KISAN BABURAO JADHAV,MUMBAI vs. ITO RG 16(1)(1), MUMBAI

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ITA 2934/MUM/2013Status: DisposedITAT Mumbai04 August 2016AY 2009-103 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s decision to disallow the cost of improvement and 20% of business expenses, as the assessee failed to provide any proof to support these claims before the Tribunal.

What were the facts?

The assessee sold land and claimed capital gains as exempt, but the AO assessed it as non-agricultural land. The CIT(A) allowed partial exemption for agricultural land but disallowed the cost of improvement. The assessee also claimed business expenses against rental income, of which 20% was disallowed by the AO and confirmed by the CIT(A).

What were the issues?

Whether the cost of improvement on land sold is allowable and whether 20% of business expenses against rental income can be disallowed for want of proof.

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” Bench, Mumbai

Before: Shri B.R. Baskaran (AM)& Shri Amit Shukla (JM)

For Respondent: Shri Sachchidanand Dube
Hearing: 3.8.2016Pronounced: 3.8.2016

O R D E R Per B.R. Baskaran (AM) :-

The appeal filed by the assessee is directed against the order dated 17- 01-2013 passed by Ld CIT(A) on the following issues for AY 2009-10. (a) Disallowance of cost of improvement incurred on the land sold. (b) Disallowance of 20% of business expenses.

2.

None appeared on behalf of the assessee, even though the notice of hearing was sent by registered post on more than one occasion. Hence we proceed to dispose of the appeal ex-parte, without the presence of the assessee.

3.

We heard the Ld D.R and perused the record. The facts relating to the first issue are that the assessee had sold a land located near Mahabaleshwar and claimed the same as agricultural land. Accordingly he claimed the capital gains as exempt. The AO noticed that the land has been converted into non- agricultural land and accordingly assessed the capital gain. Before the Ld

2 Shri Kisan Baburao Jadhav CIT(A), the assessee submitted that a portion of land alone was converted into non-agricultural land and the remaining portion of land was used for agricultural purpose. In support of the same, the assessee furnished relevant details and also copies of returns of income of earlier years, wherein the assessee had declared agricultural income. The Ld CIT(A) was convinced with the same and accordingly directed the AO to re-compute the capital gain by excluding the income relatable to the portion of agricultural land. The assessee had claimed cost of improvement over the land, but the Ld CIT(A) did not allow the said claim on the reasoning that the assessee has failed to prove the same.

4.

The assessee had earned rental income of Rs.3,05,000/- by letting out a hotel against which the assessee claimed expenditure to the tune of Rs.15,53,000/-. Since the expenses were not verifiable, the AO disallowed 20% thereof and the Ld CIT(A) also confirmed the same.

5.

The assessee is contesting the decision rendered by Ld CIT(A) on cost of improvement and disallowance of expenses. On perusal of the order passed by the tax authorities, we notice that they have disallowed both the claims for want of proof only. Before us also, the assessee has not furnished any proof to support his claim. Hence we do not find any reason to interfere with the order passed by Ld CIT(A) on both the issues.

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