DCIT, Circle-10(2), Kolkata, Kolkata V. M/s Sree Automotive Pvt. Ltd., Kolkata

ITA 1392/KOL/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5892 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 1 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 27-06-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MURTHY FCA LD
• Assessee Lawyers: SAURABH KUMAR ADD L
• Keywords: Business expenditure; Rule of consistency; Question of law; Corroborative evidences
• Section: 133(6); 32; 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : C BENCH , KOLKATA BEFORE : SHRI J. SUDHAKAR REDDY , ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO. 1392 /KOL/201 6 A.Y 20 10 - 11 D.C.I.T, CIRCLE - 10(2), VS. M/S. SREE AUTOMOTIVE KOLKATA PVT. LTD. PAN: AAEC S6807Q [ APP ELLANT ] [ RESPONDENT ] APPELLANT / REVENUE BY : SHRI S AURABH KUMAR, ADD L. CIT, SR.DR RESPONDENT / DEPARTMENT BY : SHRI M.S. MURTHY, FCA, LD.AR DATE OF HEARING : 0 2 - 05 - 2018 DATE OF P RONOUNCEMENT : 27 - 0 7 - 2018 ORDER S HRI S.S.VISWANETHRA RAVI, JM: TH IS APPEAL BY THE REVENUE IS AGAINST THE ORDER DT. 1 3 - 03 - 2014 OF THE CIT - A , 4 , KOLKATA FOR THE A.Y 20 10 - 11. 2. GROUND NO. (I) IS RELATING TO DELETION OF DISALLOWANCE MADE ON ACCOUNT OF COMMISSION & BROKERAGE. 3. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD, WE FIND THAT ACCORDING TO AO, THE ASSESSE FAILED TO FURNISH THE DETAILS WITH EVIDENCES IN RESPECT OF EXPENDITURE SHOWN BY THE ASSESSE ON ACCOUNT OF COMMISS ION AND BROKERAGE TO AN EXTENT OF RS.23,05,118/ - AND DISALLOWED THE SAME. ACCORDING TO THE CIT - A, THE ASSESSE HAS BEEN MAKING THESE PAYMENTS UNDER THE ABOVE HEADS SINCE ITS INCEPTION. THE AO DISBELIEVED THE CLAIM OF THE ASSESSE ONLY ON THE GROUND FOR NO N - SUBMISSIONS OF ANY EVIDENCE. FURTHER, THE CIT - A FOUND THAT THE AO HIMSELF ALLOWED AN AMOUNT OF RS.9,00,000/ - EACH PAID ON ACCOUNT OF BROKERAGE TO M/S. VITA VINIMOY VINIYOG PVT. LTD AND M/S. SAFFRON FINANCIAL SERVICES PVT. LTD IN THE YEAR UNDER CONSIDERAT ION . IT IS ALSO NOTICED FROM THE IMPUGNED ORDER OF THE CIT - A THAT THE ASSESSE HAS GIVEN NAMES, ADDRESSES AND PAN TO THE AO. THE ASSESSE DEDUCTED ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 2 THE TDS ON SUCH PAYMENTS. THE ENTIRE TRANSACTIONS WERE T H ROUGH BANKS. RELEVANT PORTION OF ORDER OF CIT - A IS RE PRODUCED HEREIN BELOW: - 4.2. I HAVE CONSIDERED THE ISSUE IN THE ASSESSMENT ORDER' FRAMED BY THE AO IN LIGHT OF THE ARGUMENTS MADE BY THE APPELLANT. THE SHORT ISSUE FOR MY CONSIDERATION IS THAT WHETHER THE AMOUNTS PAID ON ACCOUNT OF 'BROKERAGE & COMMISSION ' WARRANT DISALLOWANCE OR NOT. IT IS FOUND THAT THE APPELLANT HAD BEEN MAKING THIS PAYMENT ON ACCOUNT OF 'BROKERAGE & COMMISSION' SINCE ITS INCEPTION AND IT IS A COMMON OCCURRENCE IN THIS LINE OF TRADE THAT BROKERAGE IS PAID TO PERSONS ON SUCCESSFUL REFERR ALS. IN THE INSTANT CASE, THE A O HAD DISBELIEVED THE CLAIM OF THE APPELLANT ON THE GROUND THAT THE APPELLANT WAS UNABLE TO SUBSTANTIATE THE EXPENSES INCURRED ON THAT ACCOUNT. HOWEVER, THE A O HIMSELF HAS ALLOWED