TaxTMI 
TaxTMI 
2015 (10) TMI 382
X X X X Extracts X X X X
X X X X Extracts X X X X
....A.Y. 2009-2010 was not before the Ld. CIT(A)-VI. Therefore, separate orders were passed, even though conclusions are more or less similar. Assessee is aggrieved in A.Y. 2010-2011 for disallowing the interest and estimation of income whereas, Revenue is aggrieved on deletion of addition made by the A.O. towards cost of construction. 2. Briefly stated, assessee herein is a partnership firm carrying on business as a builder at Suryapet and had entered into a development agreement -cum- GPA on 31.07.2008 for construction of apartment complex on a land admeasuring 664 sq. yards at Suryapet. As per that assessee is entitled for 70% of the constructed area and 30% relate to the owners. Assessee constructed 20 flats in all and was in receipt of 15....
X X X X Extracts X X X X
X X X X Extracts X X X X
.....Y. 2009-2010, A.O. however, differed in A.Y. 2010-2011 and estimated income at 20% on the advance received and also further making the addition of salary and interest thereby, raising the demands. 4. Assessee contested before the Ld. CIT(A) in A.Y. 2009- 2010 that reference to valuation cell is not according to law as the property is stock-in-trade and further A.O. was not correct in accepting the report of valuation cell who valued the property at a much later point of time when all the flats were sold. Apart from that assessee also contended that Valuation Officers report contain errors such as rate of construction and additional area in the case of stilt parking etc., apart from variations in the areas taken. Assessee also contended th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 17103.0 15084.0 3. Penthouse 275.77 274.37 Servant room and lift 4. 269.1 208 machine room 5. Balconies 1119.456 2473.36 The difference also can be ascertained from the registered valuer's report who mentioned the total area to be 1769 Sq. Mtrs. or 19047 Sft. including the stilt of 3193 Sft whereas the Valuation Cell adopted the area at 2092.62 Sq.Mtrs, which is equivalent to 22525 Sft. Therefore, the correct area was not adopted by the Valuation Cell as alleged by the appellant. The difference in the area is 324 Sq.Mtrs. 7.2 The Hon'ble IT A T consistently holding that a rate of 15% towards rate difference as the CPWD adopted the basic Delhi rate for the construction of the building and 10% towards self supervision is being a....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... as was done by the A.O. but directed the A.O. to adopt 8% on the advances as per the computation filed by the assessee. With reference to the disallowance of interest and salary paid to partners, he directed the A.O. to allow the salary as claimed whereas, interest on partner's capital of Rs. 25,160 was not allowed on the reason that assessee failed to explain the capital brought in by the partners. In this year, Revenue is aggrieved on the deletion of addition made as unexplained investment and allowance of salary whereas the assessee is aggrieved on the non-allowance of interest. Even though estimation of income at 8% was contested in its grounds the same was not pressed by assessee. 7. After considering the rival contentions and pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e to be sustained. Accordingly, the orders of CIT(A) in both the years are upheld and Revenue contentions on addition of unexplained investment are rejected. 8. Coming to the other issue of allowing salary on the estimated income, this is as per the provisions of partnership deed provisions under section 40(b) are correctly invoked and accepted by the Ld. CIT(A). In fact, A.O. himself was accepted deduction of salary in A.Y. 2009-2010 and that there is no issue in that year, but why he did not allow the same in A.Y. 2010-2011 is not understandable. Assessee has claimed one salary in A.Y. 2009- 2010 for one partner. Whereas, by virtue of the revised agreement, it claimed salaries for two persons in the later year. Since the partnership deed....