Dr. B. Vijayapal Reddy, Bangalore V. DCIT, Bangalore

ITA 963/BANG/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 8478 (ITAT-BANGALORE)
• Duration Of Justice: 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 09-03-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 08-10-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: R CHANDRASHEKAR SMT V S
• Keywords: Unexplained cash credit; Depreciation; Cost of acquisition; Benefit of exemption
• Section: 54F; 234B; 54

Judgement Text

PAGE 1 OF 21 ITA NOS.963 & 964/B/09 1 IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH B BEFORE SHRI GEORGE GEORGE K, J.M. AND SHRI A MOHAN ALANKAMONY, A.M ITA NO.963/BANG/2009 (ASSESSMENT YEAR 2006-07) DR. B VIJAYAPAL REDDY, M/S PRASHANTHI SPECIALITY CLINIC, NO.549, 13TH CROSS, 5TH MAIN, RMV II STAGE, DOLLARS COLONY, BANGALORE-57. - APPELLANT VS THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-5(1), BANGALORE. - RESPONDENT ITA NO.964/BANG/2009 (ASST. YEAR 2006-07) (BY REVENUE) ASSESSEE BY : SHRI R CHANDRASHEKAR, ADVOC ATE REVENUE BY : SMT. V S SREELEKHA ORD ER PER GEORGE GEORGE K : THESE TWO APPEALS PREFERRED (I) BY THE ASSESSEE AND (II) THE ANOTHER BY THE REVENUE ARE DIRECTED AGAI NST THE ORDER OF THE LD. CIT(A)-II, BANGALORE IN ITA NO: 299/DC 5(1) /CIT(A)-II/- 08-09 DATED: 31.7.2009 FOR THE ASSESSMENT YEAR 2006 -07. PAGE 2 OF 21 ITA NOS.963 & 964/B/09 2 I. ITA NO: 963/09 (BY THE ASSESSEE) : 2. THE ASSESSEE HAS RAISED FIVE GROUNDS, WHICH ARE REFORMULATED IN A CONCISE MANNER AS UNDER: (I) THE AUTHORITIES BELOW ERRED IN ESTIMATING AND CONFI RMING THE INCOME FROM CLINIC AT RS.12 LAKHS AS AGAINST RS .10.73 LAKHS ADMITTED WITHOUT ANY BASIS; (II) THE AUTHORITIES BELOW ERRED IN ADDING/CONFIRMING RS .13 LAKHS AS UNEXPLAINED CASH CREDIT; (III) THE CIT(A) ERRED IN RESTRICTING THE CLAIM OF EXPEND ITURE TO 25% IN RESPECT OF COST OF IMPROVEMENT OF LAND; (IV) THE CIT(A) ERRED IN SUSTAINING THE REJECTION OF CLA IM U/S 54F OF THE ACT; & (V) THE ASSESSEE DENIES LIABLE TO LEVY OF INTEREST U/S 234B AND 234C OF THE ACT. II. ITA NO: 964/09 (BY THE REVENUE) : 3. THE REVENUE HAS RAISED SEVEN GROUNDS, OUT OF WH ICH, GROUND NO.7 BEING GENERAL AND NO SPECIFIC ISSUE INV OLVED, THE SAME HAS BECOME NON-CONSEQUENTIAL. IN THE REMAINING GRO UNDS, THE SUBSTANCES OF THE ISSUES ARE REFORMULATED IN A CONC ISE MANNER AS UNDER: THE CIT(A) ERRED (I) IN DELETING THE ADDITION OF RS.1.44 LAKHS ON ACCOUN T OF SUPPRESSED RENT; PAGE 3 OF 21 ITA NOS.963 & 964/B/09 3 (II) IN DELETING RS.15.64 LAKHS BEING STAMP DUTY EXPENSE S AND REGISTRATION FEES WITHOUT ASSIGNING ANY REASON; & (III) IN ALLOWING 25% IN RESPECT OF EXPENSES INCURRED TOW ARDS IMPROVEMENT CHARGES WITHOUT ANY BASIS. 4. THE ASSESSEE, AN INDIVIDUAL, DERIVES INCOME FRO M HOUSE PROPERTY, BUSINESS, PROFESSION AND CAPITAL GA INS. HE WAS ALSO THE SECRETARY OF SAMAGRA SHIKSHANA SAMITHI TRUST WH ICH WAS RUNNING A NUMBER OF INSTITUTIONS IN THE NAME OF ACH ARYA INSTITUTE OF SCIENCES; HEALTH SERVICES, NURSING, SAMAGRA SHIKSHA NA SCHOOL OF NURSING, BANGALORE B. SCHOOL ETC. 4.1. THE ASSESSEE, IN HIS INDIVIDUAL STATUS, RUNS HOSTELS FOR THE STUDENTS OF THE SAID INSTITUTIONS AND ADMITTING INCOME IN HIS INDIVIDUAL CAPACITY. HE HIRES BUILDINGS AND PROVID ES HOSTEL ACCOMMODATION TO THE STUDENTS UNDER THE NAME OF ACH ARYA RESIDENCY. CLINIC INCOME OF RS.12 LAKHS : 5. THE ASSESSEE BEING A DOCTOR BY PROFESSION, RUNN ING A CLINIC, HAD SHOWN GROSS RECEIPTS AT RS.13.69 LAKHS AND ADMITTED A NET INCOME OF RS.10.73 LAKHS. IN THE ABSENCE OF AN Y REGULAR BOOKS OF ACCOUNT, THE AO HAD ESTIMATED THE NET INCOME, AF TER ALLOWING DEPRECIATION, AT RS.12 LAKHS AS AGAINST RS.10.73 LA KHS ADMITTED BY THE ASSESSEE. PAGE 4 OF 21 ITA NOS.963 & 964/B/09 4 5.1. AFTER DUE CONSIDERATION OF THE ASSESSEES CON TENTIONS, THE CIT(A) WAS OF THE VIEW THAT THE ASSESSEE HAD NOT MAINTAINED ANY BOOKS OF ACCOUNT IN RESPECT OF CLINIC INCOME WH ICH HAS BEEN CONCEDED BY THE ASSESSEE BEFORE THE AO AND ALSO DUR ING THE COURSE OF APPELLATE PROCEEDINGS. SINCE THE ASSESSEE HAS B EEN RUNNING A CLINIC FOR SEVERAL YEARS, HE MUST BE HAVING SUFFICI ENT CLIENTELE AND, THUS, THE ESTIMATION MADE BY THE AO AT RS.12 LAKHS APPEARS TO BE REASONABLE AND, THUS, CONFIRMED. 