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2016 (12) TMI 347 - AT - Income TaxAdmission of Additional Evidence - Held that:- It is a matter of record that at para 3.1 of the impugned order, the learned CIT(A) has noted that in the course of appellate proceedings the assessee submitted additional evidence in the form of copies of ledger accounts and vouchers, which were forwarded to the Assessing Officer (AO) under rule 46A of the I.T. Rules, 1962 for making necessary enquiries/verification and report thereon. It is also recorded that the AO submitted the remand report dated 24.06.2010 in the matter. In these circumstances, we find no merit in the assessee’s contentions that the additional evidence put forth was not admitted or considered by the learned CIT(A) and accordingly dismiss ground No. 1. Disallowance out of Administrative Expenditure - Held that:- Most of the expenses under the head ‘administrative expenses’ incurred for advertisement, audit fees, computer expenses, inspection fees, licence fees, municipal taxes, printing and stationery, property tax, rent, professional and legal fees, sundry expenses for fire extinguisher, office telephone and postage, sales promotion, etc. would appear to us to be expended for the assessee’s business purposes, since admittedly nothing adverse has been reported in respect of any such claim by the AO in remand proceedings. As submitted by the assessee, the element of personal expenditure is admittedly embedded in the telephone expenses for residence (viz. ₹ 32,817/-) and charity/donation (Rs. 14,000/-). In these factual circumstances of the case, as discussed above, we hold that expenditure on donations of ₹ 14,000/- and about 20% of the telephone expenses of residence (approx. ₹ 6,500/-) could be justifiably be considered as having been expended for personal or /and non business purposes. We, therefore, sustain the disallowance of administrative expenses to ₹ 20,500/- (i.e. ₹ 14,000/- on account of donation plus ₹ 6,500/- out of residential telephone/postage expenses) as against ₹ 50,000/- disallowed by the AO. The AO is accordingly directed. - Decided in favour of assessee partly Income from Letting out of Bakery shop - Held that:- Respectfully following the decision of the Hon'ble Bombay High Court in the case of Dudhsagar [2014 (8) TMI 691 - BOMBAY HIGH COURT] which is factually similar to the case on hand and is squarely applicable, we hold that the income earned by the assessee from letting out of bakery alongwith equipments required to manufacture bakery products and shop alongwith furniture, fixture and kitchen equipments for running and sale of bakery products, is to be assessed as ‘income from others sources’/‘business income’ as declared by the assessee and consequently reverse the orders of the authorities below holding the same to be exigible to tax under the head ‘income from house property’. Capital gains on Relinquishment of Tenancy Rights - Held that:- Admittedly as per the recitals in the agreement and the confirmation of the builder, possession of the said properties by the assessee and the builder were made over/taken over simultaneously by both parties only on 30.12.2006 and not before that. Therefore, in this factual matrix of the case, in our view, the capital gains arising on relinquishment of tenancy rights by the assessee is not exigible to tax either substantially or protectively in the period under consideration, i.e. A.Y. 2006-07, but in the period relevant to A.Y. 2007-08. The fact that the assessee has declared the capital gains on relinquishment of tenancy rights in the said property in its return of income for A.Y. 2007-08, which has been accepted in order under section 143(1) of the Act dated 14.03.2009 is not disputed by Revenue; and rightly so. In the factual and legal matrix of the case as discussed above, we are of the considered view that the capital gains on relinquishment of tenancy right by the assessee is not exigible to tax in the year under consideration, i.e. A.Y. 2006-07 as held by the authorities below and direct the AO to delete the addition made to the assessee’s income on this account. Charging of Interest under sections 234B and 234C - Held that:- The charging of interest is consequent and mandatory and the AO has no discretion in the matter
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