2015 (6) TMI 206
X X X X Extracts X X X X
X X X X Extracts X X X X
.... three projects viz., Ganesh Millennium City, Ganesh City and Ganesh Pearl City undertaken by the assessee involving purchase of land, developing the same into plots and selling the plots. Against the sale proceeds of plots aggregating to Rs. 6,26,54,163, various expenses were claimed by the assessee which inter alia included land development charges of Rs. 48,00,863, commission of Rs. 5,44,525 and payment against land of Rs. 46,00,000. During the course of assessment proceedings, assessee was called upon by the A.O. to explain the exact nature of these expenses claimed by it and also to furnish the relevant details along with books of accounts and relevant vouchers/bills to establish that the same were incurred wholly and exclusively for t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rom the concerned land owners could not be furnished by the assessee. As regards the payment of Rs. 32,00,000 claimed to be made by the assessee to M/s. Ganesh Estates towards development charges, the A.O. held that even though the said payment was made by cash after deducting the tax at source, the relevant vouchers/bills were not produced by the assessee to establish the exact nature of work done by M/s. Ganesh Estates. As regards the balance expenditure of Rs. 16,00,863 claimed to be incurred by the assessee on fencing, road cutting, guards etc., the A.O. found that the same was supported only by self-made vouchers, which did not bear either the name or signature of the payee or even the relevant details to show the exact nature of work ....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... 32,00,000 made by the A.O. however was deleted by the Ld. CIT(A) for the following reasons given in paragraph 8.2 of his order. "8.2. I have carefully considered the remand report and the submissions of the appellant. It is an undisputed fact accepted by the Assessing Officer that the amount of Rs. 32 lakhs was paid by the appellant to M/s. Ganesh Estates, which is a proprietary concern of Sri U. Rajendra Prasad, for the development of Ganesh Millennium City with an extent of 250 acres, but only has doubts over the services really rendered by Sri U. Rajendra Prasad to the appellant company. The appellant also submitted Form NO.16A evidencing TDS on the amount of Rs. 32 lakhs paid to M/s. Ganesh Estates. An affidavit was filed by Sri U. R....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... stated in the remand report that the said payments confirmed by the concerned land lords were partly made in cash to the extent of Rs. 26,50,000. It was therefore suggested by the A.O. in the remand report that the said payments made in cash exceeding Rs. 20,000 should be disallowed under section 40A(3) to the extent of 20% i.e., Rs. 5,30,000. The Ld. CIT(A) however did not accept this suggestion of the A.O. made in the remand report and held that no disallowance under section 40A(3) was called for as the assessee had made cash payments in respect of projects located in remote villages where banking facilities were not existing. He held that the said payments thus were covered by Rule 8DD of the I.T. Rules and the disallowance under sectio....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... on these dates nor any application seeking adjournment was filed. The hearing therefore was finally fixed before the Tribunal on 05.05.2015 and a notice of the same was sent through the O/o Learned D.R. However still none has appeared on behalf of the assessee on 05.05.2015 despite the fact that notice of the said hearing sent through the department was duly served on the assessee, a proof of which is placed on record before us. This appeal of the Revenue is therefore being disposed of exparte qua the respondent-assessee after hearing the arguments of learned D.R. and perusing the relevant material on record. 4. Ground Nos. 1 and 5 raised by the Revenue in this appeal are general in nature seeking no specific decision from us. As regards ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... support and substantiate its claim for development charge of Rs. 32,00,000 claimed to be paid to M/s. Ganesh Estates. Ground No.2 of the Revenue's appeal is treated as allowed for statistical purposes. 5. As regards the issue involved in ground No.3 relating to assessee's claim for commission expenses, it is observed that the Ld. CIT(A) has again erred in relying only on the fact that the amount of commission was paid by the assessee by cheque after deducting tax at source to allow the claim of the assessee without appreciating that it is for the assessee to establish on evidence that the commission expenses claimed by it were incurred wholly and exclusively for the purpose of its business. We therefore set aside the impugned order of the....