5.2. BEFORE US ALSO, NO CONCRETE DOCUMENTARY EVIDE NCE HAS BEEN PRODUCED TO REBUT THE STAND OF THE AUTHORITIES BELOW ON THIS COUNT. THE ONLY SUBMISSION OF THE ASSESSEE WAS TH AT ESTIMATE IS WITHOUT ANY BASIS WHICH, IN OUR CONSIDERED VIEW, DOESNT CARRY ANY CONVICTION. WE ARE, THEREFORE, OF THE UNANIMOUS VI EW THAT THE STAND OF THE LOWER AUTHORITIES, IN THE GIVEN CIRCUMSTANCE S, APPEARS TO BE QUITE REASONABLE WHICH REQUIRES NO INTERFERENCE AT THIS STAGE. IT IS ORDERED ACCORDINGLY. UNEXPLAINED CASH CREDIT OF RS.13 LAKHS : 6. IT HAS BEEN OBSERVED BY THE AO THAT THE ASSESSE E HAD INTRODUCED CASH OF RS.13 LAKHS RANGING FROM RS.1 LA KH TO RS.3 LAKHS ON SEVEN OCCASIONS BETWEEN 8.3.04 AND 8.1.05. BRUSHING ASIDE THE ASSESSEES CLAIM THAT IT REPRESENTED INCO ME FROM CLINIC AS WELL AS FROM AGRICULTURAL LANDS OF HIS HUF IN ANDHR A PRADESH, THE AO BROUGHT TO TAX RS.13 LAKHS AS UNEXPLAINED CASH CREDITS FOR THE REASONING THAT PAGE 5 OF 21 ITA NOS.963 & 964/B/09 5 (I) NO BOOKS OF ACCOUNT WERE MAINTAINED IN RESPECT OF C LINIC; (II) NO EVIDENCE WAS PRODUCED TO SUPPORT THE THEORY THAT THE INCOME FROM AGRICULTURAL LANDS; (III) BEYOND COMPREHENSION THAT THE ASSESSEE COULD HAVE H AD SO MUCH OF INCOME WHEN THE ASSESSEE ALLEGED TO HAVE TAKEN A LOAN OF RS.40 LAKHS FROM PUNJAB & NATIONAL BANK; & (IV) THAT HOW SO MUCH OF MONEY COULD HAVE BEEN KEPT AT HOME. 6.1. CONSIDERING THE RIVAL SUBMISSIONS, THE LD.CIT (A) HAS OBSERVED THUS IN THE ABSENCE OF REGULAR BOOKS OF ACCOUNT FOR THE AGRICULTURAL INCOME, IT WILL NOT BE POSSIBLE TO ACC EPT THE ASSERTION OF THE ASSESSEE THAT THE CASH CREDITS OF RS.13 LAKHS RELATE TO AGRICULTURAL INCOME. WHEN THE ASSE SSEE CLAIMS THAT THE CASH CREDITS RELATE TO AGRICULTURAL INCOME, THE BURDEN WAS ON HIM TO FURNISH EVIDENCE AND NO EVIDENCE WAS FORTHCOMING FOR HAVING CARRIED ON CULTIVATION DURING THE YEAR 2004 AND THAT DURING TH E COURSE OF APPELLATE PROCEEDINGS ALSO NO EVIDENCE WA S PRODUCED. ON EXAMINATION OF LEDGER ACCOUNT UNDER T HE CAPITAL ACCOUNT OF THE ASSESSEE, ENTRIES WERE MADE BEING CASH BROUGHT IN BY DR. BVR, BUT THERE WAS NO INDIC ATION AS TO THE SOURCE FROM WHICH THESE AMOUNTS HAVE BEEN BROUGHT IN. HENCE, ADDITION OF RS.13 LAKHS BEING TH E AGGREGATE OF UNEXPLAINED CASH CREDITS MADE BY THE A O IS CONFIRMED. 6.2. BEFORE US, IT WAS VEHEMENTLY CONTENDED BY THE LD. AR THAT THE AUTHORITIES BELOW OUGHT TO HAVE CONSIDERED THE CLINIC RECEIPTS AND ALSO RECEIPTS FROM AGRICULTURAL LANDS. TO DRIVE HOME HIS POINT, HE HAS FURNISHED A PAPER BOOK CONTAINING 1 64 PAGES WHICH CONSISTS OF, INTER ALIA, COPIES OF (I) RETURN OF INCOME WITH THE COMPUTATION; (II) P & L ACCOUNT; (III) ABSOLUTE SAL E DEED PAGE 6 OF 21 ITA NOS.963 & 964/B/09 6 DT.31.1.2006; (IV) CERTIFICATES OF MANDAL REVENUE O FFICERS (V) APMC RECEIPTS ETC. 6.2.1. AFTER HEARING THE LD. D.R PRESENT, WE HAVE DULY CONSIDERED THE RIVAL SUBMISSIONS, PERUSED THE RELEV ANT RECORDS. 6.2.2. WE FIND THERE IS A FORCE IN THE CONTENTION OF THE LD. A.R THAT THE REVENUE SHOULD HAVE CONSIDERED THE SUB STANTIAL RECEIPTS FROM THE CLINIC. IT IS PERTINENT TO MENTI ON HERE THAT THE AO HAD ESTIMATED THE NET INCOME FROM THE CLINIC AT RS. 12 LAKHS WHICH HAS BEEN CONFIRMED BY THE FIRST APPELLATE AUTHORITY . AFTER ANALYZING THE ISSUE, WE HAVE, IN THE FOREGOING PARAGRAPH, CON FIRMED THE ESTIMATION OF RS.12 LAKHS AS INCOME FROM CLINIC. S UCH BEING THE GROUND REALITY, THE REVENUE CANNOT SIMPLY BRUSH ASI DE THE ASSESSEES CLAIM THAT HE HAD PUMPED IN A SUBSTANTIA L AMOUNTS FROM THE RECEIPTS FROM CLINIC WHICH WAS IN THE WHOPPING RANGE OF RS.12 LAKHS. AS COULD BE SEEN FROM THE IMPUGNED ORDER OF THE AO (ON PAGE 6) THAT RS.13 LAKHS