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TMI Blog2015 (8) TMI 1142X X X X Extracts X X X X X X X X Extracts X X X X ..... this preliminary issue and perused the record. The assessee has furnished a copy of reasons recorded by the AO for reopening of assessment at page 18 of the paper book filed by the assessee. The reasons recorded by the AO read as under: "SHRI NARASINHA J GHATE : ASSESMETN YEAR 2004-05 In this case Income tax return for the AY 2004-05 was filed on 1.11.2004 declaring total income at Rs. 2,79,690/-. The return is accompanied with tax audit report which shows the assessee is proprietor of M/s Orient Associates doing the business as Builders and developers. The asset side of the balance sheet shows WIP at Rs. 14,42,034/- and various plots of land at Ulve and Kamothe. The assessee has also shown advance against booking at Rs. 29,00,556/-. Howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AO has made reference to the advance received by the assessee towards booking of flats. Accordingly, the ld. DR submitted that the AR was not right in presuming that the AO has reopened the assessment with regard to WIP only. The ld. DR further submitted that the AO has added the sum of Rs. 1,36,525/- relating to capital gain arising on sale of assets. Accordingly, he submitted that the AO has made addition with respect to the one of the points on which the impugned assessment was reopened. 6. Having heard the rival submissions, we are of the view that there is no merit in the contentions of the assessee. As pointed out by the ld. DR that the AO has reopened the assessment, inter-alia, with regard to the income arising on sale of other a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 7980/- towards the electricity charges of his residence and claimed the same as expenditure, since he was carryon the business activities from his residence. The ld. CIT(A), by accepting the contention of the assessee with regard to the electricity charges pertaining to Plot No.200, granted relief to the tune of Rs. 2,81,034/-. However, the ld. CIT(A) confirmed the electricity charges of Rs. 7980/- pertaining to residence. Aggrieved by the decision of the ld.CIT(A) in confirming the addition of Rs. 7980/- towards electricity charges the assessee is in appeal before us. 9. We notice that the electricity charges of Rs. 7980/-pertain to residence of the assessee. Though the assessee has contended that he was using the residence as his offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shed project wise profit and loss account and hence the AO proceeded to work out the profit from each of the project. Though the AO allocated direct expenses to the concerned project, the indirect or common expenses were allocated equally @ 1/3 each between the three projects referred above. In this process, the AO arrived at profit from the project carried out at Plot No.42 at Rs. 10,95,869/- and assessed the same. The ld. CIT(A) also confirmed the same. 13. We have heard both the parties and perused the record on this issue. According to the assessee, he was preparing consolidated profit and loss account. The Ld A.R submitted that the assessee has completed the project in Plot No.42 and the other projects are only at infancy state. Accor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... should be allocated to Plot No.42. Considering the status of each of the project, we are of the considered view that the allocation of administrative expenses would meet ends of justice, if it is allocated in the following manner: a) Plot No.42 70% b) Plot No.57 20% and c) Plot No.76 10% Accordingly, we set aside the order of the ld. CIT(A) on this issue and direct the AO to recompute the profit on construction of flats on Plot No.42 by adopting the administrative expenses in the ratio cited above. 15. The next issue relate to assessment of profit from construction on flats on plot Nos. 57 and 76. The AO estimated the profit at 11% of WIP and the ld. CIT(A) also confirmed the same. Before us, the ld.AR submitted that both the projects ..... X X X X Extracts X X X X X X X X Extracts X X X X
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