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TMI Blog2022 (10) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee confined his argument to the addition of Rs.52,150/- towards difference in interest income between P&L account and 26AS and addition of Rs.1 crore made by the AO and sustained by the ld.CIT(A) towards land development expenditure. 3. Facts of the case, in brief, are that the assessee is a company engaged in the business of real estate and investment in various associated companies. It filed its original return of income on 15.10.2016 declaring total income of Rs.7,74,650/-. A search and seizure operation u/s. 132 of the I.T.Act was conducted in the case of the assessee and its other associated companies on 09.11.2017. In response to notice u/s. 153A issued on 21.03.2018, the assessee filed its return of income on 11.07.2018 declar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore inferred that when the assessee has incurred the expenditure, it has become the income of the person receiving it, therefore the assessee cannot claim such expenditure. In absence of any satisfactory explanation given by the assessee the AO made addition of Rs.1 crore to the total income of the assessee. 5. In appeal, the ld.CIT(A) sustained both the additions. Aggrieved with such order of the ld.CIT(A), the assessee is in appeal before the Tribunal. 6. So far as the first issue i.e addition of Rs.52,150/- is concerned, the ld. Counsel for the assessee submitted that the above interest income has been shown in the hands of the sister concern. He submitted that the bank had inadvertently reflected the interest in the hands of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an opportunity, assessee is in a position to substantiate with evidence to the satisfaction of the AO that such interest income which belongs to the sister concern of the assessee has in fact been offered by them to taxation. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore this issue to the file of the AO with a direction go grant an opportunity to the assessee to substantiate its case and decide the issue as per fact and law. The first issue raised by the assessee in grounds of appeal is accordingly allowed for statistical purpose. 9. So far as the second issue is concerned, the same relates to the addition of Rs.1 crore made by the AO out of the expenditure incurred towards l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmitted that since the assessee has not submitted full details to the satisfaction of the AO regarding the claim of land development expenses, the AO was fully justified in making the addition of Rs.1 crore and the ld.CIT(A) was justified in sustaining such addition. He submitted that since the assessee has not given any such details, the prayer of the assessee that certain percentage of expenditure should be disallowed cannot be accepted since in future years, the assessee may claim any such expenditure without incurring it and may plead for disallowances of such expenses at a specific percentage. He accordingly submitted that the order of the ld.CIT(A) be upheld and the ground raised by the assessee on this issue should be dismissed. 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ger extract of this expenditure. The ld.CIT(A) sustained the addition and on further appeal by the assessee, the Tribunal vide ITA No.2178/Hyd/2017 order dated 29.06.2020 restricted such disallowance to 20% by observing as under:- "8. We have heard the rival submissions and perused the material available on record. The issue in the present ground with respect to disallowance of Land Development Expenses on ad hoc basis. It is an undisputed fact that the assessee is in the real estate business and the expenses are on account of "Land Development". It is also a fact that it is not the case of the Revenue that the expenses incurred by it under this head is bogus as is evident by the fact that AO has not disallowed the entire expenses but has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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