TaxTMI 
TaxTMI 
TaxTMI 
2015 (5) TMI 718
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.... Gain' on the sale of truck as the assessee could not produce any sustainable documentary evidence in respect of purchase/sale of truck during assessment proceedings. 3. On the facts and in the circumstances of the case the Ld. CIT(A) has erred in law and in facts in deleting the addition of Rs. 11,54,243/- made by the A.O. by withdrawing the exemption claimed by the assessee u/s 10(37) of the Income-tax Act, 1961 as the assessee could not produce any sustainable documentary evidence in support of his claim during assessment proceedings. Ground No. 1 2. Apropos ground no.1, ld. DR submitted that the CIT(A) has erred in law and facts in deleting the addition made by the AO by rejecting the books of accounts of the assessee and estimating the net profit @5% of the turnover as the assessee failed to produce any relevant details of opening and closing stock and also any sustainable evidence in support of the entries contained in the books of accounts. Replying to the above, ld. Counsel of the assessee supported the impugned order and submitted that the AO rejected the books of accounts of the assessee without any good and reasonable cause as the assessee was maintaining regular ....
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....capital gain on sale of the only truck in his inventory of fixed assets. Ld. DR vehemently contended that the claim of purchase of truck was baseless, frivolous as the payment of said purchase was made in cash on 20.8.2009 amounting to Rs. 7,05,000 and during more than 8 months of the relevant financial year, the assessee did not get it transferred and registered in his name, therefore, said transaction of purchase of truck is a sham transaction which was rightly rejected by the AO. Ld. DR vehemently contended that the CIT(A) deleted the addition without any sustainable reason and by wrongly mentioning that the AO has not disputed the price paid for the truck. Ld. DR also contended that the reasons recorded by the AO for rejecting the claim of purchase of truck are sustainable and hence, impugned order may be set aside by restoring that of the AO on this issue. 5. Ld. Counsel of the assessee supported the impugned order and submitted that the claim of purchase of truck cannot be rejected at the threshold merely on the basis that the payment has been made in cash and the said purchased vehicle could not be transferred and registered in the name of assessee. Ld. Counsel further subm....
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....uery from the Bench, ld. Counsel of the assessee could not assist us why the payment was made in cash and what was the reason for not getting transferred and registered the purchased truck in the name of assessee even after a lapse of more than 8 months during the financial year under consideration. Ld. counsel during the argument has strenuously pointed out that the AO has allowed the claim of depreciation of Rs. 19,114 on the purchased truck, therefore, the transaction of purchase cannot be disputed by the AO. Ld. Counsel pointed out page no. 13 of the paper book and submitted that in the trading and profit and loss account for the year ending on 31.3.2001, the assessee made a claim of depreciation on the purchased truck which was allowed by the AO and in this situation, the AO cannot deny the transaction. 8. On careful consideration of above, we are of the view that the purchase of truck cannot be held as suspicious or bogus only because the truck has been purchased in cash from the concern wherein the assessee is beneficiary and only because the registration was not transferred in the name of the assessee purchaser. At the same time, we are also of the view that the transactio....
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....of the assessee supported the impugned order and submitted a copy of the judgment of ITAT, Chandigarh 'B' Bench in the case of Chura Ram vs ITO (2011) 10 taxmann.com 34 (Chd.) and submitted that it is not in dispute that the assessee had received enhanced compensation during the year under consideration after 1.4.2005, therefore, the enhanced compensation in respect of compulsorily acquired agricultural land is exempted u/s 10(37) of the Act. 13. On careful consideration of above submissions, we note that ITAT Chandigarh in the case of Chura Ram vs ITO (supra) has held as under:- "8. On this aspect we have carefully considered the rival submissions and perused the impugned orders of the authorities below. Firstly, it is to be observed that the use of the land for agricultural purposes has to be seen during the period of two years immediately preceding "the date of transfer" as required by section 10(3 7)(ii) of the Act and not the date of acquisition, as canvassed by the revenue. It is to be appreciated that in order to charge tax on Capital Gains accruing on a property acquired under the Land Acquisition Act, 1894 the date of transfer has to be reckoned in terms of section 16 of....
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....ld that the land was not being used for agricultural purposes because the land was said to be situated within the municipal limits; that only fodder grass and vegetables were grown in the kharif season while the land remained fallow in the rabi season; and, that assessee had acquired huge chunks of land and constructed certain godowns also. All these objections were not held as conclusive in the face of the khasra girdawri of the land produced by the assessee. As per the Hon 'ble High Court, khasra girdawri produced by the assessee showed that agricultural operations were being carried on by the assessee and merely because the land was located in a commercial area or land was having partial utilization for non-agricultural purposes were not the relevant considerations. Even in the case before us, khasra girdawri produced by the assessee clearly shows that during the period of two years immediately preceding the date of transfer, the land was being put to use for agriculture purposes. The khasra girdawri, placed at pages 8-9 and 14-15 of the Paper Book show growing of Wheat, Bajra, Makki, Chari etc. Moreover, in this case we find that the lower authorities have disregarded the e....