2022 (12) TMI 292 - AT - Income Tax

Deduction u/s 54B - investments made in purchase of agricultural land - proof of investments etc not supported by the purchase deed - CIT-A allowed the deduction u/s 54B to the extent of that the lands were purchased through registered agreements - HED THAT - We find from the impugned order that the ld. CIT(A) had gone through the material on record and directed the Assessing Officer to allow deduction u/s 54B in respect of investments made in purchase of agricultural land which is supported by registered sale deed. This finding of the ld. CIT(A) is fair and reasonable and does not require any interference. Hence, the appeal of the assessee stands dismissed.

Summary

Issues:
1. Disallowance of deduction u/s 54B of the Income Tax Act, 1961.
2. Denial of claim for exemption u/s 54F due to lack of supporting evidence.
3. Appellant's failure to appear during the appeal process.

Analysis:
1. The appellant, engaged in the hotel business, filed a return of income for the assessment year 2015-16, initially showing a total income of Rs.2,93,600/- which was later revised to a loss of Rs.5,11,671/-. The Assessing Officer completed the assessment at a total income of Rs.1,30,22,060/-, disallowing the claim for deduction of Rs.91,60,000/- u/s 54B of the Act. The Assessing Officer also rejected the claim for exemption u/s 54F, citing lack of proof of investments supported by a purchase deed. Consequently, the Assessing Officer denied the exemption under u/s 54F due to the absence of evidence regarding the expenditure on the construction of a residential bungalow. The appellant challenged this assessment order before the ld. CIT(A).

2. The ld. CIT(A) directed the Assessing Officer to allow the deduction u/s 54B to the extent that the lands were purchased through registered agreements. Upon review, it was found that the ld. CIT(A) had considered the evidence on record and made a fair decision, requiring no interference. The appellant, however, failed to appear during the appeal proceedings despite multiple notices. As a result, the ITAT Pune dismissed the appeal, upholding the decision of the ld. CIT(A) to allow the deduction u/s 54B for investments made in agricultural land supported by registered sale deeds.

3. The ITAT Pune noted the absence of the appellant during the appeal hearing and proceeded to dispose of the matter after hearing the ld. Sr. DR and examining the material on record. The tribunal found the decision of the ld. CIT(A) regarding the allowance of deduction u/s 54B to be reasonable and fair, leading to the dismissal of the appellant's appeal. Consequently, the appeal filed by the assessee was dismissed, affirming the decision of the ld. CIT(A) regarding the deduction under u/s 54B.