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Income Tax Appellate Tribunal, BANGALORE BENCH ‘B’, BANGALORE
Before: SHRI A. K. GARODIA & SHRI VIJAY PAL RAO
This is assessee’s appeal directed against the order of the ld.
CIT(A)-II, Bangalore dated 21-08-2014 for the assessment year 2008- 09.
In this appeal, the Revenue has raised the following grounds;
“1. The order of the ld.CIT(A) is opposed to law and facts of the case.
2. On the facts and circumstances of the case, the ld. CIT(A) erred in law in directing the AO to restrict the disallowance to 50% of the amount of undisclosed investment after giving credit for a personal supervision and adoption of State PWD rates without appreciating the fact that the assessee himself had arrived at the cost of construction as Rs.257.82 lakhs and the submission before the ld.CIT(A) is only an afterthought and the same is not supported by any evidence too, as admitted by the CIT(A).
3. For these and other grounds that may be urged at the time of hearing, it is prayed that the order of the CIT(A) in so far as it relates to the above grounds may be reversed and hat of the AO may be restored.
4. The appellant craves leave to add, alter, amend and/or delete any of the grounds mentioned above”.
It was submitted by the ld. DR of the revenue that the order of the ld. CIT(A) is very cryptic and therefore, his order should be reversed and that of the AO be restored and alternatively, the matter may be sent back to the file of the ld. CIT(A) for a fresh decision by way of a speaking order.
The ld. AR of the assessee supported the orders of the ld.CIT(A).
We have considered the rival submissions. We find that it is noted by the AO on page no.2 of the assessment order that total cost of the construction at Rs.2,57,82,000/- out of which the assessee could explain the source of investment of Rs.1,69,98,383/- only and for the remaining amount of Rs.87,83,617/-, the assessee could not explain the source of investment. This issue has been decided by the ld. CIT(A) as
per para-4.4 at page 11 of her order wherein it was held that she is restricting the disallowance to 50% after giving credit for the personal supervision and adoption of State PWD rates in estimating the cost of construction. At para 4.3 she stated that there is merit in the assessee’s submission, regarding credit for personal supervision of the construction at 15% and 15% benefit by considering State PWD rates as against CPWD rates. Hence, it is seen that even the claim of the assessee was restricted to the extent of 30%, whereas ld. CIT(A) has granted relief of 50% and that too without giving any reasoning and therefore, we feel it proper that this matter should go back to the file of the ld. CIT(A) for a fresh decision by way of a speaking order. Hence, we set aside the order of the ld. CIT(A) and restore the matter back to his file for a fair decision by way of a speaking and reasoned order after providing adequate opportunity of being heard to both sides.
In the result, the appeal filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on the date mentioned on the caption page.