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TMI Blog2025 (3) TMI 652X X X X Extracts X X X X X X X X Extracts X X X X ..... d. In response to the said notice, the assessee furnished computation sheet. On verification, the Assessing Officer noted that during the year the assessee sold an immovable property for a consideration of Rs. 5.18 crores and the assessee has claimed cost of acquisition with indexation and Cost of interiors and modifications to the tune of Rs. 4,65,00,704/- and offered long term capital gains Rs. 52,99,295/-. Thereafter, the Assessing Officer issued statutory notice u/sec.142(1) of the Act to the assessee calling for Sale deed, Purchase deed, details of expenditure incurred along with documentary evidence. In response to the said notice, the assessee has submitted the Valuation report issued by Valuer. However, the valuation report submitted by the assessee is not acceptable on the fact that, the valuer has arrived at Rs. 70,000/- per sq.yds for land admeasuring 470 Sq.yds. in absence of no supporting document and such value was not referred in the purchase deed. Hence, the valuation report submitted by the assessee was rejected by the Assessing Officer and issued show cause notice dated 26.02.2022 calling for specific information. In response thereto, the assessee submitted bank s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C(13) of the Act, by determining the long term capital gains of the assessee at Rs. 2,07,67,597/- as against the sum offered by the assessee at Rs. 52,99,295/- and assessed the total income of the assessee at Rs. 2,71,79,437/- as against the returned income of the assessee at Rs. 64,11,480/-. 2.3. Aggrieved by the final assessment order dated 13.01.2023 of the Assessing Officer, the assessee carried the matter in appeal before the Tribunal contending inter alia, disallowance of cost of acquisition of the property of Rs. 61,86,777/-; amount of Rs. 60 lakhs paid to Mrs. Atluri Laxmi Surya Kumari towards modification of the property; amount of Rs. 1,86,777/- paid to Mrs. Atluri Laxmi Surya Kumari for reimbursement of charges paid to Jayabheri Meadows and receipt of Rs. 61,86,777/- by Mrs. Atluri Laxmi Surya Kumari, disallowance of cost of improvement of Rs. 38,03,780/- paid to S. Naga Basi Reddy towards furniture works which is through banking channel and also not implemented the directions of the DRP wherein the DRP had allowed the expenses incurred towards payment to made to Matrix Technologies for solar water hearing; of Rs. 1,08,000/-. 3. During the course of hearing, Learned Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Income Tax Act, 1961 and also not in conformity with the provisions of Sec.144C of the Act. He accordingly submitted that the final assessment order passed by the Assessing Officer be quashed in the interest of justice. In support of the above contentions, the Learned Counsel for the Assessee, relied on the decision of Hon'ble Karnataka High Court in the case of Flextronics Technologies (India) (P.) Ltd., [2023] 148 taxmann.com 123 (Kar.); ITAT, Hyderabad Bench decision in the case of Uber India Research and Development P. Ltd., vs. DCIT ITA.TP.No.106/ Hyd/2022, decision of Hon'ble Gujarat High Court in the case of CIT vs. C-SAM (India) (P) Ltd., 94 taxmann.com 261; decision of Hon'ble Delhi High Court in the case of ESPN Star Sports Mauritius S.N.C ET Compagnie vs. Union of India 68 taxmann.com 377 (Del.); Coordinate Bench decision of ITAT Bangalore in the case of Software Prardigms Infortech (P) Ltd., vs. ACIT 89 taxmann.com 339. 3.2. Coming to the disallowance of cost of acquisition / improvement of Rs. 61,88,777/- paid to Mrs. Atluri Laxmi Surya Kumari, Infra expenses of Rs. 13,36,199/- paid to Jayabheri Properties Private Limited and cost of interiors of Rs. 38,03,780/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towards water meters to Jayabheri, cost of solar water heating and amount paid towards electricals and confirmed the above stated remaining disallowances made by the Assessing Officer. In view of the above, the Learned DR submitted that the final assessment order passed by the Assessing Officer is after verifying all the documents/details furnished by the assessee which is in accordance with law He accordingly submitted that the final assessment order passed by the Assessing Officer be confirmed in the interest of justice. 5. We have heard the rival submissions of both the parties, perused the orders of the authorities below and material available on record. Admittedly, the assessee has sold a property for a sum of Rs. 5,18,00,000/- vide sale deed dated 05.03.2020 and claimed cost of acquisition with indexation which includes additional amount spent towards cost of interiors and modifications and finally declared long term capital gains of Rs. 52,99,295/-. The cost of acquisition of the property purchased vide sale deed dated 19.02.2010 was at Rs. 1,14,30,805/-. The assessee claims to have paid a sum of Rs. 61,86,777/- to the seller of the property Smt. Atlurilaxmi Surya Kumari o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n payable to the seller. This fact has been confirmed by Jayabheri Properties. Therefore, we are of the considered view that, once relevant evidences has been filed to prove payment for infra expenses related to the impugned property to the developer, in our considered view, merely for the reason of not referring the said payment in the sale deed dated 19.02.2010, it cannot be said that the payment is not for the purpose of purchase of the property. Likewise, the assessee claimed that she has paid a sum of Rs. 38,03,780/- to Nagabasi Reddy brothers for carrying-out further interior works to the flat after she purchased from Smt. Atluri Laxmi Surya Kumari. To support her contention, the assessee has furnished a bill from the contractor. The Assessing Officer and the DRP disbelieved the claim of the assessee only on the ground that the bills submitted by the contractor is on a plain paper and does not contain sales tax and VAT registration. In our considered view, when the payment is made by cheque and the person who carried-out the work has confirmed the payment for the purpose of interior works, merely for the reason of no VAT registration for the vendor, the genuineness of payment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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