Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (12) TMI 112 - AT - Income TaxAdhoc disallowance out of expenses - Held that:- Perusal of the order passed by the learned CIT(A) in A.Y. 2008-09 would show that the assessee has filed details of expenses as additional evidence under Rule 46A and the same was forwarded to the Assessing Officer by the learned CIT(A). Since the Assessing Officer did not comment upon the additional evidence, the learned CIT(A) deleted entire additional made by the Assessing Officer. We noticed that the learned CIT(A) has not recorded such kind of facts in the impugned order, meaning thereby assessee did not file details of expenses before the learned CIT(A) during the year under consideration. Accordingly, we are of the view that the addition of part of expenses claimed by the assessee is justified. However, considering the nature of business carried on by the assessee, we are of the view that the addition of 5% of the expenses, which approximately works out to ₹ 1.80 lakhs is on the higher side. Accordingly, we modify the order passed by the learned CIT(A) and direct the Assessing Officer to restrict the addition to ₹ 1 lakh only. We order accordingly. Assessment of advance received against sale of asset - Held that:- The amount of ₹ 3 lakhs received by the assessee was advance amount received against sale of property. The assessee has furnished evidence to show that the above said advance amount of ₹ 3 lakhs has been returned back to the party in the subsequent period. Manner of treatment of advance money received is prescribed u/s. 51 of the Act as per which, advance money shall be reduced from the cost of the asset, if the same had been forfeited. In the instant case, it is not the case of the tax authorities that the assessee had retained the advance amount of ₹ 3 lakhs. On the contrary the assessee has proved that the above said amount had been returned back to the buyer in the subsequent period. Hence, we are of the view that there was no scope for assessing advance amount of ₹ 3 lakhs as income of the assessee during the year under consideration. Accordingly, we set aside the order passed by the learned CIT(A) on this issue and direct the Assessing Officer to delete the addition of ₹ 3 lakhs that was confirmed by the learned CIT(A).
|