TMI Blog2020 (4) TMI 709X X X X Extracts X X X X X X X X Extracts X X X X ..... erty and not that sale consideration is less than the value adopted for stamp duty purposes, therefore, mere inter- change of sale consideration and value adopted for the purposes of stamp duty in the reasons so recorded cannot be treated as fatal which can deny the acquisition of jurisdiction by the AO. Further, basis this tangible piece of information in possession of the AO which shows that capital gains has escaped assessment, where the approval has been accorded by the higher authorities, we donot see any infirmity therein. Not allowing the deduction of expense incurred by the assessee on account of cost of improvement of the house property and the transfer expenses - Where certain expenditure has been incurred before selling the property, the assessee can claim the same provided he is able to substantiate the same through any verifiable evidence. In the instant case, there is nothing on record which remotely support the contention so advanced by the assessee either in terms of any physical attributes of the property at the time of purchase and at the time of sale of the said property or any third party evidence which corroborates the act of incurrence of such expenditure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax long term capital gain and unexplained cash credit of ₹ 3,90,000/-. Against the said order, the assessee moved an appeal before the ld. CIT(A) who after considering the submissions of the assessee has allowed the benefit of cost of acquisition of the property for calculating the capital gains and has directed the Assessing Officer to rework the capital gains at ₹ 2,42,809/- by deducting ₹ 6,62,191/- being the cost of acquisition from sale consideration of ₹ 9,05,000/- however, the cost of improvement of ₹ 65,000/- and transfer expenses of ₹ 18,000/- claimed by the assessee were not allowed. Further out of total additions of ₹ 3,90,000/- made by the Assessing Officer U/s 68 of the Act, the ld. CIT(A) has allowed the relief of ₹ 1,70,000/- and the balance addition of ₹ 2,20,000/- has been sustained. Against the said findings, the assessee is in appeal before us. 3. In ground no. 1, the assessee has challenged the initiation of proceeding U/s 147 of the Act by issuance of notice U/s 148 of the Act. In this regard, the ld. AR submitted that the Assessing Officer has issued notice U/s 148 on account of escapement of income o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t proceeding initiated by issuance of notice U/s 148 of the Act should be quashed and set-aside. 4. Per contra, the ld. DR is heard who has submitted that it is a case where the assessee has sold an immovable property and has not disclosed the same to the tax authorities as the assessee has not filed his return of income. It was accordingly submitted that it is therefore, clearly a case of escapement of income and therefore, the notice U/s 148 of the Act has been rightly issued by the Assessing Officer after seeking approval from the higher authorities. Regarding the contention of the ld. AR that the AO has recorded wrong facts while recording the reasons, it was submitted that it was merely inter-change of sale consideration and value taken for the purposes of stamp duty however, the facts of the matter is that there is clearly transfer of an immovable property which has not been reported to tax therefore, merely because there is change of the two figures, it cannot be said that there is any infirmity in the notice issued by the AO. 5. We have heard the rival contentions and pursued the material available on record. It is a case where the assessee has sold a property and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eral improvement incurred for this house only. It is a general human tendency that before entering into a new house the new color paint and general repairs work has to take place and only after that the property is going to be used, hence the expense so incurred are having the nature of allowable expenses. 8. It was further submitted that the ld. CIT(A) has not allowed the benefit of transfer expenses like brokerage paid to the property broker who helped the assessee to sale out this property. This is a settled marked conditions that amount 2% of the sale proceeds is required to be paid to the property broker, in case the sale transaction takes place through the property broker. Here in this case the assessee paid ₹ 18000/- as 2% of the sale consideration of ₹ 905000/- to the property broker who settled the sale transaction. Therefore, the expense of brokerage is related to this property. Hence this also an allowable expense while calculating the capital gain. 9. Per contra, the ld DR submitted that regarding the cost of improvement, the assessee has not submitted any evidence in support of the cost of the improvement, therefore, in the absence of the same the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in accordance with law therefore liable to declared as illegal and against the law. It was further submitted that the bank account cannot be treated as the regular books of accounts of any assessee. 13. It was further submitted that the assessee had submitted the affidavits of all the persons from whom the amount was taken and in the affidavits, all the persons have accepted the fact that they have given respective amounts as mentioned in the affidavits to the assessee. By submission of the affidavits, the assessee has discharged his burden of prove the source of receipt. The affidavits itself are self speaking evidence in the eye of law. In absence of cross examination of the deponents, the contents made in the affidavit should be treated as correct and the addition so made may be directed to be deleted. 14. Per contra, the ld DR submitted that the ld. CIT(A) has allowed necessary relief to the assessee basis the examination of the affidavits so filed by the assessee and for the remaining, she has given her findings in respect of which the additions have been sustained. It was accordingly submitted that there is no infirmity in the order of the ld CIT(A) and the same should ..... X X X X Extracts X X X X X X X X Extracts X X X X
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