ITO, Nashik v. Shri Balasaheb Madhavrao Jadhav, Nashik

ITA 2225/PUN/2012 | 2009-2010
Pronouncement Date: 27-10-2016 | Result: Allowed

Appeal Details

RSA Number 222524514 RSA 2012
Assessee PAN AAYPJ1752C
Bench Pune
Appeal Number ITA 2225/PUN/2012
Duration Of Justice 3 year(s) 11 month(s) 18 day(s)
Appellant ITO, Nashik
Respondent Shri Balasaheb Madhavrao Jadhav, Nashik
Appeal Type Income Tax Appeal
Pronouncement Date 27-10-2016
Appeal Filed By Department
Order Result Allowed
Bench Allotted A
Tribunal Order Date 27-10-2016
Date Of Final Hearing 03-08-2016
Next Hearing Date 03-08-2016
Assessment Year 2009-2010
Appeal Filed On 08-11-2012
Judgment Text
] ]] ] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE ! # $ BEFORE MS. SUSHMA CHOWLA JM AND SHRI ANIL CHATURV EDI AM ITA NO.2225/PN/2012 ASSESSMENT YEAR : 2009-10 THE INCOME TAX OFFICER WARD 1(3) NASHIK. . APPELLANT VS. SHRI BALASAHEB MADHAVRAO JADHAV 850 RADHA NIWAS SHIVAJI NAGAR PIMPALGAON. PAN : AAYPJ1752C . RESPONDENT / APPELLANT BY : SHRI ANIL KUMAR CHAWARE / RESPONDENT BY : SHRI NIKHIL PATHAK / DATE OF HEARING : 18.10.2016 / DATE OF PRONOUNCEMENT: 27.10.2016 % / ORDER PER ANIL CHATURVEDI AM : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-I NASHIK DATED 21.08.2012 FOR THE ASSESSMENT YEAR 2009-10. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERI ALS ON RECORD ARE AS UNDER :- 2.1 ASSESSEE IS AN INDIVIDUAL STATED TO BE THE PROP RIETOR OF RACHANA CHEMICALS WHICH MANUFACTURES DY-ETHER. ASSESSEE ELECTRONICAL LY FILED HIS RETURN OF INCOME FOR ASSESSMENT YEAR 2009-10 ON 09.09.2010 DECLARING TOT AL INCOME OF RS.13 92 574/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER A SSESSMENT WAS FRAMED UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961 (IN SHOR T THE ACT) VIDE ORDER DATED 2 ITA NO.2225/PN/2012 28.12.2011 AND THE TOTAL INCOME WAS DETERMINED AT R S.21 27 691/-. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER ASSESSEE CARRIED TH E MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 21.08.2012 (IN APPEAL NO.NSK/CIT(A )-I/735/2011-12) GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY T HE ORDER OF LD. CIT(A) REVENUE IS NOW IN APPEAL BEFORE US. REVENUE VIDE LETTER DATED 30.12.2015 HAS AMENDED THE GROUNDS OF APPEAL AND THE AMENDED GROUNDS OF APPEAL READS AS UNDER :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LD. CIT(A)-I NASHIK HAS ERRED IN DELETING THE ADDITION S MADE ON ACCOUNT OF UNSECURED LOANS AMOUNTING TO RS. 30 41 000/- BY ACCEPTING THE ADDITIONAL EVIDENCE PRODUCED BEFORE THE LD. CIT(A) AND NOT ACCEPTING THE REQUEST OF THE A.O. FOR CROSS EXAMINATION OF THE EVIDENCE/INFORMATION PRODUCED BE FORE THE LD. CIT(A). 