Case Law Details
Muniyappa Muniraju Vs ITO (ITAT Bangalore)
ITAT Bangalore held that disallowance of deduction claimed u/s 54F unjustified as no steps were taken to convert the limited scrutiny into complete scrutiny. Accordingly, disallowance deleted.
Facts- The assessee is carrying on the business of civil works contract. The assessee declared his business income u/s. 44AD of the IT Act, 1961 on presumptive basis at 8% on the amount received and deposited the receipts to two bank accounts maintained in Canara Bank and State Bank of India. AO accepted this return of income and income offered u/s. 44AD on the turnover declared by assessee. The case was selected for scrutiny by CASS for the reason “Large Cash Deposits” in the year.AO made addition towards unexplained income and brought to tax u/s 69A r.w.s. 115BBE.
Further, AO noticed that assessee claimed NIL income from Long Term Capital Gains on sale of agricultural land. However, on verification of the submissions, it is noticed that the Assessee has neither purchased or constructed any new asset within the time allowed as per the Income Tax Act nor has provided any documents to prove the exemption claimed u/s.54. AO was of the opinion that the exemption claimed by the Assessee on the sale of the immovable asset does not fit under sections 54B or 54F. Hence, the total consideration received of Rs.1,05,00,000/- is brought to tax under the head “Income from Long Term Capital Gain”.
CIT(A) dismissed the appeal of the assessee. Being aggrieved, the present appeal is filed.
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