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TMI Blog2010 (10) TMI 1064X X X X Extracts X X X X X X X X Extracts X X X X ..... e order of ld. CIT(A) in ITA No.130/C-9(1)/CIT(A)-V/08-09 dated 24.6.2009 for the A.Y. 2006-07. 2. Since the issues involved in the appeal of the Revenue and the Cross Objection of the assessee are same, they are heard together and a common order passed for the sake of convenience. 3. The Revenue has raised five grounds in its appeal, wherein ground No.1, 4 & 5 are general in nature and do not survive for adjudication. The crux of the issue arising from ground Nos. 2 & 3 are that ld. CIT(A) has erred in deleting the addition made by the AO towards undisclosed investment in a property in "Peenya" for Rs. 76,30,000 which came to the knowledge of the Revenue due to AIR information and the assessee failed to produce his books of accounts to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y purchased by the assessee in Madurai forms part of the balance sheet and an amount of Rs. 62,20,000 was included therein. According to the ld. AO, the assessee had no answer with regard to the property purchased at Peenya for a consideration of Rs. 70,00,000. Therefore relying on the AIR report, the ld. AO treated the property supposed to have been purchased by the assessee in Peenya as income from undisclosed investment and made an addition of Rs. 76,30,000/- based on the purchase consideration of Rs. 70,00,000/-, and assumption of, 8% towards stamp duty - Rs. 5,60,000/-, registration fee at 1 % - Rs. 70,000/-. 7. The assessee came in appeal before the ld. CIT(A). The CIT(A) after due deliberation and after obtaining a remand report of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot purchase any property in Peenya and therefore was not in a position to submit either the purchase details before the ld. AO or it found a place in the balance sheet of the assessee. Ld. AR prayed that the matter could be remitted back to the ld. AO for the AO to establish that the assessee has purchased the property in Peenya for Rs. 70,00,000/- by producing the purchase deed. The assessment order based only on the reliance placed upon the information found in the AIR report is bad in law. The Revenue has to establish that the assessee had purchased the property by producing the sale deed from the Sub-Registrar, when the assessee claims that there was no such registration of sale executed by him. The document executed with the Sub-Regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccount and verified the schedule of cash and bank balances. Extract of the ld.CIT(A)'s order is reproduced hereinbelow at the cost of repetition for reference: "....On the other hand, the appellant stated that any land purchased for the purposes of construction of residential apartments would be accounted as direct expenses and accordingly included said investment as cost of construction. The accounts of the assessee are audited and the appellant has filed his return of income along with the said report. The Profit and Loss account reflected the same as contract receipts/construction cost and Ledger abstract of land purchase and contract receipts account for the relevant period. On perusal of the bank transactions and the schedule of Fixe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05 CA 587 Ch.No.643390 issued Shankaraiah towards a/c. towards purchase of land at Dollars Colony Payment 25,00,000.00 18.5.05 CA 587 Ch.No.643392 issued Shankaraiah towards a/c. towards purchase of land at Dollar colony Payment 20,00,000,00 Opening balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld. The AO has no cogent reason to disallow the said expenditure when the payment was made through appellant's bank account and the expenses are accounted in the books of accounts. In view of this, I am of the considered opinion that the disallowance made by the AO is not justified and the same has to be deleted." The arguments put forth by the ld. AR and the Ld.DR, before us, are quit contrary to the facts observed by the ld.CIT(A) in his order. In these circumstances, we are of the opinion that the matter may be remitted back to the file of the ld.AO for de novo consideration with respect to the loan issue of purchase of property in Peenya. In the event the assessee claims that he has not purchased the property, as revealed in the AIR, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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