OF CASH WERE INTRODUCED FO R THE PERIOD FROM 8.3.2004 TO 8.1.2005 AT RS.3 LAKHS, 2 LAKHS, 1 LAKH, 2 LAKHS, 1 LAKH, 2 LAKHS AND 2 LAKHS RESPECTIVELY. IT WAS ADMI TTED BY NONE OTHER THAN THE AO HIMSELF THAT THE ASSESSEE HAS BEEN RUNNING A CLINIC FOR MORE THAN A DECADE WHICH WAS RATIFIED BY THE FIRST APPELLATE AUTHORITY IN A TYPICAL WAY THAT I ALSO AGREE WITH THE OBSERVATION OF THE AO THAT THE APPELLANT IS RUNNING A CLINIC SINCE SEVERAL YEARS AND MUST, THEREFORE, BE HAVING SUFFICIENT CLIENTELE . PAGE 7 OF 21 ITA NOS.963 & 964/B/09 7 IN OTHER WORDS, THE ADMISSION OF THE LOWER AUTHORIT IES ENDORSES THE CLAIM OF THE ASSESSEE THAT HE HAD BROUGHT IN SUFFIC IENT FUNDS FROM HIS PROFESSIONAL RECEIPTS (CLINIC) APART FROM INCOM E FROM THE AGRICULTURAL LANDS. 6.2.3. WE HAVE CAREFULLY EXAMINED THE CERTIFICATES ISSUED BY THE MANDAL REVENUE OFFICER, GEESUGONDA AND HANAMKON DA OF A.P THAT THE HUF OF THE ASSESSEE OWNING LANDS WAY BACK FROM THE YEAR 2002 IN GORREKUNTA VILLAGE, ENUMAMULA VILLAGE AND K OTHAPETA VILLAGE AGGREGATING TO THE EXTENT OF 45 ACRES [SOUR CE: P 41 & 42 OF PB-AR]. THE ASSESSEE HAD ALSO PRODUCED COPIES OF B ILLS FOR HAVING SOLD THE AGRICULTURAL PRODUCES TO THE A.P.M.C. EVE N THOUGH BILLS WERE DATED: JANUARY, FEBRUARY AND MARCH, 2006, AS R IGHTLY HIGHLIGHTED BY THE AO IN HIS REMAND REPORT TO THE C IT(A) AND WENT ON FURTHER TO ADD THAT THE CASH CREDITS MADE IN THE BOOKS WERE IN MARCH, JULY, AUGUST, SEPTEMBER AND NOVEMBER 2004 FO R WHICH THE ASSESSEE HAS NO SUPPORT. HOWEVER, THE AO HAD NOT D ISPUTED THE LAND HOLDING OF THE ASSESSEE (HUF). THE ASSESSING OFFICER HAS CLAIMED THAT THE ASSESSEE HAD NO SUPPORT FOR AGRICU LTURAL PRODUCE FOR THE YEAR 2004. DOES IT MEAN THAT THE ASSESSEE (HUF) COULD HAVE KEPT ITS AGRICULTURAL LANDS AS DESOLATE WITHOUT PRO DUCING ANY YIELDS DURING THE YEAR THE ASSESSEE ALLEGED TO HAVE INTROD UCED THE CASH CREDITS? NO PRUDENT AGRICULTURIST WILL KEEP HIS LA NDS BARREN WITHOUT CULTIVATION EVEN FOR SHORT-TERM CROPS. 6.2.4. IN AN OVER ALL CONSIDERATION OF THE FACTS A ND CIRCUMSTANCES OF THE ISSUE AS DISCUSSED IN THE FORE -GOING PARAGRAPHS PAGE 8 OF 21 ITA NOS.963 & 964/B/09 8 AND SINCE THE ASSESSEE HAS BEEN RECEIVING RECEIPTS FROM VARIOUS PROFESSIONS/BUSINESSES AND ALSO VAST HOLDING OF AGR ICULTURAL LANDS IN A.P, WE ARE OF THE CONSIDERED VIEW THAT THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN BRINGING TO TAX NET A SUM OF RS.13 LAKHS AS UNEXPLAINED CASH CREDIT. IT IS ORDERED ACCORDINGLY . 6.2.5 MOREOVER, ANOTHER IMPORTANT ASPECT TO BE NOT ED, IS THAT ALL CREDITS ARE INTRODUCED BETWEEN PERIOD 8.3. 2004 AND 8.1.2005 FALLING WITHIN PREVIOUS YEAR RELEVANT TO A Y 2005-06. HENCE, IF ALL THE ADDITIONS ARE TO BE MADE WITH RES PECT OF RS.13 LAKHS, IT IS TO BE MADE NOT IN RESPECT OF THE CONCE RNED ASST. YEAR, NAMELY 2006-07 (THE ASST. YEAR RELATING TO THIS APP EAL) BUT IN RESPECT OF AY 2005-06. RESTRICTING OF CLAIM OF EXPENSES TO 25% : 7. THE CASE OF THE ASSESSEE IS THAT WHEN THE LAND WAS PURCHASED ON 19.4.2000, IT WAS A DRY LAND WHICH REQ UIRED LEVELING AND THE ROCKS WERE TO BE CUT AND REMOVED. ONCE THE ROCKS WERE CUT AND REMOVED, THE LAND WAS LEVELED AND ALSO CONSTRUC TED COMPOUND WALL, SHED ETC. FOR WHICH THE ASSESSEE HAD CLAIMED EXPENSES TO THE TUNE OF RS.15.25 LAKHS WHILE CALCULATING THE INDEXE D COST. THE AO DISALLOWED THE CLAIM OF THE ASSESSEE ON THE GRO UND THAT THE ASSESSEE HAD NO PROOF OF ANY KIND OR ANY DETAILS WI TH REGARD TO EXPENSES INCURRED ON ROCK CUTTING, LAND LEVELING ET C., 7.1. WHEN THE ASSESSEE APPROACHED THE LD. CIT (A) WHO WAS MAGNANIMOUS IN HIS PERCEPTION THAT PAGE 9 OF 21 ITA NOS.963 & 964/B/09 9 6.12IT IS NORMALLY SEEN THAT LANDS REQUIRE SOM E IMPROVEMENT SUCH AS LAND LEVELING AND FENCING OR PU TTING UP A COMPOUND WALL TO PREVENT ENCROACHMENT BY OUTSIDERS. IN THAT SINCE, THE APPELLANTS CLAIM CA NNOT BE DISBELIEVED IN FULL. IN MY CONSIDERED VIEW, THE AP PELLANT CAN BE GIVEN BENEFIT TO THE