TMI Blog2014 (11) TMI 835X X X X Extracts X X X X X X X X Extracts X X X X ..... rough any sub-contractor - Therefore, no question of deducting any TDS - there is no specific objection made by the AO regarding any particular expenditure - The AO has accepted the expenditure in principle and there is no reason for making adhoc disallowance of 50% expenditure claimed by the assessee – the addition is to be set aside – Decided in favour of assessee. Unexplained investments - Purchase of residential plot in Balaji Nagar Yojna – Held that:- As per the sale deed, investment only to the extent of ₹ 1,26,000/- is found to be incurred as investment in purchase of house and beyond that there is no evidence - The assessee claimed that the above investment of ₹ 1,26,000/- was made by the assessee, though the same was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gether, we are disposing them off by this common order for the sake of brevity and convenience. 2. Briefly stated, the facts of the case are that the assessee filed a Return of Income [ROI] on 9.2.2009 declaring total income of ₹ 2,51,560/-. Search and seizure proceedings u/s 132 of the Income-tax Act, 1961 [hereinafter referred to as 'the Act', for short] were carried out at the residence of Shri Murlidhar Sharma and Shri Gautam Sharma on 15.12.2009 during which certain documents belonging to the assessee were found and seized. On examination of these seized documents, it was found that some papers belonged to Smt. Jiya Devi Sharma, the assessee before us. After recording satisfaction note on 18.8.2011, in the case of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this ground are that the A.O. observed in his order during the year under consideration that the assessee had claimed land development expenses of ₹ 42,29,490/-. She had not furnished any details like the names of the persons to whom these payments were made, whether any TDS was deducted or deposited, ledger account of the expenses, nature of work, whether payment was made in cash or by cheque. Therefore, he has disallowed 50% of the claim resulting into an addition of ₹ 21,14,745/-. 3.2 The case of the assessee in this regard is that the assessee had claimed this expenditure in her original return filed u/s 139(1) of the Act and the same was allowed. It was stated that u/s 153A, there is no basis to reject the genuine ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... debited under the head 'land development expenses'. However, the ld. AR has consistently failed to file any details regarding the nature of these expenses or the persons to whom they were paid. No substantiating evidence by way of bills or vouchers has been submitted either during the assessment proceedings or during the appellate proceedings to justify this claim of expenditure. In our considered opinion, this addition is not warranted because it is beyond the scope of provision of section 153A of the Act because this expenditure had been claimed even in the original return and was rightly allowed. There is no material to deviate from the earlier finding and holding it ingenuine. The assessee did not get this work done through any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estment. This addition has also been confirmed to the extent of ₹ 1,26,000/-. The assessee is further aggrieved. 4.2 After hearing both the sides we have found that as per the sale deed, investment only to the extent of ₹ 1,26,000/- is found to be incurred as investment in purchase of house and beyond that there is no evidence. The assessee claimed that the above investment of ₹ 1,26,000/- was made by the assessee, though the same was not appearing in the balance sheet but it is submitted that no addition can be made as the investment in the said plot was made out of savings. Alternatively, it was submitted that in any case, if at all any addition was required to be made, only the amount of investment amounting to ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 40A(3) of the Act. 5.2 During the course of assessment proceedings, the ld AR submitted that the assessee had no bank a/c in Phalodi and therefore the payments had to be made in cash and was covered under Rule 6DD of the I.T. Rules, 1962. He further submitted that agricultural lands purchased are required to be converted into the residential and only thereafter, the same becomes tradable commodity. Until the agricultural land is converted into urban land after obtaining permission u/s 90B and after payment of conversion charges etc., the agricultural land, cannot partake the character of stock in trade. The payment made towards purchase of agricultural land is an asset until the same is converted. The unconverted agricultural ..... X X X X Extracts X X X X X X X X Extracts X X X X
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