ACIT [ OSD] Pune, Pune V. Shri Shirish D Kulkarni, Pune

ITA 709/PUN/2012

• Counselvise Citation: 70924514 RSA 2012
• Duration Of Justice: 2 year(s) 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 26-11-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 09-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE BEFORE: SHRI R.S. PADVEKAR, JUDICIAL MEMBER AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO . 709 / P N/ 20 1 2 ASSESSMENT YEAR : 200 8 - 09 ASSTT. COMMISSIONER OF INCOME TAX ( OSD ), PUNE VS. SHRI SHIRISH D. KULKARNI, SDK HOUSE, 1187/60, JANGLI MAHARAJ ROAD, SHIVAJINAGAR, PUNE (APPELLANT) (RESPONDENT) PAN NO. ANHPK1349L APPELLANT BY: SHRI RAJESH DAMOR RESPONDENT BY: SHRI NIKHIL PATHAK DATE OF HEARING : 13 - 08 - 2014 DATE OF PRONOUNCEMENT : 28 - 08 - 2014 ORDER PER R.S . PADVEKAR , JM : - THIS APPEAL IS FILED BY THE REVENUE CHALLENGING THE IMPUGNED ORDER OF THE LD. CIT(A) - II, PUNE DATED 30 - 12 - 2011 FOR THE A.Y . 2008 - 09. THE REVENUE HAS TAKEN THE FOLLOWING GROUND S IN THE APPEAL: 1. THE ORDER OF THE COMMISSIONER OF INCOME - TAX (APPEALS) IS CONTRARY TO LAW AND TO THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN ALLOWING THE ASSESSEE'S CLAIM OF DEDUCTION OF RS. 1,62,33,447/ - IN THE COMPUTATION OF SHORT - TERM CAPITAL GAINS ARISING ON SALE OF LAND AT FURSUNGI ON ACCOUNT OF EXPENSES TO BE INCURRED AS PER AN MOU TOWARDS DEVELOPMENT OF PROPERTY AND IN DIRECTING THE ASSESSING OFFICER TO REDUCE A SUM OF RS.85,32,153 / - FROM THE SALE CONSIDERATION ON ACCOUNT OF REFUND. 2 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE 3. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN FAILING TO APPRECIATE THAT THERE WAS NOT EVEN A MENTION OF THE SO - CALLED MEMORANDUM OF UNDERSTANDING (MOU) DT. 26.09.2007, WHICH WAS N EITHER REGISTERED NOR NOTARIZED, IN THE SALE DEEDS WHICH WERE EXECUTED SUBSEQUENTLY ON 06.11.2007 AND 10.03.2008. THIS CLEARLY INDICATES THAT THE SO - CALLED MOU WAS AN AFTER - THOUGHT AND A SELF - CREATED, SELF - SERVING DOCUMENT. 4. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN FAILING TO APPRECIATE THAT THE TOTAL EXPENSES OF RS.2,47,65,600 / - ( RS.1,62,33,447 / - + R S .85,32,153 / - ) WAS A MERE ESTIMATE WHICH HAD NEITHER BEEN QUANTIFIED IN THE SALE - DEED OR IN THE MOU AND, IN THE CIRCUMSTANCES, THE SAME COULD NOT BE TREATED AS EXPENDITURE INCURRED ONLY AND EXCLUSIVELY IN CONNECTION WITH THE TRANSFER OF ASSETS U/S. 48(1) OF THE INCOME - TAX ACT, 1961. 5. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN ALLOWING THE ASSESSEE'S CLAIM OF DEDUCTION OF RS.1,62,33,447 / - EVEN THOUGH THE ASSESSEE HAD NOT FURNISHED ANY EVIDENCE EITHER BEFORE THE ASSESSING OFFICER OR IN THE COURSE OF THE APPELLATE PROCEEDINGS IN SU PP ORT OF THE EXPENSES ACTUALLY INCURRED. 6. WITHOUT PREJUDICE TO THE ABOVE, THE L EARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN ALLOWING THE ABOVE CLAIM ALSO WITHOUT ENQUIRING AS TO WHEN THE EXPENSES WERE ACTUALLY INCURRED, MORE SO WHEN THE ASSESSEE HIMSELF HAD SUBMITTED DURING THE APPEAL PROCEEDINGS THAT EXPENSES INCURRE D UPTO TO 24/01/2011 WERE RS. 1,62,33,447/ - . THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN TAKING COGNIZANCE OF EXPENSES INCURRED BEYOND THE RELEVANT PREVIOUS YEAR. 7. WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN FAILING TO APPRECIATE THAT THE EXPENDITURE OF RS.1,62,33,447/ - CLAIMED TO HAVE BEEN INCURRED ON A WORK SUCH AS REMOVING OF BUNDS, HUTS, GRASS, 3 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE SHRUBS, CONSTRUCTION OF WALL AND ROAD, PLUMBING WORKS ETC. WAS UNREASONABLY HIGH. 8. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN FAILING TO APPRECIATE THAT THE AGREED SALE CONSIDERATION AS PER A REGISTERED DEED WOULD NOT ALTER MERELY BECAUSE THE BOARD OF DIRECTORS OF THE BUYER COMPANY PASSED A RESOLUTION TO THAT EF FECT AND ALSO WHEN THE REFUND AS PER SUCH RESOLUTION HAD NOT BEEN ACTUALLY MADE BY THE ASSESSEE AND THE ASSESSEE HAD ONLY UNDERTAKEN TO MAKE THE REFUND BEFORE 31.01.2012. 9. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN DIRECTING THE A SSESSING OFFICER TO REDUCE THE SUM OF RS.85,32,153/ - WITHOUT APPRECIATING THAT THE ASSESSEE HAD NO OBLIGATION UNDER THE SALE - DEED OR MOD TO MAKE ANY REFUND IN ANY CONTINGENCY . 10. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) GROSSLY ERRED IN FAILING TO APPRECIATE THAT AS PER THE TERMS AND CONDITIONS OF THE SALE DEEDS, THE ASSESSEE WAS NOT UNDER ANY OBLIGATION EITHER TO INCUR ANY DEVELOPMENT EXPENSES OR TO REFUND ANY SUM TO THE BUYER AND, THEREFORE, THE RATIO IN THE CASE OF V A VSUMATI, 123 ITR 94 AND IN THE CASE OF VALLIAMMAL, 127 ITR 713, WOULD NOT APPLY TO THE ASSESSEE'S CASE. 2. THE ISSUE S WHICH ARISE FOR OUR CONSIDERATION ARE WHETHER THE CLAIM OF DEDUCTION FOR IMPROVEMENT OF THE LAND AT FURSUNGI OF RS.2,47,65,600/ - WHICH WAS RESTRICTED BY THE LD. CIT(A) TO RS. 1,62,33,447/ - FOR COMPUTATION OF SHORT TERM CAPITAL GAIN IS JUSTIFIED AND DIRECTING THE ASSESSING OFFICER TO REDUCE RS.85,32,153/ - FROM GROSS CONSIDERATION AS IT WAS CONTRACTUAL LIABILITY ON THE ASSESSEE TO DO DEVELOPMENT OF LAND AS PER MOU. THE FACTS WHICH ARE REVEALED FROM THE RECORD AS UNDER. THE ASSESSEE IS AN INDIVIDUAL AND HE IS PARTNER OF DIFFERENT FIRMS. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE A.Y. 2008 - 4 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE 09 ON 29 - 09 - 2008 DECLARING TOTAL INCOME OF RS.1,22,93,880/ - . IN RESPECT OF THE COMPUTATION OF SHORT TERM CAPITAL GAIN ON THE SALE OF THE LAND SITUATED AT FURSUNGI IN PUNE , T HE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE HAS CLAIMED DEDUCTION OF RS.2,47,65,600/ - IN RESPECT OF PROVISION FOR EXPENSES TO BE INCURRED AS PER MO U TOWARDS DEVELOPMENT OF LAND . HE HAS FURTHER OBSERVED THAT AS PER THE PROVISIONS OF SEC. 48 , THE DEDUCTION OF RS.2,47,65,600/ - IN RESPECT OF PROVISION FOR EXPENSES TO BE INCURRED AS PER MOU TOWARDS DEVELOPMENT OF PROPERTY IS NOT AN ALLOWABLE DEDUCTION FO R THE PURPOSES OF COMPUTATION OF CAPITAL GAIN S . THE ASSESSING OFFICER, THEREFORE, REJECTED THE CLAIM OF DEDUCTION OF THE ASSESSEE OF RS. 2,47,65,600/ - AND THEN WORKED OUT THE SHORT TERM CAPITAL GAIN (STCG) ON THE SALE OF FURSUNGI LAND AT PUNE WHICH IN CONS EQUENCE INCREASED THE TAXABLE CAPITAL GAIN IN THE HANDS OF THE ASSESSEE. 3. THE ASSESSEE CHALLENGED THE ACTION OF THE ASSESSING OFFICER BEFORE THE LD. CIT(A). THE LD. CIT(A) CONSIDERED THE SUBMISSIONS OF THE ASSESSEE AND HE CAME TO THE CONCLUSION THAT OUT OF RS.2,47,65,600/ - THE EXPENSES ACTUALLY INCURRED BY THE ASSESSEE TO THE EXTENT OF RS.1,62,33,447/ - ARE TO BE ALLOWED AS A COST OF ASSET U/S. 48 OF THE ACT. IN RESPECT OF THE BALANCE AMOUNT OF RS.85,32,153/ - , THE LD. CIT(A) HELD THAT AS THE SAID AMOU NT IS AS PER TERMS OF THE MOU AND THE ASSESSEE COULD NOT SPEND ON THE DEVELOPMENT A S THE NATURE OF THE PROJECT WAS CHANGED HENCE TO THAT EXTENT THE AMOUNT IS TO BE REDUCED. FOR ALLOWING THE CLAIM OF THE ASSESSEE , THE REASONS AND FINDINGS OF THE LD. CIT(A) ARE AS UNDER: 4. IN GROUND NO. 2, THE APPELLANT HAS CONTESTED THE DISALLOWANCE OF DEDUCTION U/S 48 CLAIMED OF RS.2,47,65,600/ - IN COMPUTING THE SHORT - TERM CAPITAL GAIN WITH RESPECT TO THE SALE OF LAND AT FURSUNGI, PUNE. THE FACT OF THE CASE IS THAT THE AP PELLANT PURCHASED AGRICULTURAL LAND AT VILLAGE FURSUNGI, TAL.: HAVELI, DIST: PUNE HAVING 5 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE TOTAL AREA OF 234.5R DURING THE FINANCIAL YEAR 2007 - 08 FOR A TOTAL CONSIDERATION OF RS.3,36,23,900/ - . DURING THE SAID FINANCIAL YEAR I.E. 2007 - 08, THE APPELLANT LEARNT THAT D.S. KULKARNI DEVELOPERS LTD, A DEVELOPER BASED AT PUNE WERE DESIROUS TO PURCHASE 100 TO 120 ACRES OF 'CONTIGUOUS LANDS FOR DEVELOPMENT OF THEIR SEZ PROJECT. THE APPELLANT, THEREAFTER, APPROACHED THE DEVELOPER AND OFFERED TO ASSIGN THE RIGHTS OF THE AGRICULTURAL LANDS PURCHASED. THE DEVELOPERS, HOWEVER, WERE INTERESTED IN PURCHASING DEVELOPED LAND AND THEY OFFERED HANDSOME CONSIDERATION FOR SALE OF DEVELOPED LANDS PROVIDED THE APPELLANT UNDERTOOK THE WORK OF BASIC DEVELOPMENT OF THE PROPERTY AS THE LA NDS WERE AGRICULTURAL AND HENCE NOT SUITABLE FOR SEZ PROJECT FOR WHICH THE DEVELOPER NEEDED THE SAID LAND. THE BASIC DEVELOPMENT WORK INCLUDED: 1) REMOVING & DISPOSING BUNDS, OLD HUTS, COW SHEDS AND HOUSES. 