Harmail Singh, New Delhi v. ITO Ward-24 (3), New Delhi

ITA 2851/DEL/2008 | 2003-2004
Pronouncement Date: 29-01-2010 | Result: Dismissed

Appeal Details

RSA Number 285120114 RSA 2008
Assessee PAN AQIPS9848I
Bench Delhi
Appeal Number ITA 2851/DEL/2008
Duration Of Justice 1 year(s) 4 month(s) 23 day(s)
Appellant Harmail Singh, New Delhi
Respondent ITO Ward-24 (3), New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 29-01-2010
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 29-01-2010
Date Of Final Hearing 21-12-2009
Next Hearing Date 21-12-2009
Assessment Year 2003-2004
Appeal Filed On 05-09-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH C DELHI ] BEFORE SHRI C. L. SETHI JM SHRI K. D. RANJA N AM I. T. APPEAL NO. 2851 (DEL) OF 2008. ASSESSMENT YEAR : 2003-04 MR. HARMAIL SINGH THE INCOME-TAX OFFICER D-68 PARYAVARAN COMPLEX IGNOU ROAD V S. W A R D : 24 (3) N E W D E L H I - 110 030. N E W D E L H I. P A N / G I R NO. AQI PS 9848 I. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY : SHRI RAJESH ARORA C. A.; DEPARTMENT BY : SHRI D. N. KAR [CIT] - D.R.; O R D E R. PER K. D. RANJAN AM : THIS APPEAL BY THE ASSESSEE FOR ASSESSMENT YEAR 200 3-04 ARISES OUT OF THE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX (APPEALS)-X NEW DEL HI. 2. THE FIRST ISSUE FOR CONSIDERATION RELATES TO DIS ALLOWANCE OF COST CLAIMED TO BE INCURRED ON CONSTRUCTION OF FLAT TO THE EXTENT OF RS.8 30 63 5/-. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT THE RETURN OF INCOME FOR ASSESSMENT YEAR 2003- 04 WAS FILED DECLARING INCOME AT RS.75 980/-. IN THE RETURN OF INCOME ASSESSEE DID NOT FILE COPY OF PROFIT AND LOSS ACCOUNT AND BALANCE SHEET. SINCE THE RETURN WAS DEFECTIVE IN V IEW OF PROVISIONS OF SECTION 139(9) OF THE ACT THE ASSESSEE WAS REQUIRED TO FILE COPY OF THE PROFIT AND LOSS ACCOUNT AND THE BALANCE 2 I. T. APPEAL NO. 2851 (DEL) OF 2008. SHEET. IN RESPONSE TO THIS THE ASSESSEE FILED REVI SED COMPUTATION OF INCOME DECLARING A TOTAL INCOME AT RS.2 30 049/- AND FILED A NEW PROFIT AND LOSS ACCOUNT. EVEN AT THIS STAGE THE ASSESSEE DID NOT FILE PROFIT AND LOSS ACCOUNT BASED ON WHICH INCOME OF RS.75 980/- WAS SHOWN IN THE RETURN. IT IS ALSO IMPORTANT TO NOTE T HAT IN THIS CASE SURVEY UNDER SECTION 133-A WAS CONDUCTED AT THE PREMISES OF THE ASSESSEE AT 10 4 PRAYAVARAN BHAWAN NEB SARAI NEW DELHI ALONG WITH HIS PARTNER SHRI VIJENDER PAWAR A T THE PREMISE NO. 214 SAHPUR JAT ON 25/11/2003. IT WAS FOUND