|
Advanced Search Options
Case Laws
Showing 281 to 300 of 1271 Records
-
2015 (6) TMI 997
Refund claim - Rejected on Unjust Enrichment - 1% National Calamity Contingent Duty paid by mistake by way of draft - Held that:- once the amount is shown as recoverable, it is not material, in Balance-sheet, under which head it is classified. Also, if the amount is shown as receivable or recoverable from the Customs Department, then the question of unjust enrichment does not arise. Here, as the appellant being a manufacturer of fabric, there is no reason to examine its sales invoices etc. Therefore, refund is allowed. - Matter remanded back
-
2015 (6) TMI 996
Revise return - jurisdiction of AO to ignore the revised return and proceed on the basis of original return - CIT(A) held that AO had no jurisdiction to proceed with the original assessment.AO did not have jurisdiction in view of the revised return in which the disclosed income was shown as ₹ 41,31,510/- which was more than ₹ 10 lakhs, the monetary limit placed by the Central Board of Direct Taxes ("CBDT").
Held that:- Revenue's Appeal was defective since the finding of the CIT(A) on the lack of jurisdiction was not challenged by it.
-
2015 (6) TMI 995
Classification - whether the ability to work together with a computer should be understood to be the ability to work only on the basis of a computer with the machine incapable of performing this function otherwise? - Held that:- In the present case these machines are themselves computers inasmuch as they answer the description of an automatic data processing machine as mentioned in Chapter Note 5(a) of the Chapter 84. And therefore, it cannot be said that they are working on the basis of another computer. While, the notice states that these machines are compatible meaning ‘able to co-exist or be used together without problems or conflict’ or consistent or in keeping (Concise Oxford Dictionary), it stops short of saying that the machines work on the basis of other computers. Further, the word conjunction means that these machines are to be connected and worked together in coordinated manner with another computer. It has been demonstrated amply that the machines can work independent of any other computer for performing its work.
With regard to reproducing and displaying machines with calculating functions as stated in the HSN, electronic programmable calculators differ from automatic data processing machines in particular by the fact that they cannot execute without human intervention a processing programme which requires them to modify their execution by logical decision during processing run. It has been stated by the assessee that their machines can run and modify their execution by logical decision during the processing run without human intervention. This is also supported by the opinion of the experts. This would be the clincher to rule out the classification of the products under Ch. S.H. No. 8470.10. The notice also refers to these products as accounting machines and similar machines incorporating calculating devices. It is not clear of the three machine which were to be dealt as the accounting machines. However, the explanatory notes to the account machines also state that the structure of accounting machines is appreciably the same as that of calculating machines. In addition to manual input arrangements for variable data (e.g. Debit/Credit operations), like calculating machines, they may be fitted with devices for reading punched cards or tape, magnetic tape or cards, etc., to introduce recurrent data or preset data. Here also since it is similar to calculating machines, same logic that excludes these machines from calculating machines would exclude them from the accounting machines also.
-
2015 (6) TMI 994
Disallowance u.s 14A - permissible limit - Held that:- In the instant case, the income from dividend has been shown at ₹ 1,11,564, the disallowance under section 14 A read with Rule 8 D worked out by the Assessing officer comes to ₹ 4,09,675/-. Thus it is clear that the AO has disallowed the entire ‘tax exempt income’ which is not permissible in view of the judgment of Joint Investment Pvt Ltd. Vs. CIT [2015 (3) TMI 155 - DELHI HIGH COURT]. The Hon’ble Delhi High Court held that the window for disallowance is indicated in section 14A, and is only to the extent of disallowing expenditure “ incurred by he assessee in relation to the tax exempt income”. The disallowance under section 14 A read with Rule 8 D as worked out by the AO is not in accordance with law and as such working is not sustainable.
In view of the above observations, think it is appropriate to set aside the order of the Ld. CIT(A) on this issue and remit the matter to the file of AO with a direction to decide the issue a fresh in accordance with law after affording due and reasonable opportunity of being heard to the assessee. - Decided partly in favour of assessee for Statistical purposes.
