TaxTMI 
TaxTMI 
2019 (9) TMI 656
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....ls filed by Revenue and assessee were heard together and are being disposed of by this consolidated order for the sake of convenience. 3. The Revenue in ITA No.613/PUN/2003 has raised the following grounds of appeal:- 1) In the facts and in the circumstances of the case the CIT(A) erred in accepting the cash flow statement prepared by the assessee and other family concerns as not consisting complete record of all undisclosed transactions. 2) On the facts and in the circumstances of the case the CIT(A) erred in accepting the cash flow statement in the case of the assessee and in treating the amount of Rs. 7,40,000/- as income received from other sources by the firm in A.Y. 92-93 when both the partners were studying in co....
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....bove and by way of alternate submission the appellant submits that both the lower authorities have failed to appreciate that the unrecorded cash expenditure is outside the scope and purview of Section 40A[3] of the I.T. Act, 1961. In the circumstances, the disallowance of Rs. 10,30,500.00 for A.Y. 1996-97 and of Rs. 80,000.00 for A.Y. 1997-98 made by the learned Assessing Officer and as sustained by the learned C.I.T.[A] in respect of alleged unrecorded purchase price of lands at Katraj may please be deleted. 4. The appellant denies his liability to pay any interest u/s 158 BFA (1) of the I.T. Act 1961. The learned C.I.T.[A] erred in directing the learned Assessing Officer to charge the said interest. The aforesaid direction of the....
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....e same is dismissed as not pressed. 8. Now coming to the ground of appeal No.3 wherein the assessee is aggrieved by the disallowance made u/s 40A(3) of the Act. 9. This is a block assessment proceeding completed u/s 158BC(c) for the block period 01.04.1989 to 08.12.1999. The assessee is aggrieved by disallowance of Rs. 10,30,500/- for assessment year 1996-97 and Rs. 80,000/- for assessment year 1997-98. 10. The learned Authorised Representative for the assessee before us pointed out that the said disallowance made is outside the scope and purview of Section 40A(3) of the Act. In this regard, he pointed that the cash payment was made to land owners at Katraj. He also pointed out that during the course of search, document was found i....
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....sition laid down by Pune Bench of the Tribunal in the case of ACIT Vs. Rushiraj Builders (supra). Applying the said proposition to the facts of the case, we hold that there is no merit in making the aforesaid disallowance u/s 40A(3) of the Act and we delete the disallowance of Rs. 10,30,500/- for assessment year 1996-97 and Rs. 80,000/- for assessment year 1997-98. The ground of appeal No.3 is allowed. 12. Now coming to the issue raised by ground of appeal No.1 wherein the assessee is aggrieved by the orders of the authorities below in holding that the assessee during the block period had made unexplained investment of Rs. 55,52,500/- for the purchase of land at Kataj. 13. Briefly, in the facts of the case, certain cash payments were ....
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....r aspect which was raised was that Assessing Officer was asked to summon the witness as per the letters placed at Pages 48 and 49 of the Paper Book 2. However, no summons were issued by the Assessing Officer and no opportunity of hearing was given to cross-examine and therefore no addition to be made in the hands of the assessee. He also placed on record, the copy of the assessment order of Shri Subash G. Pingale for the block period and it was pointed out that the said addition was made in his hands for different years. It was pointed out that where the partners of the firm were aged about 20 years of age and had no source of income, then no addition on merits can be made in the hands of the partnership firm. 15. Learned Departmental Re....
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....gale. In such facts and circumstances, when both the partners of the partnership firm were of 20 years of age and were still studying, then and also where the investment has been admitted to have been made by Shri Subash G. Pingale, there is no question of rejecting the plea of the assessee in this regard. Accordingly, we reverse the orders of the authorities below and hold that once the addition has been made in the hands of Shri Subash G. Pingale, may be, the block assessment was not upheld on technical grounds, but where the partners were minors and were studying and had no source of income, then no addition is warranted in the hands of the partnership firm. In such facts and circumstances, we allow the claim of the assessee vide ground ....