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Enkay Homes Ltd Versus Income Tax Officer

2015 (6) TMI 941 - ITAT MUMBAI

Disallowance u/s 40A(3) - Held that:- So far as disallowance on account of purchase of steel from Panvel office imprest account, telephone charges of direction and gardening and plantation, the same cannot be disallowed u/s 40A(3) as per the reasons given by the learned counsel. Accordingly, the assessee gets relief of ₹ 16,092/- and balance amount of ₹ 13,873/- is confirmed. - Decided partly in favour of assessee.

Disallowance of donations - Held that:- The assessee has n .....

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et profit rate of 8% from the sale of development rights - Held that:- There is no allegation that the payment made by the assessee in the earlier years have been claimed by the assessee. These costs are always taken to work-in-progress. The assessee had spent money to made the payments to the members of co-operative housing to the CIDCO to acquire the rights to develop, then such a payment has to be allowed as cost. No proper basis has been given either by the AO or by the Ld. CIT(A), to estima .....

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of assessee. - ITA No.7902/Mum/2010 - Dated:- 25-3-2015 - D Karunakar Rao And Amit Shukla JJ. For the Appellant : Dr P Daniel For the Respondent : Shri Neil Philip ORDER Per: Amit Shukla: This appeal has been filed by the Assessee against order dated 16.08.2010 passed by Ld. CIT (Appeal) -22, Mumbai for the quantum of assessment passed u/s 143(3) for the A.Y. 2003-04, vide which following ground have been raised:- "1. The learned CIT(A) erred in confirming the estimate made by the AO profi .....

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the CIT(A)." 2. At the outset learned counsel, Dr. P. Daniel submitted that ground no. 1 is not pressed and accordingly, the same is dismissed as not pressed. 3. In Ground no. 2 the assessee has challenged the disallowance of ₹ 29,965/- made u/s 40A(3). The Assessing Officer noted that assessee has made cash payment exceeding ₹ 20,000/- for sums aggregating ₹ 3,16,666/-, relating to payment made to labourers, telephone charges, purchase of steel, gardening and plantation, .....

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ntified the disallowance in the following manner:- Nature & Particulars of expenditure Date of payment Amt. paid otherwise than by account payee cheque/draft 20% of such expenditure Rs. Purchase steel Panvel Imprest 13.06.02 22,000 4,400 Telephone charges 14.06.02 23,161 4,632 Gardening Plantation 20.07.02 35,300 7,060 Vehicle Expenses 24.12.03 20,206 4,041 Purchase steel Morbe 27.02.03 24,572 4,914 Purchase steel Panvel 07.01.03 24,590 4,918 Total 29,965 Accordingly, the Ld. CIT(A) confirme .....

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as per Rule 6DD. Regarding telephone charges, the submitted that the same pertained to telephone bill of Director and has not been claimed as expenditure by the assessee, therefore, no disallowance is called for. Regarding purchase of steel from Panvel office, he submitted that the same was on account of imprest account and in support, vouchers were submitted before the authorities below that there was no cash purchase but transfer from one office to other. Regarding other payments, he submitte .....

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ning and plantation, the same cannot be disallowed u/s 40A(3) as per the reasons given by the learned counsel. Accordingly, the assessee gets relief of ₹ 16,092/- and balance amount of ₹ 13,873/- is confirmed. Thus ground no. 2 is partly allowed. 6. Regarding Ground no. 3, relating to disallowance of ₹ 30,500/- out of donations, the learned counsel submitted that the assessee has not claimed any such claim of donation in the computation of income, rather it appears in the ledge .....

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essee is engaged in the business of construction and during the year it has sold its development rights to another person for ₹ 70 lakhs. On the said project, the assessee had incurred cost/expenses of ₹ 68 lakhs and therefore, the assessee had only gained ₹ 2 lakhs from the said project. The assessing officer held that the expenditure of ₹ 68 lakhs is not fully supported by evidences and therefore, the profit disclosed by the assessee cannot be accepted, accordingly, he .....

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prove the genuineness of the payment to these parties and accordingly, he estimated the net profit of 8%. In the first appellate proceedings, the Ld. CIT(A) had called for the remand report, contents of which are as under:-3 "As far as the sale of development rights are concerned the assessee has enclosed copies of development agreement of ₹ 70 lakhs and details of expenses of ₹ 68 lakhs. However, the details of expense enclosed are in respect of the amount paid to list of memb .....

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