TMI Blog2012 (8) TMI 678X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the confirmation letter is that of the USA and it is beyond verification by the Indian Income tax Officers and in view of the statement of the assessee that the said creditor has returned to India, and the assessee would be in a position to establish the genuineness of the transaction, duly establishing identity of the creditor and his creditworthiness, in the interests of justice it just and proper to set aside this issue for adjudication - restore the matter to the file of AO for fresh adjudication - in favour of assessee for statistical purposes. Disallowance of expenditure on car - asset used for both personal land professional purposes - Held that:- This is a case where provisions of S.38(2)will apply where any building, machinery, plant or furniture is not exclusively used for the purposes of the business or profession, the deductions shall be restricted to a fair proportionate part thereof which the AO may determine, having regard to the user of such building, machinery, plant or furniture for the purposes of the business or profession - estore the matter to the file of the assessing officer, for re-consideration - in favour of assessee for statistical purposes. - I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the expenses of Rs.4.04 incurred on agriculture, net agricultural income was arrived at Rs.15.51 lakhs. During the course of assessment proceedings, the assessee was required to furnish the details of the agricultural activities, besides furnishing the proof of owning agricultural lands. The assessee submitted details to show that he was owning 18.40 acres of land (which the assessing officer has taken as 6.94 acres) at Masaniguda, Shankerpally, R.R. District, and claimed to have received net income of Rs.91,569 per acre therefrom. Assessee also furnished crop wise sale consideration, besides furnishing details of expenses towards seeds, fertilizers, labour, tractor, etc. Finding various defects and deficiencies in the papers filed by the assessee and dissatisfied with the explanation of the assessee, the assessing officer estimated the agricultural income of the assessee at Rs.20,000 per acre. Accordingly determining the agricultural income for 16.94 acres at Rs.3,38,000, the assessing officer treated the balance amount of Rs.12,11,200 claimed by the assessee as agricultural income, as assessee s income from other sources and made addition in that behalf. 5. On appeal bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erely because the certificates filed by way of additional evidence are issued by the Sarpanch and MPTC and not by any technical expert or competent Revenue authority. On that count, the CIT(A), according to him, has not gone into the merits of the other objections raised by the assessing officer in the remand report, which are too technical to be accepted. It is also submitted before us that the Sarpanch and MPTC are also qualified and their certificates cannot be brushed aside on technical grounds pointed out by the assessing officer in the remand. 8. The Learned Departmental Representative, per contra, supported the orders of the lower authorities. 9. We heard both sides and perused the impugned orders of the lower authorities on the issue relating to addition made disbelieving the agricultural income disclosed by the assessee. There is no dispute with regard to the factum of agricultural activities carried out by the assessee, though there is minor difference with regard to the land holding of the assessee. We find that the CIT(A) was not justified in not admitting the additional evidence sought to be filed by the assessee for the first time before him, notwithstanding the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to, as the cheque had bounced. He submitted that the assessee had obtained a confirmation letter from the said party, and the same furnished before the CIT(A), may be entertained without treating the same as additional evidence. The CIT(A) treating the confirmation letter from Mr.RAvikant S. as additional evidence called for the comments of the assessing officer. The assessing officer in his remand report dated 23.6.2011 submitted that the address mentioned in the confirmation letter was of USA and therefore, the creditor could not be examined. It is also submitted that on verification of the PAN data, the PAN of the creditor could not be located. The assessing officer submitted that even though it was mentioned that the creditor had advanced Rs.50 lakhs to the assessee towards purchase of a plot, which was later cancelled and the amount was returned to his SB account with State Bank of Hyderabad Nallakunta on 2.11.2007, the said letter is very vague, as the same does not contain the details of the bank account from which the cheques were issued, sources of giving such advance or dates thereof. He submitted that even though confirmation letter as submitted, no proof to confirm th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessing officer noticed from the Profit and Loss Account that the assessee had claimed depreciation of Rs.1,60,650 in respect of a Honda Civic Car and of Rs.1,17,586 on Innova, besides interest and expenditure thereon of Rs.38,305 and Rs.93,865 respectively. The assessee had also claimed petrol expenditure of Rs.35,200. Considering the personal usage of the vehicles, the assessing officer disallowed 25% of the total expenditure on the vehicles noted above, which worked out to Rs.1,1,401. On appeal, the CIT(A) upheld the said disallowance made by the assessing officer. Hence, assessee is in second appeal on this issue. 18. We heard both sides and perused the impugned orders of the lower authorities on the issue of disallowance out of expenses on an asset used for both personal land professional purposes. This is a case where provisions of S.38(2) of the Act apply. That being so, the decision of the Special Bench of eh Tribunal in the case of Gulati Saree Centre (71 ITD 73)(Chd), which advocates for disallowance at @ certain percentage basis covers the issue on hand. Considering totality of facts and circumstances of this case, we set aside the order of the CIT(A) on this issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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