HIGH COURT FOR THE STATE OF TELANGANA ****

ITTA.No. 429 OF 2010 Between:

Surabhi Shelters Pvt. Ltd., Hyderabad.

…. Appellant And The Dy. Commissioner of Income-Tax, Central Circle III, Hyderabad.

…Respondent DATE OF JUDGMENT PRONOUNCED: 31.10.2025 SUBMITTED FOR APPROVAL:

THE HON’BLE SRI JUSTICE P.SAM KOSHY AND THE HON’BLE SRI JUSTICE SUDDALA CHALAPATHI RAO

1. Whether Reporters of Local newspapers may be Yes/No allowed to see the Judgments?

2. Whether the copies of judgment may be marked Yes/No to Law Reporters/Journals

3. Whether Their Ladyship/Lordship wish to see the Yes/No fair copy of the Judgment?

________________________________ SUDDALA CHALAPATHI RAO, J * THE HON’BLE SRI JUSTICE P.SAM KOSHY AND THE HON’BLE SRI JUSTICE SUDDALA CHALAPATHI RAO + ITTA.No. 429 OF 2010 % 31^st October, 2025 ITTA.No. 429 OF 2010 # Surabhi Shelters Pvt. Ltd., Hyderabad.

…Appellant VS.

$ The Dy. Commissioner of Income-Tax, Central Circle III, Hyderabad.

..Respondent ! Counsel for the Appellant : Sri Y.Ratnakar ^ Counsel for the Respondent : Ms B.Sapna Reddy, learned Senior Standing Counsel for Income Tax Department.

< Gist:

> Head Note: ? CITATIONS:

1. (2014) 369 ITR 171 (T & AP)

2. (1999) 238 ITR 177(AP)

3. (2024) 169 Taxman.com 591 (Telangana)

4. (2023) SCC Online SC 481 = (2024) 2 SCC 433

5 . (2016) 380 ITR 573 6. (2016) 387 ITR 529 THE HON’BLE SRI JUSTICE P.SAM KOSHY AND THE HON’BLE SRI JUSTICE SUDDALA CHALAPATHI RAO ITTA.No. 429 OF 2010 JUDGMENT: (Per the Hon’ble Sri Justice Suddala Chalapathi Rao)

This appeal is filed aggrieved by the order of the Income Tax Appellate Tribunal, Hyderabad, ‘B’ Bench, Hyderabad (for short ‘the ITAT’) in IT(SS)A.No.79/HYD/2006, for the block period 1992-93 to

2000-01(up to 17.08.2000).

2. Heard Sri Y.Ratnakar, learned counsel for the appellant/assessee, Ms B.Sapna Reddy, learned Senior Standing Counsel for Income Tax Department for respondent/Revenue, and perused the record.

3. The brief facts of the case are that, the appellant/assessee is a property developer. On 17.08.2000, the respondent-authorities have conducted a search at the office premises of the appellant/assessee and also at the residential premises of its Managing Director and other directors. During search, no incriminating material relating to tax evasion was found, but, however, the statement of the Managing Director of the appellant/assessee was recorded under Section 132(4) of the Income Tax Act, 1961(for short ‘the Act’), who alleged to have disclosed an amount of Rs.1,50,00,000/- as undisclosed income in the return filed by the appellant/assessee for the disputed period, and the respondents-authorities basing on the same have quantified the income of the assessee for the block assessing period for 1992-93 to 2000-

01(up to 17.08.2000), as hereunder:

“Gross Sales of projects completed after 1997 as per accounts Rs.10,59,93,593 Add: On money estimated at 30% of the above amount Rs. 3,52,20,603/-

not shown in the books ----------------------

Rs.14,12,14,197 ----------------------

Income estimated at 15% on Rs.14,12,14,197/- Rs. 2,11,82,129 Less: Income assessed earlier in the regular assessment Rs. 59,50,905 ---------------------- Rs.1,52,31,205/- ----------------------

and thus, directed the appellant/assessee to pay tax on the said undisclosed amount.

4. Aggrieved by the same, the appellant/assessee filed appeal before the Commissioner of Income Tax Appeals (for short ‘CIT(A)’), and the same was dismissed. Aggrieved by the same, the appellant filed second appeal before the ITAT, and that the learned ITAT also dismissed the said appeal. Aggrieved by the said order, the appellant/assessee has filed the present appeal before this Court.

5. The appeal was admitted on 05.07.2010 for hearing on the following substantial questions of law as raised by the appellant/assessee in the grounds of appeal:

“1. Whether on the facts and in the circumstances of the case, the transaction and income thereon which were processed in a regular assessment made u/s.143(1)/143(3) of the IT Act can