The assessee-firm faced multiple additions on advances received for land sales and unaccounted consideration, largely based on book entries and a partner’s statement under section 132(4) rather than incriminating material, with the CIT(A) granting substantial relief. On cross-appeals, the Tribunal held that banking-channel advances without correlation to specific sales could not be treated as unaccounted consideration, that additions based merely on book entries where documentary evidence and registered sale deeds existed could not be sustained, that a registered sale deed prevails over a partner’s inconsistent statement with only the profit element taxable, and that an addition resting solely on an uncorroborated partner’s statement pertaining to partners rather than the firm was not sustainable; accordingly, the Revenue’s appeal was dismissed and the assessee’s allowed. (AY. 2016-17 2017-18)
S. A. Builders and Developers v. Asst. CIT (2025) 131 ITR 685 (Hyd.)(Trib)
S. 68: Cash credits-Search and seizure-Undisclosed income-Advances received through banking channels for land sale-Suppression means receipt of excess as own money outside banking channel-No correlation with specific sale-Not unaccounted sale-Addition deleted.-Advances from buyers-Addition based on book entries, not incriminating material-Confirmation, ledger, bank statements furnished-Identity/creditworthiness beyond dispute once sale deed registered-Non-filing of confirmation from few persons irrelevant-Addition deleted-Unaccounted sale consideration-Managing partner’s admission vs registered sale deed-Latter to prevail-Only profit element assessable, cost subsumed in closing stock-Commissioner (Appeals)’s findings upheld-Advances not linked to identifiable plot-Confirmation, ledger, PAN furnished-Addition based on book entries not incriminating material-Identical treatment required for similarly placed parties-Addition deleted-Addition based solely on partner’s statement admitting unaccounted income-Statement pertaining to partners, not assessee-No corroborating material-Addition not sustainable. [S. 132, 132(4)]
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