TaxTMI 
TaxTMI 
TaxTMI 
2018 (3) TMI 1340
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.... any incriminating material regarding any undisclosed income pertaining to the appellant found during the course of search. Ld. CIT (A) ought to have quashed the order being illegal, unlawful and therefore void ab initio. It be so held now. 2. Ld. CIT (A) erred in law and on facts in holding that AO granted adequate opportunity to the appellant by elaborately discussing grounds for rejection of the claim in the order. Ld. CIT (A) failed to appreciate that failure to issue show-cause notice as regards the claims made in the return of income before any modification by AO vitiates the assessment proceedings. 3. Ld. CIT (A) erred in law in and on facts confirming disallowance made by AO of interest expenses of Rs. 1,69,442/- on borrowings for acquisition of rented property. Ld. CIT(A) ought to have deleted disallowance of interest paid to Axis Bank on borrowing for acquiring rented property and rent is assessed as house property income by AO. 4. Both the lower authorities erred in law and on facts failing to ascertain the documentary evidence substantiating that property acquired from Axis Bank loan is rented to Reliance Fresh fetching rental income offered to tax Ld. CIT (A) ....
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....owings used for the rented property situated at Mauyra Atria, Opp. Atithi Restaurant which was purchase out of loan taken from AXIS Bank, Law Garden branch and the copy of bank certificate was enclosed. However, the AO concluded that the books of accounts did not reflect AXIS bank account nor copy of said bank account was enclosed with the reply so that the explanation could not believed. 5. Against the said order appellant filed appeal before the ld. CIT(A) who partly allowed the appeal. 6. We have gone through the relevant record and impugned order. So far ground nos.1 and 2 are concerned. Appellant did not want to press these grounds. Same are dismissed as not pressed. 7. So far ground nos. 3 & 4 are concerned. Ld. AO has discussed this issue in his order at Page No.3 & 4, Para 5 & 5.2. In support of its contention regarding disallowance of interest of Rs. 1,69,442/- to paid on loan taken from Axis Bank for purchase of rental property situated at Maurya Atria Complex, Opp. Atithi Restaurant, Ahmedabad. It was submitted by the appellant that loan was taken from Axis Bank for purchase of property from which the rent was received and income was assessed as house property income.....
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....stified. 6. Initiation of penalty proceedings u/s 271 (1)(c) of the Act is unjustified." 12. So far ground nos.1 and 2 are concerned. Appellant did not want to press these grounds. Same are dismissed as not pressed. 13. So far ground nos. 3 & 4 with regard to confirmation of disallowance of Rs. 10,91,728/- for depreciation claimed on motor car are concerned, same are interconnected. Lower authorities held that the appellant was not being any business. Therefore, he was not entitled for depreciation. Ld. AR drew out attention towards the CIT(A)'s order at Page No.4, Para 7 & 7.2, in which appellant stated that he was engaged in the activity of purchase and sale of land held for trading. The profit was offered for tax as business income, he prepared the accounts which justified the claim of the assessee that he carried out an adventure and business of trading in land which amounted to business activity. We are convinced with the contention of the appellant and allow this ground of appeal. 14. So far ground no.5 with regard to charging of interest u/s.234A, 234B, 234C & 234D of the Act is concerned. Same is consequential and need not to be adjudicated. 15. So far ground no.6 ....
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....d. 8. Initiation of penalty proceedings u/s 271 (1)(c) of the Act is unjustified." 18. So far ground nos.1 and 2 are concerned. Appellant did not want to press these grounds. Same are dismissed as not pressed. 19. So far ground nos. 3 & 4 with regard to LTCG/STCG are concerned. AO has discussed at Page No.2 & 3, Para 5 & 5.4 and Page No.3 & 4, Para 6 & 6.2. Same has discussed by ld. CIT(A) at Page No.7 & 8, Para 8 & 8.2. So far brokerage expenses Rs. 2,92,500/- are concerned. Appellant sold property at Lilapur and earned long term capital gains. Similarly, land was sold in Shilaj, Block No.65 and earned Short Term Capital Gains. The appellant claimed that he has incurred expenses of brokerage of Rs. 2,25,000/- and Rs. 67,500/- and he has stated that payment of brokerage of Rs. 2,25,000/- was made by account payee cheque for sale of land in Lilapur. The expenses were incurred in relation to transaction of the land which was allowable deduction u/s.48 of the Act. We have gone through the relevant record and impugned order and paper book filed by the appellant. No such ledger account for payment of brokerage, was furnished. Contention of the appellant that even without reducing....