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2015 (11) TMI 998 - AT - Income TaxDisallowance u/s.40A(3) - Held that:- Since in the instant case, there is nothing on record to suggest that any material was unearthed during the search or in 153A proceeding which would show that non-disallowance u/s.41(1) was erroneous, therefore, we do not find any infirmity in the order of the CIT(A) deleting the addition made by the AO. Addition u/s.69B - bogus claim of expenses in the name of labour contractors - CIT(A) delted the addition - Held that:- There is no dispute to the fact that the assessment in the instant case was completed u/s.143(3) prior to the date of search and the investment in purchase of lands were already declared in such return. No incriminating material whatsoever was found during the course of search to substantiate that unaccounted investment has been made by the assessee towards purchase of the lands. The addition was mainly based on the valuation report of the DVO. The Hon’ble Delhi High Court in the case of Puneet Sabharwal (2010 (12) TMI 846 - Delhi High Court) has held that addition to income based solely on report of DVO is not valid in absence of any evidence of understatement of consideration. Further, the contention of the assessee before the AO as well as the CIT(A) that the agreements for purchase of lands were entered in the year 1996 and 2002 and the possession was also taken prior to 2004- 05 could not be controverted by the Ld. Departmental Representative. Under these circumstances, we find merit in the submission of the Ld. Counsel for the assessee that the DVO has erred in taking the sale instances of the year 2005 instead of taking comparable sale instances of 1996 and 2002. There is also nothing on record to indicate that land was undervalued. Under these circumstances we do not find any infirmity in the order of the CIT(A) deleting the addition made by the AO u/s.69B of the I.T. Act. - Decided in favour of assessee. Depreciation on windmill and MEDA charges - Held that:- the issue stands decided against the assessee by the decision of the Tribunal in the case of J-Sons Foundry Pvt. Ltd. [2015 (11) TMI 922 - ITAT PUNE] allowing higher depreciation @80% on civil work foundation and related labour cost of windmill. - Decided in favour of revenue. Addition on account of cessation of liability u/s. 41(1) in respect of creditors outstanding for a period of more than three years - Held that:- No reason to hold that the liability has ceased in the hands of the assessee and such amount of old creditors constitute income u/s.41(1).- Decided in favour of assessee. Compensation received from Suzlon Energy Ltd.- whether taxable as a revenue receipt in the hands of the assessee? - Held that:- Since the compensation of ₹ 40 lakhs received by the assessee from M/s. Suzlon Energy Ltd. was for delay in executing the project, therefore, respectfully following the decision of Hon’ble Supreme Court in the case of Saurashtra Cement Ltd. ( 2010 (7) TMI 11 - SUPREME COURT ), we hold that the amount received by the assessee is capital in nature Interest u/s 234A - Held that:- Once the search takes place on a person and the due date for filing of the return u/s.139(1) has not expired he can file the return only after the issue of notice u/s.153A. He is not required to file the return u/s.139(1). Therefore, the authorities below are not justified in levying interest u/s.234A of the I.T. Act for a period from 31-10-2009 to 20-07-2010. The ground raised by the assessee is accordingly allowed.- Decided in favour of assessee. Rework the interest chargeable u/s.234B and 234C on the balance tax liability - Held that:- AO appropriated the seized cash for adjustment against tax liability in the month of March 2011. We find the CIT(A) directed the AO to give credit for such cash seized w.e.f. 30-03-2010. We find no infirmity in the order of the CIT(A) since the assessee vide letter dated 30-03-2010 had requested the AO adjust such seized cash as self assessment tax. Until and unless the assessee makes a specific request, the AO is not duty bound to appropriate such tax either towards advance tax or towards self assessment tax. He can only adjust such seized cash from the tax determined after completion of assessment. Since in the instant case, the assessee vide letter dated 30-03-2010 only has requested the AO to adjust such seized cash towards self assessment tax for A.Y. 2009-10 and since the CIT(A) has accepted this plea of the assessee, therefore, we find there should not be any grievance on the part of the assessee. Unexplained business expenses in respect of Ghodzari Project - Held that:- CIT(A) allowed the claim of the assessee on the ground that an amount of ₹ 21.92 crores has already been considered in the hands of Mahalaxmi Infraprojects Ltd. on account of Ghodzari project which includes the amount of ₹ 1.4735 crores (Not ₹ 1.50 crores). Therefore, making addition of this amount in the hands of the assessee will amount to double taxation. We do not find any infirmity in the order of the CIT(A). The assessing authority is denuded of its authority to verify the correctness and completeness of the return, which authority it has while framing a regular assessment. It must accept the return as furnished and shall not in any event raise a demand for payment of further taxes. Accepting the income as disclosed in the return of income furnished by the assessee, it must refund to the assessee any tax paid in excess of the liability incurred by him on the basis of income disclosed. Even if the tax paid is found to be less than that payable, no further demand can be made for recovery of the balance amount since a fresh assessment is barred. However, if the assessee has paid more tax then the income that was returned then the excess tax to be refunded. We therefore, are of the considered opinion that the said decision is distinguishable and not applicable to the facts of the present case. The various other decisions relied on by the Ld. Departmental Representative are also not applicable to the facts of the present case. Therefore, this argument of the Ld. Departmental Representative is also without any force. In this view of the matter the ground raised by the Revenue is dismissed.
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