EXTENT OF 25 PER CENT O F THE EXPENSES CLAIMED TO HAVE BEEN INCURRED BY HIM. THE AO, IS, THEREFORE, DIRECTED TO TAKE INTO CONSIDERATION THE COST OF IMPROVEMENT AT 25 PER CENT I.E., RS.381250/- WHILE CALCULATING THE INDEXED COST. 7.1.1. BEFORE US, THE SUBMISSION WAS THAT THE LEARNED APPELLATE AUTHORITY ERRED IN RESTRICTING THE CLAIM OF EXPENSES TO 25% IN RESPECT OF COST OF IMPROVEMENT OF LAND. HOWEVER, NO TANGIBLE EVIDENCE WAS BROUGHT ON RECORD TO SUGGEST THAT THE CIT(A) ERRED ON THIS COUNT. AS A MATTER OF FACT, THE CIT( A) WAS RATHER VERY GENEROUS IN ACCOMMODATING THE ASSESSEE AND ALLOWING 25 PER CENT OF EXPENSES CLAIMED TO HAVE BEEN INCURRED EVEN THOU GH NO TANGIBLE PROOF IS FORTH-COMING FOR SUCH A CLAIM. 7.1.2. IN VIEW OF THE ABOVE, WE ARE OF THE CONSIDE RED VIEW THAT THE ASSESSEE HAS NO CASE ON THIS COUNT. IT IS ORDERED ACCORDINGLY. DETERMINATION OF LTCG AT RS.71,68,431/ :- 8. THE ASSESSEE HAD PURCHASED A VACANT LAND AD- MEASURING 8 GUNTAS AT KOTI HOSAHALLI ON 19.4.2000 F OR A CONSIDERATION OF RS.1.2 LAKHS. THE ASSESSEE AND TH E ADJACENT LAND OWNER TOGETHER SOLD THEIR LANDS AD-MEASURING 8 AND 9 GUNTAS PAGE 10 OF 21 ITA NOS.963 & 964/B/09 10 RESPECTIVELY (AGGREGATING TO 17 G) ON 31.1.06 FOR A TOTAL CONSIDERATION OF RS.15574207/- AND THAT THE ASSESSE E CLAIMED THE SELLERS BORE THE COST OF STAMP PAPER AND REGISTRATI ON CHARGES OF RS.15,64,060/- AND, THUS, THE NET CONSIDERATION WAS RS.1,40,10,146/- AND THE ASSESSEES SHARE WAS RS.65 ,44,010/-. THE LTCG WORKED OUT WAS RS.28,57,835/- AFTER GIVING ALL OWANCE FOR INDEXED COST OF EXPENSES AND EXEMPTION CLAIMED U/S 54 AT RS.16,36,987/- [WHICH INCLUDED EXPENSES ON ROCK-CUT TING, IMPROVEMENT OF LAND ETC.]. THE AO HAD, HOWEVER, COM PUTED THE LTCG AT RS.71.68 LAKHS BY ALLOWING ALLOWANCE FOR I NDEXED COST OF ACQUISITION AT RS.1,60,607/- IN RESPECT OF THE ASSE SSEES SHARE AND BROUGHT TO TAX LTCG OF RS.7168431/- FOR THE REASONI NG THAT (I) AS THE PER THE ENTRIES IN SALE DEED, THE STAMP PAPE RS WERE PURCHASED BY THE BUYER AND THAT THE SELLER HAD BORN E THE COST OF STAMP PAPER AND REGISTERED CHARGE WAS FALSE ; (II) NO PROOF FOR THE EXPENSES OF RS.16.36 LAKHS TOWARDS IMPROVEMENT OF THE SAID LAND; - CLAIMED TO HAVE BEEN INCURRED OVER A PERIOD OF FOUR YEARS, BUT, FOUND NO REFERENCE IN THE RSOI FURNISHED EARLI ER; (III) EXEMPTION U/S 54F WAS CLAIMED IN RESPECT OF THE INVESTMENTS MADE IN THE PURCHASE OF ARVIND ORCHARD LET OUT TO STUDENTS BY RAISING A LOAN OF RS.40 LAKHS FR OM P & N BANK; & (IV) EVEN THOUGH THE AR HAD CLAIMED THAT THE SAID FOUR F LATS IN ARVIND ORCHARD HAD BEEN INTEGRATED TO CONVERT THEM INTO ONE UNIT, THE ASSESSEE HIMSELF CONCEDED THAT NO SUC H INTEGRATION HAD BEEN CARRIED OUT. PAGE 11 OF 21 ITA NOS.963 & 964/B/09 11 8.1. AFTER CONSIDERING THE ASSESSEES CONTENTIONS, AOS REMAND REPORT AND REJOINDER TO THE REMAND REPORT AS SET-OUT IN THE IMPUGNED ORDER WHICH IS UNDER DISPUTE, THE LD. CIT (A) HAS OBSERVED THUS 6.8.THE APPELLANT IN THE REJOINDER TO THE REMAND REPORT CONTENDED THAT HE OWNED THE APARTMENT NO.4C-403 EARLIER TO PURCHASE OF THE APT.C/401, 101 AND 102 ON 30/1/05 (ACTUALLY ON 30/12/05). THIS ASPECT IS AVAILABLE FROM RECORDS ALSO. S 54F PROVIDES EXEMPT ION IN RESPECT OF PROPERTY PURCHASED WITHIN A PERIOD OF ON E YEAR AFTER THE DATE ON WHICH THE SALE TOOK PLACE. THE P URCHASE OF APT. WAS ON 30.1.05 AND THE TRANSFER WAS ON 31/1 /06. ACCORDINGLY, HE CONTENDED THAT THE PROVISO IS NOT APPLICABLE TO SUCH CASES AND A PROVISO CANNOT RUN CONTRARY TO THE SECTION. IT WOULD BE RELEVANT TO R EPRODUCE SUB-SECTION (1) OF S.54F BELOW: 54F 6.9. A PLAIN READING OF THE PROVISO TO THE SAID SE CTION MAKES IT CLEAR THAT, IF THE APPELLANT OWNS MORE THA N ONE RESIDENTIAL HOUSE OTHER THAN NEW ASSETS ON THE DATE OF TRANSFER OF THE ORIGINAL ASSET AND THE INCOME FROM SUCH RESIDENTIAL HOUSE OTHER THAN ONE RESIDENTIAL HOUSE OWNED ON THE DATE OF THE TRANSFER OF THE ORIGINAL ASSET, IS CHARGEABLE UNDER THE