-
2015 (6) TMI 993
Disallowance u/s. 14A - CIT(A) deleted the addition - Held that:- The undisputed fact is that the investments have been made out of own funds and no borrowed fund was utilized. It is also undisputed fact that in both the years under consideration, the assessee has disallowed suo motu fees paid to the portfolio manager. It is also an admitted fact that the Assessing Officer has nowhere recorded his dissatisfaction on the claim of expenditure attributable to the disallowance u/s. 14A made by the assessee. We, therefore, decline to interfere with the findings of the Ld. CIT(A).
Allowable expenditure u/s 37 - Held that:- Religious expenditure cannot be considered at par with expenditure on social cause. The undisputed fact is that in guise of advertisement expenditure, the assessee has incurred expenditure towards renovation of Bandeshwar temple. This expenditure cannot be considered having been incurred towards corporate social responsibility. In our considered opinion, only expenditure incurred towards discharge of corporate social responsibility can be considered as allowable u/s. 37(1) of the Act.
-
2015 (6) TMI 992
Penalty u/s 271(1)(c) - whether the notice u/s 274 r.w.s. 271 does not specify the exact reason for initiation of penalty proceedings u/s 271(1)(c)? - Held that:- The Assessing Officer is empowered under the Act to initiate penalty proceedings once he is satisfied in the course of any proceedings that there is concealment of income or furnishing of inaccurate particulars of total income under clause (c). Concealment, furnishing inaccurate particulars of income are different. Thus the Assessing Officer while issuing notice has to come to the conclusion that whether is it a case of concealment of income or is it a case of furnishing of inaccurate particulars. The Apex Court in the case of Ashok Pai reported in [2007 (5) TMI 199 - SUPREME Court ] has held that concealment of income and furnishing inaccurate particulars of income carry different connotations. The Gujarat High Court in the case of MANU ENGINEERING reported in [1978 (9) TMI 18 - GUJARAT High Court ] and VIRGO MARKETING [2008 (1) TMI 885 - DELHI HIGH COURT] has held that levy of penalty has to be clear as to the limb for which it is levied and the position being unclear penalty is not sustainable. Therefore, when the Assessing Officer proposes to invoke the first limb being concealment, then the notice has to be appropriately marked. Similar is the case for furnishing inaccurate particulars of income. The standard proforma without striking of the relevant clauses will lead to an inference as to non-application of mind. Thus we delete the penalty levied by the AO u/s 271(1)(c) of the Act. - Decided in favour of assessee
-
2015 (6) TMI 991
Application for modification of stay order - seeking extension of time to make pre-deposit - Held that:- Since appellant was given final notice dated 11.02.15 to show cause why the appeal shall not be dismissed for non-compliance. Their miscellaneous application dated 21.04.15 again sought for modification/recall of notice and we find only reiterated their stand on modification of stay which was already considered by this Bench and rejected. Therefore, the present miscellaneous application is devoid of any merits and the same is rejected. Since sufficient time was given to the appellants to make pre-deposit of the amount and also final notice issued for dismissal for non-compliance and the appellants failed to comply the stay order dated 26.06.2014, both the appeals are dismissed for non-compliance of the stay order. - Decided against the assessee.
-
2015 (6) TMI 990
Bar of unjust enrichment - differential duty paid subsequent to the clearance by way of payment under TR-6 challans - Held that:- We find that the Tribunal in the series of judgements in the cases of Plas Pack Industries (2004 (2) TMI 125 - CESTAT, MUMBAI ), Silwester Textiles P. Ltd. Vs. CCE, Mumbai reported in (2003 (5) TMI 305 - CESTAT, MUMBAI), Industrial Cables (2001 (12) TMI 104 - CEGAT, NEW DELHI), Easter Industries Ltd. (1999 (8) TMI 915 - CEGAT, NEW DELHI ) and in the case of Southern Agrifune Indus. Ltd. (2004 (7) TMI 246 - CESTAT, CHENNAI ) has held that the bar of unjust enrichment is not attracted when the differential duty is paid subsequent to the clearance of the goods.
