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2024 (1) TMI 64 - AT - Income TaxAssessment u/s 153A - addition made being unexplained amount of gift received from his mother - HELD THAT - Before us, assessee submitted that he is ready to file evidences to prove the genuineness of the gift and also will file assessment record for assessment year 2012-2013 wherein the donor late mother had admitted her income and will also file the nexus of this amount with the gift amount. After considering the submissions of the assessee counsel and the rival submissions of ld. CIT(DR), we note that assessee be given one more opportunity to file these details before the Assessing Officer to prove his claim of genuineness of the gift received from his mother late Smt. Radha Narayanan. Assessee will file all the details to prove that the amount received during the financial year 2011-12 with that of money received in the financial year 2014-15 relevant to the assessment year 2015-2016. Hence, this issue is set aside and remitted back to the file of the AO who will adjudicate the issue with proper reasoning after hearing to the assessee. Disallowance of expenditure claimed or incurred on account of movie Aranmanai - AO noted that assessee has failed to produce sufficient evidence in support of his claim and hence he added this amount to the total income of the assessee - CIT deleted the addition simpliciter on the reasoning that major portion of expenditure had suffered TDS and hence genuineness of the same is far from doubting - HELD THAT - CIT(A) has simpliciter deleted the addition on the basis that the expenditure had suffered TDS and copies of ledger folio of the corresponding expenditure is available in the assessment records . As the findings is incomplete and unreasonable, there may be documents available in the assessment records and the seized material relating to these expenses, the should have been examined and then this issue could have been decided. Hence in the interest of justice, the matter is set aside and remit back to the file of the Assessing Officer who will re adjudicate the issue after examining the seized material in the possession of department. The AO will find out the seized material and confront the same with the assessee while deciding the issue. The assessee is also free to submit any evidence in this regard as per law. With the above directions, the matter is remitted back to the file of the Assessing Officer for fresh adjudication. Addition of attributable expenses such as boarding and lodging, commission paid, office building maintenance and travelling - AO restricted the disallowance of expenditure at 25% - CIT(A) deleted addition - HELD THAT - We noted that this expenditure is neither denied by the AO nor the CIT(A). Even now before us, the Revenue has pointed out that this expenditure is only normal expenditure but in the absence of any bills and vouchers, the AO has rightly estimated at 25% which is not very high. In the absence of evidence, we restrict the disallowance at 10% and direct the AO accordingly. This ground of the Revenue is partly allowed. Carry forward loss claimed in the return of income filed u/s. 153A - assessee did not file the return within the time allowed in response to notice under section 153A - time limit for filing the return of income under Section 153A(1)(a) - HELD THAT - Admittedly, in the present case, before us, a notice u/s. 153A of the Act was issued on 24.01.2017 and return is to be filed within thirty days as per the notice. But the assessee filed belated return or return filed after expiry of time limit fixed by the Department i.e. 05.09.2017. It means assessee filed return almost after seven months from the expiry of the time limit fixed by the Revenue. We noted that in this case before Calcutta High Court the return of income was filed within the time allowed by revenue and not belatedly much after issuing notice u/s. 153A of the Act. But in the present case before us, the return of income in response to notice u/s. 153A of the Act was filed after seven months on 05.09.2017 as against notice issued on 24.01.2017. It means that the case law of Shrikant Mohta 2018 (8) TMI 200 - CALCUTTA HIGH COURT is factualy distinguishable and not applicable to the present case. Hence, the CIT(A) has erred in allowing set off of loss. In view of the above, we allow this issue raised by the Revenue.
Issues Involved:
1. Deletion of addition of unexplained gift amounting to Rs. 1,74,00,000/-. 2. Deletion of disallowance of expenditure for the movie "Aranmanai" amounting to Rs. 3,36,00,155/-. 3. Deletion of disallowance of expenditure for the film "Pissasu" amounting to Rs. 1,07,56,041/-. 4. Deletion of disallowance of attributable expenses amounting to Rs. 9,46,269/-. 5. Allowing carry forward of loss claimed in the return of income filed u/s 153A of the Act. Summary: Issue 1: Deletion of addition of unexplained gift amounting to Rs. 1,74,00,000/- The Revenue challenged the CIT(A)'s order deleting the addition of Rs. 1,74,00,000/- claimed as a gift from the assessee's mother, late Smt. Radha Narayanan. The Assessing Officer (AO) had added the amount as unexplained due to lack of evidence. The CIT(A) accepted the assessee's explanation based on the creditworthiness of the donor. The Tribunal noted that the assessee failed to provide sufficient evidence and remitted the issue back to the AO for fresh adjudication, allowing the assessee to submit relevant details. Issue 2: Deletion of disallowance of expenditure for the movie "Aranmanai" amounting to Rs. 3,36,00,155/- The AO disallowed the expenditure claimed for the movie "Aranmanai" due to insufficient evidence. The CIT(A) deleted the addition, stating that the expenses had suffered TDS and were genuine. The Tribunal found the CIT(A)'s findings incomplete and remitted the issue back to the AO for re-adjudication after examining the seized material and allowing the assessee to submit evidence. Issue 3: Deletion of disallowance of expenditure for the film "Pissasu" amounting to Rs. 1,07,56,041/- Similar to the "Aranmanai" expenditure, the AO disallowed the expenses for the film "Pissasu" due to lack of evidence. The CIT(A) deleted the addition based on the genuineness of the expenses. The Tribunal, following the same reasoning as for "Aranmanai," remitted the issue back to the AO for fresh adjudication. Issue 4: Deletion of disallowance of attributable expenses amounting to Rs. 9,46,269/- The AO disallowed 25% of the claimed expenses due to lack of bills and vouchers. The CIT(A) deleted the addition, noting that the expenses were made through banking channels. The Tribunal partially allowed the Revenue's appeal, restricting the disallowance to 10% in the absence of evidence. Issue 5: Allowing carry forward of loss claimed in the return of income filed u/s 153A of the Act The AO disallowed the carry forward of loss claimed in the return filed u/s 153A. The CIT(A) allowed the carry forward, treating the return as filed u/s 139(1). The Tribunal, distinguishing the case from the Calcutta High Court's decision in Shrikant Mohta, held that the belated return filed after the time limit cannot be treated as filed u/s 139(1). Consequently, the Tribunal allowed the Revenue's appeal, disallowing the carry forward of loss. Conclusion: The Tribunal remitted the issues of unexplained gift and disallowed expenditures for fresh adjudication by the AO, partially allowed the Revenue's appeal on attributable expenses, and disallowed the carry forward of loss claimed by the assessee. The appeals were partly allowed for statistical purposes.
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