Deputy Commissioner of Income-tax, V. Shri shantilal G. Mutha, Pune

ITA 575/PUN/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2819 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 24-03-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DHEERAJ KUMAR JAIN
• Keywords: Capital asset; Business income; Depreciation; Business expenditure; Rule of consistency; Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUN E , , !'!! # , $ % BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM / ITA NO. 575/PN/2014 $& ' !(' / ASSESSMENT YEAR : 2008-09 DY. COMMISSIONER OF INCOME TAX, CIRCLE 3, PUNE ....... / APPELLANT )& / V/S. SHRI SHANTILAL G. MUTHA, 8 TH FLOOR, MUTHA CHAMBER, SENAPATI BAPAT ROAD, PUNE 411016 PAN : AAXPM1652R / RESPONDENT ASSESSEE BY : SHRI RAJENDRA AGIWAL REVENUE BY : SHRI DHEERAJ KUMAR JAIN / DATE OF HEARING : 07-12-2015 / DATE OF PRONOUNCEMENT : 29-01-2016 * / ORDER PER VIKAS AWASTHY, JM : THE APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE OR DER OF COMMISSIONER OF INCOME TAX (APPEALS)-II, PUNE DATED 25-11 -2013 FOR THE ASSESSMENT YEAR 2008-09. 2. THE REVENUE HAS ASSAILED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) BY RAISING FOLLOWING GROUNDS IN THE APPEAL. 2 ITA NO. 575/PN/2014, A.Y. 2008-09 1. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ER RED IN TREATING SURPLUS FROM SALE OF DEVELOPMENT RIGHTS IN VIMAN NA GAR LAND AS BUSINESS INCOME WHEN THE ASSESSEE WAS NOT CARRYING OUT ANY BUSINESS ACTIVITIES FOR THE LAST SEVERAL YEARS AND THE SAME WAS RIGHTLY TAXED AS LONG TERM CAPITAL GAINS BY THE ASSESSING OFFICER. 2. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ER RED IN HOLDING THAT TRANSACTION OF SALE OF DEVELOPMENT RIGHTS IN LAND T RANSACTION WAS IN THE NATURE OF AN ADVENTURE IN TRADE / BUSINESS WITHOUT APPRECIATING THE FACT THAT THE LAND ACQUIRED IN 1987 WAS SOLD WITHOUT CAR RYING OUT ANY DEVELOPMENT THEREBY INDICATING THAT THE OBJECT TO A CQUIRE THE PROPERTY WAS NOT TO EXPLOIT THE PROPERTY COMMERCIALLY AND TH AT THE ISOLATED TRANSACTION WAS NOT ADVENTURE IN THE NATURE OF TRAD E. 3. THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ER RED IN ALLOWING ADMINISTRATIVE EXPENSES OF RS.1,26,87,200/- WHEN NO BUSINESS ACTIVITY WAS CARRIED ON BY THE ASSESSEE FOR SEVERAL YEARS AN D THE SAME COULD NOT BE ALLOWED AS BUSINESS EXPENDITURE. 