HEAD INCOME FROM HOUSE PROPER TY. AS MENTIONED IN THE PRECEDING PARA, THE APPELLANT PURCHASED FLAT NO. C 403 EARLIER AND THE SAME WAS LET OUT. SUBSEQUENTLY, FOUR FLATS WERE PURCHASED VIZ., C-001, C-002, C-101 AND C-102 IN THE APARTMENT NAMED ARVI ND ORCHARDS ON 30.12.05 ON WHICH HE HAS CLAIMED EXEMPTION U/S 54F. THE RECORDS SUGGEST THAT THE AP PELLANT PAID KHATA TAX FOR ONE OF ARVIND ORCHARDS FOR 7 FLA TS [NOS:C-001, C-002, C-101, C-102, C-201, C-401 AND C - PAGE 12 OF 21 ITA NOS.963 & 964/B/09 12 402] AT RS.8000/FLAT, AGGREGATING TO RS.56000/-. T HIS SHOWS THAT THE APPELLANT POSSESSES SEVERAL FLATS ON OWNERSHIP BASIS. ON THE FACTS AND IN THE CIRCUMSTA NCES OF THE CASE, IN MY CONSIDERED OPINION THE CASE ATTRACT S THE PROVISO TO S.54F. FURTHER, IT IS OBSERVED THAT THE APPELLANT RELIED UPON THE DECISION OF THE HONBLE HIGH COURT OF KARNATAKA IN THE CASE OF CIT V. D. ANANDA BASAPPA (2009) 309 ITR 329. THE GIST OF THE DECISION OF TH E HONBLE HIGH COURT IS AS FOLLOWS: A PLAIN READING OF THE PROVISION OF SECTION 54(1) OF THE INCOME-TAX ACT DISCLOSES THAT WHEN AN INDIVIDUAL-AS SESSEE OR HINDU UNDIVIDED FAMILY-ASSESSEE SELLS A RESIDENT IAL BUILDING OR LANDS APPURTENANT THERETO, HE CAN INVES T CAPITAL GAINS FOR PURCHASE OF RESIDENTIAL BUILDING TO SEEK EXEMPTION OF THE CAPITAL GAINS TAX. SECTION 13 OF T HE GENERAL CLAUSES ACT DECLARES THAT WHENEVER THE SING ULAR IS USED FOR A WORD, IT IS PERMISSIBLE TO INCLUDE THE P LURAL. THE CONTENTION OF THE REVENUE IS THAT THE PHRASE 'A ' RESIDENTIAL HOUSE WOULD MEAN ONE RESIDENTIAL HOUSE AND IT DOES NOT APPEAR TO THE CORRECT UNDERSTANDING. THE EXPRESSION 'A' RESIDENTIAL HOUSE SHOULD BE UNDERSTO OD IN A SENSE THAT BUILDING SHOULD BE OF RESIDENTIAL IN NAT URE AND 'A' SHOULD NOT BE UNDERSTOOD TO INDICATE A SINGULAR NUMBER. THE COMBINED READING OF SECTIONS 54(1) AND 54F OF THE INCOME-TAX ACT DISCLOSES THAT, A NON RESIDEN TIAL BUILDING CAN BE SOLD, THE CAPITAL GAIN OF WHICH CAN BE INVESTED IN A RESIDENTIAL BUILDING TO SEEK EXEMPTIO N OF CAPITAL GAIN TAX. HOWEVER, THE PROVISO TO SECTION 5 4 OF THE INCOME-TAX ACT, LAYS DOWN THAT IF THE ASSESSEE HAS ALREADY ONE RESIDENTIAL BUILDING, HE IS NOT ENTITLED TO EXE MPTION OF CAPITAL GAINS TAX, WHEN HE INVESTS THE CAPITAL GAIN IN PURCHASE OF ADDITIONAL RESIDENTIAL BUILDING. WHEN A HINDU UNDIVIDED FAMILY'S RESIDENTIAL HOUSE I S SOLD, THE CAPITAL GAIN SHOULD BE INVESTED FOR THE PURCHAS E OF ONLY ONE RESIDENTIAL HOUSE IS AN INCORRECT PROPOSITION. AFTER ALL, THE HINDU UNDIVIDED FAMILY PROPERTY IS HELD BY THE MEMBERS AS JOINT TENANTS. THE MEMBERS KEEPING IN VI EW PAGE 13 OF 21 ITA NOS.963 & 964/B/09 13 THE FUTURE NEEDS IN EVENT OF SEPARATION, PURCHASE M ORE THAN ONE RESIDENTIAL BUILDING, IT CANNOT BE SAID THAT TH E BENEFIT OF EXEMPTION IS TO BE DENIED UNDER SECTION 54(1) OF THE INCOME-TAX ACT. ON FACTS, IT IS SHOWN BY THE ASSESSEE THAT THE APAR TMENTS ARE SITUATED SIDE BY SIDE. THE BUILDER HAS ALSO STA TED THAT HE HAS EFFECTED MODIFICATION OF THE FLATS TO MAKE I T AS ONE UNIT BY OPENING THE DOOR IN BETWEEN TWO APARTMENTS. THE FACT THAT AT THE TIME WHEN THE INSPECTOR INSPECTED THE PREMISES, THE FLATS WERE OCCUPIED BY TWO DIFFERENT TENANTS IS NOT THE GROUND TO HOLD THAT THE APARTMENT IS NOT A ONE RESIDENTIAL UNIT. THE FACT THAT THE ASSESSEE COULD HAVE PURCHASED BOTH THE FLATS IN ONE SINGLE SALE DEED OR COULD HAVE NARRATED THE PURCHASE OF TWO PREMISES AS ONE U NIT IN THE SALE DEED IS NOT THE GROUND TO HOLD THAT THE AS SESSEE HAD NO INTENTION TO PURCHASE THE TWO FLATS AS ONE U NIT. 6.10. THE FACTS OF THE CASE RELIED ON BY THE APPE LLANT ARE DISTINGUISHABLE FROM THE FACTS OF THE APPELLANTS C ASE. THE APPELLANT PURCHASED 5 FLATS IN DIFFERENT FLOORS AND ALL OF THEM ARE INDEPENDENT UNITS. IN MADGUL UDYOG V. CIT (1990) 184 ITR 484, THE HONBLE CALCUTTA HIGH COURT POINTED OUT THAT A FLAT HAS TO BE TREATED AS AN IND EPENDENT PROPERTY AS LONG AS THE BUYER OF SUCH FLAT HAS EXCL USIVE RIGHT OF POSSESSION AND ENJOYMENT AND RIGHT OF DISP OSAL OF THE FLAT NOTWITHSTANDING THE LIMITED RIGHT OVER THE LAND ON WHICH THE ENTIRE PROPERTY STANDS. 