AN AMOUNT OF RS.9, 00,000/ EACH PAID ON ACCOU NT OF BROKERAGE TO VITA VINIMOY VINIYOG PVT. LTD. AND SAFFRON FINANCIAL SERVICES PVT LTD. THUS, BY HIS OWN ADMISSION, SUCH PAYMENTS ARE MADE WHOLLY NECESSARILY AND EXCLUSIVELY FOR THE BUSINESS OF THE APPELLANT. THE MAIN GRIEVANCE OF THE A O IN THE INSTANT C ASE IS THAT HE DOUBTED THE NATURE OF SERVICES PROVIDED BY THE NINE BROKERS AS WELL AS DOUBTED THAT PAYMENTS WERE JUST A HAWALA ENTRY. THE APPELLANT WAS IN THE BUSINESS OF DEALING IN VEHICLES OF MAHINDRA & MAHINDRA AND ASHOK LEYLAND. IN THIS BUSINESS, IT IS CUSTOMARY THAT THE PARTIES WHO REFER A PROSPECTIVE PURCHASER TO THE APPELLANT IS TO BE GIVEN BROKERAGE ON FINALIZATION OF THE DEAL. THE APPELLANT HAD PRODUCED ALL THE RELEVANT MATERIAL WHICH WAS AVAILABLE WITH IT IN SUPPORT OF ITS CLAIM OF COMMISSION/BROK ERAGE IN DISPUTE. IT HAD ALSO PRODUCED THE DETAILS OF SALES ON WHICH COMMISSION WAS PAID TO MAJORITY OF BROKERS. THE APPELLANT HAD NAMED THE BROKERS, THEIR ADDRESSES WERE AD DUCED ON RECORD AND THEIR PERMANENT ACCOUNT NUMBERS WERE ALSO PROVIDED TO THE A O . T HE A PP ELLANT ALSO TAX DEDUCTION AT SOURCE FROM THE PAYMENTS MADE TO THESE BROKERS. THE ENTIR E AMOUNT WAS DISBURSED THROUGH BANKING CHANNEL. IT WAS FURTHER CLAIMED THAT EACH COMMISSION/BROKERAGE WAS PAID AS PER BUSINESS P RACTICE AND ON THE BASIS OF MUTUAL U NDERSTANDING. IT WAS, THEREFORE, NOT POSSIBLE TO ACCEPT THAT THERE WAS NO EVIDENCE OF SERVICES RENDERED BY THE BROKERS. IT WAS SUBSTANTIATED THAT THE BROKERS HAVE DULY PLAYED THEIR ROLE BY WAY OF AUGMENTING A SALE. BY PRODUCING THE ABOVE MATERIAL, THE APPE LLAN T HAD FULLY DISCHARGED THE BURDEN WHICH LAY ON IT TO PROVE THE PAYMENT OF BROKERAGE AS SIMILAR BROKERAGE WAS PAID BY IT IN EARLIER YEAR AND WAS ALSO PAID BY OTHER ENTITIES IN SIMILAR LINE OF TRADE. IT WAS THEREFORE NOT LOGICAL TO HOLD THAT THE EXPENDIT URE OF BROKERAGE WAS NOT WHOLLY LAID OUT FOR THE PURPOSE OF BUSINESS. THE OBJECTIONS OF THE AO THAT THE APPELLANT WAS UNABLE TO SUBSTANTIATE THE PAYMENT ON ACCOUNT OF BROKERAGE DO NOT HOLD WATER. THE AO FOR VERIFICATION OF GENUINENESS OF EXPENSES WAS REQUI RED TO EXAMINE THE BANK STATEMENTS OF THE APPELLANT WHEREIN THE PAYMENTS WERE DEBITED. IT WAS NOBODY'S CASE THAT BANK STATEMENTS WERE NOT AVAILABLE WITH THE AO AT THE RELEVANT TIME OR SUCH COMMISSION WAS NOT FOUND DEBITED. IN FACT, THE AO DID NOT MAKE ANY INDEPENDENT ENQUIRY BEFORE RESORTING TO SUCH PREJUDICIAL CONCLUSION. IN MY OPINION, WITHOUT MAKING ANY ENQUIRY, THE FINDING THAT THE BROKERAGE PAID WAS NOT GENUINE COULD NOT BE ARRIVED AT. SIMILARLY, THE FINDING THAT NO SERVICES WERE RENDERED WAS ALSO WITH OUT ANY BASIS OR JUSTIFICATION. IT IS NOTED THAT THE TURNOVER OF THE APPELLANT WAS MORE THAN RS.1 ,16,48,68,471.79 A ND THE SAME COULD NOT BE ARRIVED AT WITHOUT THE HELP OF BROKERS. THESE PERSONS WERE ALSO RESPONSIBLE FOR GETTING THE VEHICLES FINANCED. IN T HE LIGHT OF THE EVIDENCES ADDUCED ON RECORD AND PAYMENTS BY CHEQUES AFTER DUE DEDUCTION OF TAX AT SOURCE, THE CASE FOR SERVICES RENDERED STAND FULLY ESTABLISHED. IT