9911796707
TMI Blog2025 (3) TMI 652X X X X Extracts X X X X X X X X Extracts X X X X ..... adjusted against the consideration 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 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. Thus, 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 ..... d 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 statement and copy of bill raised by S. Naga Basi Reddy and Reddy Brothers besides payment of Rs. 60 lakhs to Smt. Atluri Laxmi Surya Kumari who is the original seller of the property to the assessee towards the modification of the impugned property. However, the Assessing Officer noted that though the assessee had filed confirmation letter, but, not filed the ITR copy of Smt. Atluri Laxmi Surya Kumari reflecting the impugned amount offered for taxation by her. The Assessing Officer further noted that the occupation of Mrs. Atluri Laxmi Surya Kumari is found to be housewife, not in the field of relevant sector and also assessee c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty; 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 Counsel for the Assessee at the very outset drew the attention of the Bench that the assessee is a Non-Resident, filed return of income on 14.09.2021. The Assessing Officer issued notice u/sec.143(2) on 29.06.2021 and assessment order was passed by the him on 13.01.2023 u/sec.143(3) r.w.s.144C of the Act which is time barred as per provisions of sec.153(1) of the Act. He submitted that as per the provisions of sec.153C(1) of the Act the assessment has to be completed within a period of 18 months and in the instant case the time limit to pass the assessment order was by 30.09.2022, whereas, the Assessing Officer passed his final as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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/- paid to Nagabasi Reddy, the Learned Counsel for the Assessee submitted that though the assessee has made payments by way of cheque through banking channels viz., ICICI Bank from joint account of Myneni Venu and Naga Jyothi-assessee and submitted the description of the expenses date-wise to the authorities below, without considering the same, the DRP rejected the above claims of the assessee on the ground that cost of acquisition was not mentioned in the deed and expenses are not mentioned in the deed is bad in law as held by Hon'ble Madras High Court in the case of S.P. Balasubrahmanyam vs. ACIT [2017] 81 taxmann.com 154 wherei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd 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 on different dates by cheque. The assessee further claimed that she has paid an amount of Rs. 13,36,199/- towards reimbursement of infra expenses to Jayabheri Properties on behalf of the seller. The assessee further claimed that she has put-up additional interior works to the property and for this purpose she has paid a sum of Rs. 38,03,780/- to Nagabasi Reddy brothers through cheque. The Assessing Officer did not disbelieve the claim of the assessee. However, disallowed claim of cost of acquisition and improvement only on the ground that the additional amount claimed to have been paid by the assessee is not recorded in the sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 cannot be doubted. Since the assessee has furnished relevant evidences to prove payment to Nagabasi Reddy brothers for carrying-out interior works, in our considered view, the said payment partakes the nature of cost of improvement to the building and the same needs to be allowed as cost of acquisition and improvement while computing long term capital gains from the sale of property. Therefore, we are of the considered view, that the Assessing Officer and the DRP erred in not allowing the claim of additional payments made to Smt. Atluri Laxmi Surya Kumari, Jayabheri Properties and to Nagabasi Reddy brothers. Thus, we direct the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
