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TMI Blog2019 (8) TMI 520X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 8,06,268/- as 10% of Development Expenses without bringing on record any specific instances that the vouchers are not related to the business of the Assessee. Such ad- hoc disallowance based on estimate basis without bringing on record any cogent reasons, is not justified and is invalid, and the said addition be deleted. 3. Commissioner of Income Tax (Appeals) has erred in charging interest u/s. 234B. Appellant prays for just and equitable relief. 4. Appellant prays to add, alter, amend and /or withdraw the grounds, during the appellate proceedings, as the occasion may arise." 2. The brief facts in this case are that the assessee is doing trading in land and return of income for assessment year 2009-10 was filed on 01.10.2009, declaring total income Rs. 12,86,57,220/-. Subsequently, the return was revised on 21.06.2010 at the total income of Rs. 12,86,57,220/-. The case was selected for scrutiny and the assessment was completed on 14.12.2011 u/s.143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act‟) at the total income of Rs. 19,29,01,090/-, after making various additions/disallowances as appearing in the assessment order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appearing in his order, he held that the land sold by the assessee during the year as non-agricultural land and surplus of Rs. 6,34,30,268/- on sale of agricultural land were held as profits of the assessee from land dealing business and added to the total income of the assessee. 4. That before the Ld. CIT(Appeals) detailed submissions were again placed by the assessee. The Ld. CIT(Appeals) after considering the submissions of the assessee, facts of the case and assessment order upheld the addition made by the Assessing Officer by making specific observation. As regards the surrounding circumstances associated with the land it was observed by the Ld. CIT(Appeals) that land in question in Waki was purchased from one Shri Sachin Agarwal and he is in no way related to the assessee, however, normal practice is that the agricultural land were not purchased from unrelated persons for carrying out agricultural activity. Further, land in question was sold within a short span of two years which suggest intention of the assessee was not to carry out agricultural activities but to sale the same at a profit. Though, the 7/12 extracts has shown that the land is agricultural ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We have perused the case records and heard the rival contentions. We have also considered the judicial pronouncements placed on record. It is an undisputed fact that the 7/12 extracts were provided to the Revenue Authorities wherein clearly it is stated that the land in question was agricultural land. Even, there is certificate from Deputy Director, Town Planning, Pune stating that at the time of transfer the lands were agricultural land. Similarly, in the Sale Deed itself it is clear that the lands in question were agricultural land. On the contrary, though the Revenue is taking the transaction as business income they have not brought in any evidence on record neither they have conducted any specific enquiry to show that it is business transaction. The assessee through his Ld. AR claims that he was never cross examined by the Assessing Officer. 8. We find that the Hon‟ble Bombay High Court in the case of Commissioner of Income Tax Vs. Smt Debbie Alemeo (supra.) has held that "land shown as agricultural land in revenue records, admittedly the land was shown in the revenue records as agricultural land and no permission was ever obtained for non agricultural use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e income from transfer thereof was not income from business." In view of the matter and judicial pronouncements as referred hereinabove, we set aside the order of the Ld. CIT(Appeals) and direct the Assessing Officer to delete the addition from the hands of the assessee on this issue. Thus, ground No.1 raised in appeal by the assessee is allowed. 10. Ground No.2 relates to the disallowance of Rs. 8,03,268/- being 10% of development expenses. 11. During the course of assessment proceedings, the Assessing Officer noticed that the assessee had shown land purchase amounting to Rs. 3,79,08,456/-. In connection with the said land purchase, development expenses of Rs. 1,22,59,608/- was incurred which was debited to land purchase account. These expenses pertained to land excavation, removing stores, soiling, cutting, murrum filling for approach road work at site, JCB charges etc. as well as expenses for general improvement of land. The Assessing Officer noticed that the vouchers of the expenses were not fully supported by payees acknowledgement or signature. The Ld. AR of the assessee submitted that the expenditure had been incurred in connection with purchase of land onl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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