3. THE FACTS OF THE CASE AS EMANATING FROM THE RECORDS ARE: THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE IMPUGNED ASSESS MENT YEAR ON 30-09-2008 DECLARING TOTAL INCOME OF ` 8,04,75,710/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND ACCORDINGLY NOTICE U/S. 143(2) WAS ISSUED TO THE ASSESSEE ON 24-08-2009. IN TH E RETURN OF INCOME THE ASSESSEE HAD DECLARED INCOME FROM HOUSE PROP ERTY, INCOME FROM OTHER SOURCES AND INCOME FROM SALE OF LAND. THE ASS ESSEE DECLARED THE INCOME FROM SALE OF LAND AS BUSINESS INCOME A ND CLAIMED CERTAIN EXPENDITURE TOWARDS THE SAME. THE ASSESSEE HA D ACQUIRED DEVELOPMENT RIGHTS IN THE LAND WHICH IS SUBJECT MATTER O F SALE IN THE IMPUGNED ASSESSMENT YEAR FROM SMT. KUNDA SHANKARSINGH R AMSINGH VIDE UNREGISTERED AGREEMENT FOR SALE DATED 12-08-1987 FO R CONSIDERATION OF ` 4,00,000/-. THE SAID SALE AGREEMENT IS AT PAGES 59 TO 66 OF THE PAPER BOOK. SMT. KUNDA SHANKARSINGH RAMSINGH EXECUTED HER WILL ON 16-10-1993 WHICH WAS REGISTERED WITH THE O FFICE OF SUB- 3 ITA NO. 575/PN/2014, A.Y. 2008-09 REGISTRAR, MUMBAI ON 20-10-1993. ACCORDING TO THE WILL, THE LAND DEVOLVED ON THE LEGAL HEIRS OF SMT. KUNDA SHANKARSINGH RAM SINGH. SMT. KUNDA SHANKARSINGH RAMSINGH EXPIRED ON 08-03-1994. DURING THE PERIOD RELEVANT TO THE ASSESSMENT YEAR 2008-09, TH E ASSESSEE ASSIGNED HIS DEVELOPMENT RIGHTS IN THE LAND VIDE REGISTERED AGREEMENT DATED 24-04-2007 IN FAVOUR OF M/S. ASHRAY PREMISES PVT. LTD. FOR A CONSIDERATION OF ` 2 CRORES. THE ASSESSEE WAS PARTY TO THE AGREEMENT IN THE CAPACITY OF CONSENTING/CONFIRMING PARTY. A COPY OF THE AGREEMENT IS PLACED ON RECORD AT PAGES 67 TO 80 OF THE PAPER BO OK. THE ASSESSEE CLAIMED NET PROFIT OF ` 1,95,28,395/- FROM THE SALE OF SAID LAND AND OFFERED TO TAX THE SAME UNDER THE HEAD PROFITS AND GAIN S FROM THE BUSINESS AND PROFESSION. THE ASSESSEE CLAIMED THE COST OF ACQUISITION ` 4 LACS AND FURTHER EXPENDITURE OF ` 71,605/- AS EXPENDITURE FROM THE SALE CONSIDERATION OF LAND. DURING THE SCRUTINY ASSESSMEN T PROCEEDINGS THE ASSESSING OFFICER HELD THAT THE INCOME FROM SALE OF LAND IS A CAPITAL GAIN AND NOT A BUSINESS INCOME. THE ASS ESSING OFFICER OBSERVED THAT THE ASSESSEE IS NOT ENGAGED IN THE REGU LAR BUSINESS OF SALE AND PURCHASE OF LAND. THIS IS THE ONLY SALE TRANSACTION UNDER TAKEN BY THE ASSESSEE DURING THE YEAR. THE ASSESSING OFFICER TREATED THE SURPLUS FROM SALE OF LAND AS LONG TERM CAPITAL GAIN. THE A SSESSING OFFICER FURTHER DISALLOWED THE EXPENDITURE CLAIMED BY THE ASS ESSEE UNDER THE HEAD ADMINISTRATIVE EXPENSES AND DEPRECIATION AGGREGATING