from the digital devices of persons of Gangdev group covered in the search and seizure action also establish the absolute correctness of data in the excel file "THE SPIRE 2 INSTALLMENT AMOUNT SHEET" found from residence of Shri Praful Gangdev. The images of pages of diaries extracted from the digital data seized from the residential premises of Shri Praful N. Gangdev, Shailesh Kansagra and Shri Shiddharth Harshadbhai Gangdev shows that unit-wise details are also recorded in diaries. The pages of these diaries contain unit-wise details i.e. unit number, name of purchaser, on money received in cash, date of receipt of on money, document value etc. It is to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP pertinent to highlight here the amount noted in the diaries for receipt of on money in cash is in coded form i.e. the sign of '=' or "" or "/" is inserted before the last two digit of actual amount. For example, the amount written as "1000=00" is in coded form. The interpretation of the entries as recorded in diaries can be understood from the statement recorded at the residential premises of Shri Praful Gangdev, where he stated that amount "1000=00" written on page number 4 of the diary (diary of flat No. C-1103 found and seized as A5 of Annexure-A) represents Rs 1,00,000/- received in cash and other amounts are similarly noted. Scanned copy of the relevant portion of that statement recorded at the residential premises of Shri Praful Gangdev is pasted by the assessing officer, in the assessment order.

Assessing officer noticed that facts as stated by Shri Praful N Gangdev is squarely applicable to the diaries found related to the project The Spire 2. To establish what has been discussed above, snapshot of image of the office No. 1029 extracted from the digital data seized from the residential premises of Shri Shailesh Kansagra along with screen shot of relevant portion of excel sheet from the file "THE SPIRE 2 INSTALLMENT AMOUNT SHEET" is pasted. File path is working copy \hdd 2\Extracted working data\Shailesh_vivo 1713\Whatsapp messenger.files\. It is apparent from the above snapshot that Shri Mayankbhai Chauhan has booked office No. 1029 of the project The Spire 2 at the sale consideration of Rs 21,96,000/- (305*7200) out of which document value is Rs 12,70,000/-only and the remaining amount i.e. Rs.19,26,000/- is on money in cash. Shri Mayankbhai Chauhan has paid total on money of Rs.9,26,000/- on various dates as per the above snap shot. to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP The same is tabulated in the assessment order. Entries of the above tabulated on money receipts are found in the excel sheet named Sheet1 of excel file named THE SPIRE 2 INSTALLMENT AMOUNT at Cell number M246, N246, P246 & R246. Screen shot of the relevant portion of the excel sheet is pasted in the assessment order. Moreover, as per the snapshot of image of the office No. 1029 pasted above, document value of the office No. 1029 is mentioned as 12,70,000/-. On perusal of the details received from the sub-registrar office, it was found that the document price of this office is 12,70,000/- which is exactly same to the amount mentioned in the image of diary. Screenshot of relevant portion of agreement to sale is pasted in the assessment order. To further establish the correctness of the excel file "THE SPIRE 2 INSTALLMENT AMOUNT SHEET", snapshots of few other images extracted from the digital data of different persons of Gangdev group and Snapshots from the digital devices of Shri Praful Gangdev are pasted in the assessment order. This way, the assessing officer has identified the “on money” on other projects also.

Therefore, assessing officer issued a show cause notice to the assessee to explain the on money. The assessee submitted its reply before the assessing officer with documentary evidences. The assessee submitted, that seized documents are dump documents, as they do not contain the signature of the assessee and other party. Therefore, based on these dump documents, no addition should be made in the hands of the assessee. The assessee also submitted that entire sale proceeds cannot be regarded as net profit of the assessee and only profit element is to be taxed. That is, profit element on “on-money” should be taxed in the hands of the assessee. These profit to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP estimation on different project, should be done in accordance with judgement of the jurisdictional High Court of Gujarat in the case of PCIT v. Ms. Jay Kesar Bhavani Developers Pvt. Ltd. in Tax Appeal no. 267 of 2022, in this judgement, the Hon'ble Gujarat High Court has held that only profit element embedded in the gross “on-money” receipts at the rate of 6% can be taxed. The assessee also relied on various judgements of jurisdictional ITAT, Ahmedabad, where the Tribunal, estimated the profit element on the “on-money” at the rate of 8%.