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW THE LD. CIT(A)-I NASHIK HAS ERRED IN NOT ACCEPTING THE VAL UATION OF THE PROPERTY AT RS. 24 92 000/- AS PER DVOS REPORT FOR DETERMINING THE LTCG DETERMINED AT RS. 19 16 396/- AS AGAINST THE LTCG COMPUTED BY THE ASS ESSEE AT RS. 13 44 680/- (19 16 396/- LESS 13 44 680/- = 5 71 716/-). FURTHER THE CIT(A) HAS ERRED IN ALLOWING THE EXPENS ES OF RS. 6 55 320/- CLAIMED BY THE ASSESSEE IN COMPUTING THE LTCG AT RS . 13 44 680/- TAKING THE SALE CONSIDERATION AT RS. 20 00 000/- AS PER THE SALE DE ED. 3. THE APPELLANT CRAVES LEAVE TO ADD AMEND MODIFY THE GROUNDS OF APPEAL IF ANY IF CONSIDERED NECESSARY SUBSEQUENTLY. 3. FIRST GROUND IS WITH RESPECT TO DELETION OF ADDI TION OF RS.30 41 000/-. 3.1 DURING THE COURSE OF ASSESSMENT PROCEEDINGS AS SESSING OFFICER NOTICED THAT ASSESSEE HAD RECEIVED LOANS AGGREGATING TO RS. 82 05 000/- FROM VARIOUS PARTIES. THE ASSESSING OFFICER ASKED THE ASSESSEE TO PROVE THE GENUINENESS AND THE CAPACITY OF THE LENDERS. THE ASSESSING OFFICER NOTED THAT FOR THE LOANS RECEIVED FROM 6 PERSONS AGGREGATING TO RS.30 41 000/- (THE D ETAILS OF WHICH ARE LISTED AT PAGE 3 OF THE ASSESSMENT ORDER) ASSESSEE COULD NOT PROVE THE GENUINENESS AND THE CAPACITY OF THE LENDERS TO ADVANCE THE AMOUNT T O THE ASSESSEE. HE THEREFORE CONCLUDED THAT THE ASSESSEE HAS NOT PROVED THE GENU INENESS OF THE LOANS AND THAT THE AMOUNTS THAT WAS INTRODUCED AS LOAN WAS IN FACT THE UNDISCLOSED INCOME OF THE ASSESSEE. HE ACCORDINGLY MADE THE ADDITION OF RS.3 0 41 000/-. AGGRIEVED BY THE 3 ITA NO.2225/PN/2012 ORDER OF ASSESSING OFFICER ASSESSEE CARRIED THE MA TTER BEFORE CIT(A) WHO DELETED THE ADDITION BY HOLDING AS UNDER :- 7.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE C ASE THE ASSESSMENT ORDER THE REPORT OF THE AO AND THE RIVAL CONTENTIONS. OUT OF THE TOTAL UNSECURED LOANS OF RS.82 05 000/- OUTSTANDING AS ON THE YEAR END THE ASSESSING OFFICER HAS TREATED LOANS TOTALING RS.30 41 000/- AS NOT GENUINE IN RES PECT OF SIX PARTIES BROADLY ON TWO COUNTS. THESE DETAILS ARE ON PAGE 3 OF THE IMPUGNE D ASSESSMENT ORDER. FIRSTLY THERE WAS NO CONFIRMATION LETTER IN RESPECT OF FOUR PARTIES AND SECONDLY IN RESPECT OF TWO PARTIES THE BANK STATEMENT COVERING THE ENTRIE S OF THE LOANS WAS NOT PRODUCED BEFORE HIM. DURING THE HEARING BEFORE ME THE APPELL ANT FURNISHED THE CONFIRMATION LETTERS AND THE BANK STATEMENTS. THESE WERE ADDITIO NAL EVIDENCES WHICH WERE CONSIDERED NECESSARY FOR DISPOSAL OF THIS APPEAL AN D WERE DEALT WITH IN TERMS OF RULE 46A. ON PERUSAL OF THE SAME IT HAS BEEN NOTIC ED THAT THE APPELLANT HAS ACCEPTED THE SAID UNSECURED LOANS BY BANK CHEQUES A ND HAS ALSO FILED CONFIRMATIONS OF THE LENDERS 7/12 EXTRACTS OF THEI R LAND HOLDINGS PAN CARDS/PAN NOS. THE AO WAS GIVEN SUFFICIENT OPPORTUNITY IN VIE W OF RULE 46A