6.10.1. IN THE DISCUSSION MADE ABOVE, I AM IN AGREE MENT WITH THE AO THAT THE APPELLANT OWNS MORE THAN ONE RESIDENTIAL HOUSE OTHER THAN THE NEW ASSETS ON THE DATE OF TRANSFER OF THE ORIGINAL ASSET AND, ACCORDINGLY, HE WAS JUSTIFIED IN DENYING EXEMPTION U/S 54F OF THE ACT. . 8.2. THE CONTENTION OF THE LD. A R BEFORE US WAS L ARGELY CONFINED TO THE FACT THAT THE APPELLATE AUTHORITY E RRED IN AFFIRMING THE REJECTION OF THE CLAIM U/S 54F BY THE AO; THAT THE AUTHORITIES PAGE 14 OF 21 ITA NOS.963 & 964/B/09 14 BELOW ERRED IN HOLDING THAT THE ASSESSEE WAS THE OW NER OF MORE THAN ONE RESIDENTIAL HOUSE OTHER THAN THE NEW ASSET S ON THE DATE OF TRANSFER OF ORIGINAL ASSET AND THAT THE FINDING WAS CONTRARY TO THE FACTS OF THE CASE. 8.2.1. THE LD. D R PRESENT WAS HEARD. 8.2.2. WE HAVE DULY CONSIDERED THE CONTENTION OF T HE ASSESSEE AND ALSO CAREFULLY PERUSED THE RELEVANT RE CORDS. 8.2.3. AT THE OUTSET, IT IS PERTINENT TO MENTION H ERE THAT THE ASSESSEE HAD FAILED TO BRING ANY DOCUMENTARY EVIDEN CE TO REBUT THE WELL-DOCUMENTED ASSERTION OF THE REVENUE EXCEPT BY MAKING A REMARK THAT THE FINDINGS OF THE AUTHORITIES ARE CON TRARY TO THE FACTS OF THE CASE. ON THE OTHER HAND, THE AO HAD REPORTED IN HIS REMAND REPORT DATED: 25/6/2009 [SOURCE: P 11 & 12 OF CIT(A ) ORDER] THAT IN THE CASE OF THE ASSESSEE, THERE ARE 4 FLATS IN DIFFERENT FLOORS AND AS INSPECTED, THE PROPERTIES WERE USED FOR LETTING IT OUT TO RUN HOSTEL ACCOMMODATIONS. EVEN THOUGH THE ASSESSEES REPRESENTATIVE CLAIMED BEFORE THE AO THAT FOUR FLATS HAD BEEN INTE GRATED TO CONVERT THEM INTO ONE UNIT, THE ASSESSEE HIMSELF CONCEDED T HAT NO SUCH INTEGRATION HAD BEEN CARRIED OUT. AS RIGHTLY HIGHL IGHTED BY THE FIRST APPELLATE AUTHORITY IN HIS IMPUGNED ORDER WHICH IS UNDER DISPUTE, THE ASSESSEE CANNOT TAKE SANCTUARY IN THE GUISE OF JURISDICTIONAL HONBLE HIGH COURTS RULING REFERRED SUPRA WHEREIN THE HONBLE COURT IN ITS WISDOM RULED THAT ON FACT , IT IS SHOWN BY THE ASSESSEE PAGE 15 OF 21 ITA NOS.963 & 964/B/09 15 THAT THE APARTMENTS ARE SITUATED SIDE BY SIDE. THE BUILDER HAS ALSO STATED THAT HE HAS EFFECTED MODIFICATION OF THE FLA TS TO MAKE IT AS ONE UNIT BY OPENING THE DOOR IN BETWEEN TWO APARTMENTS. THE FACT THAT AT THE TIME WHEN THE INSPECTOR INSPECTED THE PREMIS ES, THE FLATS WERE OCCUPIED BY TWO DIFFERENT TENANTS IS NOT THE GROUND TO HOLD THAT THE APARTMENT IS NOT A ONE RESIDENTIAL UNIT. 8.2.4. WITH DUE RESPECTS, WE ARE OF THE FIRM VIEW THAT THE ABOVE RULING CANNOT COME TO THE RESCUE OF THE ASSES SEE AS THE CASE ON HAND IS ON THE DIFFERENT FOOTING SINCE THE ASSES SEE HAD PURCHASED FIVE FLATS IN DIFFERENT FLOORS AND THEY WERE INDEPE NDENT UNITS. 8.2.5. IN AN OVERALL CONSIDERATION OF THE FACTS AN D CIRCUMSTANCES OF THE ISSUE AS DELIBERATED UPON IN T HE FORE-GOING PARAGRAPHS, WE ARE OF THE UNANIMOUS VIEW THAT THE F INDING OF THE FIRST APPELLATE AUTHORITY IS FULLY JUSTIFIED WHICH REQUIRES NO INTERFERENCE AT THIS STAGE. IT IS ORDERED ACCORDIN GLY. 9. THE OTHER GRIEVANCE OF THE ASSESSEE IS WITH REG ARD TO LEVY OF INTEREST U/S 234B AND 234C OF THE ACT. AS THE CHARGING OF INTEREST U/S 234B AND 234C OF THE ACT ARE MANDATORY AND CONSEQUENTIAL IN NATURE, THE GROUND RAISED BY THE A SSESSEE IS DISMISSED AS NOT MAINTAINABLE. LET US NOW MOVE ON TO ADDRESS THE GRIEVANCE OF THE REVENUE AS WELL.. PAGE 16 OF 21 ITA NOS.963 & 964/B/09 16 ITA NO: 963/09 (BY THE REVENUE) : DELETION OF THE ADDITION OF RS.1.44 LAKHS ON ACCOUN T OF SUPPRESSED RENT : 10. THE AO, ON ENQUIRIES, FOUND THAT THE ASSESSEE HAD PURCHASED 5 TWO-BED ROOM FLATS IN ARVIND ORCHARD WH ICH WERE COLLECTIVELY RUN AS A HOSTEL FOR STUDENTS AND AFTER DETAILED REASONS SET-OUT IN THE IMPUGNED ORDER, HE HAD ESTIMATED THE AGGREGATE RENT FROM THOSE FLATS AT RS.1.80 LAKHS AND AFTER ALLOWIN G POSSIBLE EXPENDITURE ESTIMATED AT 20%, HE BROUGHT TO TAX A S UM OF RS.1.44 LAKHS AS NET INCOME FROM THOSE FLATS. 