THAT SHRI HARMAIL SINGH H AD CONSTRUCTED FLATS ON PLOT NO.D-63/64 PRAYAVARAN COMPLEX NEW DELHI CONSISTING OF 5 TWO BED ROOM FLATS AND 8 ONE BED ROOM FLATS. AS PER THE AGREEMENT BETWEEN THEM THE SALE PROCEEDS OF SINGLE BED ROOM FLATS WAS TO ACCRUE TO SHRI HARMAIL SINGH WHILE THE SALE PROCEED S OF 4 TWO BED ROOM FLATS WERE TO ACCRUE TO SHRI PAWAR. ON THE DATE OF SURVEY OUT OF 13 FL ATS CONSTRUCTED 9 FLATS STOOD SOLD. ALL THE 8 FLATS BELONGING TO SHRI HARMAIL SINGH THE ASSESSEE WERE SOLD. IT WAS ALSO FOUND THAT ONE BED ROOM FLAT WAS SHOWN TO BE SOLD AS PER SALE DEED AT RS.1 70 000/- WHEREAS THE ACTUAL SALE CONSIDERATION VARIED BETWEEN RS.3 65 000/- TO RS.4 00 000/-. THIS FACT WAS ALSO CORROBORATED BY THE STATEMENT OF BUYERS RECORDED SUCH AS SHRI SU SHANK TIWARI AND SHRI SHANKAR PRAMANIK. THE ASSESSEE ALSO ACCEPTED THE RECEIPT OF ON-MONEY PAYMENT IN CASH. HOWEVER THE ASSESSEE IN THE REVISED PROFIT AND LOSS ACCOUNT HAD SHOWN S ALE PROCEEDS OF TWO FLATS RELATING TO PERIOD UNDER CONSIDERATION AT RS.3 65 000/- AND RS.3 90 00 0/-. DURING THE COURSE OF SURVEY STATEMENT OF SMT. JANKI RAWAT RESIDENT OF A-104 F IRST FLOOR PRAYAVARAN COMPLEX NEW DELHI L WAS RECORDED ON 25/11/2003 WITH REGARD TO T HE PURCHASE OF FIRST FLOOR. SMT. JANKI RAWAT IS A CO-OWNER OF FLOOR ALONG WITH HER HUSBAN D SHRI GOPAL SINGH RAWAT. SHE CATEGORICALLY STATED IN HER STATEMENT THAT THE TOTA L CONSIDERATION PAID TO SHRI HARMAIL SINGH WAS AT RS.14 50 000/- AS AGAINST THE REGISTRATION O F THE FLAT AT RS.4 95 000/-. IN THE REVISED PROFIT AND LOSS ACCOUNT FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAD HIMSELF SHOWN THE TOTAL CONSIDERATION OF THE FLAT A T RS.14 50 000/- AS AGAINST THE AMOUNT MENTIONED IN THE SALE DEED REGISTERED AT RS.4 95 0 00/-. THE ASSESSING OFFICER FURTHER NOTED THAT THE ASSESSEE HAD DEBITED COST OF CONSTRUCTIO N OF THE FLAT AT RS.12 61 554/-. IT WAS CONTENDED BEFORE THE ASSESSING OFFICER THAT THE FLA T WAS SOLD FOR RS.4 95 000/- AND THE BALANCE AMOUNT WAS GIVEN BY THE BUYER FOR RENOVATION OF THE PROPERTY AND ACCORDINGLY THE ASSESSEE HAD RENOVATED THE PROPERTY AND INCURRED THE EXPENDI TURE. BUT THE ASSESSING OFFICER NOTICED THAT THE PROPERTY AT PLOT NO.A-104 PRAYAVARAN COMP LEX CONSISTED OF FOUR FLOORS I.E. GROUND FLOOR FIRST SECOND AND THIRD FLOOR. THE TOTAL CO ST OF CONSTRUCTION OF THE FLAT WAS RS.16 23 677/- WHICH WAS WORKED OUT ON THE BASIS O F THE IMPOUNDED DOCUMENTS INCLUDING 3 I. T. APPEAL NO. 2851 (DEL) OF 2008. THE COST OF LAND. THUS THE COST OF ONE FLAT WAS WO RKED OUT BY THE AO AT RS.4 30 919/- WHEREAS THE ASSESSEE HAD CLAIMED THE COST OF FLAT S OLD TO SHRI GOPAL RAWAT AND SMT. JANKI RAWAT AT RS.12 61 554/-. THE ASSESSING OFFICER ALL OWED THE COST AGAINST THE FLAT OF FIRST FLOOR AT RS.4 30 919/- AND COMPUTED THE PROFIT FROM FIRST FLOOR FLAT AT RS.10 19 081/-. THE ASSESSING OFFICER FURTHER ALLOWED COMMISSION AT THE RATE OF 2 PER CENT ON SALE CONSIDERATION OF RS.14 50 000/- AND ACCORDINGLY WORKED OUT THE NET P ROFIT AT RS.9 99 081/-. THE ASSESSING OFFICER HAD TAKEN THE PROFIT FROM SALE OF FLAT A-10 4 PRAYAVARAN COMPLEX AT RS.9 99 081/- BY ALLOCATING THE COST OF CONSTRUCTION AT RS.4 30 919/ - AGAINST THE CLAIM OF RS.12 61 554/- WHICH RESULTED IN AN ADDITION OF RS.8 30 635/-. 3. BEFORE THE LD. CIT (APPEALS) IT WAS CONTENDED TH AT THE EXPENSES AMOUNTING TO RS.12 61 554/- WERE CALCULATED ON THE BASIS OF DOCU MENTS SEIZED DURING THE COURSE OF SURVEY. IT WAS ALSO SUBMITTED THAT THE TOTAL COST OF CONSTR UCTION INCURRED WAS AT RS.16 58 461/- WHICH IS EVIDENT FROM ANNEXURE A-2 A-3 AND A-4. IT WAS ALSO CONTENDED THAT ALL THE EXPENSES WERE VERIFIABLE FROM THE IMPOUNDED DOCUMENTS. IT WAS AL SO SUBMITTED THAT THE TOTAL COST OF CONSTRUCTION AS MENTIONED BY THE AO IN THE ASSESSME NT ORDER AT RS.17 23 677/- WAS INCURRED FOR THE PURPOSE OF THE FIRST FLOOR OF THE HOUSE AND PARTLY FOR THE ABOVE PORTION OF THE SECOND FLOOR. IT WAS CONTENDED THAT GROUND FLOOR WAS ALRE ADY CONSTRUCTED AND THE ASSESSEE HAD ONLY RAISED THE STRUCTURE FOR FIRST FLOOR SECOND FLOOR AND VERY SMALL PORTION OF THE THIRD FLOOR. IT WAS ALSO CONTENDED THAT THE AREA OF THE FIRST FLOOR WAS THE LARGEST AREA THE AREA OF SECOND FLOOR WAS EVEN LESSER AND AREA OF THIRD FLOOR WAS MUCH LE SS THAN OTHER FLOORS. THEREFORE THE AO WAS NOT JUSTIFIED IN PROPORTIONATELY ALLOCATING THE COST OF CONSTRUCTION TO ALL THE FLOOR EQUALLY. IT WAS FURTHER SUBMITTED THAT THE FIRST FLOOR WAS S OLD FOR RS.4 95 000/- IN DECEMBER 2002 AS WAS EVIDENT BY THE POSSESSION LETTER. THEREAFTER T HE ASSESSEE REQUIRED TO RENOVATE THE PROPERTY AS PER SPECIFICATIONS GIVEN BY THE BUYERS FOR WHICH BUYER HAD TAKEN LOAN IN FEBRUARY 2002. THEREFORE IT WAS CONTENDED THAT T HE AO WAS NOT JUSTIFIED IN ALLOCATING THE EXPENSES OF RS.4 30 990/- TOWARDS FIRST FLOOR. IT WAS ALSO CONTENDED THAT THE ASSESSEE HAD RENOVATED THE FLOOR AFTER TAKING AN AMOUNT OF RS.9 95 000/- AND EVEN AS PER PROVISIONS OF SECTION 44-AD OF THE ACT THE NET PROFIT CANNOT BE BEYOND 8 PER CENT. THUS IT WAS ARGUED THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED BY MAKING A N ADDITION OF RS.8 30 635/- IN REGARD TO THE FIRST FLOOR A-104 PRAYAVARAN COMPLEX NEW DELHI. 