TO ` 1,26,87,200/- DEBITED TO THE PROFIT AND LOSS ACCOUNT. AGGRIEVED BY THE ASSESSMENT ORDER DATED 13-12-2010, T HE ASSESSEE PREFERRED AN APPEAL BEFORE THE COMMISSIONER OF I NCOME TAX (APPEALS). THE FIRST APPELLATE AUTHORITY VIDE IMPUGNED ORDE R ACCEPTED THE SUBMISSIONS OF THE ASSESSEE AND REVERSED THE FINDINGS OF ASSESSING OFFICER ON THE ABOVE TWO COUNTS. AGAINST THESE FINDINGS OF THE 4 ITA NO. 575/PN/2014, A.Y. 2008-09 COMMISSIONER OF INCOME TAX (APPEALS), THE REVENUE IS IN APP EAL BEFORE THE TRIBUNAL. 4. SHRI DHEERAJ KUMAR JAIN REPRESENTING THE DEPARTMENT SUBMITTED THAT THE ASSESSEE HAD INTEREST IN THE LAND SITUATED AT VIMAN NAGAR, PUNE. THE ASSESSEE HAD ACQUIRED THE SAID LAND WAY BACK IN THE YEAR 1986. THEREAFTER, NO ACTIVITY WHATSOEVER WAS CARRIED OUT BY THE ASSESSEE ON THE SAID LAND. NEITHER THE LAND WAS DEVELOPE D NOR ANY CONSTRUCTION ACTIVITY WAS CARRIED OUT BY THE ASSESSEE O N THE LAND. THE ASSESSEE WAS HOLDING THE LAND HAS CAPITAL ASSET. DURING THE PERIOD RELEVANT TO THE ASSESSMENT YEAR UNDER APPEAL, THE ASS ESSEE SOLD THE LAND AND CLAIMED THE SURPLUS FROM SALE OF LAND AS BUSINESS INCOME. THE ASSESSING OFFICER RIGHTLY DECLINED THE CLAIM OF THE ASSES SEE AS NO OTHER BUSINESS ACTIVITY OF SUCH NATURE WAS CARRIED OUT B Y THE ASSESSEE EITHER IN THE IMPUGNED ASSESSMENT YEAR OR THE PREVIOUS ASSESSMENT YEAR. IT WAS AN ISOLATED TRANSACTION UNDERTAKEN BY TH E ASSESSEE. THE ASSESSEE WAS NOT ABLE TO SHOW FROM THE RECORDS THAT T HE ASSESSEE HAD HELD THE LAND AS STOCK-IN-TRADE AND NOT AS CAPITAL ASSET . THE ASSESSEE HAD SHOWN THE INCOME FROM SALE OF LAND AS BUSINESS INCOME MERELY TO SUPPRESS HIS TAXABLE INCOME BY CLAIMING BUSINESS EXPENDITUR E TO THE TUNE OF ` 1,26,87,200/- UNDER THE HEAD ADMINISTRATIVE EXPENSES. WHEREAS, THE ASSESSEE WAS NOT ENGAGED IN ANY BUSINESS ACTIVITY. THE ASSESSEE IS HAVING ONLY REGULAR RENTAL INCOME TAXABLE UND ER THE HEAD INCOME FROM HOUSE PROPERTY AND INCOME FROM OTHER SOUR CES. THE LD. DR VEHEMENTLY SUPPORTED THE FINDINGS OF ASSESSING OFFICER A ND PRAYED FOR REVERSING THE FINDINGS OF THE COMMISSIONER OF INCOME TA X (APPEALS) ON THIS ISSUE. 