Moreover, in the present case, there is no dispute that in respect of payment of differential duty under protest, whose refund is claimed, no supplementary invoices had been issued. Had such supplementary invoice been issued, a presumption could be made under Section 12 B of the Central Excise Act but in absence of such supplementary invoice, no presumption can be made. We have gone through para-91 of the Apex Court's judgement in the case of Mafatlal Industries (1996 (12) TMI 50 - SUPREME COURT OF INDIA ) cited in the grounds of appeal and we are of the view that the observations of the Apex Court in that para are not applicable to the facts of this case at all. Commissioner's conclusion the differential duty had been paid subsequent to the clearance by way of payment under TR-6 challans, the bar of unjust enrichment would not apply. - Decided against revenue
-
2015 (6) TMI 989
Transfer of the Cenvat credit - eligibility of benefit of Rule 10 of Cenvat Credit Rules, 2004 - Held that:- Rule 10(3) of the Cenvat Credit Rules, 2004 stipulates the transfer of the Cenvat credit under sub-rules (1) and (2) shall be allowed only if the stock of inputs as such or in process, or the capital goods is also transferred along with the factory or business premises to the new site or ownership and the inputs, or capital goods, on which credit has been availed of are duly accounted for to the satisfaction of the Deputy Commissioner of Central Excise or, as the case may be, the Assistant Commissioner of Central Excise
In the instant case all the stock of finished, semi-finished goods including plants and machinery was destroyed in the fire incidence and hence question of stock transfer does not arise. Further find that the appellant had intimated to the department regarding transfer of Cenvat credit time and again and had requested for regularization of the same as per the provisions of Rule 10 of the Cenvat Credit Rules, 2004.
-
2015 (6) TMI 988
Repair and maintenance - definition of input services - Held that:- The issue is no more res integra and stands settled by the precedent decisions of the Tribunal. In the case of CCE Vadodara Vs Danke Products [2009 (7) TMI 137 - CESTAT, AHMEDABAD], it was held that repair and maintenance of the goods during the warranty period is an activity relating to sale of goods and such an activity would be covered by the definition of input services.
To the same effect is another order of the Tribunal in the case of Gujarat Forging Ltd. Vs CCE [2014 (5) TMI 641 - CESTAT AHMEDABAD] wherein it stands held that inasmuch as the cost of warranty period is already included in the assessable value of the final product, the maintenance and repair services provided during the warranty period would be included in the definition of input services. Inasmuch as the issue stands decided by the above referred decisions of the Tribunal, set aside the impugned order and allow the appeal with consequential relief to the appellant.
-
2015 (6) TMI 987
Shortages of stock - removal of inputs clandestinely - Held that:- It is admitted fact that during the course of verification of stock of inputs, there was shortages and have been explained by the Director that these shortages were due to the reason that they have not taken their stock position since long. It is also a fact that process of manufacturing of appellant is like that where HDPE granules goes waste. The appellant has paid duty on the shortages at the time of investigation itself. But the contest done by the appellant on issuance of show cause notice shows the intent of the appellant.
In this case, inputs were found short but same has been explained by the Director that as they have not taken the stock position since long, that might be the reason of shortage. These facts have not been appreciated by the lower authorities. In these circumstances, I rely on the decision of Nissan Thermoware P. Ltd. (2010 (12) TMI 487 - GUJARAT HIGH COURT) that held that in the absence of any cogent evidence of removal of inputs clandestinely, the cenvat credit cannot be denied on shortage of inputs to the appellants. - Decided in favour of assessee
-
2015 (6) TMI 986
Liability of duty on account of non-accountal shortage of goods - Held that:- Record reveals that ld. adjudicating authority penalized the appellant under Rule 25 read with Section 11AC of Central Excise of 1944. Rule 25 of Central Excise Rules, 2002 deals with circumstances in which penalty can be imposed taking shelter of section 11AC of Central Excise Act, 1944. The present case is a case which is concerned for non-accountal of excisable goods manufactured or stored by the appellants. It is in respect of shortage noticed in the course of inventory during investigation. When such is the event this is a case inviting penal provision of section 11AC with the aid of Rule of 25 Central Excise, 2002. Therefore, the appeal is remanded to the Commissioner (Appeals) to reconsider the provision of law relating to penalty and pass appropriate order granting fair opportunity of hearing to the appellant.