4 I. T. APPEAL NO. 2851 (DEL) OF 2008. 4. THE LD. CIT (APPEALS) AFTER CONSIDERING THE FACT S OF THE CASE CONFIRMED THE STAND TAKEN BY THE ASSESSING OFFICER BY OBSERVING AS UNDE R:- ' I HAVE CAREFULLY CONSIDERED THE SUBMISSIO N OF THE AR AND THE FACTS OF THE CASE. AT THE OUTSET IT MAY BE MENTIONED THAT IT HAD BEEN CLEARLY ESTABLISHED ON THE BASIS OF DOCUMENTS FOUND DURING THE COURSE OF SURVEY AND STATEMENT OF THE APPELLANT AS WELL AS BUYERS RECORD ED THAT THE APPELLANT HAD BEEN RECEIVING HIGHER AMOUNT OF CONSIDERATION THAN THE AMOUNT OF CONSIDERATION SHOWN IN THE REGISTERED SALE DEEDS. IT IS EVIDENTLY CLEAR FROM THE FACT THAT THE SALE DEED OF ONE BED ROOM FLATS AT D- 63/64 PARYAVARAN COMPLEX NEW DELHI WERE REGISTERED FOR AN AMOUNT OF RS.1 70 000/- WHEREAS THE ACTUAL SALE CONSIDERATION WERE VARYING FROM RS.3 65 000/- TO RS.4 00 000/-. EVEN IN THE REVISED P & L ACCOUNT FURNISHED DURING THE COUR SE OF ASSESSMENT PROCEEDINGS BY THE APPELLANT THE APPELLANT HIMSELF HAS ADMITTED THE SALE CONSIDERATION OF FLAT NO. 4 & 5 IN PLOT NO. D-63/64 PARYAVARAN COMPLEX NEW DELHI AT RS.3 65 000/- AND RS.3 90 000/- RESPEC TIVELY. SIMILARLY IT MAY BE PERTINENT TO POINT OUT THAT IN THE CASE OF FIRST FLOOR A-104 PARYAVARAN COMPLEX NEW DELHI THE SALE DEED WAS REGISTERED AT RS.4 95 000/- BUT WHEN THE STATEMENT OF THE BUYER SMT. JANKI RAWAT ONE OF THE CO-OWNERS WAS RECORDED SHE CATEGORICALLY STATED THAT THEY HAVE P AID TOTAL CONSIDERATION OF RS.14 50 000/-. AFTER THE STATEMENT WAS RECORDED THE APPELLANT IN THE REVISED P & L ACCOUNT HIMSELF HAS SHOWN THE TOTAL SALE CONS IDERATION AT RS.14 50 000/- AS AGAINST THE SALE DEED REGISTERED AT RS.4 95 000/ -. THOUGH AT THIS STAGE THE APPELLANT HAD TAKEN A STAND THAT THE BALANCE AMOUNT OF RS.9 95 000/- WAS RECEIVED ON ACCOUNT OF RENOVATION OF THE FLAT AND N OT AS SALE CONSIDERATION BUT NO COMPLETE EVIDENCE WAS FURNISHED IN THIS REGARD. IT MAY ALSO BE POINTED OUT HERE THAT IN THE RETURN OF INCOME THE APPELLANT HA D SHOWN INCOME AT ONLY RS.75 980/-. AS PER THE COMPUTATION OF INCOME FURN ISHED ALONG WITH THE RETURN THE AMOUNT OF RS.75 980/- WAS SHOWN AS NET P ROFIT AS PER P & L ACCOUNT. BUT NO P & L ACCOUNT WAS ENCLOSED ALONG W ITH