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TMI Blog2017 (6) TMI 952X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.Ys, the assessee has shown agricultural income. When the assessee was asked to produce pattadar pass books of the agricultural land holding and also the particulars of crops grown, expenditure incurred and the sale proceeds of the agricultural produce etc., the assessee filed only a copy of the pattadar pass book showing that the assessee is the owner of 3.25 acres of agricultural land. No other details were furnished nor explained by the assessee. The AO therefore, disbelieved the assessee's contention of being in the possession of the agricultural land and disallowed the entire agricultural income as shown by the assessee for all the A.Ys. The assessee filed appeals before the CIT (A) along with the evidence of owning 3.25 acres of wet land at Pamaru Mandal, Krishna Distt. and submitted that since it is an ancestral property, it is not reflected in the Balance sheets of the assessee for the relevant years. It was submitted that the lands were fertile and wet lands yielding two crops per annum and the income per crop is about Rs. 15,000 to Rs. 20,000 per acre. The CIT (A), called for remand reports from the AO for all the A.Ys. AO submitted the remand report stating that si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the assessee is the Managing Director in M/s. Multiscale Exim Private Limited. During the above A.Ys, the assessee has earned salary income and interests on loans. However, in the return of income for the A.Y 2008-09 and 2009-10, the assessee has disclosed only salary income and interest income was not disclosed. Even in the revised return of income filed, the assessee did not disclose interest income. The AO, therefore, treated the interest income as income accrued to the assessee during the relevant A.Ys and brought it to tax. During the appellate proceedings before the CIT (A), the assessee submitted that the AO has added the interest income to the returned income of the assessee on the basis of the claim of 'interest payable' by the Company in which the assessee was an investor. It was submitted that though the company has claimed interest as payable, it has not paid the same to the assessee and therefore, the assessee has not returned it in his return as he was under an impression that it was to be disclosed only when it is received. The CIT (A) observed that the assessee himself is the Managing Director of the company M/s. Multiscale Exim Private Ltd wherein the interest h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve alone, any adverse comments on these submissions of the assessee. He submitted that the CIT (A) has erroneously confirmed the addition not only of Rs. 12,72,000 but also of Rs. 2,00,000 against the sum of Rs. 10,00,000 which is the return of the advance made by the assessee to his wife in earlier years. He submitted that since the AO has not given any comments on the assessee's submissions in the remand report, the assessee's comments have to be accepted in toto. 11. The learned DR however, supported the orders of the authorities below and submitted that the assessee has not been able to prove the creditworthiness of Smt. Raja Bhansi Devi to advance a sum of Rs. 12,72,000 to the assessee and further that CIT (A) has perused the books of account of the assessee and found that the assessee was still to receive a sum of Rs. 2.00 lakhs out of Rs. 10.00 lakhs advanced by him. Therefore, according to him, the additions are justified. 12. Having regard to the rival contentions and the material on record, we find that the assessee has made his submissions before the CIT (A) and the CIT (A) had called for a remand report from the AO on the evidence submitted by the assessee. We have pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee during the course of survey which was impounded. As per the said valuation report, the cost of construction was Rs. 1,95,20,000. Since the assessee had shown only a sum of Rs. 90,92,130 as incurred towards construction as on 31.03.2009, the balance investment of Rs. 1,04,27,870 was treated as unexplained investment u/s 69 of the I.T. Act and added to the total income of the assessee. Aggrieved, the assessee preferred an appeal before the CIT (A). 15. It was submitted that the valuation report submitted before the Bank by the assessee was for the purpose of availing a loan and was not the actual valuation of the cost of construction. It was submitted that the report was obtained by the assessee for the sake of offering it as a collateral security for the loan while the construction was still in progress. Therefore, according to the assessee, the said report cannot be accepted as the basis for the actual cost of construction. The assessee also furnished the copy of the Departmental Valuation Officer's report according to which the cost of construction was worked out at Rs. 1,08,07,000 and also that the difference between such valuation and assessee's books has arise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the result, assessee's appeals for the A.Y 2005-06 and 2006-07 are dismissed and the appeals for the A.Y 2007-08, 2008-09 and 2009-10 are partly allowed. ITA Nos. 71 to 74 /Hyd/2013 - (Assessment Years: 2006-07 to 2009-10) in the case of Smt. Raja Bhansi Devi. Addition on account of additional investment in the residential property: 19. The assessee is an individual, deriving of income from commission. She filed her return of income for the A.Y 2006-07 on 2.01.2007 admitting total income of Rs. 1,41,766 and other sources at Rs. 12,025. During the survey operation in the case of assessee's husband Shri T. Seshagiri Rao u/s 133A of the Act, it was noticed that the assessee has constructed a residential house but has not reflected the actual cost of construction in the returns of income filed by her. Since there was reason to believe that the income chargeable to tax has escaped assessment for the A.Y 2006-07, the assessment was reopened by issuance of notice u/s 148 of the Act. In response to the same, the assessee filed a revised return of income on 17.11.2011 admitting total income at Rs. 1,53,791. 20. During the re-assessment proceedings, the AO observed that there is a diffe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate as against the State PWD rates and as held by the CIT (A) in the assessee's husband's case, 10% relief is to be given for the difference between the CPWD and State PWD rates. Therefore, grounds of appeal No.3 to 5 are partly allowed. 22. As regards Ground No.6, we find that the CIT (A) has already given relief of 10% for self supervision and we are satisfied that it would take care of the Architect and Engineer's fee as well. Therefore, no further exemption is to be allowed. Therefore, Ground No.6 is rejected. 23. In the result, assessee's appeal for the A.Y 2006-07 is partly allowed. A.Ys 2007-08 to 2009-10 24. In all these years, the common ground of appeal is against the disallowance of the loans allegedly received by the assessee from her spouse Mr. T. Seshagiri Rao. Brief facts are that during the assessment proceedings for the A.Y 2007-08, the assessee has shown to have returned an advance of Rs. 2,41,250. As the assessee failed to furnish the details such as names, address of the party, nature of the advance returned etc., the AO treated the amount as unexplained income of the assessee. During the appellate proceedings, the assessee furnished the financial statement ..... X X X X Extracts X X X X X X X X Extracts X X X X
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