IS ALSO IMPERATIVE TO REFER TO THE DECISION IN THE CASE OF CIT VS. INBUILT MERCHANT P. LTD. (ITAT NO. 225 OF 2013) DATED 14.03.2014 WHEREIN IT WAS HELD AS UNDER: 'THE VIEWS EXPRESSED BY THE ASSESSING OFFICER ARE ERRONEOUS IN LAW. THE ASSESSING OFFICER HAS OVERLOOKED THE IMPORTANCE OF THE BOOKS OF ACCOUNTS MAINTAINED IN THE ORDINARY COURSE OF BUSINESS. REFERENCE IN THIS REGARD MAY BE MADE TO SUB SECTION (2) OF SECTION 32 OF THE INDIAN EVIDENCE ACT, 1872. THE BOOKS OF ACCOUNTS MAINTAINED IN THE ORDINARY COURSE OF BUSINESS ARE RELEVANT AND THEY CANNOT BE DISCARDED IN THE ABSENCE OF APPROPRIATE R EASONS. THE MERE FACT THAT RECIPIENT DID NOT REPLY IN SOME CASES OR THEY WERE NOT FOUND AT THE ADDRESS FURNISHED BY THE ASSESSEE DOES NOT IN THE L EAST PROVE THE FACT THAT THEY WERE NON EXISTENT OR THAT THE PAYMENTS SHOWN TO HAVE B E EN MADE BY THE ASSESSEE W ERE IMAGINARY. WITH THE ADVANCEMENT OF TECHNO LO GY, IT HAS BECOME POSSIBLE TO SELL GOODS THROUGHOUT THE COUNTRY THROUGH THE INTERNET. FOR THAT PURPOSE, AGENTS ARE REQUIRED THROUGHOUT THE COUNTRY. T HE MECHANISM IN THAT REGARD HAS BEEN DISCLOSED BY THE ASSESS EE AND HAS BEE N RECORDED IN THE ORDER OF THE CIT (APPEALS). FOR THE PURPOSE OF CARRYING ITS BUSINESS, THE ASSESSEE HAS TO RECRUIT THE AGENTS. IT MAY NOT BE P OSSIBLE FOR THE ASSESSEE TO KNOW THEM PERSONALLY. WHATEVER ADDRESS WAS FURNISHED TO THE ASSESSEE, H AS BEEN DISCLOSED TO THE INCOME TAX DEPARTMENT. PAYMENTS WERE ADMITTEDLY MADE BY CHEQUE AFTER DEDUCTION OF TAX. THE TAX DEDUCTED AS SOURCE HAS DULY BEEN DEPOSITED. THE JUDGMENT IN THE CASE OF CIT VS. PRECISION FINANCE PVT. LTD. REPORTED IN 208 ITR 465 RELI ED UPON BY MR. ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 3 BHOWMICK DOES NOT REALLY ASSIST HIM. THE AFORESAID JUDGMENT IS AN AUTHORITY FOR THE PROPOSITION THAT MERE PAYMENT BY ACCOUNT PAYEE CHEQUE CANNOT ESTABLISH THAT THE TRANSACTION WAS GENUINE, BUT IN THE CASE BEFORE US, BESIDES THE FACT THAT PAY MENT WAS MADE BY CHEQUE, THERE ARE OTHER PIECES OF EVIDENCE AVAILABLE WHICH ARE AS FOLLOWS: A) BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE IN THE ORDINARY COURSE OF BUSINESS; B) DEDUCTION OF TAX AT SOURCE; C) DEPOSIT OF THE MONEY DEDUCTED AT SOURCE; D ) PARTICULARS OF THE RECIPIENT WERE DULY FURNISHED; WE ARE, AS SUCH, OF THE OPINION THAT THE VIEWS EXPRESSED BY THE LEARNED TRIBUNAL ARE UNEXCEPTIONABLE. WE, THEREFORE REFUSE TO ADMIT THE APPEAL. THE APPEAL IS THUS DISMISSED. ' THE DECISION RENDERED BY T HE HON'BLE CALCUTTA HIGH COURT IS WHOLLY APPLICABLE IN THE INSTANT CASE. THERE IS NO DOUBT THAT THE PAYMENT MADE ON ACCOUNT OF BROKERAGE IN THIS LINE OF TRADE IS ACCEPTABLE AS BUSINESS EXPENDITURE. IN FACT, THERE IS EXPLICIT ADMISSION IN THIS RESPECT BY TH E AO HIMSELF BY ALLOWING PAYMENTS MADE TO TWO OF THE BROKERS. THE APPELLANT HAD DULY DEDUCTED TAX ON SUCH PAYMENTS OF BROKERAGES W HICH WERE PROPERLY MADE THROUGH BANKING CHANNEL. THE AMOUNTS SO PAID DULY APPEARED IN THE BOOKS OF THE APPELLANT. THE AMOUNTS DEDUCTED ON ACCOUNT OF TAX AT SOURCE WERE DULY DEPOSITED TO THE CREDIT OF THE CENTRAL GOVERNMENT. THE DETAILS OF THE RECIPIENTS WERE DULY FURNISHED. IN THE IMPUGNED ORDER THE AO HAS NEITHER DISBELIEVED NOR DISPROVED THIS FACTUAL ASPECT. ON RECEIPT OF THE D ETAILS FURNISHED THE AO HOWEVER DID NOT CONDUCT ANY ENQUIRIES BY ISSUING NOTICES U/S 133(6) OF THE ACT. THEREFORE, TO SIMPLY DISCARD THE EXPENSE ON ACCOUNT OF 'COMMISSION & BROKERAGE' AND BRAND IT AS INADMISSIBLE IS SIMPLY UNSUSTAINABLE. 