9911796707
TMI Blog2023 (1) TMI 818X X X X Extracts X X X X X X X X Extracts X X X X ..... isproving these material the A.O has made the addition on the basis of information displayed on the website of the sale tax department. After taking into consideration the above facts and material on record, it is observed that assessee has not claimed such expenses as revenue expenses during the year under consideration but same were capitalized as work in progress. Therefore, any disallowance it is made its amount to reduce work in progress, since, the expenses were capitalized in the work in progress. Since the expenses were shown by the assessee under the head work in progress and has not been reflected in the trading account, therefore, no addition can be made.We consider that decision of ld. CIT(A) in sustaining the impugned dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities below. 5. BECAUSE the CIT(A) has erred in law and on facts in upholding the disallowance on the basis of certain affidavits without providing an opportunity of cross-examination to the appellant, to test the veracity and relevance of these affidavits to the facts of the present case. 6. Without prejudice, such disallowance could only reduce the WIP and could not have been treated as income of the year. 7. BECAUSE such a huge disallowance has led to an unexpected inflation in the profit of the project being 38% of the turnover which is completely unrealistic and unattainable. 2. The fact in brief is that return of income declaring total income of Rs.13,31,371/- was filed on 30.09.2011. The case was subject to scrut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e construction work showing the quantity of total consumption of steel and cement in the project. The A.O has not agreed with the submission of the assessee and stated that it has been established by the Sale Tax Department that the parties from whom the purchases were made by the assessee were bogus. Therefore, the A.O has disallowed the amount of Rs.1,25,60,620/- as purchases made from the aforesaid parties. 3. The assessee filed the appeal before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal of the assessee. 4. During the course of appellate proceedings before us the ld. Counsel contended that A.O has not made any inquiry to disprove the supporting evidences furnished by the assessee in support of the purchases made and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the copies of ledger account of the 5 parties, copy of bank statement showing payment made by account payee cheques certificate from civil engineer and site engineer etc. and submitted that without disproving these material the A.O has made the addition on the basis of information displayed on the website of the sale tax department. After taking into consideration the above facts and material on record, it is observed that assessee has not claimed such expenses as revenue expenses during the year under consideration but same were capitalized as work in progress. Therefore, any disallowance it is made its amount to reduce work in progress, since, the expenses were capitalized in the work in progress. We have considered the judicial pronounce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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