10.1. AFTER ANALYZING THE RIVAL SUBMISSION CONTENT IONS, THE CIT(A) WAS OF THE VIEW THAT THE AOS FINDING WAS IN COMPLETE IN THE SENSE THAT HE HAD NOT BROUGHT OUT THE DETAILS O F THE STUDENTS OCCUPIED THE FLATS, THEIR NAMES, PERIOD FOR WHICH E ACH STUDENT OCCUPIED THE FLATS, RENT COLLECTED FROM EACH STUDEN T ETC., SINCE THE AO HAD NOT BROUGHT ON RECORD SUFFICIENT MATERIAL TO SUPPORT HIS VIEW THAT THE ASSESSEE HAD EARNED INCOME BY TREATIN G THE FLATS AS HOSTEL FOR STUDENTS, COLLECTION OF RENTS ETC., HE D ELETED THE ENTIRE ADDITION. 10.1.1. THE GRIEVANCE OF THE REVENUE IS THAT THE C IT(A) DELETED THE ADDITION WITHOUT BRINGING ANY MATERIAL ON RECORD IN SUPPORT OF HIS DELETION. 10.1.2. WE HAVE CONSIDERED THE SUBMISSION AND ALSO PERUSED THE RELEVANT RECORDS. THE ASSESSEE, VIDE HIS STATEMENT OF PAGE 17 OF 21 ITA NOS.963 & 964/B/09 17 FACTS ACCOMPANYING THE APPEAL MEMO BEFORE THE LD. C IT (A) [ PARA 3.3. ON PAGE 3 OF CIT(A)S ORDER], HAD VOUCHED THAT 3. THE APPELLANT HAD PURCHASED APARTMENTS AT ARAVI ND ORCHARD, SAHAKARANAGAR, BANGALORE ON 30.12.2005. THE APPELLANT HAD NEITHER LET OUT THE APARTMENTS ON REN T NOR WAS IT USED FOR THE BUSINESS CARRIED ON BY THE APPE LLANT UNDER THE NAME OF M/S. ACHARYA RESIDENCY, HOWEVER W ERE USED BY APPELLANT AND HIS FAMILY MEMBERS. 10.1.3. HOWEVER, TO OUR SURPRISE, THE ASSESSEE HAD , INDEED, IN RECEIPT OF RENTS FOR WHOPPING RS.76.69 L AKHS AND CLAIMED EXPENDITURE AS RENT PAID RS.35.2 LAKHS AND HOSTEL MAINTENANCE AT RS.3.45 LAKHS ETC. FROM ACHARYA RESIDENCY [SOURCE: P & L ACCOUNT FOR THE YEAR-ENDED 31.3.06 F OR ACHARYA RESIDENCY - PAGE 4 OF PB AR]. 10.1.4. THE ASSESSEES ASSERTION BEFORE THE CIT(A) HAD BELIED THE ACTUAL POSITION . HOW DOES THIS VITAL PIECE OF INFORMATION LOSE SIGHT OF THE AUTHORITIES CONCERNED IS RATHER INTRIGUING? 10.1.5. IN VIEW OF THE ABOVE, WE ARE OF THE CONSID ERED VIEW THAT THE ISSUE SHOULD THOROUGHLY BE EXAMINED T O BRING OUT THE ACTUAL STATE OF AFFAIRS. THIS ISSUE IS, THEREFORE, REMITTED BACK ON THE FILE OF THE AO TO CARRY OUT THE DIRECTIONS OF THIS BENCH AS SPECIFIED SUPRA. THE AO SHALL, HOWEVER, GIVE AN OPPORTUNITY T O THE ASSESSEE TO PUT FORTH HIS VIEW. IT IS ORDERED ACCORDINGLY. PAGE 18 OF 21 ITA NOS.963 & 964/B/09 18 DELETION OF RS.15.64 LAKHS BEING STAMP DUTY EXPENSE S AND REGISTRATION : 11. FOR DELETING THE SUM OF RS.15.64 LAKHS BEING S TAMP DUTY EXPENSES AND REGISTRATION, THE LD. CIT(A) HAD REASONED THAT 6.11. THE APPELLANT HAS CLAIMED THAT THE STAMP DU TY AND REGISTRATION CHARGES WERE BORNE BY THE PURCHASER BUT THE AO HAS DISALLOWED THIS CLAIM ON THE GROUND THAT THE ENTRIES IN THE STAMP PAPER SHOW THE NAME O F THE PURCHASER. THE AO CAME TO THE CONCLUSION THAT T HE COST OF STAMP PAPER MUST HAVE BEEN BORNE BY THE APPELLANT WHICH IS THE NORMAL PRACTICE PREVALENT. THE APPELLANTS CONTENTION IS THAT THE STAMP DUTY AND REGISTRATION CHARGES WERE BORNE BY THE APPELLANT HIMSELF AND, IN HIS SUPPORT, HE HAS FURNISHED A COP Y OF THE CONFIRMATION GIVEN BY THE PURCHASER TO THE EFFE CT THAT HE HAS BORNE THE COST OF STAMP PAPERS AND REGISTRATION CHARGES AND NOT THE PURCHASER. IN THE ASSESSMENT ORDER AS WELL AS IN THE REMAND REPORT, T HE AO IS NOT ABLE TO ESTABLISH THAT THE STAMP DUTY AND REGISTRATION CHARGES WERE BORNE BY THE PURCHASER. MERELY BECAUSE THE STAMP PAPERS ARE PURCHASED IN TH E NAME OF THE PURCHASER, IT IS NOT A GROUND TO HOLD T HAT THE STAMP DUTY AND REGISTRATION CHARGES WERE BORNE BY THE PURCHASER ALTHOUGH, IN GENERAL, STAMPS WERE ISSUED IN THE NAME OF PURCHASER AS OBSERVED IN THE MATERIAL AVAILABLE ON RECORD. THIS ALSO DEPENDS UP ON THE MUTUAL AGREEMENT (ORAL OR OTHERWISE) BETWEEN TH E SELLER AND THE PURCHASER. SO FAR AS THE CASE ON HAN D IS CONCERNED, NO EVIDENCE IS BROUGHT ON RECORD BY THE AO TO SHOW THAT THE STAMP DUTY AND REGISTRATION CHARGES WERE PAID BY THE PURCHASER. IN VIEW OF THE SE, I AM INCLINED TO ACCEPT THE SUBMISSION OF THE APPEL LANT THAT HE HAD BORNE THE COST OF STAMP PAPER AND REGISTRATION CHARGES AMOUNTING TO RS.1564060/- PAGE 19 OF 21 ITA NOS.963 & 964/B/09 19 11.1. THE CASE OF THE REVENUE IS THAT THE CIT(A) HAD FAILED TO APPRECIATE THE FACT THAT NO EVIDENCE WAS PRODUCED BEFORE THE AO THAT THE EXPENSES TOWARDS REGISTRATION AND S TAMP DUTY HAVE TO BE BORNE BY THE SELLER. 