4.3. IN THE FACT S AND CIRCUMSTANCES OF THE INSTANT CASE, I ALSO FIND FORCE IN THE SUBMISSIONS OF THE AR THAT NOWADAYS THE CUSTOMERS LARGELY DEPEND ON THESE BROKERS FOR PROCURING NOT ONLY VEHICLES BUT ALSO FOR OBTAINING REQUISITE AUTO FINANCE FROM BANKS OR PRIVATE SOURCES. THESE BROKERS BESIDES ARRANGING FOR LOAN FACILITIES LOOK FOR COMPETITIVE OFFERS FROM INSURANCE COMPANIES AND ALSO TAKE CARE PROCEDURAL FORMALITIES IN OBTAINING DOCUMENTATION FOR THE VEHICLES FROM THE AUTHORITIES. I THEREFORE FIND MERIT IN THE SUBMISSIONS OF THE AR THAT THESE BROKERS A CRUCIAL ROLE IN MARKETING OF THE VEHICLES FROM THE APPELLANT TO THE ULTIMATE CU STOMER. IT IS A COMMO N SIGHT IN ANY AUTO SHOWROOM THAT A PROSPECTIVE CUSTOM ER COMES IN CONTACT WITH THE BROKERS WHO GENERALLY FREQUENT THE CAR SHO WROOMS AND ASSIST THE CUSTOMERS IN COMPLETING THE SALE FORMALITIES WITHOUT BEING AWARE AS TO THE EXACT ROLE PLAYED BY THEM. HOWEVER THE VEHICLE DISTRIBUTORS DEPEND ON SERVICES OF SUCH BROKERS FOR PROCURING THE CUSTOMERS WHO DO NOT HAVE ANY ESTABLISHED REFE RRALS AND THEREFORE HE DISTRIBUTORS NEED TO DEPEND ON THEIR SERVICES FOR SUCCESSFUL COMPLETION OF THE CAR SALE. I ALSO FIND MERIT IN THE SUBMISSIONS OF THE AR THAT IN THE PAST FEW YEARS THERE HAS BEEN INTENSE COMPETITION IN THE AUTOMOBILE MARKET SINCE A LA RGE NUMBER OF FOREIGN AUTO COMPANIES HAVE ENTERED INDIAN MARKETS. IN THE CIRCUMSTANCES IN ORDER TO GARNER LARGER MARKET SHARE, THE APPELLANT HAD TO DEPEND ON THE SERVICES OF BROKERS WHO ACTED AS AN INTERFACE BETWEEN THE ASSESSEE AND THE CUSTOMERS FOR SUCCE SSFUL CONCLUSION OF SALE OF VEHICLES. IN ORDER TO BE ELIGIBLE FOR THE EXPENSES U/S. 37 OF THE ACT ONE HAS TO FULFIL L THE CONDITIONS: (I) THE EXPENDITURE MUST NOT BE GOVERNED BY THE PROVISIONS OF SECTIONS 30 TO 36 OF THE ACT, (II) THE EXPENDITURE MUST HAVE BEEN LAID OUT WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF THE BUSINESS OF THE ASSESSEE, (III) THE EXPENDITURE MUST NOT BE PERSONAL IN NATURE, (IV) THE EXPENDITURE MUST NOT BE CAPITAL IN NATURE. THE EXPRESSION 'WHOLLY' EMPLOYED IN SEC. 37 OF THE ACT REFERS TO THE QUANTUM OF EXPENDITURE, WHILE THE WORD 'EXCLUSIVELY' REFERS TO THE MOTIVE, OBJECTIVE AND PURPOSE OF THE EXPENDITURE. IN THE PRESENT CONTEXT, IT WAS THE RELEVANCE OF THE EXPENDITURE WAS DULY EXPLAINED WITH EVIDENCE. THOUGH THE AO HAS DISPUTED THE FACTU M OF EXPENSES INCURRED BY THE APPELLANT ON THIS ACCOUNT IN HIS ASSESSMENT ORDER, HOWEVER, HE HAS NOT POINTED OUT A SINGLE ITEM IN RESPECT OF WHICH DOCUMENTATION WAS LACKING OR IN RESPECT OF WHICH HE DESIRED PARTICULARS TO BE PRODUCED WHICH THE APPELLANT FA ILED TO COMPLY WITH. IT IS NOT HIS CASE THAT THE EXPENSES WERE UNFAIR OR UNREASONABLE AND WAS NOT COMMENSURATE WITH THE BUSINESS OF THE APPELLANT SO THAT THE DISALLOWANCE RESORTED TO BY HIM SUFFERS FROM INCURABLE INFIRMITY AND CONTRADICTORY IN THE BACKGROU ND OF ESTABLISHED COMMERCIAL PRACTICE. 