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2015 (6) TMI 53 - ITAT DELHI

2015 (6) TMI 53 - ITAT DELHI - TMI - Disallowance of purchases made from sister concern under sec.40A(2) - Held that:- Having gone through the decision of CIT vs. Glaxo Smith Kline Asia (P) Ltd. (2010 (10) TMI 21 - Supreme Court of India ) wherein held that while making disallowance under sec. 40A(2) regarding payment to related concerns, the authorities are ought to examine as to whether there is any loss of revenue in any of the assessment years in question and to find out that the exercise is .....

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e claimed sales of jewellery by the assessee to them but the assessee has failed to furnish any satisfactory reply to the observations of the authorities below that on 18.11.2001 i.e. during the course of assessment proceedings for the assessment year 2006-07, assessee had claimed to have inherited 185 gms. of jewellery only from his father but now the assessee is claiming to have actually inherited 1198.77 gms. from his father. The assessee has not been able to rebut the above observation of th .....

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plot allotted by some government authorities/department for some specific purpose without getting it registered in the name of purchaser from the original allottee on the record of such authorities/department but at the same time some agreement is entered into between the seller and purchaser for such transaction. In absence of such evidence, we are of the view that the authorities below have rightly denied the genuineness of the claimed transaction - Decided against assesse.

Disallow .....

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justice, set aside the matter back to the file of the Assessing Officer to examine the correctness of the documents filed by the assessee in this regard and decide the issue afresh after affording opportunity of being heard to the assessee. - Decided in favour of assesse for statistical purposes.

Disallowance of interest on car loan, vehicle running and maintenance and depreciation - Held that:- the Assessing Officer had made disallowance on account of interest on car loan, vehicle r .....

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user of the car cannot be totally ruled out. - Decided against assesse. - ITA No. 3145/Del/2013 - Dated:- 25-3-2015 - Shri I.C. Sudhir AND Shri J.S. Reddy JJ. For the Appellant : Shri Ashwani Taneja, Adv. For the Respondent : Shri Gaurav Dudeja, Sr. DR ORDER Per I.C. Sudhir: JUDICIAL MEMBER The assessee has questioned first appellate order on several grounds running into five pages. The effective additions/disallowances with which the assessee is aggrieved are (i) disallowance of ₹ 2,65,19 .....

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allowance of ₹ 22,500 (30% of ₹ 75,000) on account of expenditure claimed under the provisions of income house property and further the taxing the rental income from plot under the head income from other sources( Ground No.7); (vi) disallowance of ₹ 47,037 on account of car insurance( Ground No. 8); (vii) disallowance of ₹ 37,550 (10% of ₹ 3,75,498) on account of personal user of car( Ground No.9); & (ix) charging of interest under sec. 234B and 234C of the Act( .....

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e was difference in market rate due to size or quality etc. and has also not been able to prove or distinguish as to which bills pertains to which gaze and also failed to prove that purchases made from sister concern were at prevailing market rates. The Learned CIT(Appeals) has upheld the addition made by the Assessing Officer in this regard at ₹ 2,65,195. The Assessing Officer has made this disallowance on account of unreasonable value of purchases as per the provisions of sec.40A(2) of t .....

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xo Smith Kline Asia (P) Ltd., (2010)- 236 CTR S.C. 113. He also referred page Nos. 21 to 34 and 25 to 37 of the paper book i.e. the detailed chart of purchase and sale of iron and steel by the firm of the assessee with others. 4. The Learned DR on the other hand placed reliance on the orders of the authorities below with this contention that before them the assessee has failed to furnish quality-wise details of iron and steel (M.S. Sheets) sold to its sister concern to enable the Assessing Offic .....

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evenue in any of the assessment years in question and to find out that the exercise is a revenue neutral exercise then there no interference is called for. Respectfully following this ratio of the decision, we set aside the matter to the file of the Assessing Officer to decide it afresh after affording opportunity of being heard to the assessee in view of the above cited decision of the Hon'ble Supreme Court. The ground No.3 is thus allowed for statistical purposes. 6. The Assessing Officer .....

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jewelry weighing 1249.55 gms. out of which jewellery of 1198.77 gms. was inherited by the assessee from his father and balance 96 gms. was purchased by the assessee from time to time. The source of the same and evidence regarding the sale was submitted before the Assessing Officer. The Learned AR referred page Nos. 47 to 61 of the paper book which are copies of the bills dated 26.3.1995 showing the purchase of jewellery by the father of the assessee; bills showing the sale of jewellery by the a .....

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was not having any further jewellery left by his father and, therefore, the assessee could not have sold such non-existing jewellery. The Learned AR submitted that the assessee could not reply the above facts observed by the authorities below, correctly in the assessment proceedings of assessment year 2006-07, but the fact of matter is that the assessee has sold the jewellery as evident from the copies of the sales bills and statement of the purchasers. The Learned AR submitted further that thou .....

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whom the father of the assessee claimed to have purchased the jewellery in the year 1995 was not found on the given address. Source and creditworthiness of the father has also not been established to justify the claimed sales. 9. Having gone through the orders of the authorities below, we find that they have dealt with the issues in detail. There is no dispute that Mr. Prince Goel and Mr. Nitin Goel of M/s. Shanti Abhushan Bhandar in their statements recorded by the Assessing Officer have confi .....

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n of the authorities below by furnishing any proof regarding inheritance of 1198.77 gms. of jewellery from his father. In absence of such rebuttal by the assessee and keeping in view the totality of facts and circumstances as well as preponderance of the probabilities, we are of the view that the Learned CIT(Appeals) has rightly upheld the addition. Ground No. (iv) is accordingly rejected. Ground No.5 10. The Assessing Officer made addition of ₹ 2,10,000 claimed to have been received by wa .....

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even in the name of Mr. Raj Kumar Kakkar and was allotted in the name of Mr. Bishan Dayal by the UPSIDC, which throughout the documentation remained the same. He submitted that the actual fact of the matter is that the said amount of ₹ 2,10,000 represented the sale proceeds. He referred pages No.65, 66 and 74 of the paper book which are copies of confirmation from Mr. Rikki Jain that he had purchased the said plot for ₹ 2,10,000 from the assessee through account payee cheque; and con .....

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issions, we agree that there is prevailing practice of transfer of such plot allotted by some government authorities/department for some specific purpose without getting it registered in the name of purchaser from the original allottee on the record of such authorities/department but at the same time some agreement is entered into between the seller and purchaser for such transaction. In absence of such evidence, we are of the view that the authorities below have rightly denied the genuineness o .....

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yee cheque to M/s. Shorya Developers in assessment year 2006-07 which was received back when the property was sold to Shri Prem Prakash. The Learned AR referred page Nos. 75 to 84 of the paper book which are copies of extract of S/B Account showing amount of ₹ 2,85,000 was given on 30.11.2005 to M/s. Shorya Developer, bank statement showing the payment of ₹ 2,85,000; confirmation from Shri Prem Prakash that he had made five installments of payments aggregating to ₹ 2,85,000 to .....

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. 15. The Learned DR on the other hand tried to justify the orders of the authorities below in this regard. 16. Having gone through the orders of the authorities below, we find that the genuineness of claimed refund of advance money for purchase of land from Shorya Developers has been denied on the basis that the assessee did not furnish any evidence with regard to the credit entries amounting to ₹ 2,85,000. The Assessing Officer has denied the claimed refund without examining the veracity .....

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