TMI Blog2020 (4) TMI 401X X X X Extracts X X X X X X X X Extracts X X X X ..... Municipal School for taking vacant possession of the school premises belonging to the appellant - HELD THAT:- As pointed out by the Ld. CIT (A), the assessee is owner of only 81% of the property and therefore any expense incurred on the property has to be shared in the ratio of 81:19 between the assessee and C.K. Thakkar, who also happens to be Director of the company. Since, the assessee had the share of 81% in the said property, the Ld. CIT (A) has rightly allowed the capitalization to the extent of 81% of the total amount paid which comes to ₹ 2,19,810/-. Hence, we do not find any merit in the contention of the assessee to interfere with the findings of the Ld. CIT (A). We therefore, dismiss this ground of appeal and confirm the findings of the Ld. CIT (A). Unexplained cash credit u/s 68 - HELD THAT:- The assessee furnished the confirmation from C.K. Thakkar as additional evidence. Moreover, the assessee has furnished the copy of certificate issued by the Chief Manager, NRI Branch, Bank of Baroda, Mumbai confirming that Sh. C.K. Thakkar who was maintaining NRE account no. 27920100000167 with the Bank and was having balance of ₹ 2,14,63,000/- in the said account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... School for surrendering the rented school premises at 23A Dongarsi Road, Mumbai (Total ₹ 8,00,000 + 11,56,879=19,56,879) and further addition of ₹ 50,00,000/- treating the unsecured loan taken by the assessee company as unexplained cash credit u/s 68 of the Act. The assessee challenged the assessment order before the Ld. CIT (A). The Ld. CIT (A) after hearing the assessee, partly allowed the appeal and restricted the addition of ₹ 19,56,879/- aforesaid to ₹ 10,19,807/-. However, confirmed the addition of 50,00,000/-. Still aggrieved, the assessee is in appeal before the Tribunal. 3. The assessee has challenged the impugned order passed by the Ld. CIT (A) on the following effective grounds:- 1 .Incorrect Assessment of total income at ₹ 60,19,810/- On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in partly upholding the action of the Income Tax Officer- 13(3)(2), Mumbai i.e. the Learned Assessing Officer (hereinafter referred to as Ld AO) resulting in assessment of ₹ 60,19,810/- as the Total Income of the Appellant as against the returned income of Rs. Nil. 2. Addition of payment to Kamladevi K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Levy of interest under section 234B of the Act On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in confirming the interest levied by the Ld. AO u/s 234B of the Act and the said levy of interest being wholly unjustified, ought to be deleted. 6. Inadequate Opportunity The Ld. CIT (A) and Ld. AO erred on the facts and in the circumstances of the case and in law, in passing their respective orders u/s 250 and u/s 143 (3) of the Act providing the Appellant sufficient and adequate opportunity, in breach of the principles of natural justice and in arriving at conclusions therein based on incorrect factual averments/allegations and therefore, the said orders, being bad in law are liable to be quashed. 4. Ground No. 1 of the appeal is of general nature, hence does not require separate adjudication. 5. Vide Ground No. 2 the assessee has challenged the action of the Ld. CIT (A) in upholding the action of the Ld. AO in making addition of ₹ 8,00,000/- on account of payment made by the assessee to Ms. Kamladevi K Agarwal as full and final consideration for handing over vacant possession of its property. Before us, the Ld. counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce sheet. Further, the assessee had not claimed any depreciation. Since, there is no dispute with regard to the payment of ₹ 8,00,000/- to Ms. Kamladevi K Agarwal and since the assessee has only capitalized the same amount in the schedule of fixed assets, in our considered view, the Ld. CIT (A) has wrongly upheld the findings of AO. Hence, we allow this ground of appeal and set aside the findings of the Ld CIT(A) and accordingly direct the AO to delete the addition of ₹ 8,00,000/-. 8. So far as Ground No. 3 of the appeal is concerned, this Ground pertains to the payment of ₹ 11,56,879/- made by the assessee to Bombay Municipal School for taking vacant possession of the school premises belonging to the appellant. The Ld. counsel submitted before us that the Ld. CIT (A) has wrongly confirmed the addition to the extent of ₹ 2,19,810/- being 19% of the payment made, despite the fact the assessee has not claimed the said payment in its profit and loss account and merely capitalized the same in the scheduled of fixed assets in the balance sheet. 9. On the other hand, the Ld. DR pointed out that the payment was made in the name of Shri Subhash Thakkar, who w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred to the bank account of the assessee company on different dates. The assessee further contended that since Mr. C.K. Thakkar was a non-resident therefore, could not furnish the confirmation before the AO. The assessee furnished the confirmation from C.K. Thakkar as additional evidence. Moreover, the assessee has furnished the copy of certificate issued by the Chief Manager, NRI Branch, Bank of Baroda, Mumbai confirming that Sh. C.K. Thakkar who was maintaining NRE account no. 27920100000167 with the Bank and was having balance of ₹ 2,14,63,000/- in the said account. So far as the creditworthiness is concerned the assessee has furnished the copy of opening balance of ₹ 1.48 crore with the company, opening balance of ₹ 97,00,000/-with Ruby Home Holdings Pvt. Ltd., three solvency certificates issued by the Bank of Baroda each for about 2.2 crores, copy of affidavit of Bank Manger filed in the court confirming NRI deposits of high value in Bank, FCNR fixed deposit receipts, bank balance in NRO A/c of the lender, opening bank balance in A/c No. 27920100000167 and other documentary evidence to establish creditworthiness of the lender. As pointed out by the Ld. coun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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