SHRI SATISH KUMAR MANTRI HUF, Indore V. THE ITO WARD 1(1), Indore

ITA 375/IND/2015

• Counselvise Citation: 37522714 RSA 2015
• Duration Of Justice: 4 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 26-05-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: S S DESHPANDE
• Keywords: Depreciation

Judgement Text

SATISH KUMAR MANTRI ITA NO. 375/IND/2015 1 IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, INDORE BEFORE SHRI B.C. MEENA, HONBLE ACCOUNTANT MEMBER ITA NO. 375/IND/2015 A.Y. 2005-06 SATISH KUMAR MANTRI HUF INDORE PAN AABHS 9806D ::: APPELLANT VS INCOME TAX OFFICER WARD 1(1), INDORE ::: RESPONDENT APPELLANT BY SHRI S.S. DESHPANDE RESPONDENT BY SHRI R.A. VERMA DATE OF HEARING 22.9.2015 DATE OF PRONOUNCEMENT 2 9 .9.2015 O R D E R PER SHRI B.C. MEENA, AM THIS APPEAL FILED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LEARNED CIT(A)-I, INDORE DATED 19.12 .2014. 2. THE ASSESSEE HAS SOLD A SHOP FOR RS. 6,60,000/- LOCATED AT JALGAON. THE ASSESSEE HAS CLAIMED THAT SATISH KUMAR MANTRI ITA NO. 375/IND/2015 2 EXPENDITURE OF RS.3 LACS HAS BEEN INCURRED ON THIS S HOP DURING THE FINANCIAL YEAR 2003-04 AND THEREAFTER THE SH OP HAS BEEN SOLD. THE SAME WAS DISALLOWED. THE REVENUES CONTENTION IS THAT THE CLAIM OF THE ASSESSEE REGARDING THE EXPENDITURE ON THE SHOP PRIOR TO SALE IS NOT SUPPORT ED BY DOCUMENTS AND ALL THE PAYMENTS FOR MATERIAL AND LABOUR HAVE BEEN MADE IN CASH. SOME OF THE BILLS HAVE BEEN RAIS ED BY THE TRADERS LOCATED AT INDORE WHILE THE SHOP WAS LOC ATED AT JALGAON. SINCE THE ASSESSEE FAILED TO ESTABLISH GENUINENESS OF THE EXPENSES, THE ASSESSEES CLAIM WAS REJECTED. IT WAS ALSO CLAIMED THAT THE ANGLE PATTY WAS PURCHASED IN INDORE BUT THE TRANSPORT EXPENSES HAVE BE EN DEBITED ONLY OF RS. 500/- WHICH IS NOT SUFFICIENT T O TRANSPORT 1115 KG OF ANGLE PATTI FROM INDORE TO JALGAON. IT WAS CLAIMED THAT THESE BILLS WERE NOT GENUINE. 3. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE SHOP WAS IN A VERY BAD SHAPE SATISH KUMAR MANTRI ITA NO. 375/IND/2015 3 AND WITHOUT RENOVATION, THE ASSESSEE SHOULD NOT HAVE SO LD IT OUT AND BY MAKING THESE EXPENSES FOR RENOVATION OF THE SHOP, THE ASSESSEE WAS NOT ABLE TO SELL THE SHOP. 4. I HAVE HEARD BOTH THE SIDES. THE SHOP WAS SOLD FOR RS.6,60,000/- ON 30.4.2004 THE VALUE OF SHOP AS ON 1.4.2003 WAS OF RS.2,34,982/- AND NO DEPRECIATION WAS CLAIMED. THE RENOVATION EXPENSES CLAIMED TO HAVE BEEN MADE OF RS.3 LACS DURING FINANCIAL YEAR 2003-04 RELEVANT TO THE ASSESSMENT YEAR 2004-05. THE OPENING VALUE OF THE SHOP WAS RS.2,34,982/- AS ON 1.4.2003 AND AFTER RENOVATION THE SHOP VALUED AT RS. 5,34,982/-. THE ASSES SEE IS NOT ABLE TO ESTABLISH THAT WHOLE OF THE EXPENDITURE INCURRED ON RENOVATION OF RS. 3 LACS WAS MADE IN FINAN CIAL YEAR 2003-04 RELEVANT TO THE ASSESSMENT YEAR 2004-05. ASSESSEE HAS ALSO NOT BEEN ABLE TO ESTABLISH EXPENDITUR E OF RS. 3 LACS. THEREFORE, LOOKING TO VARIOUS ASPECTS OF THE CASE, I THINK IT SHALL BE APPROPRIATE TO ESTIMATE THE SATISH KUMAR MANTRI ITA NO. 375/IND/2015 4 EXPENSES AS THE ASSESSEE MUST HAVE INCURRED SOME EXPENSES TO MAKE THE SHOP SALABLE AT THE ENHANCED PRICE. THEREFORE, IN THE INTEREST OF JUSTICE AND EQUITY AND L OOKING TO VARIOUS ASPECTS OF THE CASE, I ESTIMATE THAT THE ASSE SSEE MUST HAVE INCURRED EXPENSES OF RS.1,50,000/- ON RENOVATION OF THE SAME. I DIRECT TO ALLOW EXPENSE UPTO RS.1,50,000/-. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS PAR TLY ALLOWED. PRONOUNCED IN OPEN COURT ON 29 TH SEPTEMBER, 2015 SD (B.C. MEENA) ACCOUNTANT MEMBER 29 TH SEPTEMBER, 2015 DN/- SATISH KUMAR MANTRI ITA NO. 375/IND/2015 5