KISHOR K KASTA,PORBANDAR vs. INCOME TAX OFFICER, WARD 2(4),, PORBANDAR

Grounds of appeal raised by the assessee are as follows: 1. Ld. AO as well as CIT(Appeals) has erred in not considering the bills and ledgers for deduction of cost of improvement produced by the assessee during the appellate stage and taking view that the assessee has failed to produce bank account statement that corroborate these bills and ledger accounts particularly when the payment was made in cash.

Succinctly, the factual panorama of the case is that assessee before me is an Individual and filed the original return of income for the assessment year (A.Y.) 2015-16, on 17-10-2015, declaring income of Rs. 3,16,120/-, under the head business and income from other sources. It was observed by the assessing officer from the information available on record that the assessee has sold an immovable property for a consideration of Rs. 9,50,000/- on 04-04-2014. The market value of the said property, as per stamp duty of the property is Rs. 17,92,000/-. Hence the provisions of section 50C of the Act will be applicable in the assessee`s case, under consideration. The assessee has not declared any income under the head capital gains in the return filed on 17-10-2015. Since, there is escapement of income, therefore notice u/s 148 of the Act has been issued to the assessee on 31-03-2021. In response to the notice, assessee could not file satisfactory reply, therefore, assessing officer held the assessee transferred property for the consideration less than the jantri value/market value or the value adopted/assessed by the Stamp Duty Authority, therefore, assessing officer made addition in the hands of the assessee to the tune of Rs.17,92,000/-.

Aggrieved by the order of the assessing officer, the assessee carried the matter in appeal before the Ld.CIT(A), who has confirmed the addition made by the assessing officer. Before learned CIT(A), the assessee submitted that he is entitled for indexed cost of improvement, which has not been provided to the assessee. That is, assessee has contested that the Assessing Officer has not taken into account the cost of improvement made by the assessee to the immovable property. However, ld.CIT(A) during the appellate stage, observed that the assessee has not produced sufficient evidences, pertaining to the same cost of

Shri Dushyant Maharshi, Learned Counsel for the assessee, vehemently argued that the total addition was made by the assessing officer to the tune of Rs.17,92,000/-. On appeal filed by the assessee, the Ld.CIT(A) reduced the addition to the extent of Rs.8,45,360/-. The Ld. Counsel submitted that assessee is in appeal before this Tribunal because of the reason that the Ld.CIT(A) has not considered the cost of improvement of Rs.5,00,000/-. The assessee has submitted each and every documents related to cost improvement of Rs.5,00,000/-, therefore benefit of cost improvement should be provided to the assessee.

On the other hand, the Ld. DR for the revenue relied on the findings of the ld.CIT(A).

I have heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld CIT(A) and other materials brought on record. I note that the total addition was made by the assessing officer is to the tune of Rs.17,92,000/-, on appeal by the assessee, the Ld.CIT(A) reduced the addition made by the assessing officer to Rs.8,45,360/- from Rs.17,92,000/-. The ld Counsel for the assessee submitted documents and evidences relating the cost of improvement to the tune of Rs.5,00,000/-, before the Bench. Considering the genuineness of the documents and evidences, I note that the cost of improvement to the extent of Rs.5,00,000/- should be provided to the assessee. Therefore, I direct the assessing officer to

In the result, the appeal filed by the assessee is partly allowed, in above terms.