THE RETURN OF INCOME. EVEN WHEN THE ASSESSING OFFICER ISSUED NOTICE UNDER SECTION 139(9) TO RECTIFY THE DEFECT AND REQUIRED THE APPELLANT TO FILE TH4E P & L ACCOUNT ON THE BASIS OF 5 I. T. APPEAL NO. 2851 (DEL) OF 2008. WHICH THE RETURN OF INCOME WAS FILED THE APPELLANT HAS NOT FURNISHED ANY P & L ACCOUNT SHOWING NET INCOME AT RS.2 29 086/-. DUR ING THE COURSE OF APPELLATE PROCEEDINGS ALSO THE APPELLANT WAS ASKED TO FURNISH THE P & L ACCOUNT BASED ON WHICH THE RETURN OF INCOME WAS FU RNISHED BUT THE APPELLANT HAD NOT FURNISHED THE COPY OF THAT P & L ACCOUNT. IT MAY BE RELEVANT TO REPRODUCE REVISED P & L ACCOUNT FURNISHED BY THE AP PELLANT DURING THE ASSESSMENT PROCEEDINGS WHICH IS AS FOLLOWS :- PROFIT & LOSS A/C. FOR THE YEAR ENDED 31/3/2003 PARTICULARS AMOUNT PARTICULARS AMOUNT RS. RS. TO CONSTRUCTION & LAND COST. BY SALES. FLAT NO.4 D-63/64 FLAT NO.4 D-63/64 PARYAVARAN COMPLEX 269892.31 PARYAVARAN COMPLEX 3 65 000 FLAT NO.4 D-63/64 FLAT NO.4 D-63/64 PARYAVARAN COMPLEX 269892.31 PARYAVARAN COMPLEX 3 90 000 1ST FLOOR A-104 1ST FLOOR A-104 PARYAVARAN COMPLEX 12 61 554.35 1801338.97 PARYAVARAN COMPLEX 1450000 2205000.00 TO COMMISSION ON SALE OF PROPERTIES 44100.00 BY COMMISSION INCOME. 27825.00 TO SALARY 54000.00 TO CONVEYANCE & TELEPHONE CHARGES. 55800.00 TO COST INCURRED FOR RENOVATION ON ACCOUNT OF DEMOLITION. 48500.00 NET PROFITS : 2 29 086.03 2232825.00 2232825.00 6 I. T. APPEAL NO. 2851 (DEL) OF 2008. FROM THE ABOVE IT MAY BE SEEN THAT THE APP ELLANT HAD CLAIMED TOTAL COST OF CONSTRUCTION AND LAND TOWARDS FIRST FLOOR A-104 PARYAVARAN COMPLEX NEW DELHI AT RS.12 61 554/-. IT WAS CONTENDED BY THE A PPELLANT THAT THIS COST OF CONSTRUCTION WAS WORKED OUT BASED ON THE EXPENDITUR E ON CONSTRUCTION RECORDED IN THE IMPOUNDED DOCUMENTS CONTAINED IN TH E ANNEXURES A-2 TO A-4. HERE IT MAY BE NOTED THAT THE APPELLANT HAD CONSTR UCTED GROUND FLOOR FIRST FLOOR SECOND FLOOR AND THIRD FLOOR. GROUND FLOOR IS OCCUPIED BY THE APPELLANT. THE FIRST FLOOR HAS BEEN SHOWN TO BE SOLD TO SHRI G OPAL SINGH RAWAT AND JANKI RAWAT FOR A CONSIDERATION AS PER SALE DEED REGISTER ED AT RS.4 95 000/- WHEREAS THE ACTUAL AMOUNT RECEIVED WAS RS.14 50 000/-. THE SECOND FLOOR HAS BEEN SHOWN TO BE SOLD TO SHRI DAVINDER SINGH FOR A CONSI DERATION OF RS.4 95 000/- AND THIRD FLOOR ALSO TO SHRI DAVINDER SINGH FOR RS. 3 25 000/-. THESE FACTS CLEARLY SHOW THAT THE APPELLANT HAD INCURRED TOTAL EXPENDITURE AS RECORDED IN THE IMPOUNDED