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2015 (7) TMI 662 - AT - Income TaxDisallowance of Development expenses - Held that:- It is evident from records that the compound wall was already in existence and there is no permanent structure or building on the land. The Assessing Officer visited the site to have first hand information and found that there is only a compound wall and small tin shed on the land under question. Thus, the claim of ₹ 3,26,500/- for fixing 30 light point, 15 plug point and 4 fan point etc. is not tenable. Even the enquiries made by Assessing Officer from the persons who have allegedly worked on the land does not infuse confidence, therefore, the same were disbelieved. Further, the Assessing Officer observed that most of the parties who had allegedly carried out development work were shown as sundry creditors outstanding as on 31-03-2008. The assessee had allegedly made payments to the said person in assessment years 2009-10, 2010-11 and 2011-12 through cheques drawn on, The Thane Janata Sahakari Bank, Nigadi Branch. The enquiry made by the Assessing Officer revealed that most of the outstanding sundry creditors were paid by bearer cheques and in majority of the cases amount was withdrawn by one Shri Jaganan Thorat who is stated to be a close relative of one of the partners of the assessee firm. Since, the assessee was not able to substantiate the claim, the amount of ₹ 50,02,425/- was offered for tax.In the light of above facts, we do not find any infirmity in the order of Commissioner of Income Tax (Appeals) in confirming disallowance. - Decided against assessee. Levy of penalty u/s. 271(1)(c) - Held that:- In the instant case, admittedly explanation has been offered. Whether it is bonafide or not that has to be seen. The assessee has placed on record the agreements and other documents to show sale transactions of land. The assessee has also placed on record bills to show the expenditure on development of land. Some of the bills/invoices have been rejected by treating them as not genuine by Revenue, however, the persons who have issued the bills have not denied the issuance of bills. The Assessing Officer has rejected the bills on certain presumptions. Thus, in our view, there is no concealment of any information by the assessee. Thus it is not a fit case for levy of penalty for concealment of income or for furnishing inaccurate particulars of income - Decided in favour of assessee.
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