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TMI Blog2006 (6) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... ee was asked to give reasons for low profit rate and also to file reasons for debit balance shown in the capital account of M/s Choudhary Auto Agency. It was explained that due to stiff competition in this line of business, the assessee drew low profit, and also that he had to sell the goods at a competitive rate. With regard to negative capital balance, the assessee explained that during the year under consideration of Rs. 12,60,000 was withdrawn to invest in other firms and that he sustained a loss of over 9 crores of rupees during the year. The AO was not satisfied and made the impugned addition of Rs. 13,14,019. The learned CIT(A) deleted this addition because the AO had applied the provisions of s. 145(2) mainly because of non-maintena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital gain shown at Rs. 8,95,370 as against Rs. 16,82,604 assessed by the AO under the head "Short-term capital gain". 7. The facts relating to this issue are that the assessee has shown the short-term capital gain (STCG) on sale of plant and machinery, factory and fixtures at Rs. 1,25,850. The assessee also showed the long-term capital gain on sale of a plot of 400 sq. mt. at Rs. 14,48,205. A building was raised on a plot by the assessee. According to the learned AO, the plot and building comprises one capital unit known as factory building of M/s Diamond Textile and this capital asset was sold by the assessee during the year. The AO further observed that there is no detail regarding the value of the land and that only the structure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preciable asset. The first appellate authority allowed the desired relief. 9. We have heard the rival submissions and perused the evidence on record. 10. The Bench wanted the learned Authorised Representative to file the proof that the assessee was showing land as a separate asset and was not claiming any depreciation thereon. The assessee filed the requisite documents in the form of computation of total income for asst. yr. 1997-98 along with P L a/c for the year ending 31st March, 1007 (sic-1997) arid a statement of fixed assets as on 31st March, 1997. Likewise relevant papers for asst. yr. 1998-99 were also filed. From these papers, we are convinced that the assessee has been showing the land separately and did not claim any deprecia ..... X X X X Extracts X X X X X X X X Extracts X X X X
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