Case Details: Mohamed Ibrahim v. Income-tax Officer (International Taxation) - [2023] 151 taxmann.com 406 (Chennai-Trib.)
Judiciary and Counsel Details
- V. Durga Rao, Judicial Member & G. Manjunatha, Accountant Member
- T. Vasudevan, Adv. for the Appellant.
- D. Hema Bhupal, JCIT for the Respondent.
Facts of the Case
Assessee, a non-resident, sold two immovable properties during the relevant year and filed return of income while claiming exemption under section 54. During the scrutiny proceedings, Assessing Officer (AO) noticed that the assessee claimed the cost of improvement and indexation thereon. Subsequently, AO issued notice to the assessee to prove the genuineness of such claim.
Unsatisfied by the bills produced, the AO disallowed the claim of cost of improvement and added to the assessee’s income.
On appeal, CIT(A) upheld the additions made by AO, and the matter reached Chennai Tribunal.
ITAT Held
The Tribunal held that the assessee furnished bills for painting grills, gates, and labour masonry & tiles when asked by the AO. Those bills were without date & signature. It is common to paint the building after purchase, provide grills & gates, and do masonry & tiles work.
Accordingly, the Tribunal directed the AO to include the payments along with the cost of improvement and rework out the indexed cost of improvement and allow the same.
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