4.4. IT IS ALSO FOUND THAT THE AO HAS RELIED UPON THE RATIO IN THE CASE OF MC DOWELL & CO. LTD. VS. CTO (1985) 154 ITR 148, WHEREIN IT WAS HELD THAT EVEN IF TRANSACTIONS ARE GENUINE AND EVEN IF IT IS ACTED UPON, IF THE TRANSACTION IS ENTERED INTO WITH THE INTENTION TO AVOID TAXES, THEN THE TRANSACTION WOULD CONSTITUTE A COLORABLE DEVICE. H E HAS CITED CASE OF TWINSTAR HOLDINGS LTD. VS. CIT (2003) 260 ITR 6 (BOMBAY) WHEREIN SIMILAR ANALOGY WAS DECIDED. FURTHER IN THE CASE OF BHAGAT CONSTRUCTION CO. P VT. LTD. VS. CIT 2001 250 ITR 291 (DELHI) IT WAS HELD THAT A COLOURABLE TRANSACTION IS ONE WHICH IS SEEMINGLY VALID, BUT A FEIGNED OR COUNTERFEIT TRANSACTION IS ENTER ED I NTO FOR ULTERIOR PURPOSE. IN THE CASE OF WORKMEN OF AS SOCIATED RUBBER INDUSTRIES LTD. VS. ASSOCIATED RUBBER INDUSTRIES LTD. (1986) 157 ITR 77 (SC) IT HAS BEEN HELD THAT THE DUTY OF THE COURT IN EVERY CASE WHERE INGENUITY IS EXPENDED TO AVOID TAXATION AND WELFARE LEGISLATIONS, TO GO BEHIND THE SMOKE SCREEN AND DISCOVER THE TRUE STATE OF AFFAIRS. THE COURT IS NOT TO BE SATISFIED WITH THE FORM AND LEAVE ALONE THE SUBSTANCE OF A ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 4 TRANSACTION. THE RATIONALE OF THE AO IN APPLYING THE AFORESAID PRINCIPLE WAS TO CONCLUDE THAT HE HAD PIERCED THE CORPORATE VEIL AND WENT BEHIND THE SMOKE AND DISCOVERED THE TRUE STATE OF THE BUSINESS WHICH HAD SHOWN THAT THE APPELLANT HAD PAID BROKERAGE WHICH WAS NOT FOR THE PURPOSE OF BUSINESS AND WITHOUT RENDERING ANY KIND OF SERVICE. HOWEVER, HE WAS UNABLE TO ADDUCE ANY EVIDENCE IN SUPPO RT OF SUCH FINDING. IT WAS FOR THE AO TO PROVE THAT THE PAYMENTS WERE MADE WITH THE INTENTION TO AVOID TAXES. SUCH ALLEGATION WITHOUT ANY EVIDENCE TO JUSTIFY IT MAKES THE RATIOS INAPPLICABLE TO THE FACTS OF THE INSTANT CASE AND ACCORDINGLY DISTINGUISHABLE. 4.5. THE CIRCUMSTANCES PREVAILING IN THE PRESENT INSTANCE ARE SIMILAR WITH THOSE OF THE PRECEDING ASSESSMENT YEARS. SINCE THERE IS NO CHANGE IN THE CIRCUMSTANCES AS PREVAILING IN THOSE ASSESSMENT YEARS WITH THE ASSESSMENT YEAR UNDER APPEAL, THE GRIEVANC E OF THE APPELLANT IS UPHELD. IN THE CASE OF SRI HANUMAN SUGAR & INDUSTRIES LTD. VS. CIT (2004) 266 ITR 106 (CAL), IT WAS OBSERVED AS UNDER: 'IN SUBSEQUENT YEARS, IF 'ON MATERIALS AVAILABLE, THE AUTHORITIES CONCERNED COME TO A FINDING ON THEN AVAILABL E FACTS THAT ARRANGEMENT OF LEASE BY THE ASSESSEE DID NOT DEPICT ANY INTENTION OF TEMPORARY ARRANGEMENT AND IN FACT IT WAS A FINAL PARTING WITH THE FACTORY, APPROPRIATE DECISION COULD BE TAKEN ON SUCH FINDING BY THE AUTHORITIES. SUCH FINDING WOULD NOT BE H IT BY THE PRINCIPLES OF RES JUDICATA. THE PRINCIPLE OF RES JUDICATA DOES NOT APPLY IN INCOME TAX MATTERS, BUT FOR COMING TO SEPARATE CONCLUSION IN TWO DIFFERENT