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2019 (6) TMI 1372 - AT - Income TaxDeduction u/s 54F - claim of deduction disallowed by the AO for the reason that on the date of transfer of land, assessee has owned more than one residential house - assess contention that he has demolished one house for new comstruction - HELD THAT:- As noted that assessee has produced application that was filed by the assessee only in November 2009 requesting for permission for development of plot and in the building plan submitted before PMC authorities, the existing building, which was claimed to have been demolished in May, 2009 was shown as “to be demolished”. He therefore concluded that “to be demolished” proved beyond doubt that the existing bunglow was not demolished till June / July – 2010. He also noticed that the property tax in respect of the said property was paid as applicable for residential house and not for open plot even for the year 2009 and 2010. CIT(A) therefore did not accept the claim of the assessee that the existing construction of the property was demolished and the property became a vacant plot on the date of transfer of land. With respect to other residential properties owned by assessee, CIT(A) has given a finding that assessee owns three flats and that since the assessee was the owner of more than one residential house as on the date of transfer of land, he was not eligible for deduction u/s 54F of the Act. - Decided against assessee. Depreciation on the civil foundation work of windmill - rate of depreciation applicable is 10% as civil structure or 80% being the rate applicable to windmill - HELD THAT:- We find that the identical issue has been decided by the Hon’ble Bombay High Court in the case of CIT Vs. Cooper Foundary Pvt. Ltd [2011 (6) TMI 837 - BOMBAY HIGH COURT] in assessee’s favour wherein it had upheld the order of Tribunal granting depreciation @ 80% on the foundation cost incurred for installation of windmill. Before us, Revenue has not placed any contrary binding decision in its support. We therefore relying on the aforesaid decision of Hon’ble Bombay High Court hold that on the cost incurred for installation of windmill, the depreciation is to be allowed at the rate which is applicable to windmill. We direct accordingly and thus, the ground of the assessee is allowed. Deemed rental income of residential house u/s 23(4) - Case of assessee that the residential houses owned by assessee are his stock-in-trade and therefore, no addition on account of deemed rent can be made - HELD THAT:- We find that Ld.CIT(A) while upholding the addition has given a finding that three flats at Lake Town were held by the assessee as capital assets and were not business assets of the assessee. With respect to bunglow at Prabhat Road, he has noted that the bunglow was not demolished as on 31.03.2010 and thus the assessee owned more than one house during the year and therefore additions made by AO was as per the provisions of Sec.23(4). Before us, no material has been placed by Ld.A.R. to point out any fallacy in the findings of Ld.CIT(A). We therefore find no reason to interfere with the order of Ld.CIT(A) and thus the ground No.3 of assessee is dismissed. Disallowance u/s 14A - HELD THAT:- We find that while upholding the disallowance, Ld.CIT(A) has noted that proper satisfaction was recorded by AO before disallowing expenses. He has further noted that substantial investments were made by the assessee and therefore the contention of the assessee that no expenses have been incurred for earning exempt income cannot be accepted. He has also noted that disallowance has been made for administrative expenses under Rule 8D(2)(iii) of the I.T. Rules. Before us, no fallacy in the findings of Ld.CIT(A) has been pointed out by Ld.A.R. We therefore find no reason to interfere with the order of Ld.CIT(A) and thus, the ground No.4 of assessee is dismissed. Disallowance on adhoc basis on account of personal element - HELD THAT:- We find that while upholding the order of AO, CIT(A) has noted that assessee was not in a position to furnish any log book indicating the use of vehicles for exclusive and wholly for the purpose of business and that assessee was also not having any personal vehicles to show that it was used for personal purposes. Even with respect to disallowance on account of conveyance and travelling, he has noted that no evidence to support his case was filed before Ld.CIT(A).
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