Income Tax Appellate Tribunal (ITAT), Delhi bench consisting of Saktijit Dey, Judicial Member and Pradip Kumar Kedia, Accountant Member upholds addition of Long Term Capital Gain (LTCG) on the ground that affidavit filed by Assessee is vague and non-descript has no Evidentiary Value.
The assessee, Surinder Kaur Sethi, sold one immovable property for Rs.9,25,00,000/- during the year under consideration which is stated to be acquired/constructed prior to 01.04.1981. For the purposes of calculation of Long-Term Capital Gain, the assessee adopted the cost of acquisition of land and building as per valuation determined by the registered valuer. The assessee interalia also claimed cost of improvement at Rs.1,80,000/- and Rs.2 lac attributable to F.Y. 1982 and 1983 respectively while computing the Long Term Capital Gains. The indexed cost of such cost of improvement was worked out to Rs.37,65,123/- for deduction. The Assessing Officer on inquiry from the assessee in the course of the assessment found that the aforesaid claim towards cost of improvement is not supported by any documentary evidence. The Assessing Officer accordingly observed that the cost of improvement claimed with a view to reduce tax liabilities. The Assessing Officer thus denied the cost of improvement so claimed for the purposes of determination of taxable Long Term Capital Gains.Aggrieved, the assessee preferred appeal before the Commissioner of Income Tax(CIT). The CIT also could not see any merit in the claim of the assessee and thus declined to interfere with the action of the Assessing Officer.
The Tribunal said “On perusal of the affidavit, it is not known as to what kind of improvement has been carried out by the brother of the assessee. No particulars whatsoever is available on record in this regard.The affidavit is vague and non-descript. It is not clear from affidavit as to what is the basis for affirming the contents on oath.Such bald verification makes the impugned affidavit meaningless and valueless.The burden of proof lies on the assessee to produce evidence which is rightly considered unsatisfactory and devoid of any factual basis by the lower authorities. We thus see no reason to interfere with the order of the CIT.”
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