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2022 (11) TMI 177 - ITAT BANGALOREAddition being loan taken against the Birla Sun Life Policy - whether CIT [A] failed to appreciate that loan taken against the Birla Sun Life Policy is an opening balance which was carried forward from the previous year ? - HELD THAT:- For the purpose of verification whether loan has been taken from the relevant assessment year or it has been carried forward from the previous year and it includes interest also as submitted by the AR( Authorised Representative) , this issue is sent back to the file of the AO for the purpose of verification and also as per the arguments of the asseseee. If it is found that difference amount includes interest and carried forward from the previous year the AO shall delete the addition. The assessee shall produce necessary documents for substantiating his case. These grounds are allowed for statistical purposes. Disallowing made of 50% of Salaries Wages - HELD THAT:- Considering the submissions and findings of the lower authorities and acceptance made by the ld. AR, we restrict the addition made under this head ( salaries and wages) the ‘disallowance’ is restricted to the 20% from the total disallowance. Disallowance of insurance expenses - AO disallowed 50% of insurance expenses - AR submitted that in the remand proceedings the AO noticed that it was paid through banking channel, therefore, the disallowance should not be made by the AO - HELD THAT:- Considering the rival submissions and perusing the material on record, in the remand proceedings, the AO fairly accepted that the insurance expenses were paid through banking channels, therefore, the payment should not be doubted . Both the authorities below have accepted that the payments have been for the payment of Insurance expenses , therefore, this issue is allowed. Disallowance of Workman and staff - welfare - HELD THAT:- We observe that in the remand proceedings, the AO accepted that these are the payments which has been deducted by the contractree from the running bills, therefore, the AO should not have been disallowed the payments expenses. The assessee has not incurred nay expenditures directliy. These deduction are mandatory deductions as per the terms and conditions of the contract, therefore this ground of appeal is allowed. Disallowance under the head of other expenses’- HELD THAT:- Considering the rival submissions, and findings of the CIT (A) as per his observations the appellant’s letter the complete details were submitted by way of annexure but the same facts were not brought in the remand proceedings. The AO after verifying accepted of Rs. 14,85,63,996/-. Considering the prayer of the assessee we think it fit to send back to the AO for denovo examinations. This ground of appeal is allowed for statistical purposes. Addition of Unsecured loan - HELD THAT:- As observed that the details of loan viz. opening balance, additions/payments made during the year, mode of loan taken/refunded, confirmations from the parties and closing balance at the year end has not been provided by the ld. AR. for verifications. In fact the opening balance can of loan cannot be added which was not the subject matter of the scrutiny proceedings. Considering the above noted facts, we deem it fit to sending back to the file of AO for de-novo consideration. If AO finds that there is opening balance of loan as on 01.04.2015, the AO will decide the issue as per the above cited judgement Jagatkuamr Satishbhai Patel [2012 (12) TMI 1017 - GUJARAT HIGH COURT] And in respect of others he will decide the issue in accordance with law. This ground is allowed for statistical purposes. Benefit of indexation for cost of improvement - Allegation of not granting principal of natural justice for giving opportunity to the assessee as per section 251 of the I.T.Act. by the CIT(A) - HELD THAT:- The expenditure for cost of improvements were incurred from the drawings made by the assessee in the respective years. Hence the assessee is eligible for indexation benefit for the cost of improvement expenses’ increased towards capital assets. Considering the rival submissions, we deem it fit to send back the issue to the file of AO for denovo consideration as per law. Further, we observe that the CIT(A) has not violated the principal of natural justice u/s 251 of the Act. The opportunity was provided and remand report was obtained and the assessee has also submitted rejoinder on 27.3.2019 in which he has himself requested to the CIT(A) , not to invoke sec. 251 of the Act. Therefore, this contention is not accepted.
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