YEARS, THERE MUST BE SEPARATE FACTS LEADING TO SUCH DIFFERENT CONCLUSIONS. ON IDENTICAL FACTS, SEPARATE CONCLUSIONS BY THE REVENUE AUTHORITIES ARE NOT DESIRED. THEREFORE, CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, I FIND SUBSTANCE IN THE ARGUMENT OF THE A/R THAT THE CLAIM OF THE APPELLANT IS LIABLE TO BE ACCEDE TO ON THE GROUNDS OF RULE OF CONSISTENCY ALSO. AS SUCH, CONSIDERING ALL THE FACTS OF THE CASE, I HAVE NO HESITATION TO CONCLUDE THAT THE DISALLOWANCE OF 'COMMISSION & BROKERAGE' MADE BY THE AO TO THE EXTENT OF ~22,80,000/ IS NOT JUSTIFIED IN THE FACTS AND CIRCUMST ANCES OF THE INSTANT CASE AND ACCORDINGLY, THE AO IS DIRECTED TO DELETE THE SAME. THUS, THE GROUND NO. 2 IS PARTLY ALLOWED. 4. IN VIEW OF ABOVE, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE CIT - A AND IT IS JUSTIFIED. GROUND NO.(I) RAISED BY THE REVE NUE IS DISMISSED. 5. GROUND NO. (II) IS RELATING TO DELETION OF ADDITION MADE ON ACCOUNT OF DONATION OF PUJA EXPENSES OF RS.6,18,121/ - . 6. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE ASSESSE FILED LIST DETAILING THE AMOUNT OF DONATION AND PUJA EXP ENSES PAID ON ACCOUNT OF VARIOUS OCCASIONS TO DIFFERENT PARTIES , BUT FOR NON - FILING ANY DOCUMENTARY EVIDENCE OR RECEIPTS, THE AO DISALLOWED AN AMOUNT OF RS.6,18,131/ - . THE CIT - A BY PLACING RELIANCE ON THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CA SE OF CIT VS. ARUNA SUGARS LTD REPORTED IN (1981) 132 ITR 718(MAD) DELETED THE IMPUGNED ADDITION MADE BY THE AO. RELEVANT PORTION OF CIT - A ORDER IS REPRODUCED HEREIN BELOW: - 5.2 I HAVE CONSIDERED THE ISSUE IN THE ASSESSMENT ORDER FRAMED BY THE AO IN LIGH T OF THE ARGUMENTS MADE BY THE APPELLANT. THE SHORT ISSUE FOR MY CONSIDERATION IS THAT WHETHER THE AMOUNTS EXPENDED ON ACCOUNT OF 'DONATION & PUJA' WARRANT DISALLOWANCE OR NOT. IT IS FOUND THAT THE APPELLANT HAD BEEN MAKING THIS PAYMENT ON ACCOUNT OF 'DONA TION & PUJA' SINCE ITS INCEPTION. IT IS OBSERVED THAT ON FACTS THERE IS NO DISPUTE THAT THE APPELLANT HAD INCURRED EXPENDITURE IN THE SUM OF RS. 83,546/ IN PERFORMING PUJA. ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 5 THE AO WAS ALSO APPRISED THAT PERFORMING SUCH RITUAL GIVES PEACE OF MIND AND INCULC ATES LOYALTY IN ITS EMPLOYEES AND INCREASES WORK EFFICIENCY. I T IS NOTICED THAT IN CASE OF SIMILAR CLAIM, THE HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT VS. ARUNA SUGARS LTD. (1981) 132 ITR 718 (MAD) WHILE ACCEPTING THE ISSUE CONCERNED IN THE FAVOUR OF T HE APPELLANT HAS HELD AS UNDER: 'THE COMMISSIONER OF INCOME TAX, TAMIL NADU II/, MADRAS, HAS AP PLIED FOR A DIRECTION TO THE TRIBUNAL IN EACH OF THESE TWO PETITIONS FOR REFERENCE OF THE FOLLOWING QUESTION: WHETHER, ON THE FACTS AND IN THE CIRCUMST ANCES OF THE CASE, THE APPELLATE TRIBUNAL WAS RIGHT IN HOLDING THAT THE EXPENSES INCURRED BY THE ASSESSEE TOWARDS POOJA AND BAKSHISH SHOULD BE ALLOWED AS BUSINESS EXPENSES OR EXPENSES OF THE STAFF ?' THE FACTS ARE IN A SHORT COMPASS. THE ASSESSMENT YEARS UNDER CONSIDERATION ARE 1968 69 AND 1969 70. THE ASSESSEE CLAIMED