9911796707
TMI Blog2023 (10) TMI 1137X X X X Extracts X X X X X X X X Extracts X X X X ..... n the subsequent years and the sale has duly been shown in the books of accounts and due taxes have also been paid. We are surprised to note that the AO has treated the advances as bogus in respect of which the sale deeds were executed in the subsequent years. We direct the AO to delete the addition. Project expenses disallowed - addition by CIT(A) as made by the AO on estimated basis by adding 25% of the total project expenses claimed by the assessee - HELD THAT:- After examining profit and loss account, the vouchers filed by the assessee, we note that these were expenses incurred in connection with the construction of the flats project which were duly supported with the bills and vouchers and has been correctly shown in the expenses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich have been shown under the head unsecured loans and advances from the parties. The AO in order to verify the said advances issued notice u/s 133(6) of the Act to selected parties and accordingly the replies received from these parties were compared with the books of accounts of the assessee. However, in some cases, the letter issued u/s 133(6) of the Act to 15 parties out of which 7 notices were returned unserved. Accordingly, the AO held that the advances from these parties were not proved. Accordingly, the AO added a sum of Rs. 14.71 Lakh to the income of the assessee on the ground that the same was falsely claimed by the assessee as advances whereas the flats have been sold to these parties during the year. 4. in the appellate pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 6. The issue raised in ground no. 2 is against the confirmation of addition of Rs. 16,75,860/- by Ld. CIT(A) as made by the AO on estimated basis by adding 25% of the total project expenses claimed by the assessee. 7. The facts in brief are that the assessee has claimed Rs. 67,03,440/- as project expenses in the profit and loss account and after capitalising the proportionate expenses to the flat work-in-progress which were shown at Rs. 1,19,32,434.17 and the net profit was calculated at Rs. 59,832/-. For the sake of ready reference and better understanding, we extract the profit and loss account as under: 8. The AO has estimated the disallowance at 35% of the project expenses on the ground that the assessee has not filed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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