In this case the appellant has contested duty liability and consequently imposition of penalty. This Tribunal has not given any finding on the issue of duty liability. Therefore, recall the order of this Tribunal dated 21-10-2014 and direct the registry to relist the appeal to be heard on merits.
-
2015 (6) TMI 985
Penalty under Section 11AC - shortage of inputs/finished goods were found - clandestine removal of goods - Held that:- As during the course of stock taking certain shortages were found but the contention of the appellant that stock taking was done on eye estimation basis has not been reverted by the Revenue without any supportive evidence and there is a shortage of around 0.56%. That shortage may be due to the stock taking by way of eye estimation basis. Furthermore, revenue has not produced any corroborative evidence to allege goods have been removed clandestinely without payment of duty.
As Revenue has failed to prove the mala fide act on the part of the appellant to allege clandestine removal of the goods. Therefore, in the absence of any ingredient of Section 11AC of the Act penalty on the appellants are not imposable. - Decided in favour of assessee.
-
2015 (6) TMI 984
Eligibility of deduction u/s.10A - CIT(A) allowed the claim - Held that:- There is no dispute that the CIT (A) had followed his own orders for A. Y. 2002-03 to 2004-05 while allowing the claim of the assessee u/s.10A of the Act. The CIT(A) has examined the question of splitting up of an existing business as alleged by the Revenue. As rightly pointed out by him, as the activities were finally culminated at the work site of the clients in Sourth Korea, there was no need for full fledged infrastructural facilities in India. Such facility is not called for in the line of business carried on by the assessee. Therefore, in the facts and circumstances of the case, we find that the assessee is entitled for the deduction u/s 10A and the CIT(A) has rightly held so. - Decided in favour of assessee
Claim of software expenses - revenue v/s capital expenditure - CIT(A) allowed assessee's claim of revenue exp - Held that:- In the classification of the software expenditure claimed as revenue outgo, assessee has put it under four categories, viz., annual licence fee, maintenance and upgradation service charges, rental and lease charges and anti virus software, having one year shelf-life. Revenue has not questioned this classification nor the contention of the assessee that software which gave rise to enduring benefit were indeed classified by it as an asset. Annual licence fee, by the very nomenclature implies that assessee had obtained licence to use the software, and but for the fees, the facility would not be available to the assessee.Rental and lease charges also come within the very similar meaning. Anti-virus software was having a shelf life of only one year. Maintenance and upgradation service charges would not create a new software. At the best this would go only to improve the profit giving apparatus of the assessee and make it more efficient. We are of the opinion that CIT (A) was justified in relying on the decisions of Hon’ble Delhi and Bombay High Courts in the case of Asahi India Safety Glass Ltd (2011 (11) TMI 2 - DELHI HIGH COURT ) and Raychem RPG Ltd. (2011 (7) TMI 953 - Bombay High Court ) respectively. We do not find any reason to interfere with the order of CIT (A). - Decided in favour of assessee
Disallowance u/s.14A r.w.rule 8D(2)(ii) - CIT(A) allowed the claim - Held that:- There is no dispute that the interest charged by the assessee to its P & L account which was the basis for the disallowance under Rule 8D(2)(ii) made by the AO, were entirely on account of term loan and overdraft. Assessee has also shown that the term loan was used in an earlier year when there were no investments in non-tax bearing instruments. In so far as OD raised by the assessee is concerned, nothing has been shown by the Revenue to show that any part of such overdraft amount was used for financing the investments. Once assessee state that no expenditure what so ever was incurred by it for earning tax-free income, AO has to demonstrate why the claim could not be accepted with cogent reasons. We are therefore of the opinion that the disallowance was rightly deleted by the CIT (A).- Decided in favour of assessee
MAT computation - adjustment for leave encashment provision and for bonus provision not allowed by the AO while computing the book profit u/s.115JB - Held that:- Actuarial valuation is a scientific method for determining a liability that has crystalised, but quantification of which are dependent on future events which are certain to happen. Once an assessee has made provisioning based on actuarial valuation, it ceases to be a provision for an unascertained liability. We are therefore of the opinion that CIT (A) was justified in deleting these additions while computing the tax u/s.115JB of the Act - Decided in favour of assessee