2) REMOVING GRASS, SHRUBS, DEBRIS, DISPOSING CART ING AWAY AND CLEANING. 3) GOVERNMENT & PRIVATE MEASUREMENT OF LAND (MOJANI) 4) CONSTRUCTION OF ENTIRE ROAD NETWORK. 5) CONSTRUCTION OF RETAINING/COMPOUND WALL 6) PLUMBING DEVELOPMENT WORKS. 7) EXTERNAL DRAINAGE DEVELOPMENT WORK, STORM WATER DEVELOPMENT WOR K ETC. THE DEVELOPER OFFERED THE APPELLANT A VERY HIGH RATE FOR THE SAID LAND IN LIEU OF GETTING THE DEVELOPMENT WORK DONE OF NEARLY 1.30 CRORES PER ACRE WHEREAS THE MARKET RATE OF THE SAID LAND FOR STAMP DUTY PURPOSE WAS VERY LESS. IN VIEW OF THE ABOVE, T HE APPELLANT ACCEPTED THE OFFER MADE BY THE DEVELOPER AND EXECUTED A MOU DATED 26.09.2007. THE COPY OF THE SAID MOU HAS ALSO BEEN FURNISHED DURING THE APPELLATE PROCEEDINGS AND SUBSEQUENTLY EXECUTED THE SALE DEED IN FAVOUR OF THE DEVELOPER M/S D.S. KULKARN I DEVELOPERS LTD. AS UNDER: SR. NO. DATE OF SALE GAT NO. OF LAND CONSIDERATION RECEIVED AREA OF LAND 1. 06.11.2007 46/1 /1B 4,94,00,000 152R 2. 10.03.2008 48/2B/1 48/5/2 1,69,00,000 52R 6,63,00,000 204R 6 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE THE MARKET VALUE FOR STAMP DUT Y U/S 50C OF THE AFORESAID LAND WAS ONLY RS.31,32,000/ - AGAINST THE TOTAL CONSIDERATION RECEIVED OF RS.6,63,00,000/ - BY THE APPELLANT. THUS, THE APPELLANT OUT OF THE TOTAL LAND OF 234.50 R SOLD 204R AND RETAINING ABOUT 30.5R WITH HIM. THE APPELLANT, THEREA FTER, WHILE COMPUTING THE SHORT - TERM CAPITAL GAIN CLAIMED EXPENSES OF RS.2,47,65,600/ - TO BE INCURRED ON THE SAID LAND AS PER THE MOU DATED 26.09.2007 AND HAD MADE A DETAILED ESTIMATE FOR THE DEVELOPMENT WORK ON THE BASIS OF WHICH THE EXPENSES OF RS.2,47,6 5,600/ - WAS WORKED OUT. THE APPELLANT AFTER CLAIMING THE DEDUCTION ON ACCOUNT OF EXPENSES TO BE INCURRED OFFERED RS.1,21,27,745/ - AS SHORT - TERM CAPITAL GAINS ON THE SALE OF LAND FOR A.Y. 2008 - 09. DURING THE ASSESSMENT PROCEEDINGS THE A.O. HELD THAT THE DED UCTION OF RS.2,47,65,600/ - IN RESPECT OF PROVISIONS FOR EXPENSES TO BE INCURRED AS PER THE MOU TOWARDS THE DEVELOPMENT OF THE LAND WAS NOT AN ELIGIBLE DEDUCTION FOR PURPOSE OF COMPUTATION OF INCOME BY WAY OF SHORT TERM CAPITAL GAIN. THE A.O. HELD THAT AS P ER THE PROVISIONS OF SECTION 48 OF THE I.T. ACT, 1961, THE CAPITAL GAINS HAD TO BE COMPLETED BY DEDUCTING FROM THE FACE VALUE OF CONSIDERATION RECEIVED ON ACCRUING AS A RESULT OF CAPITAL ASSET, THE FOLLOWING AMOUNTS, NAMELY; 1. EXPENDITURE INCURRED WHOLL Y IN CONNECTION WITH THE TRANSFER AND 2. THE COST OF ACQUISITION OF ASSETS AND COSTS OF ANY IMPROVEMENT. 4.1 IN VIEW OF THE ABOVE THE A.O. HELD THAT DEDUCTION OF RS.2,47,65,600/ - IN RESPECT OF THE PROVISIONS FOR EXPENSES TO BE INCURRED AS PER THE MOU DATE D 26.09.2007 TOWARDS DEVELOPMENT OF PROPERTY WAS NOT AN ELIGIBLE DEDUCTION FOR THE PURPOSE OF WORKING OUT THE CAPITAL GAINS AND THUS THE SAID PROVISIONS OF EXPENSES OF RS.2,47,65,600/ - ESTIMATED BY THE APPELLANT AND CLAIMED AS DEDUCTION WAS DISALLOWED AND ADDED TO THE TOTAL INCOME. 