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2016 (12) TMI 234 - AT - Income TaxAllowability of development expenses incurred in respect of land sold by the assessee - Held that:- In respect of first person, Shri Namdeo Vishwanath Karale, to whom the assessee claimed to have paid ₹ 1 lakh, the said person has categorically stated that he had not done any work in 2002-03. He states that he had received an amount of ₹ 1,50,000/- with the work completed in 2009-10. First of all, there is difference in the amount claimed and received by the said person. The assessee’s claim was of ₹ 1 lakh, whereas the said person claimed to have received ₹ 1,50,000/- for work completed in the later years. The assessee has failed to establish its case and hence, the disallowance of ₹ 1 lakh is warranted. In respect of second disallowance of ₹ 1 lakh, amount being paid to Shri Vishal Ashok Gaikwad for removal of encroachments. The assessee has failed to establish that the said person was residing at the said property against which, the said charges for removal of encroachments have been paid in cash. In the absence of any proof of residence of said person on the said property, there is no merit in the claim of assessee and the same is dismissed. Coming to the last claim of assessee of ₹ 1 lakh, which is claimed to be incurred on construction of compound wall. The recipient has admitted to have carried on the said work and also admitted to have received the amount. However, he did not remember exact number of poles and only for this minor issue, the claim of assessee cannot be rejected. The Assessing Officer is directed to allow the claim of assessee to the extent of ₹ 1 lakh. Accordingly, the order of CIT(A) is modified in restricting the disallowance to ₹ 2 lakhs and allowing the claim of assessee to the extent of ₹ 1 lakh. - Decided partly in favour of assessee As in the case of wife of assessee part of claim of assessee has been accepted out of total expenditure of ₹ 12,90,000/- and only balance of ₹ 7,50,000/- has been disallowed for want of source of making the said payment and whether the expenditure was incurred by the assessee and was allowable in the hands of assessee is a secondary factor. The first fact it has to be proved by the assessee in the present set of facts is whether the assessee had requisite cash available with her to undertake the development work. In the absence of assessee proving the same, there is no merit in the claim of assessee and the same is rejected. The grounds of appeal raised by the assessee are thus, dismissed.
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