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TMI Blog2017 (10) TMI 993X X X X Extracts X X X X X X X X Extracts X X X X ..... confirmed by the ld. CIT(A) is directed to be deleted. Ground of the assessee is allowed. Addition being 20% of the various expenses for which no evidence, such as copies of bills, vouchers were furnished - Held that:- No satisfactory reply or cogent explanation was put forth. The ld. CIT(A) confirmed the action of the Assessing Officer. Before here also, no cogent explanation has been put forth under such facts and circumstances of the case. Find no infirmity in the order of the ld. CIT(A) who has rightly confirmed the action of the Assessing Officer. Thus, Ground of assessee dismissed. Addition on account of wage expenses because no bills and vouchers were produced before the Assessing Officer as well as before the ld. CIT(A). Since the assessee has not produced any cogent explanation before any of the authorities below or even before us, ld. CIT(A) has rightly confirmed the action of the Assessing Officer. Ground of assessee dismissed. - ITA No. 2441/DEL/2017 - - - Dated:- 16-10-2017 - SHRI B.P. JAIN, ACCOUNTANT MEMBER For The Assessee : Shri Arun Kishore, CA For The Revenue : Shri T. Vasanthan Sr. DR ORDER This appeal of the assessee arises from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otal Rs.3,61,858/- ii) That looking at the profile and the nature of business of the appellant, communication and mobility expenses are required to be incurred for the purposes of the business of the appellant. iii) That without prejudice to the above contentions, the disallowance @ 20% is highly excessive. 6. That the net business income of the appellant be reduced by ₹ 41,30,064/- [40,02,248 + 55,444 + 72,372/- short term capital gain be assessed at ₹ 3,66,526/- and long term capital gain be assessed at ₹ 27,36,384/- [28,88,686 1,52,302/-] 3. Ground Nos. 1 and 6 are general in nature and do not require any adjudication. 4. As regards Ground No. 2 with regard to confirmation of addition of ₹ 40,02,248/- as business income in place of capital gains earned on immovable property, the brief facts of the case as emanating from the order of the Assessing Officer are that r'4. On perusal of the Audit Report u/s 44AB of the Income I ax Act. 1961. Form No. 3CB assessee is proprietor of M/s Homz R I Js. on further perusal of Form No. 3CD, Para No. 8(a) the nature of business of the assessee is shown a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital asset in his hands from the time of closure, not withstanding that they were stock-in-trade earlier in his hands. 6. Even in the course of a business, an assessee may try to transfer same of the stock-in-trade from his trading activity and dea.de -to '.old them, as investment. The stocks so held would assume the character of capital asset from the date of such holding. This may usually happen in the case of dealer in shares and real estate. But in all these cases, the finding will be one of fact depending upon he intention, and conduct of the assessee supported by direct and circumstantial evidence. Similarly, when a capital asset is converted into stock-in-trade the same will no longer be capital asset. However, this situation is covered by section 45(2). In order to substantiate the view to treat capital gem as income from Profit Gain of Business or Profession, following case laws are referred: Gurdial Saraindas Co. v CTTfl963! 50 ITR 633 (Bern) It is well settled that the mere fact that property was purchased with the intention of selling it at a profit is not conclusive on the question whether an isolated transaction of purchase and resale is an ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quare yards 6903.85 7. In view of the above findings, it is clear that the assessee is involved in business of sale and. purchase of the properties. During the year assessee has shown total income from Profit on sale of Plots ₹ 40,02,248/- in the computation of income and the same was deducted from income from business profession for separate consideration of income under head capital gain, is considered as income from business and profession. 8. The ld. CIT(A) confirmed the action of the Assessing Officer. 9. I have considered the rival arguments made by both the sides, perused the orders of the A.O and the ld. CIT(A) and the paper book filed on behalf of the assessee. It is an admitted fact which has not been controverted by the ld. counsel for the assessee that the auditor 'Sr. \No Details Property oj Area (in yards) Rate per square yards including Registration expenses Purchase Price as per deed including Registratio nexpenses Sale Price as per deed Difference 1 Plot No. Amritsar 227 500 2268.15 11,34,077/- 15,50,000/- 4.15,923/- 2 Plot No. Amritsar 244 500 2268.15 11.34.077/- 15,50,000/- 4,15,923/- 3 Plot No. Amritsar 219 287.77 2268.15 6.52.706/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to ₹ 1,52,302/-. 13. I have considered the rival arguments made by both the sides, perused the orders of the A.O and the ld. CIT(A) and the paper book filed on behalf of the assessee. It is evident from record that the assessee had made investment in shares in two companies and the companies have been closed and it was stated that the name of the company had been struck out under the Companies Act and the shares invested as loss. Therefore, there cannot be any gain to the assessee in this regard and the same cannot be the income of the assessee from any angle. Accordingly, the addition so confirmed by the ld. CIT(A) is directed to be deleted. Ground No. 3 of the assessee is allowed. 14. As regards Ground No. 4 confirming the lumpsum addition of ₹ 55,444/- being 20% of the various expenses for which no evidence, such as copies of bills, vouchers were furnished. The assessee was also confronted about the same but no satisfactory reply or cogent explanation was put forth. The ld. CIT(A) confirmed the action of the Assessing Officer. 15. Before me also, no cogent explanation has been put forth under such facts and circumstances of the case. I find no infirmity in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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