4.2 DURING THE APPELLATE PROCEEDINGS THE APPELLANT HAS CONTENDED THAT THE DEVELOPMENT WORK WAS APPELLANT'S COMMITMENT AS PER THE MOU DATED 26.09.2007, BY VIRTUE OF WHICH THE APPELLANT ACCEPTED THE VARIOUS DEVELOPMENT WORKS WHICH WAS A CONTRACTUAL LIABILITY AND BECAUSE OF THE SAME THE COMPANY OR THE BUYER AGREED TO PAY HANDSOME CONSIDERATION FOR SALE OF LAND FOR THEIR SEZ PROJECT. THE DETAILS OF THE EXPENDITURE INCURRED BY THE APPELLANT TOWARDS THE DEVELOPMENT OF THE LAND TO THE EX TENT OF RS.1,62,33,447/ - HAS ALSO 7 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE BEEN FURNISHED. IT HAS ALSO BEEN SUBMITTED THAT THE BALANCE AMOUNT OF RS.85,32,153/ - OUT OF THE TOTAL ESTIMATED EXPENDITURE OF RS.2,47,65,600/ - WAS TO BE INCURRED FURTHER; HOWEVER, THE SAME HAS BEEN HELD UP BECAUSE OF THE INSTRUCTIONS OF THE COMPANY TO HOLD DEVELOPMENT WORK TILL THEIR FINAL INSTRUCTIONS AS THE SEZ PROJECT HAS NOW CHANGED TO SPECIAL TOWNSHIP PROJECT. 4.3 THE APPELLANT HAS FURTHER STATED THAT ALL EXPENDITURE WHOLLY AND EXCLUSIVELY INCURRED IN CONNECTION WITH TRANSFER HAS TO BE ALLOWED AND IT IS IMMATERIAL THAT THE SAID EXPENDITURE WAS INCURRED SUBSEQUENT TO THE SALE DEED AND, THEREFORE, CONTENDED THAT THE CRUCIAL TEST TO BE APPLIED IS REGARDING INCURRING OF THE EXPENDITURE WHOLLY AND EXCLUSIVELY IN CONNECTION WITH TRANSFER AND THAT IT IS IMMATERIAL WHETHER IT WAS INCURRED PRIOR OR SUBSEQUENT TO THE PASSING OF TITLE. IT IS ALSO SUBMITTED THAT AS PER THE MOU DATED 26.09.2007 THE APPELLANT PROMISED AND TOOK RESPONSIBILITY TO CARRY OUT THE DEVELOPMENT WORK ON THE S AID LAND AS PER THE UNDERSTANDING AND BASED ON THE SAME THE CONSIDERATION WAS FIXED WHICH INCLUDED THE SAID COST OF THE DEVELOPMENT WORK. IT IS ALSO CONTENDED THAT THE ESTIMATE OF EXPENDITURE TO BE INCURRED ON THE SAID LAND WAS ALSO APPROVED BY THE COMPANY AND WAS INTRINSICALLY LINKED WITH THE TRANSFER THOUGH THE SAME HAS BEEN INCURRED SUBSEQUENT TO THE EXECUTION OF THE SALE DEED. IT HAS, THEREFORE, BEEN CONTENDED THAT THE A.O. HAD FAILED TO CONSIDER THAT THE DEVELOPMENT WORK WAS APPELLANT'S CONTRACTUAL OBL IGATION AND IF THE SAID WORK WAS NOT CARRIED OUT, THE COMPANY WOULD HAVE RECOVERED THE SAID AMOUNT. IT IS ALSO SUBMITTED THAT THE CONTENTION OF THE A.O. THAT PROVISION FOR EXPENSES IN SHORT TERM CAPITAL GAIN CANNOT BE ALLOWED AS PER THE PROVISIONS OF SECTI ON 48 IS NOT CORRECT AS VARIOUS AUTHORITIES HAVE HELD THAT EXPENDITURE WHOLLY AND EXCLUSIVELY INCURRED IN CONNECTION WITH TRANSFER HAS TO BE ALLOWED AND IT IS IMMATERIAL THAT THE SAID EXPENDITURE WAS INCURRED SUBSEQUENT TO THE SALE DEED. THE APPELLANT HAS RELIED ON THE FOLLOWING JUDICIAL CONTENTIONS: 1. V.A. VASUMATI VS. CIT (1980) 123 ITR 94 (KER) 2. CIT VS. DR. P. RAJENDRAN (1981) 127 ITR 810 (KER) 3. KALPATARU CONSTRUCTION VS. DCIT (2007) 13 SOT 194 (MUM) 4. S.S. JHAVERI VS. UNION OF INDIA (2006) 286 ITR 428 (BOM) 8 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE 4.3.1 IN THE CASE OF V.A. VASUMATI, CITED SUPRA, THE KERALA HIGH COURT HELD THAT ALL THE EXPENDITURE WHOLLY AND EXCLUSIVELY INCURRED IN CONNECTION WITH TRANSFER IS ALLOWABLE. THIS WAS A CASE OF COMPULSORY ACQUISITION AND THE APPELLANT HAD CHALLE NGED THE AMOUNT AWARDED WITH RESPECT TO THE EXPENDITURE INCURRED ON SUBSEQUENT LITIGATION BY THE APPELLANT, THE HON'BLE COURT HELD THAT ALL EXPENDITURE WHOLLY AND EXCLUSIVELY INCURRED IN CONNECTION WITH SUCH LITIGATION IS AN EXPENDITURE WITHIN THE MEANING OF SECTION 48 AND FOR THE PURPOSE OF THE SECTION, IT IS IMMATERIAL THAT THE EXPENDITURE WAS INCURRED SUBSEQUENT TO THE AWARD SO LONG AS IT WAS INCURRED WHOLLY AND EXCLUSIVELY IN CONNECTION WITH THE COMPULSORY ACQUISITION. IN THE PRESENT CASE ALSO THE EXPEN DITURE INCURRED BY THE APPELLANT IS WITH REFERENCE TO AND IS IN CONNECTION WITH WHOLLY AND EXCLUSIVELY RELATED TO THE TRANSFER OF THE LAND AND THE FACT THAT EXPENDITURE INCURRED BY THE APPELLANT HAS NOT BEEN DISPUTED BY THE A.O. DURING THE ASSESSMENT STAGE . 4. 