5 ITA NO. 575/PN/2014, A.Y. 2008-09 5. ON THE OTHER HAND SHRI RAJENDRA AGIWAL APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS HAVING TWO PROPRIETORSHIP FIRMS NAMELY, M/S. MUTHA AGENCIES AND M/S. MUTHA ASSOC IATES. THE ASSESSEE IS CARRYING ON THE BUSINESS OF GAS AGENCY IN TH E FIRM MUTHA AGENCIES. THE ASSESSEE IS CARRYING ON THE BUSINESS OF R EAL ESTATE, SALE AND PURCHASE OF LAND UNDER THE PROPRIETORSHIP FIRM MUTHA ASSOCIATES. APART FROM THE ABOVE, THE ASSESSEE IS ALSO HAVING RENTA L INCOME FROM HOUSE PROPERTY AND INCOME FROM OTHER SOURCES. DURING T HE FINANCIAL YEAR 2007-08 THE ASSESSEE HAD ASSIGNED THE DEVELOPMEN T RIGHTS IN THE LAND ADMEASURING ABOUT 1 ACRE SITUATED AT SURVEY NO. 20 8, HISSA NO. 1B, LOHEGAON (REFERRED TO AS THE LAND SITUATED AT VIMAN NAGAR, PUNE). THE ASSESSEE HAD ASSIGNED THE DEVELOPMENT RIGHTS IN THE LAND IN FAVOUR OF M/S. ASHRAY PREMISES PVT. LTD. VIDE REGISTERED DEVELOPME NT AGREEMENT DATED 24-04-2007 FOR A CONSIDERATION OF ` 2 CRORES. THE SAID AGREEMENT WAS EXECUTED BY THE LEGAL HEIRS OF SMT. KUNDA SHANKARS INGH RAMSINGH AND THE ASSESSEE WAS CONSENTING/CONFIRMING PART Y TO THE AGREEMENT. THE ASSESSEE HAD CLAIMED THE INCOME FROM LAND AS BUSINESS INCOME. THE LD. AR SUBMITTED THAT THE ASSESSEE HAS BEEN DEALING IN LAND AND REAL ESTATE AS BUILDER AND PROMOTER FOR MORE THAN 25 YEARS. THE ASSESSEE HAD CONSTRUCTED AND DEVELOPED NUMBER OF RESIDENTIAL AND COMMERCIAL PROJECTS. IN THE PAST YEARS THE ASSESS EE HAD MADE CERTAIN INVESTMENTS IN PROPERTIES VIZ: DODEJA PROPER TY AT MARKET YARD, SAWALA PROPERTY AT KOTHRUD, PAPERA PROPERTY AT B UND GARDEN AND BAJAJ PROPERTY AT KOTHRUD WHEREIN SUBSTANTIAL INVE STMENT WAS MADE AND THEREAFTER, THE PROPERTIES RAN INTO LITIGATION. EVEN THE LA ND AT VIMAN NAGAR WAS UNDER LITIGATION IN CIVIL COURT, THEREFORE, NO DEVELOPMENT ACTIVITY WAS CARRIED OUT BY THE ASSESSEE ON THE SAID LAND. SINCE, THE TIME ASSESSEE HAD ACQUIRED THE LAND AT VIMAN N AGAR, PUNE IT 6 ITA NO. 575/PN/2014, A.Y. 2008-09 HAS BEEN SHOWN AS CURRENT ASSET IN THE BOOKS OF ACCOU NT. AT NO STAGE THE ASSESSEE HAS EVER CONVERTED THE LAND INTO CAPITAL A SSET. SINCE, THE SUBSTANTIAL INVESTMENT MADE BY THE ASSESSEE GOT STRUCK IN LITIGATION, THE ASSESSEE HAD GONE DORMANT IN HIS BUSINESS OF REAL ES TATE. THE LD. AR DRAWS OUR ATTENTION TO THE AGREEMENT FOR SALE DATED 24-08-1997 AT PAGES 59 OF THE PAPER BOOK TO SHOW THAT THE DEVELOPME NT RIGHTS WERE ACQUIRED BY THE ASSESSEE FOR DEVELOPING THE LAND. THE INT ENTION OF THE ASSESSEE WAS NOT TO PURCHASE THE LAND FOR INVESTMENT P URPOSE. THE LD. AR ALSO REFERRED TO 7/12 EXTRACTS FOR THE YEAR 2006-07 WHEREIN THE NAME OF THE OWNER WAS RECORDED AND NOT THAT OF THE AS SESSEE. THE LD. AR ALSO REFERRED TO THE BALANCE SHEET AS ON 31-03-1998 WHEREIN THE LAND WAS SHOWN