AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2014 (8) TMI 243
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....icularly, on business receipts/expenditure, disbelieving the capital gains in the HUF status and gifts received from brother-in-law through NRE account. The appeals in A.Ys. 2005-06 and 2006-07 were also similarly considered by the Ld. CIT(A) in the same order but the Revenue has not preferred any appeal as the tax effect was less than the prescribed limit. Therefore, Revenue appeals are only from A.Ys. 2007-08 to 2009-2010. 3. We have heard the Ld. D.R. and Ld. Counsel in detail and perused the paper book placed on record including the submissions made before the Ld. CIT(A). ITA.No.1820/Hyd/2011 - A.Y. 2008-2008 : 4. In this appeal, Revenue is aggrieved on two issues i.e., addition of Rs. 1,90,000/- made on account of 'advances received as unproved credits' and gift of Rs. 3,70,000/- received from his brother-in-law through others. 4.1. As far as addition of Rs. 1,90,000/- is concerned, A.O. made addition shown by the assessee as 'advance received for sale of plots' as unsecured loan in the absence of confirmation as such as income. It was the submission before the Ld. CIT(A) that assessee filed confirmation letters who confirmed that they gave advances for purchase of plots, ....
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....lowing his findings on similar issue in A.Y. 2005-06 vide para 4.2, deleted the addition. In order to appreciate the reasons of Ld. CIT(A) in para 4.2 in A.Y. 2005- 06 the same is extracted wherein he has given detailed order as under : "4.2. I have considered the submissions made by the appellant, gone through the order of the AO and also the material placed before me. Above all, it may be noted here that the appellant was not maintaining books of account and in this regard it may be noted here that whenever there is a grey area the same is considered in favour of the revenue. An other important matter to be noted here is that in the returns originally filed, the appellant has not admitted property transactions on the ground that such transactions are part of HUF state of affairs. But, however, in the returns filed in response to 148 proceedings, the appellant has reflected property transactions also. Now coming to the question of gifts received during the year, there is no dispute between the relation between the donor and the donee. There is also no dispute that that the said amount has come from the donar's NRE account at the native place of the donor. The only dispute was....
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.... development expenditure. In the course of survey operations, there was a statement from the assessee that he has spent about Rs. 6 lakhs approximately. On that reason and that assessee has not provided any material evidence or proof for the source of expenditure incurred, the entire development expenditure claimed was disallowed. Ld. CIT(A) considered the submissions of the assessee and deleted the same by stating as under : "17.2. I have considered the submissions made by the appellant, gone through the order of the AO, and also perused various stages of development activities from purchase of raw lands till they are made into plots to be sold to prospective buyers. But, however, the fact remains that major expenses were supported by self made vouchers, whose authenticity is not foolproof. But then, for such a situation disallowing entire expenses is also not called for. It is something like income is earned without expending a single paisa. Since majority of expenses were supported by self made vouchers, without ignoring the entire expenditure, a reasonable approach of disallowing a part of the expenditure could have been adopted by the AO, which he has not done. But, however, ....
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....eration was more than Rs. 40,00,000/- and as such the TDS provisions are applicable. In the light of this the A.O. is directed to delete the impugned addition made in this regard." 14. After considering the rival contentions, we do not see any reason to interfere with the order of the Ld. CIT(A). Payment of commission is an incidental expenditure in the business of real estate. Without even giving show cause notice or asking for the details A.O. disallowed the expenditure without any reason. We cannot approve such disallowance. We on the facts of the case, did not intend to interfere with the order of the Ld. CIT(A). Accordingly, ground No.4 of the Revenue is rejected. 15. Ground No.5 contested by the Revenue is with reference to the addition of Rs. 7,40,000/- being amount credited to capital account of the assessee. A.O. noticed that assessee has credited an amount of Rs. 7,40,000/- in his account, therefore, treated the same as income. It was submitted by the assessee that he maintained two sets of books viz., personal and other for the business. The incomes accumulated/received during the year were credited to his personal account including the gift received from his brother- ....