3.2 IN THE CASE OF DR. P. RAJENDRAN, CITED SUPRA, THE KERALA HIGH COURT HELD THAT THE WORDS 'IN CONNECTION WITH 1 USED IN CLAUSE (I) OF SECTION 48 OF THE IT. ACT, ARE VERY WIDE IN THEIR AMBIT AND HENCE THERE IS NO WARRANT FOR IMPORTING A DISTINCTION THA T TO QUALIFY FOR DEDUCTION THE EXPENDITURE MUST NECESSARILY HAVE BEEN INCURRED PRIOR TO THE PASSING OF TITLE. IT WAS FURTHER HELD THAT THE CRUCIAL TEST TO BE APPLIED IS WHETHER THE EXPENDITURE WAS INCURRED WHOLLY AND EXCLUSIVELY IN CONNECTION WITH TRANSFER AND IT IS IMMATERIAL WHETHER IT WAS INCURRED PRIOR OR SUBSEQUENT TO THE PASSING OF TITLE. IN THE OTHER CASE CITED BY THE APPELLANT OF KALPATARU CONSTRUCTION SUPRA, THE ITAT MUMBAI, HAS HELD THAT SUBSEQUENT EVENTS CONTINGENT UPON WHICH THE SAID CONSIDERATI ON OF CAPITAL ASSET WAS VARIABLE THEN SUCH EVENT HAS TO BE CONSIDERED WHILE COMPUTING THE CAPITAL GAIN. 4.3.3 IN THE PRESENT CASE, THE VALUE OF LAND IN QUESTION INCREASED SUBSTANTIALLY ON ACCOUNT OF THE VARIOUS IMPROVEMENT AND DEVELOPMENT WORK WHICH WAS TO BE CARRIED OUT AS PER THE MOU DATED 26.09.2007. HAD SUCH IMPROVEMENT UPON THE LAND NOT TAKEN PLACE THE SALE PRICE OF THE LAND WOULD HAVE BEEN MUCH LESS. THE WORD 'IMPROVE' HAS VARIOUS SHADES OF MEANING AND IT INCLUDES EVERYTHING BY DOING IN WHICH THERE I S ENHANCEMENT IN VALUE OF THE ASSET OR THERE IS A RISE IN ITS PRICE OR THE ASSET IS MADE TO GROW 9 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE BETTER. IN THE CASE OF VALLIAMMAL VS CIT (1981) 127 ITR 713 (MAD)(TB), BETTERMENT CHARGES PAID TO MUNICIPALITY WAS HELD TO CONSTITUTE COST OF IMPROVEMENT FOR T HE PURPOSE OF CLAUSE (I) OF SECTION 48 OF THE ACT, AS IT CONTRIBUTED TO THE INCREASE IN POTENTIAL VALUE OF LAND IN A REAL SENSE. IN THE PRESENT CASE ALSO THE APPELLANT HAS CARRIED OUT A DIVERSE SET OF DEVELOPMENT WORK ON THE LAND SUCH AS CONSTRUCTION OF RO AD NETWORK IN CONCRETE, REMOVING BUND, OLD HUTS, HOUSES AND CLEANING GRASS, SHRUBS, DEBRIS ETC., BUILD THE COMPOUND WALL, WHICH HAS INDEED ADDED VALUE TO THE LAND FOR WHICH THE SALE CONSIDERATION RECEIVED BY THE APPELLANT WAS MUCH MORE THAN THE EXISTING PR ICE AS PER THE STAMP DUTY VALUATION 4.4 SECTIONS 48 AND 50 OF THE ACT CLARIFY THAT CAPITAL GAIN CAN BE CORRECTLY WORKED OUT ONLY IF COST OF ACQUISITION OR IMPROVEMENT OF THE ASSET IS DEDUCTED FROM THE FULL VALUE OF CONSIDERATION RECEIVED. THEREFORE, TO ENT ITLE THE ASSESSEE TO ANY DEDUCTION IN TERMS OF THE SAID PROVISIONS ON ACCOUNT OF ANY IMPROVEMENT IT IS REQUIRED THAT A CLAIM FOR SUCH DEDUCTION IS MADE BEFORE THE ASSESSING AUTHORITY FAILING WHICH THE A.O. SHALL BE ENTITLED TO PROCEED ON THE ASSUMPTION THA T NO SUCH IMPROVEMENT WAS ACTUALLY MADE. IN THE PRESENT CASE THE CLAIM OF THE SAID IMPROVEMENT OF THE LAND WAS MADE BEFORE THE A.O. THOUGH IT WAS BASED ON AN ESTIMATE AS PER THE MOU WHICH FETCHED THE APPELLANT A MUCH HIGHER SUM OF MONEY THAN IT COULD HAV E BEEN WITHOUT SUCH IMPROVEMENT AS ENVISAGED IN THE MEMORANDUM AND WITHOUT WHICH LAND DEAL WOULD NOT HAVE TAKEN PLACE AND IT CERTAINLY HAD TO BE ADDED TO THE COST OF THE ASSET WHICH THE A.O. HAS FAILED TO CONSIDER AT THE ASSESSMENT STAGE. THE SALE OF TH E CAPITAL ASSET AND THE DEVELOPMENT WORK TO BE CARRIED OUT AS PER THE CONTENTS OF THE MOU DATED 26.09.2007 HAS NOT BEEN DISPUTED BY THE A.O. THE EXPRESSION IN CONNECTION WITH SUCH TRANSFER IS WIDER THAN THE EXPRESSION 'FOR THE TRANSFER'. ANY AMOUNT, THE PA YMENT OF WHICH IS ABSOLUTELY NECESSARY TO EFFECT THE TRANSFER WILL BE AN EXPENDITURE COVERED BY THIS CLAUSE. IN OTHER WORDS, IF, WITHOUT REMOVING ANY ENCUMBRANCE, SALE OR TRANSFER COULD NOT BE EFFECTED, THE AMOUNT PAID FOR REMOVING THAT ENCUMBRANCE WILL FALL UNDER CLAUSE (I). IN THE CASE OF CIT VS SHAKUNTALA KANTILAL (1991) 190 ITR 56 (BOM) AND FOLLOWED IN CIT VS ABRAM AM (2001) 247 ITR 312 (BOM) SLP DISMISSED AND CIT VS PIROJA C. PATEL (2000) 242 ITR 582 (BOM) IT HAS BEEN HELD THAT THE PHRASE 'IN CONNEC TION WITH' SHOULD BE.LIBERALLY CONSTRUED AND THAT, IN A CASE OF AN ACQUISITION OF LAND THE EXPENDITURE INCURRED FOR PROSECUTING A REFERENCE TO THE COURT, 10 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE EXPENDITURE INCURRED