UNDER THE HEAD CURRENT ASSETS, LOANS AND ADVANCES. THEREIN, THE COMPONENT OF ADVANCE AGAINST PROPERTIES INCLU DE ADVANCE OF ` 3,60,000/- TO SMT. KUNDA SHANKARSINGH RAMSINGH IN RESPECT OF THE PROPERTY WHICH IS SUBJECT MATTER OF APPEAL. THE LD. AR FUR THER SUBMITTED THAT IN THE SUBSEQUENT FINANCIAL YEARS THE LAND WAS SHOWN UNDER CURRENT ASSETS AND ADVANCES IN THE BALANCE SHEE T AND IN THE YEAR 1996 THE LAND WAS SHOWN AS STOCK-IN-TRADE IN SCHEDULE J . THE LD. AR ALSO REFERRED TO THE ASSESSMENT ORDER PLACED ON RECORD AT PAGES 119 TO 139 OF THE PAPER BOOK WHEREIN THE DEPARTMENT HAS ACCE PTED THE REAL ESTATE BUSINESS CARRIED ON BY THE ASSESSEE. THE LD. AR FURTHER REFERRED TO THE DETAILS OF EXPENDITURE WHICH INCLUDE LEGAL FEE AND EXP ENSES AMOUNTING TO ` 1,85,422/- TO HIGHLIGHT THAT THE ASSESSEE HAS BEEN INCURRING HUGE EXPENDITURE IN DEFENDING THE TITLE OF THE PR OPERTIES WHICH ARE UNDER LITIGATION. THE LD. AR VEHEMENTLY SUPPORT ED THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND PRAY ED FOR DISMISSING THE APPEAL OF THE REVENUE. 7 ITA NO. 575/PN/2014, A.Y. 2008-09 6. THE LD. DR REFUTING THE SUBMISSIONS MADE ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE PRINCIPLE OF RES JUDICATA DO ES NOT APPLY IN INCOME TAX PROCEEDINGS. IF THE DEPARTMENT HAS ACCEPTE D THE CLAIM OF THE ASSESSEE IN SOME ASSESSMENT YEARS IT DOES NOT ME AN THAT THE CLAIM OF THE ASSESSEE HAS TO BE ACCEPTED IN EVERY ASSESSMEN T YEAR. THE CLAIM OF THE ASSESSEE CAN BE ACCEPTED ONLY AFTER APPRECIATING THE FACTS IN EACH ASSESSMENT YEAR. 7. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESEN TATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE ALSO EXAMINED THE DOCUMENTS PLACED ON RECORD BY T HE LD. AR OF THE ASSESSEE IN THE FORM OF PAPER BOOK. THE UNDISPUTED FACTS WHICH HAVE EMERGED FROM THE SUBMISSIONS AND THE MATERIAL AVAILAB LE ON RECORD IS THAT THE ASSESSEE HAS ACQUIRED LAND ADMEASUR ING ABOUT 1 ACRE AT VIMAN NAGAR, PUNE FROM SMT. KUNDA SHANKARSINGH R AMSINGH WAY BACK IN THE YEAR 1987. OSTENSIBLY, ONLY AGREEMENT FOR SALE WAS EXECUTED BETWEEN THE PARTIES AND A CONSIDERATION OF ` 4 LACS WAS PAID BY THE ASSESSEE TO ACQUIRE THE DEVELOPMENT RIGHTS. SMT. KU NDA SHANKARSINGH RAMSINGH HAD EXECUTED REGISTERED WILL IN FA VOUR OF HER LEGAL HEIRS. IN THE YEAR 2007 THE ASSESSEE ASSIGNED THE DEVELOPMENT RIGHTS IN FAVOUR OF M/S. ASHRAY PREMISES PVT. LTD., THE AGR EEMENT WAS EXECUTED BETWEEN THE OWNERS OF THE LAND AS VENDORS