The two member bench of the Income Tax Appellate Tribunal ( ITAT ) Delhi, dismissed the taxpayer’s appeal after they claimed assessment under section 44AD without maintaining day-to-day regular books of account.
The Assessing Officer received information that the assessee had deposited cash amounting to Rs. 29, 20,960/- in the bank account and had also purchased bank drafts by cash amounting to Rs. 27,59,760/- during the year under consideration. The Assessing Officer noted that the assessee had not filed any return of income for the year under consideration. The Assessing Officer accordingly recorded reasons and issued notice under Section 148. The assessee filed return declaring income of Rs. 46,100/-
It was pointed out that the bank statement of the assessee revealed that there were credit entries totaling Rs.1,98,59,760/-. The assessee submitted that out of the aforesaid deposits an amount of Rs.1,20,00,000/- was received as advance for purchase of land from farmers. The assessee further submitted that the assessee’s grandmother had sold immovable property for her share of consideration amounting to Rs.89,23,357/- out of which Rs.39,23,357/- was received in cash and the balance amount of Rs.50,00,000/- was received in cheque. The assessee submitted that his grandmother had no bank account and accordingly deposited the aforesaid amounts in the assessee’s bank account.
Further considered the assessee’s submission but was not satisfied. The Assessing Officer held that 25% of the deposits were the unaccounted income of the assessee and added the same to the total income. Addition of Rs.49,64,940/- was challenged before CIT(A) in first appeal.
The assessee has claimed that the deposit of Rs. 1, 98,59,760/- in the ICICI bank is out of the fact that as a professional land aggregator assessee had received Rs. 1,20,00,000/- from Krish Builders as advance for purchase of properties. Same was by way of chute of Rs. 40,00,000/- on 26.03.2010 and Rs. 80,00,000/- by way of RTGS on 31.03.2010. He claimed that his grandmother Smt. Ramrati had sold land for a total sale consideration Rs. 1,63,00,000/- on 25.09.2009 along with other co-sharer and her mother had share of Rs. 89,23,357/-, which were received in the form of cash component of Rs. 39,23,357/- and a cheque of Rs. 50,00,000/- dated 29.09.2009.
The bench observed that no substantial evidence was produced to justify the transactions. The manner in which CIT (A) has discussed the receipt and payment by assessee and lack of certainty to whom the payments were actually returned. The non-corroboration of claim of working as land aggregator with specific transactions taken up or abandoned on behalf of said builder M/s Krrish Buildtech, only justifies the conclusion of CIT (A) and same cannot be said to be based on mere suspicion
Further the bench consisting of G.S Pannu ( Vice President ) and Anubhav Sharma ( Judicial member ) noted that admittedly the assessee had sought assessment under Section 44AD with a claim of not maintaining any day to day record or regular books of account. That all the more required evidence of the alleged business activity as a land aggregator. Thus the findings of CIT (A) deserve no interference. Grounds raised have thus no substance. The appeal of the assessee was dismissed.
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