BY ASSESSEE ON MAINTENANCE OF STAFF ETC. PENDING FINALIZATION COMPENSATION WILL B E DEDUCTIBLE EXPENDITURE SINCE CAPITAL GAIN ARE CHARGEABLE IN THE PREVIOUS YEAR VIZ. - THAT IN WHICH THE TRANSFER TOOK PLACE ALL EXPENSES INCIDENTAL TO THE TRANSFER WHENEVER THEY MAY HAVE BEEN INCURRED SHOULD BE DEDUCTED AGAINST THE FULL AMOUNT OF CONSIDERAT ION. IN THE CASE OF ADDL. CIT VS ROHTAK TEXTILE MILLS LTD. (1982) 138 ITR 195 (DEL) IT WAS HELD THAT ALL EXPENDITURE INCIDENTAL TO TRANSFER MUST BE DEDUCTIBLE IN COMPUTING THE AMOUNT OF CAPITAL GAINS WHETHER INCURRED IN THAT PREVIOUS YEAR OR NOT. THE CONCE PT OF EXPENDITURE BEING RELATABLE TO THE YEAR IN WHICH IT WAS INCURRED WILL NOT BE QUITE APPROPRIATE IN THE CONTEXT OF COMPUTATION OF THE CAPITAL GAINS IN VIEW OF THE LANGUAGE OF SECTION 45 R / W S. 48. COURTS HAVE OBSERVED THAT THE CRUCIAL WORDS IN THE PR OVISION ARE 'IN CONNECTION WITH TRANSFER'. THE EXPRESSION MEANS INTRINSICALLY LINKED WITH TRANSFER. SUCH EXPENDITURE HAS TO BE WHOLLY AND EXCLUSIVELY IN CONNECTION WITH THE TRANSFER. EVEN IF SUCH EXPENDITURE HAS SOME NEXUS WITH THE TRANSFER IT DOES NOT QUA LIFY FOR DEDUCTION UNLESS IT IS WHOLLY AND EXCLUSIVELY IN CONNECTION WITH THE TRANSFER. FURTHER, THE EXPRESSION 'WHOLLY AND EXCLUSIVELY' DOES NOT MEAN THAT THE EXPENDITURE SHOULD BE A 'NECESSARY' EXPENDITURE BECAUSE THE EXPRESSION 'WHOLLY AND EXCLUSIVELY' DOES NOT MEAN 'NECESSARY'. THUS IN THE COMPUTATION OF CAPITAL GAINS, IN ORDER TO QUALIFY FOR DEDUCTION UNDER SECTION 48, THE EXPENDITURE SHOULD BE 'WHOLLY' IN TERMS OF QUANTUM IN CONNECTION WITH TRANSFER AND THE MOTIVE FOR SUCH EXPENDITURE SHOULD ALSO BE T HE TRANSFER OF THE CAPITAL ASSET IN ORDER THAT EXPENDITURE COMES WITHIN THE AMBIT OF THE WORD 'EXCLUSIVELY'. THE ALLOWABILITY HAS TO BE EXAMINED FROM THIS ANGLE. 4.5 THE DEVELOPMENT WORK OR EXPENSES INCURRED ON THE IMPROVEMENT OF THE LAND HAS BEEN WHOLLY A ND EXCLUSIVELY INCURRED IN RELATION WITH THE LAND SOLD BY THE APPELLANT TO M/S DSK KULKARNI LTD. THE EXPENSES INCURRED TO THE EXTENT OF RS.1,62,33,447/ - OUT OF THE TOTAL EXPENSES ESTIMATED BY THE APPELLANT OF RS.2,47,65,600/ - WILL HAVE TO BE ALLOWED AS COS T OF ASSET U/S 48. IN THE SUBMISSION DATED 29.12.2011 MADE BY THE APPELLANT IT HAS BEEN STATED THAT UPTO 24.01.2011 THE APPELLANT HAD ALREADY SPENT RS.1,62,33,447/ - ON DEVELOPMENT WORK ON THE 'FURSUNGI 1 LAND WHICH HAD BEEN APPROVED BY THE BUYER M/S DSK KUL KARNI LTD; WHICH CONSISTED OF CONSTRUCTION OF ROADS, PARTIAL COMPOUND WALL, LEVELING OF LAND AND REMOVING DEBRIS ETC. HOWEVER, DUE TO CERTAIN SUBSEQUENT DEVELOPMENT THE BUYER'S PROPOSED SEZ PROJECT GOT CANCELLED AND THE 11 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE SAME HAS BEEN PROPOSED BY THEM FOR A SPECIAL TOWNSHIP PROJECT TO THE GOVERNMENT. THEREFORE, AS PER THE BOARD'S RESOLUTION THE BUYER ASKED THE APPELLANT TO REFUND THE BALANCE UNSPENT SUM OF MONEY AMOUNTING TO RS.85,32,153/ - WHICH WAS TO BE SPENT ON THE DEVELOPMENT OF DRAINAGE WORK AND WATER S UPPLY SCHEMES BY THE APPELLANT AND WHICH REMAINED TO BE EXECUTED. IN VIEW OF THE ABOVE FACTS, THEREFORE, THE EXPENSES CLAIMED BY THE APPELLANT WILL HAVE TO BE RESTRICTED TO RS.1,62,33,447/ - I.E. TO THE EXTENT OF EXPENSES ACTUALLY SPENT AND INCURRED ON THE LAND AS EVIDENT FROM THE DETAILS FURNISHED AND CONFIRMED IN THE STATUS REPORT BY THE BUYER M/S .D.S. KULKARNI - DEV. LTD. THE REMAINING AMOUNT WHICH HAS REMAINED UNSPENT AND WHICH HAS BEEN ASKED BY THE BUYER TO BE REFUNDED OF RS.85,32,153/ - WILL HAVE TO BE REDUCED FROM THE SALE CONSIDERATION THEREBY SHORT - TERM CAPITAL GAIN WILL BE REDUCED TO THAT EXTENT. 