The response of the assessee has been examined thoroughly by the assessing officer. Overall reading of the response gives an idea that at some instances, it is contended by the assessee that incomplete details / data cannot be accepted to be actual / real. The assessing officer, however, noted that this contention is not relevant as there is no any extrapolation which is being made here. Whatever unaccounted receipts are logically deductable from the seized document, the same is only proposed for addition in the show cause notice. Further, it requires to be made clear that the addition proposed in the show cause notice is not solely based on the statement of Shri Praful Gangdev rather the data seized. Further, in most part of the reply, the assessee is seeking to make a point that entire on-money receipts should not be taxed with the help of various judicial decisions from different judicial forums. After thorough examination of the response to show cause notice and considering the averments made by the assessee in its reply, the assessing officer noted that there is no doubt that the accounts of the assessee where all the transactions are not reflected cannot be relied upon, as they present incomplete and incorrect state of affairs of business of the to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP assessee and requires to be disregarded invoking the provisions of section 145(3) of the Act. Accordingly, provisions of section 145(3) are invoked by the assessing officer and the assessment of total income of the assessee was made after taking into account all relevant material gathered during the search and the assessment proceedings. There is no uniform method that can be employed to compute income when part receipts on account of sale are not included on the books. The method differs from case to case depending upon various factors i.e. type of business, modus operandi of the assessee, sufficiency of data available for estimation etc. In a case where the evidence available on record contains details of corresponding unaccounted payments which are also partly included on the books, such partly recorded payments should also be taken into consideration. Taxing the receipts only has never been the motto of the Income-tax Act. In this regard, assessing officer relied on the observation of the Supreme Court in CIT v. Williamson Financial Services [2007] 165 Taxman 638 (SC), which is reproduced below:

The assessing officer noted that where suppression of sales receipts is involved, the question is whether the entire sales or only a percentage of profit should be adopted as income. In CIT v. President Industries [2002] 124 Taxman 654 (Gujarat), the Assessing Officer had found evidence of suppression of sales. He adopted the entire receipt (sales) as income but the Hon'ble Jurisdictional High Court has held that the entire undisclosed receipts (sales) cannot constitute income. The sales only represent the price to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP received by the seller of the units for which the seller has already incurred the cost in order to acquire or process the inventory. Therefore, it is the realization of excess consideration over the cost incurred which should be assessed as profit or income. In other words, profit component embedded in the sales could be treated as income. Recently, in the case of PCIT v. Ms. Jay Kesar Bhavani Developers Pvt. Ltd. in Tax Appeal no. 267 of 2022, the Hon'ble Guj. High Court has held that only profit element embedded in the gross on-money receipts can be taxed. For this, the Hon'ble court has derived reference from its earlier decision delivered in the case of DCIT Vs. Panna Corporation reported in [2012] 74 DTR 89. Relevant part of the decision is as under -

