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TMI Blog2014 (3) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... both the companies i.e. M/s Vitir Chattels Pvt. Ltd. and Nulon India Ltd. are claimed to be regularly assessed and family related concerns of the assessee - If the amount of Mr. Yash Golyan is lying in one of the family related concern i.e. Vitir Chattels Pvt. Ltd. and then transferred to another concern i.e. Nulon India Ltd. and both of them are assessed – thus, the assessee’s discharge of onus is to be weighed from the assessment record of these concerns – thus, the matter remitted back to the AO for fresh adjudication – Decided in favour of Assessee. - ITA No. 556/Del/2013 - - - Dated:- 21-2-2014 - Shri R. P. Tolani And Shri S. V. Mrhrotra,JJ. For the Appellant : Shri K. R. Manjani Adv. For the Respondent : Smt. Renuka Jain Gupta Sr. DR ORDER Per R. P. Tolani, J.M: This is assessee's appeal against the order of CIT(A)-XVI, New Delhi dated 07-12-2012 relating to A.Y. 2009-10. Following grounds are raised: 1. Learned A.O. as well as CIT(A) have erred on facts as well as in law in not allowing litigation expenses for 15 years in various courts as well as electricity charges of tenant which were incurred to improve the valuation of property, on wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade: In order to improve market value, drawback, encumbrances on right and title of her property No.51-B, Friends colony which was let out to a firm, M/s. Amin Chand Pyare Lal for paltry sum of Rs.2,000/- p.m. which was increased to Rs.2,200/- p.m. in July 1992. Your honour are aware that in Delhi where the rents are below Rs.3500/- p.m., these are governed by Delhi Rent Control Act and the tenant cannot be evicted. However, in this case, the tenant had sub-let the property to Shri Anil Kumar Gupta without the consent and knowledge of the landlord. The nature of the tenant could be gauged from the fact that the litigation dragged on from June 1992 to 18th December 2006 and the matter has been rolling and roaming from Additional Rent Controller to High Court in which stay petitions and objections even about the ownership of the landlords were raised. After .fighting the case in Hon 'ble Delhi High Court in regard to stay and miscellaneous applications for more than three years, the matter came back to Additional Rent Controller where the petition for eviction was originally filed. The matter was ultimately settled in Hon'ble High Court on 18.12.2006 when Shri Ani! Gupta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant's portion. i. 298 ITR 268 (Karn) Mrs. June Perrett v. Income-tax Officer Capital gains-deductions-expenditure incurred wholly and exclusively in connection with transfer-sale of property received under will-expenditure incurred on obtaining probate, travel expenses of executors and expenditure on evicting illegal tenant-deductible-income- tax act, 1961, s. 48. ii. 241 CTR 364 (Mad.) V. LAKSHMI REDDY Vs. INCOME TAX OFFICER Capital gains-Deduction under s. 48-Amount spent for rectifying the defects in the title to the property and removing encumbrance to transfer-Is expenditure incurred in connection with the transfer for the purpose of computation of capital gains as per s. 48. 2.3. Ld. CIT(A) rejected the claim of the assessee, by observing as under: 3.3.1 I have considered the findings of the A.O. as well as all the submissions of the AIR of the appellant. During the relevant F.Y the assessee has sold house property for a consideration of Rs.15 crores as per sale deed dated 03/0712008 and as the assessee was having 50% shares in the property, therefore, sale consideration of Rs. 7,50,00,000/- was shown under the head income from capital gain in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court fee, court expenses, typing photostat, certified copies of orders, postage, courier, miscellaneous expenses, fees of advocates and senior advocates, juniors, clerks, munshis, salary of person who was engaged to pursue the litigation, conveyance, transport and telephones etc. were filed. No documentary evidence in support of the above expenses were filed despite sufficient opportunities were allowed by the A.O. During the course of appellate proceedings also on 03.12.2012, the A.R of the appellant was requested to furnish the details of the above expenses along with supporting evidences. The A.R submitted that the particulars are not available. In the absence of any details and documentary evidences in support of the expenses claimed by the appellant, the genuineness of the expenses claimed are not proved. The appellant has failed to discharge the onus cast upon her, to prove that expenditures claimed are genuine. Therefore, the expenses are not allowable to the appellant as incurred in connection with transfer of capital asset u/s 48. In the case of B.N. Pinto v. CIT [1974] 96 ITR 306 (MYS) Hon'ble Mysore High Court have held that: It was not claimed that there was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ran Bansal vs. ACIT (ITAT, Del) 10 ITR (Trib) 180 Hon'ble ITAT Delhi and in the case of S. Sudha vs. ACIT (ITAT, Chennai) 10 ITR (Trib) 206; 131 ITD 575 ITAT Chennai have held that expenditures on tiles laying, white washing, electrical re-wiring, wood work etc. are on general maintenance of property and not for improvement of property. Therefore, not deductible while computing capital gains. In view of the above facts and decisions, the said electricity charges paid being in the nature of general maintenance of property, is not allowable while computing capital gain u/s 48. The appeal fails in this ground. 2.4. Apropos the second ground, A.O. found that in the personal balance sheet of the assessee an amount of Rs. 16 lacs was shown as unsecured loan received from her son Master Yash Golyan. Assessee was required to file confirmation and copy of bank a/c in this behalf to substantiate the cash credits, which according to A.O. was not filed. It was thus held that assessee has failed to prove the identity, creditworthiness and capacity of Master Yash Golyan to advance this amount and added as unexplained cash credit in the income of the assessee u/s 68 of the Act. 2.5. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is before us. 3. Ld. Counsel for the assessee adverting to grounds contends that the facts about on going property dispute between the assessee, M/s Amin Chand Pyare Lal and Anil Kumar Gupta have not been denied by any of the lower authorities. The above amounts have been excluded from cost of acquisition mainly by observations that necessary evidence for incurring of expenditure was not produced by the assessee. Smt. Bina Devi was a non- resident and the property disputes i.e. restoration of possession and connected litigations were going on in Delhi. Chronology of the legal proceedings starting from 6-11-1992 onwards before Rent Controller, Rent Control Tribunal and Hon'ble Delhi High Court dispute are placed on the record. Smt. Bina Devi being not physically present in India had to contest multifarious litigation through legal attorneys, senior advocates and battery of other lawyers. The spectrum of litigation speaks volumes about legal expenses in a place like Delhi. The expenditure incurred is attributable to the heads mentioned in the statement in this behalf. Thus, the title of the assessee for peaceful enjoyment of property was endangered and to save the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts proposed by A.O. is to the effect that the assessee failed to adduce evidence towards incurring these legal expenses. The fact of the matter is that the legal expenses have been incurred not by the assessee but by her grand mother in law as it is only after the improvement and clearance of title, the property was gifted to both the donees. Thus, the expenditure was incurred by Smt. Bina Devi and this claim has been made by the assessee based on her information. 3.4. Apropos second ground of appeal, ld. Counsel contends that the confirmation from the said M/s Vitir Chattels Pvt. Ltd. and Nulon India Ltd. were duly filed before the CIT(A). The above amount is continuing in their books way back from the year 2003 in the name of Shri Yash Golyan. He subsequently became major and the confirmation was also filed by him in the capacity of major. The assessee discharged her primary onus by explaining that the amount in question was owned by Shri Yash Golyan from 2003 and the amount has been transferred through internal book transfer in the account of Nulon India Ltd.. These concerns are related with the assessee family. It will be travesty of justice to add the same amount in the ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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