4.6 IN VIEW OF THE ABOVE STATED FACTS THE DISALLOWANCE MADE BY THE A.O. IS LIABLE TO BE DELETED AND THE GROUND OF APPEAL NO. 2 RAISED BY THE APPELLANT IS AL LOWED. NOW, THE REVENUE BEING AGGRIEVED IS BEFORE US. 4 . WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. THE LD. COUNSEL SUBMITS THAT THE ASSESSEE HAD NEGOTIATED WITH THE LANDLORDS AT VILLAGE - FURSUNGI, TAL. - HAVELI, DISTT. - PUNE FOR PURCHASE OF LAND S . THE ASSESSEE PURCHASED THE AGRICULTURAL LAND DURING THE F.Y. 2007 - 08 AT VILLAGE - FURSUNGI. THE ASSESSEE ARGUES THAT THE ASSESSEE PURCHASED THE LAND ADMEASURING 234.5R AND THE COST OF ACQUISITION TO THE ASSESSEE WAS TO EXTEND OF RS.3,36,23,900/ - . THE ASSES SEE ALSO PAID THE BROKERAGE OF RS.1,50,000/ - W HICH DETAILS WERE SUBMITTED BEFORE THE ASSESSING OFFICER. HE SUBMITS THAT D.S. KULKARNI DEVELOPERS LTD., WHICH IS RE NOWNED BUILDER AND DEVELOPER IN PUNE WAS DESIROUS TO PURCHASE ABOUT 100 TO 120 ACRES OF CONTI GUOUS LANDS FOR DEVELOPMENT OF THEIR SEZ PROJECT AT VILLAGE - FURSUNGI, TAL. - HAVELI, DISTT. - PUNE. THE ASSESSEE APPROACHED D.S. KULKARNI DEVELOPERS LTD. AND OFFERED TO ASSIGN THE ASSESSEES RIGHTS OF THE AGRICULTURAL LANDS ACQUIRED IN VILLAGE - FURSUNGI. THE D.S. KULKARNI DEVELOPERS LTD. (IN SHORT DSKDL) OFFERED HANDSOME CONSIDERATION FOR 12 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE SALE OF LANDS PROVIDED THE ASSESSEE UNDERT AKES THE WORK OF BASIC DEVELOPMENT OF THE PROPERTY AS THE LANDS WERE USED FOR AGRICULTURAL PURPOSES AND WERE NOT SUITABLE FOR SEZ PROJECT. HE SUBMITS THAT AS PER UNDERSTANDING BETWEEN THE ASSESSEE AND DEVELOPER , THE SAID DSKDL WAS INTERESTED IN PURCHASING THE DEVELOPED LAND SUBJECT TO 1) REMOVING & DISPOSING BUNDS, OLD HUTS, COW SHEDS AND HOUSES. 2) REMOVING GRASS, SHRUBS, DEBRIS, DISPOSING CARTING AWAY AND CLEANING. 3) GOVERNMENT & PRIVATE MEASUREMENT OF LAND (MOJANI) 4) CONSTRUCTION OF ENTIRE ROAD NETWORK. 5) CONSTRUCTION OF RETAINING/COMPOUND WALL 6) PLUMBING DEVELOPMENT WORKS. 7) EXTERNAL DRAINAGE DEVELOPMENT WORK, STORM WATER DEVELOPMENT WORK ETC. 5 . AFTER DEAL WAS FINALIZED THERE WAS A MOU BETWEEN THE ASSESSEE AND DSKDL DATED 26 - 09 - 2007 AND IT WAS THE CONTRACTUAL OBLIGATION OF THE ASSESSEE TO COMPLETE THE ENTIRE DEVELOPMENT WORK MENTIONED HERE - IN - ABOVE. HE SUBMITS THAT FOR D OING ALL THESE WORKS AND AFTER DEVELOPMENT THE ASSESSEE WAS OFFERED THE GOOD PURCHASE PRICE FOR THE LAND. HE SUBMITS THAT SUBSEQUENTLY THE ASSESSEE EXECUTED SALE DEED IN FAVOUR OF THE DEVELOPER I.E. DSKDL , TRANSFERRING THE TITLE IN LAND ADMEASURING 204R F OR THE CONSIDERATION OF RS.6.63 CRORES AND THE ASSESSEE RETAIN ED ABOUT LAND ADMEASURING 30.5R WITH HIM. THE ASSESSEE MADE THE DETAILED ESTIMATE FOR THE DEVELOPMENT WORK TO BE EXECUTED BY THE ASSESSEE ON THE SAID LAND AND AS PER THE SAID ESTIMATE THE ASSES SEE WAS TO INCUR THE EXPENDITURE TO THE EXTENT OF RS.2,47,65,600/ - WHICH DETAILS WERE FURNISHED TO THE ASSESSING OFFICER. HE ARGUES THAT THE ASSESSING OFFICER ACCEPTED THE QUANTUM OF DEVELOPMENT WORK AS WELL AS THE CONTENT OF THE MOU. HE ARGUES THAT AS 13 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE P ER THE MOU BETWEEN THE ASSESSEE AND DEVELOPER DATED 26 - 09 - 2007 THERE WERE CONDITIONS FOR GIVING THE HIGH ER CONSIDERATION TO THE ASSESSEE AND HENCE, OR IN OTHER WORDS THE HIGH ER CONSIDERATION OFFERED BY THE DSKDL WAS SUBJECT TO THE IMPROVEMENT AND DEVELOPME NT OF THE PLOT OF LAND SUITABLE FOR SEZ PROJECT . HE ARGUES THAT AS PER CLEAR UNDERSTANDING BETWEEN THE ASSESSEE AND DSKDL THE ASSESSEE HAS TO MAKE THE SAID LAND COMPATIBLE TO THE SEZ PROJECT. 6 . THE LD. COUNSEL SUBMITS THAT THE ASSESSEE FILED BEFORE TH E LD. CIT(A) THE DETAILS OF THE EXPENDITURE TO THE EXTENT OF RS.1,62,33,447/ - WHICH WERE ACTUALLY INCURRED WHEN THE HEARING BEFORE THE LD. CIT(A) WAS GOING ON. HE ARGUES THAT SUBSEQUENTLY , THE DEVELOPER CHANGED THE PROJECT AND MADE IT SPECIAL TOWNSHIP PRO JECT . DUE TO CHANGE IN THE PROJECT , THE ASSESSEE WAS INSTRUCTED TO HOLD THE DEVELOPMENT WORK. HE ARGUES THAT THE CONSIDERATION FIXED FOR THE SALE OF THE LAND WAS LINKED WITH THE DEVELOPMENT EXPENDITURE WHICH WAS THE ASSESSEES CONTRACTUAL LIABILIT Y AND H ENCE, THE ASSESSEE WAS ENTITLED TO CLAIM THE SAME EXPENDITURE AS A DEDUCTION. LD. COUNSEL SUPPORTED THE ORDER OF THE LD. CIT(A). 