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TMI Blog2023 (3) TMI 1142X X X X Extracts X X X X X X X X Extracts X X X X ..... he "Act") dated 26.03.2016. 2. Grounds of appeal raised by the revenue are reproduced as under: "1. That on the facts and in circumstances of the case the Ld. CIT(A) has erred in facts and law in allowing the appeal on the issue of disallowance u/s. 14A of the Income Tax Act, whereas it is primarily a responsibility of the Assessee to show the source of acquisition of shares by production of material during assessment stage, as decided by the Hon'ble High Court of Calcutta in the case of Dhanuka & Sons vs. CIT Central-l. 2. That on the facts and in circumstances of the case the Ld. CIT(A) has erred in facts as well as law, in deleting the disallowance u/s. 40A(2) of the Income Tax Act since the party M/s. Carvan Creation Pvt. Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . AO called for de tails in respect of various expenses and claims made by assessee which were duly complied with. However, Ld. AO made certain additions and disallowances and completed the assessment at an assessed total income of Rs.1,55,07,720/-. Aggrieved by the additions and disallowances, assessee went in appeal before the Ld. CIT(A). Ld. CIT(A) after considering the submissions made by the assessee and objectively dealing with the issues partly allowed the appeal of the assessee. In respect of the relief granted by the Ld. CIT(A), the revenue is in appeal before the Tribunal by taking the above stated five grounds which are de alt hereunder in seriatim. 4. First ground is in respect of disallowance made u/s. 14A of the Act of Rs.2,2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I Agro Ltd. Vs. DCIT in G.A. 3022 of 2013 ITAT 161 of 2013, dt. 23rd December, 2013. Thus, considering the facts on record and the judicial precedents referred above, we do not find any reason to interfere with the finding given by the Ld. CIT(A). Accordingly, ground no. 1 is dismissed. 5. Ground no. 2 relates to disallowance made u/s. 40A(2) of the Act in respect of interest charged by one party M/s. Carvan Creations Pvt. Ltd. at a rate of interest namely, 16% compared to 10% by the remaining other parties. In this respect, Ld. Counsel referred to the difference in terms and conditions for the amount borrowed by the assessee from M/s. Carvan Creation Pvt. Ltd. vis-à-vis the other parties. This party had offered flexible repayment t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ground no. 3 is in respect of depreciation claimed by the assessee on its speed boat which according to the revenue is rental income from the said boat, which is not allowable. In this respect, Ld. Counsel referred to the fact as stated in the order of Ld. CIT(A), according to which assessee had let out its speed boat to M/s. Easyfit Jewellery Ltd. for a monthly rent of Rs.25,000/-. The boat was given for a period of eleven months. However, after three months, the boat was taken back for assessee's use. Accordingly, rental receipts for only three months have been shown in the financials of the assessee. 6.1. Ld. CIT(A) noted that rental income from boat has to be assessed either as business income or income from other sources. It cannot b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdingly 4th floor was not appearing under stock of the assessee as the same does not belong to the assessee as per JV agreement. Hence the act of AO by addition of INR 72,89,373/- (2,91,57,491/4=72,89,373) is not correct in law and accordingly the assessee should be allowed relief in the same." 7.1. On these facts, Ld. CIT(A) noted that Ld. AO has overlooked the fact of JV Agreement, according to which, 4th floor and the roof rights will be with the developer i.e. Japna Estates, in respect of cost incurred by it for the developer of the property. Since 4th floor and the roof rights was with the development in terms of the JV Agreement, there was no question of this being disclosed in the inventory of the assessee in the books and the fina ..... X X X X Extracts X X X X X X X X Extracts X X X X
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