Disallowance of debit notes raised by parent company for defraying the ESOP charges of employees deputed by it - Held that:- Absence of a written contract by itself might not be fatal to the claim of an expenditure especially when such expenditure is based on an understanding between a holding company and a subsidiary company, but nevertheless, it is the duty of the assessee to show that what has been reimbursed as amortised ESOP cost by its holding company were actually charged by such holding company in its P & L account as expenditure and the reimbursements made by the assessee were shown as a part of its income. Assessee has to demonstrate that the services received by it from such employees were commensurate with the payment. We are, therefore, of the opinion that the claim of the assessee requires a fresh look by the AO. We , therefore, set aside the orders of the lower authorities on this issue and remit it back to the AO for fresh consideration.Assessee will be free to produce fresh evidence to justify the incurrence of such expenditure and also show that the expenditure was not claimed twice, i.e., both by the assessee as well as by its holding company. - Decided in favour of assessee for statistical purposes.
-
2015 (6) TMI 983
Availment of CENVAT Credit - Capital goods - Rule 57Q(3) of the Central Excise Rules, 1944 - Held that:- It is appropriate that the present appeal be disposed of in terms of the earlier judgment of this Court as referred to herein above, since the questions of law that arise for consideration in this appeal have already been answered by the Division Bench of this Court [2014 (5) TMI 790 - Karnataka High Court]. Since the same are pending adjudication before the Hon'ble Supreme Court, it is needless to state that any order that is to be passed by the Hon'ble Supreme Court would be applicable to the parties herein. - Appeal disposed of.
-
2015 (6) TMI 982
Clandestine removal of goods - short found finished goods - stock taking of CTD and TMT bars was done on the basis of average taken up by weighing 5 bundles of each size - Held that:- in the absence of any cogent evidence in support of the allegation of clandestine removal except the average weighment done in this case the charge remains unproved. Further, in reply to the show cause notice appellant has given the details of weighment and as per the weighment the difference works out to be around 3.3 MT in the stock of 1092.730 MT which is only a meager quantity - charge of clandestine removal remained unproved. - Demand of duty set aside - Decided in favor of assessee.
-
2015 (6) TMI 981
Deduction u/s.80IA on windmill power generation - CIT(A) allowed claim - Held that:- The issue is squarely covered by the judgment of jurisdictional high court in the case of Velayudhaswamy Spinning Mills (P) Ltd (2010 (3) TMI 860 - Madras High Court ) wherein held that the business undertaking of the assessee is wind mill power generation/hosiery goods, etc., and it has claimed the benefit of deduction under Section 80IA of the Income Tax Act for the assessment year in question and for the subsequent years as well. Having exercised its option and its losses have been set off already against other income of the business enterprise, the assessee in this appeal falls within the parameters of Section 80IA of the Income Tax Act. Being so, we are inclined to confirm the order of the Commissioner of Income Tax (Appeals) on this issue. - Decided in favour of assessee
Disallowance made u/s.40(a)(i) r.w.s 195 - non deduction of TDS - CIT(A) deleted the addition - Held that:- nature of services mentioned above will come not within the definition of “fees for technical services” given under explanation 2 to Section 9(1)(vii) of the Act. By virtue of such services, the concerned recipients had not made available to the assessee any new technic or skill which assessee could use in its business. The services rendered by the said parties related to clearing, warehousing and freight charges, outside India. The logistics service rendered was essentially warehousing facility. In our opinion, this cannot be equated with managerial, technical or consultancy services. Even if it is considered as technical service, the fee was payable only for services utilized by the assessee in the business or profession carried on by the said nonresidents outside India. Such business or profession of the non-residents, earned them income outside India. Thus, it would fall within the exception given under sub-clause (b) of Section 9(1) of the Act. In any case, under Section 195 of the Act, assessee is liable to deduct tax only where the payment made to non-residents is chargeable to tax under the provisions of the Act. In the circumstances mentioned above, assessee was justified in having a bonafide belief that the payments did not warrant application of Section 195 of the Act. In such circumstances, we are of the opinion that it could not have been saddled with the consequences mentioned under Section 40(a)(i) of the Act. Disallowances were rightly deleted by the ld. CIT(Appeals). - Decided in favour of assessee
