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Navneet Malhotra Prop. M/s Jeewan Hospital Versus ITO Ward-2 Rewari

2015 (7) TMI 168 - ITAT DELHI

Entitlement to deduction u/s 54F - disallowance of expenses on property and interest paid on loan - Held that:- Assessee had advanced claim in regard to computation of long term capital gain after giving the details of purchase cost and the improvement cost over 4 years. The indexed cost of acquisition was accordingly computed. The assessing officer, however, only took into consideration the amount paid as per allotment letter and expenses on conveyance deed. The assessee in its reply, as reprod .....

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erved that assessee is entitled to proportionate deduction u/s 54F and, therefore, it cannot be said that assessee had advanced any false claim. It is not in dispute that assessee had been allotted a residential plot in CHD City Sector 45 Karnol on the basis of which he ha advanced claim u/s 54 F which was in principle accepted by Ld. CIT(A) but since the total consideration was only ₹ 5,55,00/- as against ₹ 10,000/- being the sale consideration therefore, he allowed only proportiona .....

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it is not in dispute that assessee had shown business assets aggregating to ₹ 3,28,856/-. The assessing officer had required the assessee to show as to why interest paid to Smt. Prem Lata Jain ₹ 32,600/- be not disallowed as investment in non business assets, properties and shares was much more than capital. On this basis it was inferred that loan of Smt. Prem Lata Jain had not been utilized for business purpose. The assessing officer has not demonstrated any nexus between the amount .....

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CIT(A)Rohtak, , New Delhi in Appeal No. 8/RTK/2012-13. 2. The assessee has filed his return of income declaring an income of ₹ 4,61,180/-. The assessing officer noticed that the assessee had sold a residential plot no. 285 Sector 2HSIDC, Croth Centre, Bawal, Distt, Rewari on 3rd March 2008 for a consideration of ₹ 10 lakhs. The assessee had claimed deduction u/s 54 to the tune of ₹ 5,55,00/- in his return of income. The computation of capital gain, filed by the assessee, along .....

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ceipts etc for the purchase and improvement expenses as shown by the assessee. He has observed that assessee filed the details of the expenses of the cost but no documentary evidences in support were filed by the assessee. In reply to Assessing Officer s query, the assessee filed the details of investments made over the years inter alia pointing out that the payments were made through DD. The details are at pages 2 & 3 of the assessment order. The assessee also filed the allotment letter dat .....

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sing Officer accepted that assessee had purchased this property for ₹ 3,24,00/-and had incurred expenditure of ₹ 20,200/- for the conveyance deed. He accordingly computed cost of acquisition, indexed cost and long term capital gain as under:- Description Cost Indexed Cost Remarks Cost of property as per balance sheet as on 31/3/2007 2,90,557/- 3,35,103/- As claimed. The balance cost i.e 3,24,000-290557 assumed to be paid during the F.Y 2007-08. 33,443/- 33,443/- No documentary eviden .....

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e to him on sale of a plot and further required to file documentary evidence in support of his contention. The assessing officer has observed that assesses changed his contention and claimed the deduction u/s 54F. The Assessing Officer noticed from the documents filed by the assessee in support of his claim for deduction u/s 54F, that assessee had made investment of ₹ 5,55,00/- in a Plot with CHD Developers Karnol. The Assessing Officer noticed that though assesses had shown that he had ma .....

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are on record with an earlier reply. Membership of flat society i.e Housing society is duly covered under u/s 54F read with Section 54F as per verdict of the Ld. Gujrat High Court in the case of CIT VS. Jundas Premchand Gandlin in (2005) 279 ITR 552. 6. The assessing officer, after considering the assessese s reply and the provisions of Section 54F, denied the assessee s claim for the following reasons:- (i) As per provisions of Section 54F, the assessee was required to invest whole of the sale .....

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ital gain at ₹ 6,11,249. 7. The Assessing Officer further noticed from the profit and loss account of the assessee that assessee paid interest of ₹ 32,600/- to Smt. Prem Lata Jain. After considering the position of investments made by assessee, the assessing officer observed that the assessee s investment in non business assets in much more than his capital. He further noted that during the year assessee had invested ₹ 8,76,642/- in shares and securities. Accordingly, he disall .....

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the Ld. CIT(A) the written submissions dated 9/11/2013 were filed explaining the main issue of investment and claim u/s 54F was accepted and proportionate deduction allowed. On disallowance of expenses on property and interest paid on loan which were supported by complete particulars and vouchers could not prove the intention on the part of the assessee to conceal the particulars. Further the disallowances upheld in appeal do not amount to concealment of income nor furnishing inaccurate particul .....

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tro Products (P) Ltd. Reported in (2010) 322 ITR 158 11. As regards the penalty apropos claim of interest paid in the written submission Ld. AR submits that the assessee has interest was duly returned by person to whom it was paid. Further, the confirmation and other documents are on record which were furnished during assessment proceedings. 12. I have considered the written submissions and the submissions of Ld. DR. The facts are not in dispute. The assessee had advanced claim in regard to comp .....

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llowance of certain expenses claimed by assessee as cost of acquisition could not lead to the conclusion that assessee had advanced any false claim only because assessee was unable to substantiate the same with reference to specific vouchers. The next issue is regarding assessee s claim u/s 54F. Ld. CIT(A) has clearly observed that assessee is entitled to proportionate deduction u/s 54F and, therefore, it cannot be said that assessee had advanced any false claim. It is not in dispute that assess .....

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