MATERIAL AT RS.16 58 461/- IN CONNECT ION WITH CONSTRUCTION OF ALL THE FLOORS. FROM THE DETAILS OF EXPENSES MENTI ONED IN THESE IMPOUNDED DOCUMENTS IT IS NOTICED THAT THE EXPENDITURE FOR T HE F.Y. 2000-01 WAS RS.3 93 406/- AND FOR F.Y. 2001-02 AT RS.22 052/- O NLY THE BALANCE EXPENDITURE OF RS.12 55 062/- PERTAINS TO F.Y. 2002 -03 AND 2003-04. THUS THE APPELLANT IS UNABLE TO ADDUCE ANY CREDIBLE EVID ENCE TO SHOW AS TO HOW MUCH COST OF CONSTRUCTION HAS BEEN ALLOCATED TO THE OTHER PORTIONS OF THE PROPERTY I.E. GROUND FLOOR SECOND FLOOR AND THIRD FLOOR. THE APPELLANT HAS ALSO NOT ADDUCED ANY EVIDENCE TO SHOW THAT INCOME EARNED ON SALE OF SECOND AND THIRD FLOOR HAS BEEN REFLECTED IN EARLIER YEARS OR SUBSEQUENT YEARS RETURN OF INCOME AND HOW MUCH EXPENDITURE HAS BEEN ALLOCATED TO THESE FLOORS. LOOKING TO THE TOTALITY OF THE FACTS AND CIRCUMSTAN CES AND ESPECIALLY THAT THE APPELLANT HAD NOT FURNISHED DESPITE SO MANY OPPORTU NITIES GIVEN THE P & L ACCOUNT BASED ON WHICH THE RETURN OF INCOME WAS FIL ED THE AO IN MY OPINION HAS NO OTHER OPTION BUT TO ALLOCATE THE EX PENSES IN EQUAL PROPORTIONS AND ALLOWED THE COST TOWARDS FIRST FLOOR CONSISTS O F COST OF CONSTRUCTION AND COST OF LAND AT RS.4 30 919/-. HENCE THE INCOME A SSESSED BY THE AO ON THE SALE OF THIS FIRST FLOOR AT RS.9 90 081/- IS CONFIR MED. ' 7 I. T. APPEAL NO. 2851 (DEL) OF 2008. 5. BEFORE US THE LD. AR OF THE ASSESSEE REITERATED THE SIMILAR ARGUMENTS. BEFORE US THE ASSESSEE HAD NOT PRODUCED ANY EVIDENCE TO PROVE THA T THE FIRST FLOOR OF THE HOUSE WAS ALREADY IN EXISTENCE AND THE ASSESSEE HAD CONSTRUCTED FIRST FLOOR SECOND FLOOR AND THIRD FLOOR. THE ASSESSEE HAD ADMITTED THE SALE PROCEEDS AT RS.4 95 000/- WHEREAS THE PURCHASER SMT. JANKI RAWAT HAD STATED TO HAVE PURCHASED THE FLAT FOR RS. 14 50 000/-. IN FACT THE ASSESSEE HAD HIMSELF ADMITTED THE SALE OF THE FLAT AT RS.14 50 0 00/- IN REVISED COMPUTATION OF INCOME. THE LD. CIT (APPEALS) HAS RECORDED A FINDING THAT THE T OTAL EXPENDITURE INCURRED AS PER IMPOUNDED MATERIAL WAS AT RS.16 58 461/- IN CONNECTION WITH C ONSTRUCTION OF ALL FLOORS. FROM THE DETAILS OF EXPENSES MENTIONED IN THE IMPOUNDED DOCUMENTS THE EXPENDITURE INCURRED FOR FINANCIAL YEAR 2000-01 WAS AT RS.3 93 406/- AND FOR FINANCIAL YEAR 2001-02 AT RS.22 052/- ONLY AND THE BALANCE EXPENDITURE OF RS.12 55 062/- PERTAINED TO FINANCIAL YEARS 2002-03 AND 2003-04. THUS THE ASSESSEE WAS UNABLE TO ADDUCE ANY CREDIBLE EVIDENCE TO SHOW AS TO WHY