-
2015 (6) TMI 980
Reopening of assessment - assessee having not been provided the copy of the reasons recorded for re-opening of assessment u/s. 147, but only the gist thereof - Held that:- The omission of the last sentence is not a reason itself, but only the concluding sentence, stating of the foregoing as being the reasons for belief as to escapement of income. Inasmuch as the same does not bear any reason, we do not find that it could be said that the assessee had not been conveyed the reasons as to escapement of income, or had been so either in part or only the gist thereof, as alleged. That the same are only reasons leading to the belief as to the escapement of income is evident and implied. What are these then and for and toward what are they being given, or given as, etc. would be the queries arising out of the assessee’s clearly unreasonable and unconvincing stand. Further, even assuming, without admitting, a debate, it would preclude section 254(2). The said ground is accordingly rejected.
Non-application of mind by the Assessing Officer (AO) in the matter, who has stated to have reopened simply on the basis of the findings of the DDIT(Inv.) - Held that:- there was material available with the AO on the basis of which a reasonable belief that income chargeable to tax had escaped assessment could be formed (paragraph 2.12). The same is a finding of fact, and for which the tribunal tranverses, as apparent from the discussion, through the said materials, issuing its final findings at paragraph 2.15. The assessee has also, vide ground 3(iii) referred to the tribunal’s observation that assessment had been reopened on the basis of section 132(4) statement made at the time of search which was on oath (at paragraph 2.14). It is stated that in so stating, the tribunal has overlooked that there was a survey at the vendor’s premises prior to the relevant search. How would, we wonder, that contradict or impugn the said observation by the tribunal in any manner? What the tribunal states is again a matter of fact, borne out by the reasons recorded and the material on record. Two, the fact that the search was preceeded by a survey, on the contrary, is defeating of the assessee’s case inasmuch as, clearly, material was found in survey leading to the search. The statement by the tribunal, it must be appreciated, was made while considering the assessee’s plea of there being no material for forming, prima-facie, a reasonable belief as to escapement of income. Whether, rather, there is material on record establishing the said survey is itself not known, for the assessee to have raised the plea, which though we have found as irrelevant. The ground is without basis
Each of the arguments raised by the assessee stand duly considered by the tribunal. Finding/s of fact, rendered upon appreciation of evidences, could not be revisited in rectification proceedings. We, accordingly, find no ground for the same.
Denial of opportunity to cross-examine the AO’s witnesses and, thus, a violation of the principle of natural justice - Held that: The argument is misplaced. For all we know, the cross-examination may not have been asked for, being in the nature of deposition/s. The tribunal has considered the argument (refer para 3.10), and in its view the disallowance had not been affected only on the basis of the said statements and, two, that all the material had been duly confronted to the assessee. It also clearly states that the rendering of the services by the companies could not be accepted on the basis of affidavits. The said ground is, again, without merit. - Decided against assessee
-
2015 (6) TMI 979
Transfer pricing adjustment - selection of comparable - Held that:- Avani Cincom Technologies Ltd., KALS Information Systems Ltd. and Celestial Labs Ltd. be omitted from the list of comparables.
KALS Information Systems Ltd.company was developing software products and was not purely or mainly a software service provider thus need to be excluded
Bodhtree Consulting Limited company is not a good comparable in view of the software products produced by the company. As such, no segmental data is adequately available too thus need to be excluded.
