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2016 (11) TMI 64 - AT - Income TaxAddition on account of sale of plot - CIT(A) has recorded a finding of fact that the assessee has not shown this plot as "Stock-in-Trade" in his balance sheet and no document was found during the course of search to the effect that the assessee has converted this plot into Stock-in-trade - Held that:- The intention of the assessee can be determined through the treatment of the asset in the financial statements as well as the conduct and the actions of the assessee in relation to the asset. In the instant case, the asset has been shown as an investment and not as stock-in-trade in the financial statements. Further, there are no physical improvements/ developments which has been carried out right from the year of purchase to the year of sale. The intention of the assessee was therefore to hold this plot of land as an investment and not as stock-in trade. On similar facts, the Coordinate Bench of this Tribunal in the assessee’s own case for the A.Y. 2004-05 had decided the issue under consideration in favour of the assessee. Addition on account of investment in construction of house when the addition is supported by the finding of the DVO - Held that:- AO as well as DVO both failed to list out the items considered as loose furniture found at the time of inspection of the house of the assessee and no valuation of such loose furniture was made by the DVO, therefore there is no justification to made estimated addition on this account just merely on the presumptive finding of the DVO which is not supported by any evidence more so when the investment shown by the assessee is duly supported by the bills and vouchers. We have given a careful consideration to the matter and of the view that the ld CIT(A) has elaborately gone through the contentions and has rightly arrived at the conclusion that there is no basis for the adhoc estimation of ₹ 20,00,000. Hence, we confirm the following findings of the ld CIT(A). - Decided in favour of the assessee. Addition on account of advance given to Gulam Farooq Ansari - Held that:- Assessee had produced the re-casted audited cash book after incorporating all entries before the AO. There were sufficient cash balance available with assessee and his family members/group concern to cover the payment of ₹ 1,50,00,000/- to Ansari.” During the course of the arguments, the Revenue has not brought anything further to our notice and the findings of ld CIT(A) remain uncontroverted before us. The assessee has successfully demonstrated through its explanation and documentation in terms of re-casted books of accounts that the statement made during the course of the search cannot be made the sole basis for making the addition of ₹ 1,50,00,000 in his hands as there was sufficient cash balance in the books of accounts to make the said payment and discharged its onus as laid down by the decision of Hon’ble Supreme Court in case of Pullangode Rubber Produce Co (1971 (9) TMI 64 - SUPREME Court ) and Rajasthan High Court in case of Ashok Kumar Soni (2006 (7) TMI 162 - RAJASTHAN High Court ). - Decided in favour of the assessee. Deemed dividend income under section 2(22)(e) - Held that:- The advance given by the company to the assessee is for business purposes towards purchase of land and the same cannot be treated as deemed dividend in the hands of the assessee. Accordingly, we allow the appeal of the assessee
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