LAXMANBHAI PRABHUDAS PATEL vs. DEPUTY COMMISSIONER OF INCOME TAX

PDF · subscribers
TAXAP/481/2018HC GujaratGJHC24011246201809 May 2018Author: HONOURABLE MR. JUSTICE AKIL KURESHI,HONOURABLE MR. JUSTICE B.N. KARIA2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court agreed with the view of the Tribunal. The Court noted that the assessee failed to produce any accounts whatsoever regarding the claimed renovation expenditure. Even for recent expenditure, the assessee could have produced accounts and bills. The Tribunal, however, recognized that a constructed property over many years would require some maintenance and therefore granted partial relief of Rs. 1 lakh on an ad-hoc basis. The High Court found no question of law arising from the ITAT's decision. The appeal is dismissed.

What were the facts?

The assessee, Laxmanbhai Prabhudas Patel, acquired an office premises on April 1, 1992, for Rs. 1 lakh and sold it on February 4, 2010, for Rs. 13 lakhs. For the assessment year 2010-11, the assessee claimed Rs. 4.23 lakhs as renovation expenses to compute capital gains. The Assessing Officer rejected this claim for lack of accounts. The Commissioner upheld this decision. The Income Tax Appellate Tribunal (ITAT) granted partial relief, allowing Rs. 1 lakh on an ad-hoc basis. The assessee filed an appeal before the High Court challenging the ITAT's judgment.

What were the issues?

1. Whether the Income Tax Appellate Tribunal erred in law and on facts in rejecting the appellant's claim of renovation expenditure under Section 48 of the Income Tax Act, 1961? The assessee contended that the renovation expenses were incurred for the property sold. The revenue argued that the assessee failed to produce any accounts or bills to substantiate the claimed renovation expenditure. The Tribunal, while acknowledging that some maintenance might be required for a property over many years, granted partial relief on an ad-hoc basis, which the assessee is challenging.

Which sections of the Income-tax Act were involved?

Section 48

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
C/TAXAP/481/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 481 of 2018 ========================================================== LAXMANBHAI PRABHUDAS PATEL Versus DEPUTY COMMISSIONER OF INCOME TAX ========================================================== Appearance: MR. JAIMIN R DAVE(7022) for the PETITIONER(s) No. 1 for the RESPONDENT(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MR.JUSTICE B.N. KARIA Date : 09/05/2018

ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI)

1.

Assessee has filed this appeal challenging the judgment of the Income Tax Appellate Tribunal dated 22.09.2017   raising   following   question   for   our consideration: “Whether Income Tax Appellate Tribunal has erred   in   law   and   on   facts   in   rejecting appellants   claim   of   renovation   expenditure under   Section   48   of   the  Income   Tax   Act, 1961.”

2.

Brief facts are as under.

3.

The assessee had acquired an office premises on payment of sum of Rs.1 lakh on 01.04.1992. The same was   sold   for   consideration   of   Rs.13   lakhs   on 04.02.2010. The question of computation of capital gain arising out of such sale arise in the assessment year 2010­11. In the return filed, the assessee had C/TAXAP/481/2018 ORDER claimed   benefit   of   renovation   expenses   of   Rs.4.23 lakhs (rounded off).  The Assessing Officer rejected such claim in the order of assessment observing that the   assessee   has   not   maintained   or   produced   any accounts. This view was approved by the Commissioner. The Tribunal in the further appeal, granted partial relief allowing expenditure of one lakh of rupees on ad­hoc basis.

4.

We are broadly in agreement with the view of the Tribunal.     The   assessee   failed   to   produce   any accounts whatsoever with respect to the expenditure which he claimed to have been incurred in renovation. Even   if   some   of   the   expenditure   may   have   been incurred in distant past, the assessee could have at least produced the accounts and bills for the recent expenditure.  The Tribunal at the same time recognize that in constructed property over so many years would require some maintenance, granted partial relief.

5.

No   question   of   law   arises.     Tax   Appeal   is dismissed. (AKIL KURESHI, J) (B.N. KARIA, J) ANKIT SHAH

More judgments on Section 48

All 1,457 judgments and leading authorities on Section 48 →

Recent GST High Court judgments

Search GST case law →