AN D M/S. ASHRAY PREMISES PVT. LTD. AS PURCHASER/DEVELOPER/BUILDER ON THE OTHER PART. THE ASSESSEE WAS CONSENTING/CONFIRMING PARTY IN THE SAID AGREEMENT. A PERUSAL OF THE REGISTERED DEVELOPMENT AGREEMENT DATED 24-04-2007 SHOWS THAT SMT. KUNDA SHANKARSINGH RAMSINGH HAD AGREED TO GIVE THE LAND TO THE CONSENTING PARTY, THAT IS THE ASSESSEE AND HAD RECEIVED THE CONSIDERATION FROM THE CONSENTING PARTY. A CLOSE EXAMINAT ION OF 8 ITA NO. 575/PN/2014, A.Y. 2008-09 AGREEMENT FOR SALE DATED 12-08-1997 AND DEVELOPMENT AGREEMENT DATED 24-04-2007 SHOWS THAT THE ASSESSEE HAD INVESTE D IN THE LAND NOT FOR THE PURPOSE OF HOLDING THE LAND AS INVESTMENT BUT AS BUSINESS ASSET. THE ASSESSEE HAD ALSO REFERRED TO THE BALANCE S HEET FOR THE VARIOUS FINANCIAL YEARS WHEREIN THE LAND HAS BEEN SHOWN UN DER THE HEAD CURRENT ASSETS AND ADVANCES. IN THE BALANCE SHE ET FOR THE YEAR ENDING ON 31-03-1996, THE LAND HAS BEEN SHOWN AS STOCK-IN-TRADE . THE REVENUE HAS NOT BEEN ABLE TO CONTROVERT THE ASSERTION S OF THE ASSESSEE SUPPORTED BY DOCUMENTARY EVIDENCE THAT THE ASSESSEE HAS NEVER CONVERTED THE LAND FROM STOCK-IN-TRADE TO INVESTMENT. T HE REVENUE HAS NOT PLACED ON RECORD ANY DOCUMENT TO SHOW THAT THE A SSESSEE HAS HELD THE LAND AS INVESTMENT AT ANY STAGE. 8. ONE OF THE CONTENTIONS OF THE DEPARTMENT IS THAT THE SALE OF LAND IN THE IMPUGNED ASSESSMENT YEAR IS THE ONLY TRANSACTION UNDER TAKEN BY THE ASSESSEE AND THUS, IT CANNOT BE SAID THAT THE A SSESSEE IS ENGAGED IN THE BUSINESS OF SALE AND PURCHASE OF LAND. TH E ASSESSEE HAS SHOWN FROM DOCUMENTS ON RECORD THAT THE ASSESSEE WAS REGULARLY ENGAGED IN THE BUSINESS OF REAL ESTATE AND DEVELOPMENT O F VARIOUS PROJECTS. THE ASSESSEE HAS PLACED ON RECORD ASSESSME NT ORDERS FOR ASSESSMENT YEARS 2003-04, 2004-05, 2007-08, 2009-10, 20 10-11 AND 2012-13. IN ALL THESE ASSESSMENT ORDERS THE DEPARTMEN T HAS ACCEPTED THE BUSINESS INCOME OF THE ASSESSEE FROM THE ACTIVITY OF T HE REAL ESTATE BUSINESS. IT IS A TRITE LAW THAT THE PRINCIPLE OF RES JUDIC ATA DOES NOT APPLY IN THE INCOME TAX PROCEEDINGS. HOWEVER, THE HON'B LE APEX COURT IN THE CASE OF RADHASOAMI SATSANG VS. COMMISSIONER OF INCO ME TAX REPORTED AS 193 ITR 321 (SC) HAS EMPHASIZED THE IMPORTA NCE OF RULE OF CONSISTENCY TO BE FOLLOWED. THUS, IN VIEW OF LAW LAID DOWN BY THE 9 ITA NO. 575/PN/2014, A.Y. 2008-09 HON'BLE SUPREME COURT OF INDIA THE CONTENTION OF THE REV ENUE IS NOT SUSTAINABLE. 