Estimation of rate of profit by the assessing officer The assessing officer noted that details of various projects undertaken by the searched group members and their partners have been recovered from the seized Miracle File. Some projects were in completion stage whereas some were just started. Besides, in respect of some projects comprehensive details i.e. Land purchase expense. On-money receipts have been recovered from the seized data whereas in other projects very limited details i.e. only on- money receipts were recovered during the search operation. Wherever, details of receipts and payments were recoverable form the seized data, it was noticed by the assessing officer that the net surplus funds available with these projects were ranged from (-) 1271% to 35%. Reason for this vast gap between the upper and lower ends of this net surplus range was primarily attributable to the stage in which a particular project has reached since its inception. For example, if any project is just launched then its % of net surplus funds would be lower because most of the funds are spent / applied on inventory and the inflow of on-money has not started in full pace. Due to combined effect of these two aspects the availability of surplus funds remains either on lower side or sometimes in negative state. Thus, it is to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP understood that taking reference from the net surplus / unaccounted profits of such just launched projects would not give true picture of the potential profitability of such projects. In order to estimate a reasonable rate of profit, it is taken that only those projects for which maximum data is available from the seized material should be relied upon. At the same time, it is also ensured that the project that almost reached its final stage (with respect to construction activity and receipt of on-money both) should only be taken as reference for adoption of an appropriate rate of profit. After considering all the above aspects, only one project i.e. The Spire which has been developed by M/s. Buildcon Associates has been identified. Net receipts of this project (The Spire) has been calculated and it is seen that after considering all kind of transactions i.e. Net on-money receipts, Expenses for running the project including the Land purchase there remained average net surplus of 35% in the hands of respective developer/owner. Moreover, in respect of the project under consideration the material gathered during search operation indicated on-money receipts only. Under these circumstances, it would not be fair if the same benchmark rates adopted for other projects where receipts and payment both kinds of transactions are available are also applied to the project where only on-money receipts are available. At the same time, considering that the assessee is also in the same line of business with the same group of persons, the possibility of having incurred unaccounted expenses cannot be ruled out completely (No data is recovered during search does not necessarily mean no unaccounted expenses incurred). Further, various judgments discussed earlier also endorse the same preposition that only profit embedded in the gross unaccounted receipts should be taxed and not the entire unaccounted receipts.

Aggrieved by the various additions made by the assessing officer, the assessee carried the matter in appeal before the learned CIT(A). The learned CIT(A), estimated the profit element on the “on money”, at the rate of 8%, to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP 12%, 16%, 20% etc, in a different assessment years. Therefore, assessee, as well as, revenue, both are in appeal before us. The main contention of the revenue in these appeals are that the addition made by the assessing officer should be confirmed. Whereas, main contention in the assessee’s appeals is that the profit estimation on “on -money”, is on higher side, therefore, it should be reduced to a reasonable extent, by following the judgement of Hon’ble Jurisdictional High Court of Gujarat in various cases such as, in the case of Ms. Jay Kesar Bhavani Developers Pvt. Ltd. in Tax Appeal no. 267 of 2022, wherein 6% addition on “on money, was upheld. In various judgements of jurisdictional ITAT Ahmedabad, (cited by assessee in legal compilation) held the addition on “on money” at the rate of 8% is sufficient to plug the leakage of the revenue. Therefore, the solitary grievance of the assessee in assessee’s appeals are that reasonable estimation may be made in the hands of the assessee. The findings of the learned CIT(A) would be discussed while adjudicating the relevant issue involved in concise and summarised grounds noted above.

Now, we shall adjudicate, summarised and concise grounds of appeal, one by one, as follows:

We note that the assessee is in appeal before us and praying the Bench that estimated addition is very higher side and it should be reduced, at a reasonable level. However, learned DR for the revenue submitted that addition made by the assessing officer may be confirmed. We note that the estimation of income is based on facts and will vary from business to business and year to year, depending on the business conditions. We note that ld.CIT(A) has estimated the profit on the “on-money” at the rate of 16% but the ld.CIT(A) has failed to bring on record any comparable case in support of his estimation that too @ 16% and in some cases 8% and 12% etc. No doubt estimate of the profit can be resorted to in these types of cases but the estimate and that too at a particular percentage or fraction of percentage which ld CIT(A) has adopted has to be based on sound reasoning in comparison with the past results as well as comparable cases. Without this the estimation so made cannot be said to be valid estimation. The jurisdictional Hon’ble High Court of Gujarat, in case of estimation of profit element on, “on-money” has taken the view that estimation of profit in these type of cases of “on- money” had been held between range of 6% to 8%. to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP 16. We note that the average profit of the assessee as per audited books of accounts is 7%, therefore, profit estimation done by the learned CIT(A) at the rate of 16% on the “on-money” is higher side. Considering the nature of business and voluminous ‘on- money’ and taking into account, the fact that there is expenditure made by the assessee to develop the project out of the “on-money”, therefore, profit margin in this type of business normally is 10% on “on-money”. We proceed to work out the estimation of profit keeping in mind the following facts: (i)The estimate is not opened up to be framed in an arbitrary manner. (ii) The estimate by rule of thumb is absolutely infirm. (iii)The estimation of rate of profit return must necessarily vary with the nature of the business. (iv)There cannot be any uniform yardstick. (v)An assessment to be best of judgement can only be based on the material available on record and past records and considering the totality of the facts. (vi) Only real income and neither notional income nor astronomical income, can be taxed under the I.T. Act, 1961. Accordingly, we note that estimation the profit element on ‘on-money’ at the rate of 10%, should be fair, keeping in mind the principle laid down by Hon'ble Supreme Court in the case of H. M. Esufali Abdulali that the method to be adopted must be which is approximately nearer to the truth.

Therefore, respectfully following the binding judgement of the Co- ordinate Bench of ITAT Rajkot in identical and similar group case (Supra), we direct the assessing officer to tax the “on money” at the rate of 10%, hence, we partly allow the following appeals of the assessee:

Summarized and concise ground No.(iii) is reproduced below for ready reference:

On the other hand, learned Counsel for the assessee submitted that assessee has been following the accrual basis of accounting and percentage of completion method. Therefore, revenue should be recognised in the year in which the transaction got materialised, that is, in assessee`s case, when the document is registered and executed, then only the revenue is recognised, with certainty. Hence, learned CIT(A) has rightly directed the assessing officer to recognise the revenue in the year in which the transaction/sale of flat is registered.

We have considered the submissions of both the parties, and we note that ICDS- 3 refers to Income Computation and Disclosure Standard–III, issued by the Central Board of Direct Taxes under section 145(2) of the Income-tax Act, 1961. It deals with computation of income from construction contracts for tax purposes. It is largely based on the earlier Accounting Standard AS-7 but contains important differences relevant for income tax computation. We note that ICDS–III applies to construction contracts of contractors, however, assessee under consideration is not a contractor, but he is a contractee. A person who undertakes contract to do a job/work for others, is contractor. However, assessee under consideration is not a contractor but a contractee, who gets the work done from contractor and assessee pays the amount to the contractors for services rendered by them to it ( assessee), therefore, ICDS-III is not applicable to the assessee under consideration. Hence, we are of the view that ICDS-III applies to Contractors (not contractees). Fundamental Accounting Principle, as per ICDS-III is the Percentage of Completion Method (POCM). The Percentage of Completion Method is mandatory method under ICDS-III. Under ICDS-III the Revenue from variations, claims and incentives shall be recognised only when there is reasonable certainty of its ultimate collection.

We note that even if the addition on account of estimated profit on alleged “on- money” cash receipts is made, the same should be made in the year of actual sale when the conveyance deed is executed in the favour of buyer when the significant risk and rewards are transferred. It is observed that the assessee has consistently followed revenue recognition method whereby sale is offered to tax when registered sale deed of particular unit is executed, that is, date on which significant risk and reward has been transferred to buyer. This method of accounting has been followed consistently by assessee on year to year basis and assessing officer has not disturbed such methodology. This method of accounting of recognizing revenue has been accepted by Hon'ble Gujarat High court in the case of Shivalik Buildwell Pvt Ltd. [2013] 40 taxmann.com 219 wherein it is held as under: "Section 5 of the Income-tax Act, 1961 Income Accrual of [Booking amount received by builder] - Assessee was a builder and developer - He received certain amount as advance from different parties Assessing Officer added said amount to assessee's taxable income to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP Tribunal set aside addition made by Assessing Officer holding that assessee being a developer of project, profit in its case would arise only on transfer of title of property and, therefore, receipt of any advance or booking amount could not be treated as trading receipt of year under consideration Whether on facts, impugned order passed by Tribunal deleting addition was to be upheld - Held, yes [Para 4] [In favour of assessee]"