E-Zest Solutions Ltd. and Quintegra Solutions Ltd. are functionally different from the assessee and are not comparable to software development services as are engaged in proprietary software products and owns its own intangibles unlike the assessee in the case on hand who is a software service provider.
Flextronics Software Systems Ltd., iGate Global Systems Ltd., Infosys Technologies Ltd., Mindtree Ltd. (Seg.) and Sasken Communication Technologies Ltd. (Seg.) companies have been excluded from the list of comparables on the ground that these companies have a turnover filter above ₹ 200 crores and cannot be compared with the assessee, whose turnover is only ₹ 66.94 crores.
Wipro Ltd. be excluded from the list of comparable companies.
Thirdware Solutions Ltd. and Lucid Software Ltd. companies be omitted from the list of comparables for the period under consideration in the case on hand as are not functionally comparable with a software development service provider such as the assessee.
Persistent Systems Ltd. is engaged in product development and product design services while the assessee is a software development services provider.
Helios & Matheson Information Technology Ltd. in view of the admitted factual position that the employee cost in the case of this company was less than 25% of its sales, this company has to be excluded from the list of comparables.
Birla Technologies Ltd. company should be taken as a comparable as there is no other basis for rejecting this company as comparable assigned by the TPO
Indium Software (India) Ltd t export turnover filter of this company was 37.77% of its total turnover and therefore this company passes the export revenue filter of more than 25% of the turnover and has to be regarded as a comparable.
Excluding the lease line expenses from the total turnover as well as the export turnover, following the decision of the CIT v. Tata Elxsi Ltd.,(2011 (8) TMI 782 - KARNATAKA HIGH COURT ) confirmed.
-
2015 (6) TMI 978
Computation of annual letting value and vacancy allowance - Held that:- The assessee produced the receipt of the property tax as well as the summary of the property tax due demand in respect of the property at Jubilee Hills, Hyderabad before the CIT(A), but the CIT(A) has not considered the Municipal valuation of the said property while deciding the issue. As it is manifest from the assessment order, the AO accepted the annual letting value based on the Municipal value in respect of the properties situated at Bangalore. Therefore, the Municipal value in respect of the property at Jubilee Hills, Hyderabad is also required to be considered while determining the annual let out value u/s 23(1)(a) of the Act. Therefore, in the facts and circumstances of the case, as well as the in the interest of justice, we set aside this issue of determination of annual letting value in respect of the property at Jubilee Hills, Hyderabad to the record of the AO to re-do the exercise of computation of annual let out value, after considering the property tax payment record filed by the assessee.
Vacancy allowance claimed by the assessee, we note that the assessee never let out the property at Jubilee Hills, Hyderabad. Therefore, the question of remaining the property vacant during the year for the purpose of vacancy allowance does not arise. Accordingly, the claim of the assessee is devoid of any merit, when the assessee never let out the property in question. Hence, the claim of vacancy allowance is rejected.
Disallowance of cost of improvement, while computing the capital gain - Held that:- Assessee has not produced any supporting evidence regarding the expenditure incurred by the assessee on account of improvement of the property in question, however, as pointed out by the learned counsel for the assessee, the property in question was purchased by assessee vide sale deed dated 19-10-1995 and as per the schedule of the property, there is no mention of any construction or any structure on the said property purchased by the assessee. We note that the assessee had sold the property vide sale deed dated 2nd December, 2008 and as per the schedule of the property, being part of the sale deed dated 2nd December, 2008 the property is described as ‘House No.”. Therefore, prima facie it appears that what is sold by the assessee is a constructed property. However, it is a matter of verification and examination. Accordingly, this issue is set aside to the record of the AO to examine the facts of any construction physically existing on the property in question at the time of sale, in comparison to the state of property at the time of purchase vide sale deed dated 19-10-1995. In case, it is found that the assessee has carried out any construction or improvement work in the property and also produced the record of payment of money then the claim of the assessee cannot be brushed aside, merely because the assessee has not produced the bills of the expenditure. - Decided in favour of assessee for statistical purpose.
............
|
9911796707