OF THE I.T. RULES BEFORE ADMITTING THEM. THE AO VIDE LETTER DATED 19/ 03/2012 WAS DIRECTED TO EXAMINE THE ADDITIONAL EVIDENCE FILED BY THE APPELL ANT. HE HAS CONSIDERED THE EVIDENCE AND HAS FILED HIS COMMENTS ON THE SAME . HOWEVER EVEN AFTER BEING SPECIFICALLY ASKED TO EXAMINE THE EVIDENCE THE AO INSTEAD OF VERIFYING THE EVIDENCE IN THE MANNER HE LIKED SUCH AS EXAMINATION OF LENDE RS ETC. BEFORE FILING THE REPORT HAS AGAIN ASKED FOR THE SAID EXAMINATION. THIS TANT AMOUNTS TO PROCRASTINATION AND AS THE ADDITIONAL EVIDENCE HAS ALREADY BEEN BROUGHT TO THE AO'S NOTICE THROUGH THE PROCESS OF LAW ESTABLISHED THE REQUEST OF THE A.O. IS CONSIDERED UNREASONABLE HENCE THE SAME IS REJECTED. 7.3.1 IN REPLY THE AO VIDE REPORT DATED 09/04/2012 HAS ARGUED THAT THE MERE FILING OF THE CONFIRMATION LETTER IS NOT SUFFICIENT TO PRO VE THE GENUINENESS OF THE LOAN. ON THE FACTS OF THIS CASE WHEREIN THE ID. AO HAS ACCE PTED THE LOANS IN WHICH LETTERS OF CONFIRMATION AND BANK STATEMENTS WERE FILED BEFORE HIM ON HIS PART IT IS NOT JUSTIFIABLE TO REJECT THE CONFIRMATION LETTERS AND BANK STATEMENT FILED SUBSEQUENTLY TO THE ASSESSMENT ORDER AND DEALT WITH IN TERMS OF RUL E 46A. IN RESPECT OF THE TWO PARTIES WHERE ADDITION WAS MADE FOR WANT OF THEIR B ANK STATEMENTS THE APPELLANT SUBMITTED CONFIRMATION LETTER IN RESPECT OF ONE PAR TY AND BANK STATEMENT IN RESPECT OF THE OTHER PARTY. THE CONFIRMATION LETTERS BEARS COMPLETE NAMES AND ADDRESSES AND THEIR PANS. THE BANK STATEMENT FILED INDICATES THE CLEARING OF CHEQUE THROUGH WHICH THE AMOUNT OF LOAN WAS ADVANCED TO TH E ASSESSEE. THESE ARE REASONABLY GOOD PROOFS WHICH THE ID. AO HAS CONVERT ED INTO NO PROOF. THEREFORE IT IS NOT THE CASE OF A MERE FILING OF A CONFIRMATION LETTER. IT IS SETTLED LAW THAT REJECTION OF AN EXPLANATION OF THE ASSESSEE BY IGNORING TO CO NSIDER IMPORTANT PIECES OF EVIDENCE IS AN ERROR IN LAW. IN RESPECT OF LOAN FRO M SHRI MILIND BHUMKAR RS. 8 00 000/- THE APPELLANT HAS FILED CERTIFICATE FRO M SBI STATING THAT THE SAID AMOUNT HAS BEEN TRANSFERRED TO THE BANK ACCOUNT OF THE APP ELLANT FROM THE BANK ACCOUNT OF VMB GROUP. IN THIS REGARD THE APPELLANT HAS CLARI FIED THAT SHRI MILIND BHUMKAR IS PROPRIETOR OF M/S. VMB GROUP. FURTHER THE CONTENT IONS OF THE A.O. HAVE BEEN REASONABLY REBUTTED BY THE APPELLANT AS PER THE PRE CEDING PARAGRAPHS. IT IS A SETTLED LAW THAT IN ORDER OF PROVE THE CASH CREDITS /UNSECURED LOANS THE ASSESSEE HAS TO PROVE THREE CONDITIONS VIZ. IDENTITY OF THE LENDER GENUINENESS OF THE TRANSACTION AND CAPACITY OF THE LENDER. IN THE CAS E UNDER APPEAL THE TRANSACTIONS ARE THROUGH BANKING CHANNEL AND THE APPELLANT HAS A LSO FILED EVIDENCES LIKE 7/12 EXTRACTS OF THE LAND HOLDINGS AND PAN CARD/ PAN NOS . OF THE LENDERS WHICH HAS