TaxTMI 
TaxTMI 
2016 (1) TMI 492
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....re was otherwise loss suffered. 2. Directing the AO to measure the shortest possible aerial distance of the land and in case it is in the area upto a distance of 2 Kms from the Gunnor Municipal Limits while upholding the AO's findings but ignoring the fact that in the AO's remand report it was clarified that the land area of 5 acre 6 kanal & 4 acre 1 kanal 15 maria falls within 2 Kms from the end of the municipal limits." Ground No.1 3. Apropos ground no.1, we have heard arguments of both the sides and carefully perused the material placed on record before us. Learned Departmental Representative submitted that the Assessing Officer noticed that the land falls within the category of capital assets as defined in section 2(14)(iii)(b) of the Income Tax Act, 1961 (for short the Act), therefore, the sale of agricultural land is considered for capital gain tax purpose and he rightly worked out long term capital gain and the same was correctly added to the income of the assessee. Learned Departmental Representative vehemently contended that the CIT(A) granted relief to the assessee without any solid reasoning or basis, thus the same may be set aside by restoring that of the....
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....s as (Kism Chaahi Bhoomi Darj Ha The land has not been in any use since 2006. Thus, it is held that the capital gains worked out on transfer of these lands (Khewat No. 1002/987, Khata No. 1229 and Khewat No. 898,Khata No. 1154, 1156, 1158) are held justified as these lands, being non-agricultural lands, are capital assets in accordance with the section 2(14) of the Act and thus the AO's findings in this regard are thus upheld. 4.1 The notification no. 9447 dated 06.01.1994 specifies the area upto a distance of 2.00 Kilometers (Kms) from the Gunnor Municipal Limits in all direction. It means that the distance has to be measured from the boundary of the municipal limit. In principle, I do agree with the view of the view_of the AO, stated in the remand report, that Gunnor Town and Village Panchi Gujran have common boundary and Inspectors of Income Tax and the revenue authorities of Gunnor measured the distance of lands other than lands mentioned in para 4 above ( lands other than Khewat Nck 1002/987, Khata No. 1229 and Khewat No. 898, Khata No^ll54, 1156, 11581. from the office of the Tehsildar by vehicle, which may be more than 6 Kms. Therefore, the shortest possible aer....
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....hold the field. The CIT(A) after laying dicta in principle, restored the issue to the file of the Assessing Officer for limited purposes of factual verification and we are unable to see any perversity or any other valid reason to interfere with the same. Before we part with the discussion on this issue, it is relevant to mention that the Assessing Officer will also take into consideration the binding Circular no. 17/2015 dated 6.10.2015 of the CBDT (supra) while verifying the facts and while applying the law in pursuance to the order of the first appellate authority. Accordingly, we uphold the conclusion of the CIT(A) with the direction to the Assessing Officer, as set out above. Therefore, ground no. 1 of the Revenue being devoid of merits is dismissed. Ground No.2 7. Apropos ground no. 2 of the revenue, we have heard the rival submissions and carefully perused the relevant material placed on record, inter alia, assessment order, impugned order of CIT(A) and other records. Ld. Ld. DR pointed out that the Assessing Officer in first para at page 4 has rejected the books of accounts of the assessee u/s 145(3) of the Act and this action of the Assessing Officer has been upheld b....
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....he CIT(A) in regard to rejection of book results u/s 145(3) of the Act as admittedly there is no cross appeal by the assessee against said findings of the authorities below. Further, the assessee, in his ground no. 5 before the CIT(A), has agitated the issue of addition of Rs. 41,90,024 by simply alleging that the said addition is not warranted by the case and the addition so made needs to be deleted. From the facts emerged from the assessment order as noted by the Assessing Officer, it is apparent that the assessee, during the survey, surrendered an amount of Rs. 85,10,310 during survey u/s 133A of the Act conducted at the business premises of the assessee which include difference in stock of Rs. 83,00,310 and excess cash of Rs. 2,10,000. The assessee replying to the question no. 17 in his statement recorded during survey voluntarily surrendered said amount of Rs. 85,10,310 for taxation over and above normal profit for the financial year and on this basis and after rejecting the book results, the Assessing Officer proceeded to estimate the normal profit from business by adopting GP rate of 2.90% of total turnover amounting to Rs. 7,70,486 (being 2.90% of turnover of Rs. 2,65,68,48....
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.... appellant, as evident from the chart of 7 years which is annexed here with, varies from year to year. The reasons for the same are different year to year. The GP rate has gone up to 30.48% in the relevant year only on account of disclosure of income of Rs. 85.10 lakhs during survey, otherwise it is in loss. It is noticed that this is not the first year in which the input cost has gone up substantially higher in last 7 years. However, the appellant demonstrated that goods exported in financial year (FY) 2008-09 was at lesser rate than the cost of purchases, which resulted loss of Rs. 69.53 lakhs. The appellant argued that the recurring loss forced him to give up this export business from 04.09.2009. Further, the appellant failed to justify the steep rise in various expenses as pointed out by the AO in 3rd para of page 4 of the impugned order. No documentary proof of expenses to substantiate the claim was produced before me to controvert the findings of the AO. Therefore, keeping in view the facts and circumstances in totality, I hereby uphold the addition of Rs. 10.00 lakhs out of Rs. 41,90,024/- done by the AO under the head business income. Thus, the addition of Rs. 31,90,024/-/u....