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2016 (2) TMI 121 - ITAT KOLKATA

2016 (2) TMI 121 - ITAT KOLKATA - TMI - Addition u/s 69A representing realization of assets inherited from mother pursuant to her 'WILL" - Held that:- The said WILL is a valid WILL and the same regulated the succession as declared by the testator, i.e. the mother of the assessee. In respect of page no.16, where the Profit & Loss account belonging to the mother of the assessee is produced, wherein it shows that she has invested in shares, particularly, in MKJ Development Ltd., Starlight Credit (I .....

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/-), no arguments were advanced by the assessee before us. Hence, we dismiss the claim of the assessee in this regard. - Decided partly in favour of assessee

Ad hoc disallowance @ 20% out of car expenses, depreciation on car and telephone expenses treating the expenses incurred for personal use - Held that:- On mere presumption the AO just made the additions on ad hoc basis without any basis. The AO himself opined that the expenses of personal use could not be ascertained in the absen .....

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favour of assessee - ITA No. 373/Kol/2012 - Dated:- 4-12-2015 - M. Balaganesh, AM And S. S. Viswanethra Ravi, JM For the Appellant : Shri Sanjay Mukherjee, JCIT For the Respondent : Shri Somnath Ghosh & Shri Sarnath Ghosh, Advs ORDER Per Shri S S Viswanethra Ravi, JM This is an appeal preferred by the assessee against the order dated 15.11.2011 passed by the CIT(Appeals)-XX, Kolkata in Appeal No. 144/CIT(A)-XX/Wd-36(4)/09-10/Kol for the assessment year 2007-08 framed under section 143(3) of .....

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activities. Without prejudice the disallowances are excessive." 3. The assessee is the proprietor of M/s. Lohia Ispat Udyog. The return of income for the assessment year was filed on 12.10.2007 declaring a total income of ₹ 1,39,760/-. The case was taken up for scrutiny assessment under section 143(3) and notices under section 143(2) were issued. During the scrutiny assessment, the A.R. of the assessee appeared from time to time and furnished books of accounts, bills/vouchers which w .....

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evi Lohia during her life time, purchased immovable and movable properties out of her own funds. She also claimed to have received by way of gifts from her ancestors as well as her relatives on some ceremonial occasions. In the year 2005, she executed a WILL wherein she bequeathed her current assets to the assessee in the form of shares and others and balance thereon i.e., jewellery and ornaments were given to her daughter-in-law i.e. wife of the assessee. The assessee sold all his current asset .....

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of the view that the WILL has not been certified by any Advocate and not been attested by an independent witness and found the signature of the assessee as a witness whereby, the AO disbelieved the said WILL and the amounts transferred to business account were added to the income of assessee. 3.3 The assessee claimed expenditure of motor car to an extent of ₹ 1,09,933/- but the AO disallowed the same to the extent of ₹ 21,987/- being 20% against ₹ 1,09,933/-. The assessee claim .....

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xecuted by the mother of the assessee. The ld. CIT(A) reiterated the same grounds on which the AO took the view with reference to the WILL. The ld. CIT(A) found that 20% disallowance is too high for the expenditure on motor car, depreciation on motor car and telephone expenses and however restricted the same to 10%. Ld. CIT(A) allowed the appeal of the assessee partly, against which the assessee is before us. 5. Before us, the ld. Counsel for the assessee contended that the assessee produced all .....

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ya Bank, Liluah branch, Howrah. In this regard, the ld. Counsel drew our attention to the page no.13 of paper book to para 4 of the WILL wherein he pointed that the mother of the assessee expressed her intention to grant all her current assets to a tune of ₹ 4,28,795/- to the assessee. Supporting the same, the ld. Counsel for the assessee also pointed to the balance-sheet of his mother at page no.16 of the paper book where all her investments in shares totaling to ₹ 4,28,795/- and th .....

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s of the lower authorities and considered the arguments of both the representatives. Now the question before us whether the AO and the ld. CIT(A) are right in not accepting the WILL as it does not measure upto a requisite standard of valid WILL. 6.1 It is pertinent to mention that there is no specific format for WILL and in order to declare a WILL as a valid WILL, there are general procedures which should be adopted while writing a WILL by the testator which includes declaration in the beginning .....

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does not specify that requirements, any person who would have a financial interest in the estate under the laws of descent and distribution can start an action in the court of law to challenge the validity of the WILL. It is also noticed in the said WILL that the executor, i.e. the mother of the assessee stated that she has three children i.e., two sons and one daughter. Amongst them is the assessee before us but none challenged the said WILL before the Court of law. In fact, no contrary eviden .....

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28,795/-. Therefore, in our view, the amount to an extent of ₹ 4,28,795/- is validly proved to have been invested by the assessee in his business concern from his personal account which is the sale proceeds of such shares which he got from WILL. Therefore, the nature and source of the fund was received from the mother of the assessee is proved. As regards the balance sum of ₹ 16,000/- (Rs.4,44,795/- ₹ 4,28,795/-), no arguments were advanced by the assessee before us. Hence, we .....

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reciation on car and ₹ 7,523/- out of telephone expenses on the ground that the personal use in the above expenses cannot be ruled out. 8. Before us, the ld. Counsel for the assessee argued that the expenses were incurred in the normal course of the business and no ad hoc disallowance is justified. The ld. Counsel submitted that the assessee maintained a motor car for facilitating travelling for his business purposes and incurred the expenditure on account of car running expenses. The ld. .....

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