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2017 (11) TMI 1371 - AT - Income TaxDisallowance of expenses - proof of payment as per the registered agreement which is a sale deed - Held that:- As referring to registered sale deed it is specifically mentioned in the said sale deed that all the expenses on sale deed are borne by the seller. Further it was also seen from the back page no. 51 are purchased by assessee as the same is in the name of assessee. Pg No. 52 of the paper book is the account of the property mentioning payment of ₹ 11,26,600/- in cash for the purchase of stamp papers on the sale of the property. Said account is from regular book of audited accounts, which are examined and accepted by the A.O. and no adverse remark regarding book of accounts, availability of cash etc. was found by the A.O. who in fact specifically accepted such payment. Hence payment is as per the registered agreement which is a sale deed and there is no requirement of any cash flow statement when payment is from cash book maintained in the ordinary course of business. In fact addition for doubting source is to be made U/s 69 and not for the disallowance of expenditure and in fact ld. CIT(A) raised only doubts but has not denied that payment has been made. All the bills are bearing name/address/phone no. of the supplier and most of the bills are bearing printed numbers as well as item supplied like rodi, cement etc. Beside AO has not rejected accounts and specifically accepted these expenses. In any case in case of any doubt ld. CIT(A) had to conduct inquiry from the suppliers or at least had to enquire from the assessee about his doubts as onus was on him to prove expenses bogus. His observation about rented property is wrong on the record. As per above discussions enhancement made by ld. CIT(A) is without any material - Decided against revenue Addition being interest on borrowed funds capitalized - AR argued that the interest paid against housing loan is part of cost of acquisition U/s 48 - Held that:- After considering the settled position of law about the allowance of interest on loan taken for the purchase of house property as part of cost more so when assessee has also not taken any other advantage of said interest and incurrence of interest expenditure is not under doubt, claim of interest is fully allowable against the sale consideration and ground of assessee allowed.
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