TMI Blog2021 (11) TMI 744X X X X Extracts X X X X X X X X Extracts X X X X ..... th the vehicles were given on rent at very low rentals and the assessee, in the process incurred huge loss which has been utilized to set off the income from house property - HELD THAT:- The matter requires a re-visit to the file of the AO to find out as to the status in the preceding and succeeding years since the two vehicles were purchased on 27th December, 2010 and 29.09.2011 respectively. The AO may find out what is the rental income of Toyota Innova and Tata Canter in other cases to ascertain as to whether the assessee is deliberately entering into an agreement with a concern just to incur losses so as to set off the same from income from house property. The AO shall decide the issue as per fact and law and after giving due opportunity of being heard to the assessee. Ground No.2 raised by the assessee is accordingly allowed for statistical purposes. Reopening of assessment u/s 147 - CIT(A) giving a direction u/s 150(1) to the AO for taking action in the hands of the assessee as per law - HELD THAT:- The assessment year involved in the instant case is 2012-13. The property was purchased on 01.07.2010 for ₹ 22 lakhs. The assessee has obtained housing loan from the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - ₹ 3,48,000/- c) Out of deduction on account of vehicle and interest on vehicles which was sold - ₹ 6,71,350/- 3. In appeal, the ld.CIT(A) granted part relief to the assessee and sustained the disallowance of ₹ 1,11,000/- on account of various allowances, an amount of ₹ 2,01,405/- out of the disallowance u/s 57 of the Act in respect of depreciation and interest on vehicle, an amount of ₹ 3,81,600/- out of income from house property. 4. Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds:- 1. That the Id. assessing officer has erred in law as well as on the facts and circumstances of the case in disallowing of reimbursement of expenses and allowances under the provision of the Income Tax Act, 1961 amounting to ₹ 110000.00 claimed against salary income as per the following details and the ld Commissioner of Income-Tax (Appeals),-15, Delhi has erred in sustaining the same:- On account of reimbursement of medical expenses 15000.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d thus deserves to be quashed. 6. That the ld Commissioner of Income-Tax (Appeals)-15 Delhi has erred in law as well on the facts and circumstances of the case in giving the direction in respect of purchase of flat, whereby yielding a benefit of ₹ 1272000.00 to the assessee from the seller of the flat under the provision of section 56 (2)(vii)(b)(ii) of the Income Tax Act, 1961 which was not in existence in Assessment Year 2011-12 and made effective w.e.f. Assessment Year 2014-15, thus the direction so issued is against the provision of law. 7. The assessee reserves her right to add, alter, modify, delete or amend all or any of the grounds of appeal before or at the time of hearing of appeal. 5. Ground of appeal No.1 by the assessee relates to the order of the CIT(A) in confirming the disallowance of ₹ 1,11,000/-. 6. After hearing both the sides, I find the assessee has claimed deduction of medical allowance of ₹ 15,000/-, washing allowance of ₹ 36000.00 and helper allowance of ₹ 60000.00 which were disallowed by the AO on the ground that the assessee did not furnish any reply to justify these disallowances. I find, the ld.CIT(A) u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms of the provisions of section 10 (14) read with Rule 2 BB. However, If is not submitted as to what is the educational and professional background/education/qualification of the assessee. Copy of her appointment letter, proving her employment with M/s Mittal Forgings Components Private Limited and proving her nature of job with M/s Mittal forgings and Components Private Limited has not been filed. Not a single word has been uttered by the assessee either before the Assessing Officer or during the course of appellate proceedings, to prove the nature of duties performed by her during her employment with M/s Mittal Forgings Components Private Limited. It is not known as to what is the nature of her job/duties which requires attendance in the office in specific/special/exclusive 'uniform' to be worn by her for performing her duties/during office hours in the course of her employment with the employer company.lt is also not known/made known that such uniform requires frequent dry-cleaning/specialized cleaning. It is also not made known that there are other employees in the company which requires special clothing and special cleaning. Not a single word has been uttered by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the ld.CIT(A), no prudent person would enter into/execute any transaction to incur losses only. Since the assessee could not give any plausible explanation either before the AO or before him to justify the letting out of vehicles at lower rentals which are not sufficient to recover financial cost and depreciation cost, he upheld the action of the AO. It is the submission of the ld. Counsel for the assessee that he has filed the following details before the CIT(A) which has not been considered by him:- Particulars As per assessee As per Income Tax Act Tata Canter Rental income 252000 252000 (-) Interest on load 95868 95868 Net income (cash inflow) 156132 156132 (-) Depreciation 102250 271050 Profit 53882 -117618 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 12,72,000/- obtained by the assessee at the time of purchase of property. It is the submission of the ld. Counsel that for applicability of section 150(1), the record of proceedings must be before the appropriate authority. If there are no proceedings before it or if the assessment year in question is also not a matter which would call for consideration before higher authority, section 150 of the Act will have no application. It is also his submission that such proceedings can be initiated only within the period of limitation prescribed u/s 149 of the Act, if any, available at the time of order which was subject matter of appeal. It is also his submission that there is no provision under the Act by which the difference between value of the property adopted by the bank for sanctioning the loan and the actual cost of the property can be subjected to tax. 12.1 I find some force in the above argument of the ld. Counsel. The assessment year involved in the instant case is 2012-13. The property was purchased on 01.07.2010 for ₹ 22 lakhs. The assessee has obtained housing loan from the bank. The bank has valued the property at higher price for sanctioning the loan. Under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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