11.1.1. ON A CAREFUL PERUSAL OF THE IMPUGNED ORDER S UNDER DISPUTE, WE FIND FACTUAL ERRORS ON THE ASSERT IONS OF THE AUTHORITIES CONCERNED AS DETAILED BELOW: (I) THE AO SAYS THAT (ON PAGE 5: THE STAMP PAPER ON WHICH THE SALE DEED IS MADE IS PURCHASED BY THE BUYER AS IS EVIDENCED FROM THE SEAL ON THE BACK OF THE SALE DEE D. THEREFORE, THE ASSESSEES CONTENTION THAT STAMP PAP ER AND REGISTRATION WAS BORNE BY THEM IS NOT FAVOURABLE. (II) THE CIT(A) SAYS THAT 6.11. THE APPELLANT HAS CLAIMED THAT THE STAMP DUTY AND REGISTRATION CHARGES WERE B ORNE BY THE PURCHASER BUT THE AO HAS DISALLOWED THIS CLAIM ON THE GROUND THAT THE ENTRIES IN THE STAMP PAPER SHOW THE NAME OF THE PURCHASER. THE AO CAME TO THE CONCLUSIO N THAT THE COST OF STAMP PAPER MUST HAVE BEEN BORNE B Y THE APPELLANT WHICH IS THE NORMAL PRACTICE PREVALENT. (III) THE ASSESSEE IN HIS STATEMENT OF FACTS FILED BEFORE THE CIT(A) HAD AVERRED THAT 6.THE STAMP DUTY AND REGISTRATION EXPENSES (SIC) EXPENSES WERE BORN (BO RNE)BY THE VENDORS, WHICH WAS RS.1564060/- AND THIS WAS DEDUCTED FROM THE TOTAL SALE CONSIDERATION AND OUT OF THE BALANCE THE APPELLANTS SHARE WAS WORKED OUT AT RS.6541010/-.. (IV) IN DEED, THE CIT(A) HAD MADE A MISTAKE IN HIS IMPUGNED ORDER THAT THE APPELLANT HAS CLAIMED THAT THE STAMP DUTY AND REGISTRATION CHARGES WERE BORNE BY THE PURCHASER PAGE 20 OF 21 ITA NOS.963 & 964/B/09 20 11.1.2. AS COULD BE SEEN FROM THE CONFIRMATION LET TER PURPORTED TO HAVE BEEN ORIGINATED FROM THE PURCHASE R [SOURCE: PAGE 40 OF PB AR], FURTHER, AS AGREED BETWEEN ME AND THE SELLER THE STAMP PAPER AND REGISTRATION CHARGES HAVE BEEN BORN E BY THE SELLER HIMSELF. SINCE THE DD ISSUED BY THE BANK FOR THE V ALUE OF STAMP PAPER DOES NOT CONTAIN THE NAME AND THE PURCHASER O F DD, AS A NORMAL COURSE OF ACTION, THE PURCHASER NAME WILL BE WRITTEN FOR THE ABOVE FEES PAID AT SUB-REGISTRAR OFFICE AND IN THE SAME WAY MY NAME IS PRINTED ON THE PAGE 2 OF THE ABOVE MENTIONE D DOCUMENT.. 11.1.3. THE MOOT QUESTION IS, WHO HAD PURCHASED TH E D.D WAS IT BY THE BUYER OR BY THE SELLERS BUT, NO DOCUMENTARY EVIDENCE IS FORTH-COMING. THE BUYERS ASSERTION IS ALSO OSTENSIBLY SILENT ON THIS COUNT. TO CLEAR THE AIR OF CONFUSIO N, WE ARE OF THE CONSIDERED VIEW THAT THIS ISSUE SHOULD GO BACK ON T HE FILE OF THE AO FOR FRESH CONSIDERATION. ACCORDINGLY, THIS ISSUE I S REMITTED BACK WITH SPECIFIC DIRECTIONS TO THE AO TO CONSIDER THE FRESH EVIDENCE IN THE FORM OF CONFIRMATION LETTER FROM THE SELLER AND TO TAKE APPROPRIATE ACTION IN ACCORDANCE WITH THE PROVISION S OF THE ACT AFTER AFFORDING A REASONABLE OPPORTUNITY TO THE ASS ESSEE OF BEING HEARD. ALLOWANCE OF 25% IN RESPECT OF EXPENSES INCURRED T OWARDS IMPROVEMENT CHARGES: 12. AT THE OUTSET, WE WOULD LIKE TO POINT OUT THAT THIS ISSUE HAD CROPPED UP WHILE CONSIDERING THE ASSESSEES APP EAL AND AFTER PAGE 21 OF 21 ITA NOS.963 & 964/B/09 21 DUE DELIBERATIONS WE HAVE TAKEN A VIEW, REFERRED SU PRA, THAT THE CIT(A) WAS JUSTIFIED IN ALLOWING 25% IN RESPECT OF EXPENSES CLAIMED TOWARDS IMPROVEMENT CHARGES FOR THE LAND. AS SUCH, THE ISSUE RAISED BY THE REVENUE HAS BECOME OBSOLETE AND , ACCORDINGLY, DISMISSED. 13. IN THE RESULT, THE ASSESSEES APPEAL AS WELL AS THE REVENUES APPEAL IS PARTLY ALLOWED. SD/- SD/- (A MOHAN ALANKAMONY) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE, DATED :19/3/2010 COPY TO : 1. THE REVENUE 2. THE ASSESSEE 3. THE CIT CONCERNED. 4. THE CIT(A) CONCERNED. 5. DR 6. GF 7. GF, ITAT, NEW DELHI. MSP/18/3/ BY ORDER ASST. REGISTRAR, ITAT, BANGALORE.