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2022 (9) TMI 518 - AT - Income TaxDeduction u/s. 54B - agricultural land which is purchased prior to the sale of agricultural land - HELD THAT:- The assessee is entitled for the claim of deduction provided the agricultural land is purchased within two years after the date of sale of agricultural land. In assessee’s case, the agricultural land is sold on 14.2.2014 (50% share) and the agricultural land against which deduction u/s. 54B is claimed was purchased on 23.5.2013 which is prior to the sale. Therefore, we are of the view that the assessee is not entitled to claim deduction u/s. 54B of the Act for the agricultural land which is purchased prior to the sale of agricultural land. We therefore see no reason to interfere with the order of the CIT(Appeals) in this regard. Disallowance made towards long term capital gains - Expenses at the time of purchases - AR submitted that the assessee had submitted confirmations from 3 persons which the CIT(Appeals) did not consider on the basis that the additional evidence are not furnished as per Rule 46A and no explanation was provided for additional evidence - CIT(Appeals) has power to admit the additional evidence before him which goes to the root of the issue and cannot reject the evidence merely on technicality of Rule 46A. In our considered view, there was sufficient and reasonable cause for the assessee in producing the confirmations before the AO. We therefore admit these additional evidence and remit the issue to the AO for verification of the confirmations from the 3 parties and decide the allowability of the claim in accordance with law, after providing opportunity of being heard to the assessee. Landscaping and other expenses claimed - Documents now produced in the form of additional evidence in support of the landscaping and other expenses requires verification by the AO and for this purpose, we remit this issue to the AO for consideration of the AO and decision in accordance with law, after reasonable opportunity of being heard to the assessee. Expenses at the time of purchase, landscaping and other expenses claimed in the computation of capital gains for the year under consideration, we notice that the assessee has claimed 100% of the above expenses. Since only 50% of the total sale proceeds is offered to income during the current year, the deduction claimed also should be restricted to 50%. Accordingly, we direct the AO to allow only 50% of eligible deduction of these expenses after due verification of the evidence. Unexplained cash deposits made into the Appellant's Bank Account - Assessee has prepared and submitted the cash book during the course of hearing before the AO. However, the same cannot be rejected by the revenue authorities stating that it is prepared to reflect only bank entries and does not represent any business transaction. Further, we notice that there is no description as narration of the entries in the cash book and hence it cannot be conclusively said that there is no transaction pertaining to business accounted. AO/CIT(A) have not done any reconciliation of entries in the cash book with that of bank entries as per bank statement. The summary of cash book transactions submitted by the AR before us also needs to be examined by the revenue authorities. In view of the above, we remit this issue back to the AO for verification of details afresh. Appeal of the assessee is partly allowed for statistical purposes.
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