PROVED THE GENUINENESS OF THE TRANSACTION AND ALSO THE IDENTITY OF THE LENDERS. THE CAPACITY OF THE LENDERS HAS ALSO BEEN PROVED AS THE SAID LOANS ACCEPTED BY BANK CHEQUES WERE EITHER FROM THE PERSONS WHO ARE ASSESS ED TO TAX OR FROM THE PERSONS WHO ARE RICH AGRICULTURISTS OF PIMPANGAON(B) HAVING SUBSTANTIAL LAND HOLDING. IN VIEW OF THE ABOVE FACTS AND DISCUSSION ALL THE THRE E CONDITIONS REQUIRED TO BE 4 ITA NO.2225/PN/2012 FULFILLED TO PROVE THE UNSECURED LOANS HAVE BEEN FU LFILLED BY THE APPELLANT. IN VIEW OF THE ABOVE FACTS AND DISCUSSION THE ADDITION OF RS. 30 41 000/- ON ACCOUNT OF UNEXPLAINED UNSECURED LOANS IS DELETED. GROUND NO.2 IS ALLOWED. 4. AGGRIEVED BY THE ORDER OF CIT(A) REVENUE IS NOW IN APPEAL BEFORE US. 4.1 BEFORE US LD. DR SUPPORTED THE ORDER OF ASSESS ING OFFICER. HE FURTHER SUBMITTED THAT DURING THE REMAND PROCEEDINGS ASSES SEE DID NOT PRODUCE THE LENDERS FOR EXAMINATION BY THE ASSESSING OFFICER AN D THAT LD. CIT(A) DECIDED THE ISSUE ONLY ON THE BASIS OF REMAND REPORT. HE THERE FORE SUBMITTED THAT THE ASSESSING OFFICER BE GRANTED AN OPPORTUNITY TO EXAM INE THE LENDERS. THE LD. AR ON THE OTHER HAND SUPPORTED THE ORDER OF CIT(A) AND DID NOT SERIOUSLY OBJECT TO THE PRAYER OF LD. DR OF GRANTING THE OPPORTUNITY OF EXA MINATION OF LENDERS BY THE ASSESSING OFFICER. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN THE PRESENT CASE REVENUES GRIEVANCE IS THAT ASSES SING OFFICER WAS NOT GIVEN AN OPPORTUNITY TO EXAMINE THE LENDERS AND THAT LD. CIT (A) DECIDED THE ISSUE ONLY ON THE BASIS OF REMAND REPORT OF ASSESSING OFFICER. B EFORE US LD. AR HAS ALSO NOT SERIOUSLY OBJECTED TO THE PRAYER OF LD. DR FOR EXAM INATION OF THE LENDERS BY THE ASSESSING OFFICER. IN VIEW OF THE AFORESAID FACTS WE RESTORE THE ISSUE TO THE FILE OF ASSESSING OFFICER SO THAT HE CAN EXAMINE THE LENDER S AND THEREAFTER DECIDE THE ISSUE IN ACCORDANCE WITH LAW. THUS THIS GROUND OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 6. SECOND GROUND IS WITH RESPECT TO RELIEF GRANTED WHILE COMPUTING LONG TERM CAPITAL GAINS. 5 ITA NO.2225/PN/2012 6.1 THE ASSESSING OFFICER NOTICED THAT DURING THE Y EAR ASSESSEE HAD SOLD A PIECE OF LAND SITUATED AT VILLAGE DINDORI AND THE S ALES CONSIDERATION AS PER THE SALE DEED WAS RS.20 LACS AS AGAINST THE VALUATION OF THE LAND FOR STAMP DUTY AT RS.49 98 000/-. SINCE THE VALUE AS PER STAMP DUTY WAS MORE THAN THE VALUE AS PER SALE DEED ASSESSING OFFICER REFERRED THE MATTER FO R VALUATION TO DEPARTMENTAL VALUATION OFFICER (DVO). THE DVO VIDE REPORT DATED 23.12.2011 VALUED THE PROPERTY AT RS.24 92 000/-. ON THE BASIS OF THE VA LUATION REPORT ASSESSING OFFICER COMPUTED THE LONG TERM CAPITAL GAIN (LTCG) AT RS.19 16 396/-. THE ASSESSING OFFICER ALSO NOTED THAT ASSESSEE WHILE