TaxTMI 
TaxTMI 
TaxTMI 
2017 (2) TMI 592
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....ience. ITA No. 969/Ahd/2014 Assessee's appeal for A.Y. 2010-11 3. The sum and substance of the grievance of the assessee is that the ld. CIT(A) erred in confirming the disallowance of Rs. 1.45 crore in respect of cost of improvement while arriving at Long Term Capital Gain. 4. The assessee filed its return of income electronically on 08.10.2010 declaring total income at Rs. 49,60,542/-. The return was selected for scrutiny assessment and accordingly statutory notices were issued and served upon the assessee. 5. During the course of the scrutiny assessment proceedings, the A.O. noticed that the assessee has sold a property for a total consideration of Rs. 4.11 crores. On perusing the computation of capital gains, the A.O. noticed that th....
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....rm belief that the only expenses which are deductible for computing capital gains chargeable to tax are:- (i) Expenditure incurred wholly and exclusively in connection with such transfer. (ii) The cost of acquisition of the asset and the cost of improvement them. 9. Since the assessee has not incurred full expenditure for the improvement of the property nor any details have been furnished in connection with of development of asset nor any evidence has been brought on record that the remaining expenses from improvement of asset has been made, the nature of work done, the A.O. denied the expenditure incurred towards the cost of improvement amounting to Rs. 1.45 crores. 10. Assessee carried the matter before the ld. CIT(A) and reiterated....
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....e computing the capital gains tax liability, the assessee deducted cost of improvement of Rs. 1.95 crores. It is not in dispute that during the year under consideration, the assessee has paid only Rs. 50 lacs to Rama Realty. Admittedly, the balance of Rs. 1.45 crores was shown as outstanding as on 31.03.2010. 15. The lower authorities are of the firm view that since this amount was never paid during the year under consideration, the same cannot be allowed as cost of improvement. 16. It is true that u/s. 48 clause (i) what has mentioned is expenditure incurred and incurred means paid or payable but there is no such reference so far as cost of improvement is concerned. Be that as it may, it is equally true that the onus is upon the assessee....
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....then the payment is not supported by any actual work done by M/s. Rama Realty. To this extent, in our considered opinion, the same cannot be considered towards cost of improvement. We, accordingly, confirm the disallowance to the extent of Rs. 45.90 lacs. 18. So far as the balance of Rs. 99.10 lacs is concerned, a perusal of the paper book shows that the assessee has offered the same as remission/cessation of liability in A.Y. 2013-14 and has paid the taxes accordingly. Since, the assessee has offered this amount as its income in subsequent year if the disallowance is sustained during the year under consideration, it would amount to double taxation of the same amount. Therefore, in our understanding of the fact, this disallowance cannot be....
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....er contended that the investments in each financial year did not exceed the upper limit of Rs. 50 lacs, therefore, the A.O. erred in not allowing the claim of deduction. 25. After considering the facts and the submissions, the ld. CIT(A) observed as under:- 7.2 The above submission of the appellant with regard to disallowance of its claim of deduction u/s 54EC of the Act is found to be tenable. In my opinion if the assessee is able to keep six months limit from the date of transfer of capital asset, but still able to place investment of Rs. 50,00,000/- is in two different financial years, then it cannot be said that restrictive proviso will limit the claim to Rs. 50,00,000/- only. The appellant had invested Rs. 50,00,000/- each in two di....