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2020 (10) TMI 1046 - AT - Income TaxGenuineness of Commission paid to relative against sale of land - HELD THAT:- In this case, absolutely, no material on record has been brought by the assessee to suggest as to how the commission agent i.e., the said relative has worked in order to facilitate the sale of the plot of the land. Merely payment through banking channels is not sufficient to establish the genuineness of the particular transaction. There has to be some specific material on record, 3rd party confirmation and most important that the facts should convey the basic need for why the commission was paid. In the present case of the assessee, these aspects are not at all proved. Disallowance on account of various expenses regarding the leveling of land, expenses towards compound wall, land development expenses and evacuation payment - HELD THAT:- Assessee could not produce the tenants namely, Maruti Narayan Patil to whom an amount of ₹ 13 lakh was paid and Shri Sudhakar Patil to whom ₹ 1 lakh was paid, totaling to ₹ 14 lakhs, for removing the encroachment. The assessee failed to substantiate the basis of such payments. The assessee also failed to prove through the return of income reflecting the above payments. Therefore, the disallowance of ₹ 14 lakhs i.e., payment to tenants is hereby upheld. Un-substantiated expenses AR prayed that this amount as the WIP - Since the CIT (Appeals) mentions that this amount assessee might have incurred the same for running his project. However, nothing was placed on record by the learned Authorised Representative before us, as regards any running project of the assessee during the relevant year. Considering the prayer of the assessee and the fact that CIT (Appeals) in his order mentions of WIP, this issue is restored to the file of AO for factual verification whether the said amount could qualify as WIP. AO shall decide this issue of balance expenditure whether WIP or not while complying with the principles of natural justice. Therefore these grounds partly allowed for statistical purposes.
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