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2014 (11) TMI 848 - AT - Income TaxUnexplained cash credits u/s 68 – Addition outside the scope of section 153A or not – Admission of additional evidences – Held that:- The assessee-firm had already filed its Return of Income, long before the date of search i.e., on 15.12.2009 - ‘no incriminating material’ was found during search was found relating to these loans - on the additional evidence produced under Rule 46A, the CIT(A) has chosen to call the report of the A.O and this action of him amounts to acceptance of these evidence – when no incriminating evidence regarding these cash creditors [unsecured loan] were found during search in addition to what had been already disclosed - the addition is not justified and is set aside – Decided in favour of assessee. Advances received towards sale of plot – Held that:- No incriminating evidence was found during search regarding these advances - These have already been shown in the original return of income - The assessee produced proof to prove these advances - The AO has sent his remand report after verifying them - the assessee had received advances against sale of property which were adjusted against sale made subsequently - this receipt cannot partake the character of income – the claim of the assessee is quite justified – Decided in favour of assessee. Addition out of expenses on the basis of original assessment sustained u/s 40(i)(a) – Held that:- Total addition of ₹ 10,86,632/- was made in the assessment order passed u/s 143(3) of the Act - This addition included a sum of ₹ 8,86,880/- made u/s 40(i)(a) and of ₹ 38,050/- made on account of various expenses – the addition has been confirmed by the CIT(A) as well as Appellate Tribunal and the appeal of the assessee is stated to be pending before the Hon'ble Jurisdictional High Court – thus, there is no reason to interfere in the order – Decided against assessee. Addition made u/s 40A(3) deleted - purchase of agricultural land – Land stock in trade or not – Held that:- Following the decision in Smt. Jiya Devi Sharma Versus The ACIT, Central Circle – 2, Jodhpur [2014 (11) TMI 835 - ITAT JODHPUR] - in the case of the payment to agriculturists were made under circumstances which are excluded under the provisions of Rules - The agricultural land cannot be converted to stock in trade until permission is obtained and the provisions of section 40A(3) of the Act cannot be invoked in this case according to the prevailing law - Principles of section 40A(3) of the Act cannot be invoked in respect of agricultural land – thus, the order of the CIT(A) is upheld – Decided against revenue.
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