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2021 (4) TMI 1193 - AT - Income TaxRejection of books of accounts - Estimation of profit - assessee submitted that he had maintained regular books of account and got audited them u/s 44AB - HELD THAT:- We are of the view that since the books of account of the assessee are subject to audit u/s 44AB of the Act and bills & vouchers were not available and before the AO the assessee confessed that he destroyed the bills/vouchers after incurring the expenditure. Considering the prayer of the assessee & in the interest of justice as well as looking into the facts of the case, we direct the AO to estimate the profit @ 8% on direct contract receipts and @ 3% on sub-contract works. Accordingly, ground raised by the assessee on this issue is partly allowed. Long term capital gains on the sale of landed - HELD THAT:- The contention of the assessee is that the purchase consideration of the property is at ₹ 1,49,00,000/- and the AO while making the assessment for AY 2008-09 has determined the total purchase of the property at ₹ 3.5 crores. Therefore, to meet the ends of justice, we remit the issue back to the file of the AO with a direction to ascertain the correct purchase value of the property and decide the issue in accordance with law after providing reasonable opportunity of being heard to the assessee in the matter. The assessee is directed to substantiate his claim by way of documentary evidence. This ground is allowed for statistical purposes. Unexplained cash credit - HELD THAT:- On perusal of record and submissions of the assessee, the assessee could not satisfy the basic ingredients laid down in section 68 of the IT Act even though the revenue authorities provided sufficient opportunities to the assessee to substantiate his claim by way of documentary evidence as per the requirement of section 68 of the Act. Therefore, we are of the considered view that the CIT(A) has rightly decide the issue against the assessee and accordingly, we uphold the order of the CIT(A) and dismiss the ground raised by the assessee on this issue. Unexplained investments in form of pro-notes in the hands of the assessee in respect of the following pro-notes found and seized by the department at the time of search - HELD THAT:- The submission of the assessee is that these three pro-notes were not in the name of the assessee and it was in the name of others as per the above table. We are of the view that if the AO was not satisfied with the submission of the assessee, he could have summoned the persons, whose names are appeared on the pro-notes, but, without doing the same, he had made addition in the hands of the assessee is not proper and not in accordance with law. We find force and substance in the arguments advanced by the ld. AR of the assessee and therefore, we direct the AO to delete the addition made in the hands of the assessee. Addition of interest income accrued - HELD THAT:- On perusal of the interest calculation done by the AO @ 20% on the entire pro-notes, we are of the view that the calculation done by the AO is not correct. The assessee has admitted the interest of ₹ 2,17,101/-. The AO has calculated the interest on the entire amount of ₹ 33,76,000/- whereas we have directed the AO to delete the additions of ₹ 9,00,000 + 1,26,000/- + 23,50,000/- on the ground that the source of the same were explained by the assessee. We have observed that the assessee has explained the source of ₹ 23,50,000/- and directed the AO to delete this addition; however, he is liable for interest income thereon only @ 24% as offered on the pro-notes as observed by the AO. Therefore, we direct the AO to recalculate the interest on ₹ 23,50,000/- . This ground is partly allowed. Unexplained investment in jewellery - HELD THAT:- During the course of search, gross weight of jewellery at 751.5 grams were found. On perusal of the submissions made by the assessee before the CIT(A) that there are four members in his family consisting of his wife, unmarried daughter, son and himself. Assessee quoted Instruction No. 1916 of 11/05/1004 of CBDT and according to which, he is entitled to have 950 grams of jewellery and the assessee is having the less than the entitled quantity. However, the AO denied to give benefit as per the said Instruction of CBDT on the ground that as per the above Instruction certain jewellery not to be seized. We are of the view that various courts have decided the issue in favour of the assessee in the light of the above Instruction issued by the CBDT - We direct the AO to delete the addition made in the hands of the assessee on account of jewellery.
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