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2015 (6) TMI 484 - ITAT AHMEDABAD

2015 (6) TMI 484 - ITAT AHMEDABAD - TMI - Computation of short-term capital gain - non inclusion of cost of acquisition of the asset and the cost of any improvement thereto - Held that:- FAA has made a detailed analysis of each item of expenditure claimed by the assessee towards the improvement of the asset as well as incurred in connection with the transfer. It is to be appreciated that assessee has claimed expenses of ₹ 1,55,750/- incurred towards fertilizer and matipuran. The total land .....

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assessee could only produced his account as well as account of his sons wherein their books, they have claimed incurred expenditure but the assessee could not bring any demonstrative evidence exhibiting that some physical changes were brought in the asset. Considering the well reasoned finding of the CIT(A) vis--vis the claim made by the assessee, we are of the view that ends of justice would meet if a sum of ₹ 1,50,000/- is allowed to the assessee on an estimate basis for leveling and pu .....

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T(A) dated 22nd June, 2011 passed for AY 2008-09. The solitary substantial ground of appeal raised by the assessee is that ld. CIT(A) has erred in confirming the computation of short-term capital gain at ₹ 25,65,800/- as against ₹ 2,88,415/- computed by the assessee. 2. The brief facts of the case are that the assessee is an individual. He has filed his return of income on 26th March, 2009 declaring total income of ₹ 50,970/-. The case of the assessee was selected for scrutiny .....

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for a sum of ₹ 31,65,800/-. The land sold by the assessee is an agricultural land. The assessee had computed short-term capital gain of ₹ 2,88,415/-. He claimed expenditure of ₹ 28,77,315/-. This claim was made on account of improvement made in the land. The AO rejected this claim on the ground that assessee failed to substantiate the alleged expenditure incurred for improving the land. 3. On appeal the ld. first appellate authority has reappreciated the facts and circumstance .....

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ocate fees. Therefore, these expenses cannot be allowed as part of the cost of land. The appellant had also claimed ₹ 7,12,315/- as expenses incurred out of his own account and claimed the expenses of ₹ 7,50,000/- and ₹ 7,10,000/- as incurred respectively by his two sons Shri Nitin Patel and Shri Himanshu Patel. These expenses were stated to be incurred towards drainage, bore, matipuran, fertilizers and small unit of dwelling unit. It is not acceptable that any expenditure was .....

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ting evidence. The total claim made during the appellate proceedings is for ₹ 22,77,315/- (Rs.70,000/- stamp duty + ₹ 35,000/- advocate fees + ₹ 7,12,315/- expenses incurred out of own account + ₹ 7,50,000/- expenses incurred by his son Nitin Patel + ₹ 7,10,000/- expenses incurred by his son Himanshu Patel) whereas in the concluding para, the claim was made for ₹ 28,77,315/-. I have gone through the copies of the bills and vouchers and noticed that the details .....

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incurred for fertilizer and matipuran and construction of wall and gate (no bills or vouchers and no any details of dates of expenditure and source of expenditure). The rest of the expenses of ₹ 20,68,161 (as per the details of 43 bills) are relating to the construction related material and the same cannot be allowed as expenses incurred for improvement of the landed property. I have tried to examine the bills and vouchers of these expenses filed before the Assessing Officer and copies al .....

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n of these expenses it can be inferred that the expenses on the whole building were not less than a crore of rupees and such building was not found constructed on the land so sold. These expenses may be relating to any other building of assessee s sons. Thus, these expenses incurred on construction material and related labour cannot be linked to the land sold and cannot be allowed as improvement expenses of the land. Likewise the expenses of ₹ 70,000/- stated to be incurred on stamp duty ( .....

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rred by his sons on the construction of any dwelling units cannot be allowed to the appellant in the name of improvement expenses. 2.4 Considering the above discussion, it is held that the Assessing Officer had correctly computed the short term capital gain of ₹ 25,65,800/- on account of sale of land by the appellant. The cost of the land for ₹ 6,00,000/- are the only allowable expenses for the detailed reasons discussed in para 2.2 and para 2.3 above. The finding of the AO with refe .....

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lue of the consideration received or accruing as a result of the transfer of the capital asset the following amounts - (i) Expenditure incurred wholly and exclusively in connection with such transfer; (ii) The cost of acquisition of the asset and the cost of any improvement thereto. According to the assessee the expenditure incurred for stamp duty, advocate s fees, falls within sub-clause (1) of section 48 i.e. it is connected with transfer of the capital assets. She contended that a sum of S .....

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