On identical facts, it is relevant to refer to the Decision of Hon'ble ITAT Ahmedabad in the case of M/s D R. Construction Vs. Income Tax Officer in wherein Hon'ble ITAT has held as under:- "Unaccounted expenditure-receipt of 'on money' in the present case assessee is dealing in several immovable property ie, flats and shops which he has constructed. A single flat is a capital asset for the purchaser but for the assessee all the flats together constitute stock-in-trade. HELD THAT:-it is undisputed position that out of this on money assessee has incurred various expenditure/investment. Therefore, 'on money' as such and as a whole cannot be taxed over and above the income accruing on the basis of entries recorded in the books of account on the basis of decision held in E.D, Sassoon & Co. Ltd. & Ors. vs. CIT (1954 (5) TMI 2 SUPREME COURT we hold that advance money received either by way of cheque or by way of cash will partake the character of taxable income when registered sale deed of the flats is executed in subsequent years. As a result, the sum of 10 crores will not taxable in Asst. Year 2008-09. The appeal of assessee is accordingly allowed.”

On the similar facts, the learned CIT(A) relied on the judgement of the Hon'ble Supreme Court. The Hon'ble Supreme Court upheld the order passed by the Hon'ble Jurisdictional High Court of Gujarat in the case of CIT vs. Happy Home Corporation [2018] 94 taxmann.com 292 wherein it was held as under: "Section 145 of the Income-tax Act, 1961 Method of accounting (Project completion method) - Assessee was engaged in construction business - It was subjected to a survey action which was conducted on business. premises - During course of survey, statement of one partner of firm was recorded in which, he admitted of firm having received a sum of Rs.26.05 crores not disclosed in books of account-While doing so, he further stated that same would be subject to registration of sale deeds When assessment was undertaken, assessee contended that firm was following project completion method of accounting and income would be offered to tax as and when final sale deeds were registered Assessee firm thus offered only a sum of Rs.1 crore during year under consideration Assessing Officer rejected assessee's stand and added entire amount of Rs.26.05 crores as income of assessee during current year Tribunal accepted assessee's contention that since firm was following project completion method for offering income to tax, same would be subjected to tax upon completion of sale, though amount may have been received earlier from buyer Revenue to 538 & 680 to 682/Rjt/2024 A.Y. 2019-20 to 2022-23 Neelratna Enterprise LLP filed instant appeal on ground that in his statement, partner of firm had disclosed entire amount as income of relevant year - Whether in view of fact that while agreeing that sum of Rs. 26.05 crores was undisclosed income of assessee for relevant current year, said partner of firm added a clarification that same would be subject to execution of sale deeds, there was no error in impugned order of Tribunal and, thus, same was to be upheld-Held, yes [Para 5] [in favour of assessee]”

In the light of the above judgement of the Hon’ble Supreme Court, in the case of Happy Home Corporation (supra), and Hon’ble jurisdictional High Court of Gujarat in the case of Shivalik Buildwell Pvt Ltd(supra) and decision of Ahmedabad Tribunal, in the case of M/s D R. Construction, we find that unaccounted profit estimated on ‘on-money’ receipt is required to be taxed in the year in which sale deed is executed by assessee or significant risk and rewards is transferred to buyer. As in case in hand, the assessee has been following revenue recognition method on execution of sale deed, only on-money receipt as computed in present case would be taxable in the year in which sale deed is executed and not when ‘on-money’ was received. Besides, we find that ICDS-III is not applicable to the assessee under consideration, therefore, we dismiss the ground raised

In the combined result, appeals filed by the assessee, are partly allowed to the extent indicated above, whereas appeals find by the revenue, are dismissed.