RS. 1,751 AND RS. 3,250 AS MISCELLANEOUS EXPENSES. THESE HAD BEEN CLASSIFIED AS POOJA EXPENSES AND ALSO EXPENSES FOR BAKSHISH AND PRESENTATION. THE INCOME TAX OFFICER DISALLOWED THE CLAIM A ND THE SAID DISALLOWANCE WAS CONFIRMED BY THE APPELLATE ASSISTANT COMMISSIONER ON APPEAL. ON FURTHER APPEAL, THE INCOME TAX APPELLATE TRIBUNAL ALLOWED THE APPEALS IN PART. IN PARA 12 OF ITS ORDER, THE TRIBUNAL POINTED OUT THAT THESE EXPENSES WERE INCURRED FOR THE POOJAS ETC., PERFORMED BY THE WORKERS AND THAT THEY SHOULD FORM PART OF THE WELFARE EXPENSES. IT ALSO POINTED OUT THAT, SIMILARLY, EXPENSES ON BAKSHISH AND PRESENTATION WERE FOUND TO HAVE BEEN INCURRED IN RESPECT OF THE WORKERS ALONE. HENCE, THE T RIBUNAL DID NOT FIND ANY REASON FOR THE DISALLOWANCE OF THESE CLAIMS. IT IS THIS CONCLUSION OF THE TRIBUNAL THAT IS NOW SOUGHT TO BE QUESTIONED. HAVING REGARD TO THE FINDING OF THE TRIBUNAL THAT THESE EXPENSES HAVE BEEN INCURRED ONLY IN RESPECT OF THE WO RKERS, IT IS CLEAR THAT THE EXPENSES HAVE BEEN RIGHTLY HELD TO BE ONES INCURRED FOR THE WELFARE OF THE WORKERS. THE CONCLUSION OF THE TRIBUNAL IS BASED ON THE PARTICULAR FACTS AND, THEREFORE, NO QUESTION OF LAW ARISES OUT OF THE ORDER OF THE TRIBUNAL. ' 5.3. IN RESPECT OF DONATION, IT IS OBSERVED THAT THE APPELLANT HAD FILED DETAILS OF EXPENSES. IT WAS FOUND THAT THE APPELLANT HAD PAID DONATION OF RS.5,34,575/ TO VARIOUS ORGANIZATIONS. IT IS WELL KNOWN THAT IN ORDER TO RUN THE BUSINESS PEACEFULLY IT IS N ECESSARY TO CONTRIBUTE TO LOCAL RELIGIOUS AND SOCIAL CAUSES. IN A SIMILAR CIRCUMSTANCE, THE JURISDICTIONAL INCOME TAX APPELLATE TRIBUNAL, KOLKATA 'A' BENCH IN TUNU COLD STORAGE VS. ACIT (ITA NO. 7/KO1/07) DATED 28.02.2007, RELIED ON BY THE A/R, HAS HELD AS UNDER: ' ..... SINCE THERE IS NO DISPUTE THAT THE SUBSCRIPTION AND DONATION WAS GIVEN BY THE ASSESSEE TO VARIOUS ORGANIZATIONS TO AVOID CONFRONTATION AND FOR SMOOTH RUNNING OF ITS BUSINESS, THEREFORE, THE EXPENSES INCURRED BY THE ASSESSEE ON SUBSCRIPT ION AND DONATION RS. 2568/ IS INCIDENTAL TO ASSESSEE' BUSINESS AND ALLOWABLE AS BUSINESS EXPENDITURE. THIS VIEW ALSO FINDS SUPPORT FROM THE DECISION OF THE HON'BLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS BATA INDIA LLD. (1993) 201 ITR 884 (CAL) WHEREI N IT HAS BEEN HELD AT PAGE 890 THAT 'CONTRIBUTION TO LOCAL PUJA AND THE FESTIVALS COMMITTEES OR ORGANIZATIONS TO AVOID CONFRONTATION AND FOR SMOOTH RUNNING OF ITS RELATIONSHIP ARE ALLOWABLE AS BUSINESS EXPENDITURE'. 5.4 THEREFORE, CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND RESPECTFULLY FOLLOWING THE JUDICIAL PRONOUNCEMENTS ON THE ISSUE, I AM OF THE CONSIDERED VIEW THAT THE AO HAS ERRED IN RESORTING TO THE IMPUGNED DISALLOWANCE ON ACCOUNT OF DONATION AND PUJA EXPENSES WHICH WERE NOT JUSTIFIED IN THE CIRCUMSTANCES AND THUS, I HAVE NO HESITATION TO HOLD THAT THE IMPUGNED DISALLOWANCE MADE BY THE AO IS NOT JUSTIFIED IN THE CIRCUMSTANCES AND ACCORDINGLY, DIRECT HIM TO DELETE THE ENTIRE ADDITION OF RS.6,18,121/ MADE ON THIS ACCOUNT. THUS, GROUND NO. 3 OF THE APPEAL IS ALLOWED. 