9. THE COMMISSIONER OF INCOME TAX (APPEALS) IN DETAILED AND WELL REASONED ORDER HAS HELD THAT THE TRANSACTION INVOLVING S ALE OF LAND UNDERTAKEN BY THE ASSESSEE IS IN THE NATURE OF BUSINESS . THE INTENTION OF THE ASSESSEE AT THE TIME OF PURCHASE OF LAND IS CRUCIAL. THE COMMISSIONER OF INCOME TAX (APPEALS) AFTER APPRECIATING THE FACTS OF THE CASE AND VARIOUS JUDGMENTS HAS COME TO SUCH A CO NCLUSION. WE DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE COMMISSIONER OF INC OME TAX (APPEALS) ON THE ISSUE. ACCORDINGLY, GROUND NOS. 1 AND 2 RAISED BY THE REVENUE IN ITS APPEAL ARE DISMISSED BEING DEVOID OF ANY MERIT. 10. IN SO FAR AS DISALLOWANCE OF ADMINISTRATIVE EXPENSES AMOUNTING TO ` 1,26,87,200/- IS CONCERNED THE ONLY ARGUMENT ADVANCED B Y THE LD. DR IS THAT SINCE NO BUSINESS ACTIVITY WAS CARRIED OUT BY TH E ASSESSEE, THE EXPENDITURE IN THE NATURE OF ADMINISTRATIVE EXPENSES CANN OT BE ALLOWED. WE FIND THAT THE DEPARTMENT HAS BEEN ALLOWING SUC H EXPENDITURE YEAR AFTER YEAR TO THE ASSESSEE. NO PLAUSIB LE REASON HAS BEEN GIVEN BY THE ASSESSING OFFICER TO DISALLOW THE SAME IN THE IMPUGNED ASSESSMENT YEAR. SINCE, WE HAVE ALREADY HELD TH AT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF DEALING IN LAND IN TH E ASSESSMENT YEAR UNDER APPEAL, WE FIND NO REASON TO DISA LLOW THE CLAIM OF THE ASSESSEE ON THIS COUNT. THE ASSESSING OFFICER HAS NOT RAISED ANY DOUBT OVER THE EXPENDITURE INCURRED WHILE DISALLOWING THE S AME. IN ABSENCE OF ANY CONTRARY EVIDENCE THE EXPENDITURE CLAIMED BY THE ASSESSEE HAS TO BE ALLOWED. THE COMMISSIONER OF INCOME T AX (APPEALS) IN THE IMPUGNED ORDER HAS GIVEN DETAILED REASONS FOR ACCE PTING THE 10 ITA NO. 575/PN/2014, A.Y. 2008-09 CLAIM OF THE ASSESSEE. WE DO NOT FIND ANY REASON TO TAKE A CONTRARY VIEW ON THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPE ALS) ON THE ISSUE. ACCORDINGLY, GROUND NO. 3 RAISED BY THE REVEN UE IN ITS APPEAL IS DISMISSED. 11. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED BEING DEVOID OF ANY MERIT. ORDER PRONOUNCED ON FRIDAY, THE 29 TH DAY OF JANUARY, 2016. SD/- SD/- ( . . / R.K. PANDA) ( ! ' / VIKAS AWASTHY) #' / ACCOUNTANT MEMBER $ % #' / JUDICIAL MEMBER / PUNE; &# / DATED : 29 TH JANUARY, 2016 RK *+,$-.'/'(- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ' () / THE CIT(A)-II, PUNE 4. ' / THE CIT-II, PUNE 5. !*+ %%,- , ,- , . /01 , / DR, ITAT, A BENCH, PUNE. 6. + 2 34 / GUARD FILE. // ! % // TRUE COPY// #5 / BY ORDER, %6 ,1 / PRIVATE SECRETARY, ,- , / ITAT, PUNE