Assessee sold a property and claimed a deduction u/s 48 of the Act. The Assessee claimed renovation expenses of Rs.9,50,000/- which was not allowed by the AO on account of insufficient documentation. The Assessee argued that being an NRI, payments were made through his mother’s accounts, and the renovation was done by Mr. Alok Lal through his firm M/s Fourth Dimension. The DRP, after a remand report, upheld the AO’s decision, citing lack of evidence establishing the relationship between Fourth Dimension and Alok Lal. The Assessee argued that the flat required significant renovation before being inhabitable, which justified the expenses claimed. The Assessee also emphasized the use of cheques for payments and cash withdrawals as evidence of genuine expenses. The ITAT after considering the submissions made by the Assessee, found merit therein. It accepted the explanation of the NRI Assessee and directed the AO to allow the indexed cost of improvement and recompute the capital gains. (AY. 2020-21)