HIGHER COST OF CONSTRUCTION HAD BEEN ALLOCATED TO THE OTHER POR TIONS OF THE PROPERTY I.E. GROUND FLOOR SECOND FLOOR AND THIRD FLOOR. THE ASSESSEE HAD NOT ADDUCED ANY EVIDENCE NEITHER BEFORE AO NOR BEFORE THE LD. CIT OR BEFORE US THAT INCOME E ARNED ON SALE OF SECOND AND THIRD FLOOR HAD BEEN REFLECTED IN EARLIER YEARS OR SUBSEQUENT YEARS AND HOW MUCH EXPENDITURE WAS ALLOCATED TO THESE FLOORS. NO MATERIAL HAS BEEN BROUGHT BEFO RE US BY THE ASSESSEE TO CONTROVERT THE FINDINGS OF THE LD. CIT (A). ACCORDINGLY IN OUR C ONSIDERED OPINION THE LD. CIT (A) WAS JUSTIFIED CONFIRMING THE STAND OF THE AO. 6. GROUND NO. 2 RELATES TO CONFIRMING THE ADDITION ON ACCOUNT OF DISALLOWANCE OF EXPENSES OF SALARY RS.54 000/- CONVEYANCE AND TELE PHONE OF RS.55 800/- AND COST INCURRED ON RENOVATION OF FLATS SOLD AMOUNTING TO RS.48 500/ -. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTED THAT THE A SSESSEE WAS NOT MAINTAINING REGULAR BOOKS OF ACCOUNTS. A DIARY IMPOUNDED AS ANNEXURE A-6 F OUND DURING THE COURSE OF SURVEY WAS THE ONLY WRITTEN RECORD AVAILABLE WITH THE ASSESSEE AND EVEN THE DIARY WAS NOT WRITTEN BY THE ASSESSEE HIMSELF. THE NOTING WAS ONLY RELATED TO R ECEIPT FROM BUYERS AND PAYMENT TO CREDITORS ONLY TO RECORD THE SAID RECEIPTS AND PAYM ENTS AND TO AVOID ANY CONFUSION. SINCE THE ASSESSEE WAS NOT ACCOUNTABLE TO ANY OTHER PERSON IN RESPECT OF THESE EXPENSES ON ACCOUNT OF SALARY TELEPHONE CONVEYANCE ETC. IN THE ABSENCE O F ANY DOCUMENTARY EVIDENCE MAINTAINED TO SHOW THAT THE EXPENDITURE WAS INCURRED THE EXPENSE S DEBITED IN PROFIT AND LOSS ACCOUNT WERE 8 I. T. APPEAL NO. 2851 (DEL) OF 2008. DISALLOWED BY ASSESSING OFFICER. ON APPEAL THE LD . CIT (APPEALS) HAD UPHELD THE DISALLOWANCE MADE BY THE ASSESSING OFFICER. 7. BEFORE US NOTHING HAS BEEN PRODUCED BY THE ASSES SEE TO PROVE THAT THE SAID EXPENDITURE WAS INCURRED BY THE ASSESSEE. IN THE A BSENCE OF ANY SUCH MATERIAL THE DISALLOWANCE MADE BY THE AO AND CONFIRMED BY THE LD . CIT (A) HAS TO BE UPHELD. WE ORDER ACCORDINGLY. 8. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON : 29TH JANUARY 2010. SD/- SD/- [ C. L. SETHI ] [ K. D. RANJAN ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 29TH JANUARY 2010. *MEHTA * COPY OF THE ORDER FORWARDED TO : - 1. APPELLANT. 2. RESPONDENT. 3. CIT 4. CIT (APPEALS) 5. DR ITAT NEW DELHI. TRUE COPY. BY ORDER. ASSISTANT REGISTRAR ITAT. 9 I. T. APPEAL NO. 2851 (DEL) OF 2008. 10 I. T. APPEAL NO. 2851 (DEL) OF 2008.