7 . PER CONTRA, THE LD. DR VEHEMENTLY ARGUES THAT IN THE FINAL SALE DEED BETWEEN THE ASSESSEE AND THE DEVELOPER THERE IS NO WH ISPER OF THE MOU BETWEEN THE ASSESSEE AND DSKDL DATED 26 - 09 - 2007. HE ARGUES THAT EVEN PRESUMING THE ASSESSEE HAS INCURRED THE EXPENDITURE TO THE EXTENT OF RS.1,62,33,447/ - BUT SO FAR AS REDUCING AN AMOUNT OF RS.85,32,153/ - FROM THE SALE CONSIDERATION IS N OT PROPER AS ADMITTEDLY THE ASSESSEE HAS NOT INCURRED THE SAID EXPENDITURE. HE PLEADED FOR RESTORING THE ORDER OF THE ASSESSING OFFICER. 8 . ON PERUSAL OF THE ASSESSMENT ORDER, WE FIND THAT THE ASSESSING OFFICER HAS NOT DISCUSSED THE ISSUE IN DETAIL BUT ADOPTED SHORTCUT BY DISALLOWING THE ENTIRE CLAIM OF EXPENDITURE BY WRITING 5 - 6 LINES. WE FIND 14 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE THAT THE LD. CIT(A) HAS IN DETAIL DEALT WITH THE ISSUE AND ALSO NARRATED THE RELEVANT FACTS. IN THIS CASE NOWHERE IT IS DISPUTED THAT THE ASSESSEE HAS SOLD THE LANDS TO THE DSKDL BUT THE SOLITARY CONTROVERSY IS IN RESPECT OF CONTRACTUAL LIABILITY ON THE ASSESSEE FOR CARRYING OUT DEVELOPMENT WORKS ON THE SAID LAND AS THOSE LANDS WERE AGRICULTURAL LAND , WHEREBY THE SAID LAND WOULD BE COMPATIBLE FOR THE PROJECT OF THE DSKDL WHICH WAS INITIALLY SEZ PROJECT. IT IS STATED THAT SUBSEQUENTLY THE DSKDL DECIDED NOT TO GO WITH THE SEZ PROJECT BUT DECIDE D TO GO WITH THE SPECIAL TOWNSHIP PROJECT AND HENCE, THE ASSESSEE WAS REQUESTED TO WITHHOLD THE FURTHER DEVELOPMENT. THE ASSESSEE HAS PRODUCED THE DETAILS OF THE EXPENDITURE ON THE SAID LAND BEFORE THE LD. CIT(A) TO THE EXTENT OF RS.1,62,33,447/ - WHICH HAS NOT BEEN CONTROVERTED BEFORE US ONLY ARGUMENT OF THE REVENUE IS THAT THE SAID EXPENDITURE IS INCURRED BY THE ASSESSEE NO T DURING THE ASSESSMENT YEAR. 9 . WE FIND THAT THE IDENTICAL ISSUE HAS COME FOR THE CONSIDERATION BEFORE THE ITAT, MUMBAI IN THE CASE OF KALPATARU CON STRUCTION VS. DCIT (2007) 13 SOT 194 (MUM) AND IT IS HELD THAT THE CONSIDERATION OF THE SUBSEQUENT EVENT S ALSO RELEVANT FOR COMPUTATION OF THE CAPITAL GAIN. ANOTHER ARGUMENT OF THE REVENUE IS THAT THERE IS NO MENTION OF THE MOU DATED 26 - 09 - 2007 IN THE FINAL SALE DEED. IT IS TRUE THAT THE SAID MOU WAS NOT REGISTERED BUT AT THE SAME TIME IT IS ALSO NOT DISPU TED THAT THE SAID MOU EXECUTED ON THE NON - JUDICIAL STAMP PAPER OF RS.100/ - COPY PLACED AT PAGE NOS. 46 TO 52 OF THE COMPILATION. WE ALSO FIND THAT THE LD. CIT(A) HAS GIVEN THE CATEGORICAL FINDING THAT THERE WAS CONTRACTUAL OBLIGATION ON THE ASSESSEE TO DO THE DEVELOPMENT AND HENCE, TO THE EXTENT OF RS.1,62,33,447/ - WHICH WERE SPENT BY THE ASSESSEE UP TO 24 - 01 - 2011 , THE LD. CIT(A) ALLOWED THE CLAIM OF DEDUCTION TO THE ASSESSEE. IN RESPECT OF THE BALANCE AMOUNT OF RS.85,32,153/ - , THE SAME WAS DIRECTED TO BE REDUCED FROM THE SALE CONSIDERATION FOR THE REASON THAT THE HIGHER CONSIDERATION OFFERED BY THE BUYER OF THE LAND I.E. DSKDL WAS 15 ITA NO . 709/PN/2012, SHR I SHIRISH D. KULKARNI, PUNE SUBJECT TO THE TERMS OF DEVELOPMENT OF THE INFRASTRUCTURE LIKE ROAD S, LEVELING AND OTHER IMPROVEMENTS ETC . AFTER GIVING OUR ANXIOUS CONSIDERATION TO THE ENTIRETY OF THE FACTS, WE ARE OF THE OPINION THAT NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE LD. CIT( A). WE, ACCORDINGLY, CONFIRM THE SAME. 10 . IN THE RESULT, THE REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 28 - 0 8 - 201 4 SD/ - SD/ - ( R.K. PANDA ) ( R.S. PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER RK /PS PUNE , DATED : 28 TH AUGUST, 20 1 4 COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A) - II, PUNE 4 THE CIT - II, PUNE 5 THE DR, ITAT, A BENCH, PUNE . 6 GUARD FILE. //TRUE COPY// BY ORDER PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL PUNE