COMPUTING TH E LTCG HAD CLAIMED DEDUCTION OF RS.6 55 320/- ON ACCOUNT OF EXPENSES FOR THE SAL E TRANSACTION. IN THE ABSENCE OF NECESSARY DETAILS ASSESSING OFFICER DISALLOWED THE CLAIM OF EXPENSES. AGGRIEVED BY THE ORDER OF ASSESSING OFFICER ASSESSEE CARRIED THE MATTER BEFORE CIT(A) WHO DECIDED THE ISSUE BY HOLDING AS UNDER :- 6.1 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE C ASE THE ASSESSMENT ORDER THE REPORT OF THE AO AND RIVAL CONTENTIONS. IN THE CASE UNDER APPEAL THE COMMISSION HAS BEEN PAID AT RS. 2 60 150/- IN RESPECT OF SALE OF LAND FOR CONSIDERATION OF RS.20 00 000/- I.E. @ 1.30% WHICH DOES NOT APPEAR T O BE EXCESSIVE. FURTHER THE EXPENDITURE IS SUPPORTED BY VOUCHERS WHICH ARE DULY SIGNED BY THE PAYEES. IT IS A KNOWN FACT THAT FOR SELLING IMMOVABLE PROPERTY GEN ERALLY SERVICES OF THE AGENTS REGULARLY DEALING IN PROPERTY MARKET IS REQUIRED AN D THE COMMISSION IS GENERALLY PAID @ 1% TO 2% OF THE SALE VALUE. FURTHER THE CON TENTIONS OF THE A.O. HAVE BEEN REASONABLY REBUTTED BY THE APPELLANT AS PER THE PRE CEDING PARAGRAPHS. THE A.O. VIDE LETTER DATED 19/03/2012 WAS DIRECTED TO EXAMIN E THE ADDITIONAL EVIDENCE FILED BY THE APPELLANT. THE A.O. HAS CONSIDERED THE EVIDE NCE AND HAS FILED HIS COMMENTS ON THE SAME. HOWEVER EVEN AFTER SPECIFICALLY ASKED TO EXAMINE THE EVIDENCE THE A.O. INSTEAD OF VERIFYING THE EVIDENCE SUCH AS EXAM INATION OF PAYEE ETC. BEFORE FILING THE REPORT HAS AGAIN ASKED FOR ANOTHER EXAM INATION. THIS TANTAMOUNTS TO PROCRASTINATION AND AS THE ADDITIONAL EVIDENCE HAS ALREADY BEEN BROUGHT TO THE AO'S NOTICE THROUGH THE PROCESS OF LAW ESTABLISHED THE REQUEST OF THE A.O. IS CONSIDERED UNREASONABLE HENCE THE SAME IS REJECTED. IN VIEW O F THE FACT THAT THE APPELLANT HAS FILED ADDITIONAL EVIDENCE THE A.O. WAS GIVEN SUFFI CIENT OPPORTUNITY IN VIEW OF RULE 46A OF THE I.T. RULE AND THEN THE ADDITIONAL EVID ENCE HAS BEEN ADMITTED AS THE SAID EVIDENCE WAS FOUND NECESSARY TO DECIDE THE GRO UNDS OF APPEAL. THE DISALLOWANCE OF EXPENDITURE OF RS.2 60 150/- ON ACC OUNT OF COMMISSION PAYMENT IS THEREFORE CANCELLED AND THE ADDITION IS DELETED. 6.2 XXXXX 6.3 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CA SE THE ASSESSMENT ORDER THE REPORT OF THE AO AND RIVAL CONTENTIONS. ON PERUSAL OF THE SAME IT HAS BEEN NOTICED THAT THE APPELLANT HAS INCURRED EXPENDITURE OF RS.2 00 000/- FOR VACATING THE LAND WHICH WAS CLAIMED TO HAVE BEEN ENCROACHED. THE EXP ENDITURE CLAIMED IS 10% OF THE SALE PROCEEDS OF THE LAND SOLD. IN THE PRESENT DAYS AN ENCROACHMENT ON THE 6 ITA NO.2225/PN/2012 VACANT LAND HAS BECOME A COMMON PHENOMENA. IN SUPPO RT OF THE ABOVE CLAIM THE APPELLANT HAS FILED VOUCHERS WHICH ARE DULY SIGNED BY THE PAYEES. FURTHER THE CONTENTIONS OF THE A.O. HAVE BEEN REASONABLY