2010 (7) TMI 1093 - AT - Income Tax

Summary

Issues involved: Appeal against order u/s 147/143(3) for AY 2004-05 - Deletion of addition of loans - Deletion of addition of marriage expenses - Deletion of addition of unexplained investment in property.

Deletion of addition of loans:
The Assessing Officer made an addition of Rs. 8 lakh on loans taken by the assessee, treating them as unexplained. However, the CIT(A) deleted the addition, noting that the assessee provided confirmations from lenders, income tax details, and other supporting documents. The ITAT upheld the CIT(A)'s decision, stating that the AO did not disprove the documents provided by the assessee and failed to conduct further enquiry before rejecting the explanation.

Deletion of addition of marriage expenses:
The AO added Rs. 5 lakh as unexplained expenditure on the marriage of the assessee's daughter, which was later deleted by the CIT(A) for lack of evidence. The ITAT agreed with the CIT(A), stating that the AO did not establish any basis for estimating the expenses at Rs. 5 lakh, especially when the assessee had explained the source of Rs. 2 lakh spent on the marriage.

Deletion of addition of unexplained investment in property:
The AO added Rs. 12 lakh as unexplained investment in a property based on a valuation report, which was deleted by the CIT(A) due to lack of evidence of undervaluation. The ITAT upheld the CIT(A)'s decision, noting that the AO did not provide any material to prove additional investment by the assessee beyond the amount mentioned in the sale agreement.

In conclusion, the ITAT dismissed the revenue's appeal, upholding the CIT(A)'s decisions in all three issues.