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TMI Blog2017 (10) TMI 1456X X X X Extracts X X X X X X X X Extracts X X X X ..... ,000/- for renovation to the erstwhile owner. Even otherwise no documentary evidences with regard to the renovation works done previously and later stage of the house was ever filed before the authorities below or before us. On the aforesaid consideration, we do not have any hesitation to hold that that the ld. CIT(A) has rightly decided the issue in hand against assessee Addition on account of repair and renovation of the property - HELD THAT:- We have failed to understand as to why the assessee alongwith his mother had shown to be licensee/tenant of his father, once his father purchased the property on 29th April, 1999. From the complaint, it reflects that assessee s father had purchased the hotel on 29.04.1999 and therefore sold the same on 04.04.2005 to Sh. Makhtool Singh and other persons and till date the assessee claimed to be the tenant of the said property. This case pertains to the assessment year:2006-07 which means Financial Year: 2005-06 and father of the assessee sold the said property on 04.04.2005, however, it seems that the assessee claiming the expenditure on renovation to be carried out in the F.Y. 2005-06 which at all, does not seems to be true. It is against hu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for justifying the contention of the assessee. 4. That the Authorities below did not appreciate that the payment was made by the assessee- company through payees account cheque and this fact has been duly admitted by Sh. Kewal Krishan Gupta. In view of these circumstances the addition of ₹ 500000/- confirmed by the worthy CIT(A) is not called for and the same may be deleted. 5. That again the worthy CIT(A) has grossly erred in confirming the addition of ₹ 10,31,906/- on account of repair and renovation of the property. The authorities below did not appreciate that this was an old matter and the amount was spent on the repair and renovation of the said old building. The authorities below did not appreciate that necessary proof was filed in the shape of certificate of Architect. It is relevant to point out that the AO if at all was not satisfied with the same he could have summoned the Architect u/s 131 for enquiring the correctness of the facts. The assessee also filed affidavit before the AO which should have been accepted in view of decision of Supreme Court of India in the case of Mehta Parikh & Co. reported in 30 (TR 181. It was also explained before the auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation is not sufficient to prove that the actual renovation was made and the amount has actually been spent. The assessee could not furnish the bills regarding material or labour on any other proof to substantiate his claim. It was observed by the Assessing Officer that it is very interesting to note that the estimated quotation expenditure has been made exactly of the same amount that too not round off amount. It is well held in CIT Vs. Durga Prasad More (1971) 82 ITR 540(SC) that where a party is relying upon self serving documents, it is for the party to establish the truth. Further in the present case, the assessee has failed to discharge his burden of proof, therefore, the claim of the assessee regarding cost of improvement/renovation expenses at ₹ 10,31,906/- was rejected and added into the income of the assessee. Further with regard to issues of expenditure of ₹ 5,00,000/-, it was claimed by the assessee that the said amount has been incurred for renovation on the property in question by Sh. Kewal Krishan Gupta, however, Sh. Kewal Krishan Gupta was called upon by the Assessing Officer and his statement was recorded u/s 131 of the I.T. Act in which he specifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee also filed affidavit before the AO which should have been accepted in view of decision of Supreme Court of India in the case of Mehta Parikh & Co. reported in 30 ITR 181. It was also explained before the authorities below that the original bills were also stolen along-with other documents in the robbery. Thus the amount of ₹ 10,31,906/- on account of renovation of the said depilated property which was very old one and required lot of repairs should have been allowed. Further the Worthy CIT(A) was not justified in confirming the order of the AO therein charging interest u/s 234A, 234B and 234C. The interest charged is not justified and the same may be cancelled. Alternatively the interest charged is very high & excessive. 6. On the other hand, the Ld. DR relied upon the order passed by the authorities below. 7. We have gone through with the facts and circumstances of the case. Ground Nos.1,2,& 7 are general in nature, hence, do not require separate adjudication. Ground No.3 & 4 are connected with each other, therefore, for the sake of convenience and brevity taken together. Let us to peruse the conclusion drawn by the Ld. CIT(A). "Decision:- During assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... housand was spent on renovation and in response to the specific question with regard to furnishing the details of major construction made, if any, which cost beyond more than 2-3 lacs on which Sh. Kamal Kishore Gupta replied " No, I have not made any such huge expenditure on renovation which cost more than 1 Lac." Although, the Ld. AR relied upon the amount of ₹ 2,00,000/-₹ 1,45,000/- & ₹ 1,50,000/- vide cheques No.407807, 396971, and 39690 on dated 8.12.2005, 18.08.2005 and 15.10.2005 respectively, however, the assessee has failed to discharge its onus to prove by bringing on record any supportive material in support of its case once there is ocular evidence which is direct cannot be side lined as Sh. Kamal Kishore Gupta specifically admitted before the A.O u/s 131 of the Act that he has not made any such huge expenditure of renovation which cost more than 1 Lac. Contention of the assessee that Sh. Kamal Kishore Gupta having been admitted to receive ₹ 5,00,000/- by cheque does not sound good in view of specific reply of the said person before A.O. Contention to AO to the effect that statement of Mr. Gupta can not be relied in the absence of assessee as no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence of the actual expenditure incurred on renovation work of the hotel which was carried out much later by the appellant. Accordingly the said quotation of the architect cannot be accepted as an evidence of renovation expenditure incurred by the appellant and is dismissed. In absence of any evidence in the form of bills of material and labour or any other proof of having incurred renovation expenditure on the hotel building by the appellant before the AO or before the undersigned, the AO was justified in rejecting the claim of the appellant of renovation expenditure of ₹ 10,31,906/- and the addition of ₹ 10,31,906/- is confirmed." We have given our thoughtful consideration to the facts and circumstances of the case, submissions of the parties and the order passed by the authorities below. In the instant case for deciding the issue qua renovation expenses claimed at ₹ 10,31,906/- it was emphasized by the assessee that theft was taken place in the hotel premises i.e., Hotel Pegasus, Opp. Railway Station, building at 161/XIV-2, Khasra No.84 , G.T. Road, Amritsar. The Ld. AR relied upon the quotation dated 26.06.1999 to the tune of ₹ 10,31,906/-. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to the assessment year:2006-07 which means Financial Year: 2005-06 and father of the assessee sold the said property on 04.04.2005, however, it seems that the assessee claiming the expenditure on renovation to be carried out in the F.Y. 2005-06 which at all, does not seems to be true. It is also against human probabilities that the quotation dated 26.06.1999 reflects the amount of ₹ 10,31,906/-, however, the renovation alleged to be carried on later on after many years, which have been claimed by the assessee exactly as of quotation amount which creates many doubts for its authenticity. Further, we have to observe that in the Evidence Act, there is a provision to prove the facts by adducing secondary evidence, if primarily is not available as in the instant case, the assessee has based his case upon the theft taken place at the hotel premises, however, we have failed to understand as to what stopped the assessee to brought on record or to call upon the records of raw material supplier, contractor, labours and labour wages expenses if incurred if any. We further observed that the assessee got various opportunities in the assessment proceedings to substantiate its claim, ho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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