REBUTT ED BY THE APPELLANT AS PER THE PRECEDING PARAGRAPHS. THE A.O. VIDE LETTER DATED 19 /3/2012 WAS DIRECTED TO EXAMINE THE ADDITIONAL EVIDENCE FILED BY THE APPELL ANT. THE A.O. HAS CONSIDERED THE EVIDENCE AND HAS FILED HIS COMMENTS ON THE SAME. HO WEVER EVEN AFTER SPECIFICALLY ASKED TO EXAMINE THE EVIDENCE THE A.O. INSTEAD OF VERIFYING THE EVIDENCE IN THE MANNER HE LIKED SUCH AS EXAMINATION OF PAYEE ETC. B EFORE FILING THE REPORT HAS AGAIN ASKED FOR THE SAID EXAMINATION. THIS TANTAMOUNTS TO PROCRASTINATION AND AS THE ADDITIONAL EVIDENCE HAS ALREADY BEEN BROUGHT TO THE AO'S NOTICE THROUGH THE PROCESS OF LAW ESTABLISHED THE REQUEST OF THE A.O. IS CONSIDERED UNREASONABLE HENCE THE SAME IS REJECTED. IN VIEW OF THE FACT THA T THE APPELLANT HAS FILED ADDITIONAL EVIDENCE THE A.O. WAS GIVEN SUFFICIENT OPPORTUNITY IN VIEW OF RULE 46A OF THE I.T. RULE AND THEN THE ADDITIONAL EVIDENCE HAS BEEN AD MITTED AS THE SAID EVIDENCE WAS FOUND NECESSARY TO DECIDE THE GROUNDS OF APPEAL . THE DISALLOWANCE OF EXPENDITURE OF RS.2 00 000/- ON ACCOUNT OF EXPENDIT URE FOR REMOVING ENCROACHMENT IS THEREFORE CANCELLED AND THE ADDITION IS DELETED. 6.4 XXXXX 6.5 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CA SE THE ASSESSMENT ORDER THE REPORT OF THE AO AND THE RIVAL CONTENTIONS. ON PERU SAL OF THE SAME IT HAS BEEN NOTICED THAT THE APPELLANT HAS INCURRED EXPENDITURE OF RS. 1 30 170/- ON ACCOUNT OF FENCING. IN SUPPORT OF THE ABOVE CLAIM THE APPELLA NT HAS FILED VOUCHERS WHICH ARE DULY SIGNED BY THE PAYEES. FURTHER THE CONTENTIONS OF THE A.O. HAVE BEEN REASONABLY REBUTTED BY THE APPELLANT AS PER THE PRE CEDING PARAGRAPHS. THE A.O. VIDE LETTER DATED 19/03/2012 WAS DIRECTED TO EXAMIN E THE ADDITIONAL EVIDENCE FILED BY THE APPELLANT. THE A.O. HAS CONSIDERED THE EVIDE NCE AND HAS FILED HIS COMMENTS ON THE SAME. HOWEVER EVEN AFTER SPECIFICALLY ASKED TO EXAMINE THE EVIDENCE THE A.O. INSTEAD OF VERIFYING THE EVIDENCE IN THE MANN ER HE LIKED SUCH AS EXAMINATION OF PAYEE ETC. BEFORE FILING THE REPORT HAS AGAIN A SKED FOR THE SAID EXAMINATION. THIS TANTAMOUNTS TO PROCRASTINATION AN D AS THE ADDITIONAL EVIDENCE HAS ALREADY BEEN BROUGHT TO THE AO'S NOTICE THROUGH THE PROCESS OF LAW ESTABLISHED THE REQUEST OF THE A.O. IS CONSIDERED UNREASONABLE HENCE THE SAME IS REJECTED. IN VIEW OF THE FACT THAT THE APPELLANT HAS FILED ADDIT IONAL EVIDENCE THE A.O. WAS GIVEN SUFFICIENT OPPORTUNITY IN VIEW OF RULE 46A OF THE I .T. RULE AND THEN THE ADDITIONAL EVIDENCE HAS BEEN ADMITTED AS THE SAID EVIDENCE WAS FOUND NECESSARY TO DECIDE THE GROUNDS OF APPEAL. THE DISALLOWANCE OF EXPENDIT URE OF RS.1 30 170/- ON ACCOUNT OF FENCING EXPENDITURE IS THEREFORE CANCELLED AND T HE ADDITION IS DELETED. 