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TMI Blog2013 (7) TMI 724X X X X Extracts X X X X X X X X Extracts X X X X ..... hase deed dated 23.4.1981 showing aggregating amount of Rs.6,86,550/-. The assessee stated that there was an expenditure incurred towards cost of improvement of said land in Financial Year ending 31.3.1989 of Rs.8,54,325/- and in the year ending on 31.3.1990 of Rs.14,86,751/- . Thus, the assessee claimed aggregating amount of Rs.23,41,076/- towards cost of improvement of the said land. The assessee sold 66000 sq.ft. area of the said land for a total consideration of Rs.1,38,75,000/- during the Financial Year relevant to the assessment year under consideration. The assessee worked out the taxable gains at "Nil" after considering the indexation cost. The details of the taxable as computed by the assessee at "Nil" is given by AO at page 3 of the assessment order and at page 5 of the order of ld.CIT(A). It may be stated that the AO considered the cost of acquisition of the said land of 66000 sq.ft., area sold by the assessee under consideration of Rs.3,08,000/-. As mentioned hereinabove, the assessee claimed cost of improvement of land and after taking into account the indexation cost of the said improved land considered it at Rs.69,33,151/-, which the assessee reduced from the sale co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs detailed explanation was filed stating that the Director Shri R.K. Gulati was not having good terms with his wife Mrs. Ranjana Gulati and in the year 1988, she left her marital home and moved to Bangalore in the company of a total stranger. This led to irreparable differences and non-compatibility between them. Due to such estranged relationship between the two, the official documents, ledgers, files and other records were destroyed by Smt. Ranjana Gulati. In the year 1992, Shri R.K. Gulati filed divorce petition and was granted divorce from his wife Smt. Ranjana Gulati by the Delhi High Court. It was thus explained to the AO that the detailed supporting evidences may not be available due to the aforesaid circumstances however, the appellant filed the bifurcation of the expenses incurred and the nature of work carried out at that time. 15. The appellant submits that the AO ought to have appreciated the factual gamut of the case and the circumstantial evidences proving that the evidences were destroyed in fit of rage between the Director and his wife and ultimately leading to divorce between them. The appellant submits that whatever details it could gather from the records of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and which has been added to the cost of land, however, the said balance sheet is not filed with the department for those years as the appellant company was not filing return of income due to non-existence of income. Apart from this, there is no other circumstantial evidence in possession of the appellant to prove the incurring of the expenses. 5.6.4 In the present case, considering the totality of the facts, occurring of events as per the explanations furnished, I am of the view that the appellant ought to be given atleast partial benefit if not fully. It is seen that the appellant has been borrowing funds from other sister concerns whether it be for the purchase of the land or for making improvements in land. For the purchase of land, the appellant borrowed the entire funds from M/s. Crystal Shipping Co. P. Ltd. and now for the purposes of incurring expenses on improvement of land, the appellant has borrowed funds from another sister concern MIs. Crystal Shipping. The evidence to the effect of borrowing of funds is established from the balance sheet of other sister concerns, even if the balance sheet of the appellant is to be ignored completely. Apart from this, it is a general ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not file any evidence to substantiate that there was any cost incurred by the assessee for improvement of the land under consideration. The ld. DR, at the time of hearing submitted a letter dated 9.7.2013 from the AO, copy of which is placed on record, stating that the assessment record is not available. It is relevant to state that the department has been given number of opportunities to produce the assessment record. Ld. DR fairly conceded that he could not substantiate the ground taken by the department that ld.CIT(A) admitted additional evidence in violation of Rule 46A of the Rules. Ld.AR reiterated before us that no additional evidences were filed by the assessee before ld. CIT(A). A reference was also made to the certificate filed with the paper book that all the documents on which reliance is placed were filed before AO as well as ld.CIT(A). 7. Now coming to restricting the disallowance of expenditure on improvement of land to Rs.3,40,751/- as against Rs.23,40,751/- stated by department in the grounds of appeal, ld. DR supported the order of the AO on the ground that the assessee could not produce any evidence to substantiate the incurring of the expenditure for improvemen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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