Section 28(i), read with section 153A, of the Income-tax Act, 1961

IT : Where assessee's claim regarding land development expenses was rightly allowed by Assessing Officer in original return and there was no material to deviate from earlier findings, ad hoc disallowance was not justified in assessment during search
IT : Where seized sale deed revealed that assessee had purchased a residential plot and there was no evidence to establish that said investment was out of past savings, addition as unexplained investment was justified
IT : Where assessee purchased agricultural land through cash payment of Rs.4.8 lakhs as assesse had not bank account where said land was situated, section 40A(3) could not be invoked to disallow said cash payments
■■■
[2015] 55 taxmann.com 256 (Jodhpur - Trib.)
IN THE ITAT JODHPUR BENCH
Smt. Jiya Devi Sharma
v.
Assistant Commissioner of Income-tax*
HARI OM MARATHA, JUDICIAL MEMBER
AND N.K. SAINI, ACCOUNTANT MEMBER
I.T. APPEAL NOS. 211 & 212 (JD.) OF 2013
[ASSESSMENT YEARS 2008-09 & 2009-10]
SEPTEMBER  20, 2013
I. Section 28(i), read with section 153A, of the Income-tax Act, 1961 - Business loss/deduction - Allowable as (Land development expenses) - Assessment years 2008-09 & 2009-10 - Whether, where assessee's claim regarding land development expenses was rightly allowed by Assessing Officer in original return and there was no material to deviate from earlier finding, ad hoc disallowance was not justified in assessment during search by invoking section 153A - Held, yes [Para 3.3] [In favour of assessee]
II. Section 69, read with section 153A of the Income-tax Act, 1961 - Unexplained investments (Construction expenses) - Assessment years 2008-09 & 2009-10 - Search was conducted in assessee premises and a sale deed was seized - As per sale deed, assessee had purchased a residential plot and but same was not shown in books of account - Assessee claimed that said investment was out of her past savings although there was no evidence of same - Whether addition as unexplained investment under section 69 was sustainable - Held, yes [Para 4.2] [In favour of revenue]
III. Section 40A(3) of the Income-tax Act, 1961, read with Rule 6DD of the Income-Tax Rules, 1962 - Business disallowance - Cash payment exceeding prescribed limits (Rule 6DD/Exceptions) - Assessment years 2008-09 & 2009-10 - Whether where assessee purchased agricultural land through cash payments of Rs. 4.8 lakhs, as assessee had no bank account where said land was situated, section 40A(3) could not be invoked to disallow said cash payments made by assessee - Held, yes [Para 5.3] [In favour of assessee]