Swagath Seeds (P) Ltd., Hyderabad V. ITO, Hyderabad

ITA 1054/HYD/2010

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 6184 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-11-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 28-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMLAN TRIPATHY
• Keywords: Opportunity of being heard; Corroborative evidences; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI AKBER BASHA, ACCOUNTANT MEMBER I.T.A. NO. 1053/HYD/2010 ASSESSMENT YEAR 2002-03 I.T.A. NO. 1054/HYD/2010 ASSESSMENT YEAR 2004-05 M/S. SWAGATH SEEDS (P) LTD. HYDERABAD PAN: AAECS9780J VS. THE INCOME-TAX OFFICER, WARD-3(2) HYDERABAD APPELLANT RESPONDENT APPELLANT BY: SHRI SAI PRASAD RESPONDENT BY: SHRI AMLAN TRIPATHY O R D E R PER NRS GANESAN, JM: BOTH THE APPEALS OF THE ASSESSEE ARE DIRECTED AGAI NST THE COMMON ORDER PASSED BY THE CIT(A)-IV, HYDERABAD DAT ED 31.3.2010 FOR ASSESSMENT YEARS 2002-03 AND 2004-05. THEREFOR E, WE HEARD THE BOTH THE APPEALS TOGETHER AND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2. LET US FIRST TAKE THE ASSESSEE'S APPEAL FOR A.Y. 2002-03. THE ONLY ISSUE ARISES FOR CONSIDERATION IS DISALLOWANCE OF RS.57,224 TOWARDS TRAVELLING EXPENSES. WE HEARD SHRI SAI PRA SAD, THE LEARNED REPRESENTATIVE FOR THE ASSESSEE AND SHRI AMLAN TRIP ATHY, THE LEARNED DR. THE ASSESSING OFFICER ADMITTEDLY DISALLOWED A SUM OF RS.57,224 ON THE GROUND THAT THE ASSESSEE DEBITED EXPENDITURE UNDER THE HEAD TRAVELLING EXPENSES A SUM OF RS.6,61,780. HOWEVER, THE LEDGER ACCOUNT PRODUCED SHOWED A DEBIT OF RS.6,04,566. TH EREFORE, THE DIFFERENCE BETWEEN THE ABOVE TWO AMOUNTS WAS FOUND TO BE NOT EXPLAINED. THE CONTENTION OF THE LEARNED REPRESENT ATIVE FOR THE ASSESSEE BEFORE THIS TRIBUNAL IS THAT THE ASSESSING OFFICER HAS NOT EXAMINED ALL THE LEDGERS MAINTAINED BY THE ASSESSEE . ACCORDING TO THE I.T.A. NOS. 1053 & 105 4/HYD/2010 M/S. SWAGATH SEEDS (P) LTD. ============================ 2 LEARNED REPRESENTATIVE FOR THE ASSESSEE SOME OF THE LEDGERS WERE NOT EVEN VERIFIED BY THE ASSESSING OFFICER. IN VIEW OF THE ABOVE SUBMISSION OF THE LEARNED REPRESENTATIVE FOR THE AS SESSEE, THE LEARNED DR HAS NO SERIOUS OBJECTION TO REMIT BACK THE MATTE R TO THE FILE OF THE ASSESSING OFFICER TO VERIFY ALL THE LEDGERS SAID TO BE MAINTAINED BY THE ASSESSEE. IN VIEW OF THE ABOVE FACTS AND SITUATION , THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ISSUE OF DI SALLOWANCE OF RS.57,224 TOWARDS TRAVELLING EXPENSES IS REMITTED B ACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL VER IFY ALL THE LEDGERS SAID TO BE MAINTAINED BY THE ASSESSEE AND THEREAFTE R DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER GIVING A REASON ABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 3. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN I.T .A. NO. 1053/HYD/2010 IS ALLOWED FOR STATISTICAL PURPOSES. 4. NOW LET US TAKE THE ASSESSEE'S APPEAL FOR A.Y. 2 004-05. WE HEARD SRI SAI PRASAD, THE LEARNED REPRESENTATIVE FO R THE ASSESSEE AND THE LEARNED DR, SHRI AMLAN TRIPATHY. THE ONLY ISSU E FOR CONSIDERATION IS DISALLOWANCE OF 10% OF THE EXPENDITURE CLAIMED B Y THE ASSESSEE ON THE GROUND THAT MOST OF THE EXPENDITURE WAS NOT VER IFIABLE AND WITHOUT ANY SUPPORTING EVIDENCE. THE ASSESSEE CLAIMED AN E XPENDITURE OF RS.64,27,274 TOWARDS KISAN MELA EXPENSES, SALES PRO MOTION EXPENSES AND TRAVELLING EXPENSES. HOWEVER, THE ASS ESSING OFFICER DISALLOWED THE EXPENDITURE TO THE EXTENT OF 10%. I T IS NOT IN DISPUTE THAT SIMILAR EXPENDITURE WAS INCURRED FOR THE A.Y. 2002- 03 AND 2003-04 ALSO. ON THE BASIS OF THE VERY SAME MATERIAL, THE ASSESSING OFFICER ADMITTEDLY ACCEPTED THE EXPENDITURE CLAIMED BY THE ASSESSEE. ONCE THE ASSESSING OFFICER ACCEPTED THE CLAIM OF THE ASS ESSEE ON IDENTICAL ITEMS OF EXPENDITURE, WE FIND NO REASON FOR DISALLO WING 10% OF SUCH EXPENDITURE FOR A.Y. 2004-05 ALONE. IT IS NOT KNOW N WHEN THE ASSESSING OFFICER ACCEPTED THE SELF-MADE VOUCHERS F OR A.Y. 2002-03 WHY IT COULD NOT BE ACCEPTED FOR A.Y. 2004-05. IN OUR OPINION, WHEN THE EXPENDITURE INCURRED BY THE ASSESSEE IS NOT IN DISPUTE AND THE I.T.A. NOS. 1053 & 105 4/HYD/2010 M/S. SWAGATH SEEDS (P) LTD. ============================ 3 EXPENDITURE WAS INCURRED FOR KISAN MELA, THE ONLY P OSSIBLE VOUCHER WOULD BE SELF-MADE VOUCHER. THEREFORE, WE DO NOT FI ND ANY REASON TO DISALLOW ANY PART OF THE EXPENDITURE. IF THE ASSES SING OFFICER HAS ANY DOUBT ABOUT THE EXPENDITURE, HE SHOULD HAVE DISALLO WED THE ENTIRE EXPENDITURE CLAIMED BY THE ASSESSEE. IN VIEW OF TH E ABOVE, WE DO NOT FIND ANY JUSTIFICATION FOR DISALLOWANCE OF 10% EXPE NDITURE. ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LOWER AUTHORITY AND T HE ADDITION OF RS.6,42,727 IS DELETED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN ITA NO. 1054/HYD/2010 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12TH NOVEMBER, 2010. SD/- (AKBER BASHA) ACCOUNTANT MEMBER SD/- (N.R.S. GANESAN) JUDICIAL MEMBER HYDERABAD, DATED 12TH NOVEMBER, 2010 TPRAO COPY FORWARDED TO: 1. M/S. SWAGATH SEEDS (P) LTD., C/O. CH. PARTHASARA THY & CO., 1-1-298/2/B/3, 1ST FLOOR, SOWBHAGYA AVENUE, ST. NO. 1, ASHOK NAGAR, HYDERABAD-20. 2. THE INCOME-TAX OFFICER, WARD-3(2), HYDERABAD. 3. THE CIT(A)-IV, HYDERABAD 4 THE CIT-III, HYDERABAD 5. THE DR B BENCH, ITAT, HYDERABAD