6.6 XXXXX 6.7 I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CA SE THE ASSESSMENT ORDER THE REPORT OF THE AO AND THE RIVAL CONTENTIONS. ON PERU SAL OF THE SAME IT HAS BEEN NOTICED THAT THE APPELLANT HAS INCURRED EXPENDITURE OF RS. 65 000/- ON ACCOUNT OF CONSTRUCTION OF KACCHA APPROACH ROAD. THE AGRICULTU RAL LAND OF THE APPELLANT IS NOT SITUATED ADJACENT TO THE ROAD AND HENCE APPROACH RO AD IS NECESSARY FOR THE FARM LOCATED IN INTERIOR AREA. IN SUPPORT OF THE ABOVE C LAIM THE APPELLANT HAS FILED VOUCHERS WHICH ARE DULY SIGNED BY THE PAYEES. FURTH ER THE CONTENTIONS OF THE A.O. HAVE BEEN REASONABLY REBUTTED BY THE APPELLANT AS P ER THE PRECEDING PARAGRAPHS. THE A.O. VIDE LETTER DATED 19/03/2012 WAS DIRECTED TO EXAMINE THE ADDITIONAL EVIDENCE FILED BY THE APPELLANT. THE A.O. HAS CONSI DERED THE EVIDENCE AND HAS FILED HIS COMMENTS ON THE SAME. HOWEVER EVEN AFTER SPECI FICALLY ASKED TO EXAMINE THE EVIDENCE THE A.O. INSTEAD OF VERIFYING THE EVIDENC E IN THE MANNER HE LIKED SUCH AS EXAMINATION OF PAYEE ETC. BEFORE FILING THE REP ORT HAS AGAIN ASKED FOR THE SAID EXAMINATION. THIS TANTAMOUNTS TO PROCRASTINATION AN D AS THE ADDITIONAL EVIDENCE HAS ALREADY BEEN BROUGHT TO THE AO'S NOTICE THROUGH THE PROCESS OF LAW ESTABLISHED THE REQUEST OF THE A.O. IS CONSIDERED UNREASONABLE HENCE THE SAME IS REJECTED. IN VIEW OF THE FACT THAT THE APPELLANT HAS FILED ADDIT IONAL EVIDENCE THE A.O. WAS GIVEN SUFFICIENT OPPORTUNITY IN VIEW OF RULE 46A OF THE L .T. RULE AND THEN THE ADDITIONAL 7 ITA NO.2225/PN/2012 EVIDENCE HAS BEEN ADMITTED AS THE SAID EVIDENCE WAS FOUND NECESSARY TO DECIDE THE GROUNDS OF APPEAL. THE DISALLOWANCE OF EXPENDIT URE OF RS.65 000/- ON ACCOUNT OF CONSTRUCTION OF KACCHA APPROACH ROAD IS THEREFO RE CANCELLED AND THE ADDITION IS DELETED. 7. AGGRIEVED BY THE ORDER OF CIT(A) REVENUE IS NOW IN APPEAL BEFORE US. 7.1 BEFORE US LD. DR SUPPORTED THE ORDER OF ASSESS ING OFFICER AND FURTHER ON THE ISSUE OF REPORT OF DVO HE SUBMITTED THAT THE F ACTS OF THE CASE IN THE CASE OF THE DECISION OF MADRAS TRIBUNAL WHICH HAS BEEN RELIED UPON BY CIT(A) ARE NOT APPLICABLE TO THE PRESENT FACTS. AS FAR AS THE ISS UE OF ALLOWING THE EXPENSES WHILE COMPUTING CAPITALS GAINS BY THE ASSESSEE ARE CONCER NED HE SUBMITTED THAT NO DETAILS HAVE BEEN FURNISHED BY ASSESSEE IN SUPPORT OF THE EXPENSES. THE CIT(A) DECIDED THE ISSUE ONLY ON THE BASIS OF REMAND REPOR T AND THE ASSESSING OFFICER WAS NOT ALLOWED A CHANCE TO EXAMINE THE PAYEES. HE THE REFORE PRAYED THAT ASSESSING OFFICER BE GRANTED AN OPPORTUNITY TO EXAMINE THE PA YEES. HE THUS SUPPORTED THE ORDER OF ASSESSING OFFICER. THE LD. AR ON THE OTHE R HAND SUPPORTED THE ORDER OF CIT(A) AND AS FAR AS THE REQUEST OF LD. DR FOR EXAM INATION OF PAYEES IS CONCERNED HE DID NOT SERIOUSLY OBJECTED TO THE PRAYER OF LD. DR. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THERE ARE TWO ISSUES IN THE PRESENT GROUND VIZ. FIR ST ISSUE BEING INVOKING OF PROVISIONS OF SECTION 50C AND SECOND BEING ALLOWING OF EXPENSES WHILE COMPUTING THE CAPITAL GAINS. AS FAR AS THE FIRST ISSUE NAMEL Y INVOKING OF PROVISIONS OF SECTION 50C IS CONCERNED WE FIND THAT LD. CIT(A) BY RELYIN G ON THE DECISION OF ITAT MADRAS IN THE CASE OF KUMUDINE VENUGOPAL (SUPRA) HA S DIRECTED THE DELETION OF ADDITION MADE UNDER SECTION 50C. ON PERUSING THE D ECISION IN THE CASE OF KUMUDINE VENUGOPAL (SUPRA) WE FIND THAT THE FACTS I N THAT CASE WERE DIFFERENT THAN THE PRESENT CASE. IN THAT CASE THE FACT WAS THAT A SSESSEE DURING THE COURSE OF ASSESSMENT ITSELF HAD INVOKED HER RIGHT UNDER SECTI ON 50C(2) AND HAD REFERRED THE 8 ITA NO.2225/PN/2012 VALUATION OF PROPERTY TO DVO AND TILL THE TIME THE ASSESSMENT WAS COMPLETED THE REPORT OF VALUATION WAS NOT RECEIVED BY ASSESSING O FFICER. IT WAS DURING THE APPELLATE PROCEEDINGS THE VALUATION REPORT WAS REC EIVED AND CIT(A) HAD CONSIDERED THE DVOS REPORT WHILE PASSING THE APPEL LATE ORDER AND THUS THE VALUATION AS DONE BY DVO WAS NOT A SUBJECT-MATTER O F APPEAL. IN THE PRESENT CASE THE FACTS ARE ENTIRELY DIFFERENT. BEFORE US LD. A R COULD NOT DEMONSTRATE AS TO HOW THE DECISION OF MADRAS ITAT IN THE CASE OF KUMUDINE VENUGOPAL (SUPRA) WOULD BE APPLICABLE TO THE PRESENT FACTS. IN SUCH A SITUATI ON WE ARE OF THE VIEW THAT CIT(A) HAS ERRED IN DECIDING THE ISSUE ON THE BASIS OF DEC ISION OF MADRAS ITAT AND THERE WE SET-ASIDE THE PORTION OF THE ORDER OF CIT(A). A S FAR AS ALLOWABILITY OF EXPENSES ARE CONCERNED WE FIND THAT THE EXPENSES WERE FOUND TO BE JUSTIFIED BY LD. CIT(A). WE HOWEVER FIND THAT WHILE DECIDING THE ISSUE THE ASSESSING OFFICER WAS NOT GIVEN AN OPPORTUNITY TO EXAMINE THE RECIPIENTS OF THE EXP ENSES PAID BY THE ASSESSEE. IN SUCH A SITUATION WE ARE OF THE VIEW THAT IN THE IN TEREST OF JUSTICE AN OPPORTUNITY NEEDS TO BE GIVEN TO ASSESSING OFFICER TO EXAMINE T HE RECIPIENTS. WE THEREFORE RESTORE THE ISSUE TO THE FILE OF ASSESSING OFFICER TO DECIDE THE ISSUE AFTER EXAMINING THE PAYEES AND IN ACCORDANCE WITH LAW. THUS THIS G ROUND OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 9. IN THE RESULT THE APPEAL OF THE REVENUE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 27 TH DAY OF OCTOBER 2016. SD/- SD/- ( SUSHMA CHOWLA ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER # / ACCOUNTANT MEMBER PUNE ; DATED : 27 TH OCTOBER 2016. 9 ITA NO.2225/PN/2012 % & ' () *) / COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-I NASHIK; 4) THE CIT-I NASHIK; 5) THE DR A BENCH I.T.A.T. PUNE; 6) GUARD FILE. % / BY ORDER ' # //TRUE COPY// $ %& # '( / SR. PRIVATE SECRETARY ) '* / ITAT PUNE