7. IN VIEW OF ABOVE, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE CIT - A AND WE UPHOLD THE SAME. GROUND NO. (II) RAISED BY THE REVENUE IS DISMISSED. 8. GROUND NO. (III) IS RELATING TO DELETION DISALLOWA NCE OF RS.44,49,647/ - UNDER THE HEAD OTHER EXPENSES. ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 6 9. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD, WE FIND THAT THE ASSESSESSEE CLAIMED THE FOLLOWING EXPENSES UNDER THE HEAD OTHER EXPENSES: - I) DIRECT EXPENSES RS.69,09,662/ II) DISCOUNT ALLOWE D RS.31,01,000/ III) TRAINING EXPENSES RS.29,90,000/ IV) STIPEND RS.34,18,000/ V) STAFF INCENTIVE RS.16,08,627/ VI) MISC. EXPENSES RS. 1,44,135/ VII) SALES PROMOTION RS. 17,88,916/ VIII) CARRIAGE OUTWARD RS.12,94,015/ IX) CONVEYANCE RS. 14,93,881/ 10. ACCORDING TO AO, MOST OF THE ABOVE EXPENSES WERE REPETITIVE IN NATURE AS TRAINING, STIPEND OR STAFF INCENTIVE ARE SIMILAR TYPE OF EXPENSES AND MOST OF THEM WERE PAID IN CASH. THE AO SHOW CAUSED THE ASSESSE WHY THE ABOVE EXPENSES SHOULD NOT BE DISALLOWED. IN RESPONSE , THE ASSESSE FILED WRITTEN SUBMISSIONS EXPLAINING ALL EXPENSES AND DETAILS OF STATEMENT OF EXPENDITURE HEAD WISE. FOR NOT FILING PROPER SUPPORTING EVIDENCES THE AO DISALLOWED @ 20% OF THE ABOVE EXPENDITURE I.E. AT RS.44,49,647/ - . WE FIND FROM THE ORDER OF THE CIT - A THAT THE AO FAILED TO MAKE ANY EFFORT TO IDENTIFY ANY SPECIFIC EXPENDITURE, WHICH NOT INCURRED IN RELATION TO ASSESSEES BUSINESS AND DOES NOT TALLY WITH THE VOUCHERS. THE AO DID NOT DISPUTE THE CORRECT OF BOOKS OF ASSESSE AND NO BASIS OR WHAT SOEVER WAS GIVEN BY THE AO FOR ESTIMATING THE SAID DISALLOWANCE @ 20%. THE CIT - A DELETED THE SAID DISALLOWANCE AS UNDER: - 6.2 I HAVE CONSIDERED THE ISSUE IN THE ASSESSMENT ORDER FRAMED BY THE AO IN LIGHT OF THE ARGUMENTS MADE BY THE APPELLANT. THE S HORT ISSUE FOR MY CONSIDERATION IS THAT WHETHER THE DISALLOWANCE OF 20% OF EXPENSES OUT OF 'OTHER EXPENSES' IS JUSTIFIED OR NOT. ON APPRAISAL OF ALL THE MATERIALS BROUGHT BEFORE ME, IT TRANSPIRES THAT THE ACTION OF THE AO IS FRAUGHT WITH A TAINT OF ILLEGAL ITY. THE AO HAS RECORDED A FINDING THAT THE APPELLANT HAD PRODUCED BOOKS OF ACCOUNTS AND ALSO COMPLIED WITH THE SHOW CAUSE NOTICE BY EXPLAINING THE NATURE OF EXPENSES AND DETAILED HEAD WISE STATEMENT OF EXPENSES. THERE IS NO DISSATISFACTION RECORDED BY THE AO IN THIS RESPECT. THE LIMITED GRIEVANCE RECORDED BY THE AO IS THAT '... IN ABSENCE OF PROPER SUPPORTING EVIDENCES .... ' IN SUPPORT OF SUCH EXPENSES. THUS, THE AO HAS MADE AD HOC DISALLOWANCE ON ESTIMATE BASIS, ALTHOUGH HE DID NOT DISPUTE THE BUSINESS P URPOSES OF SUCH EXPENSES. THERE IS NO DISPUTE AS TO THE FACT THAT THE EXPENDITURE INCURRED BY WAY OF PAYMENTS MADE UNDER THESE HEADS WERE DULY EXPLAINED BEFORE THE AO WHO DID NOT DENY THE VERACITY THEREOF. THE APPELLANT HAS MAINTAINED THE DETAILS OF THESE EXPENSES, WHICH ARE SUPPORTED BY VOUCHERS; THE APPELLANT'S ACCOUNTS ARE STATUTORILY AUDITED U/S. 44AB OF THE ACT AND NO ADVERSE COMMENT WAS FOUND TO BE RECORDED BY THE AUDITOR ABOUT MAINTENANCE OF VOUCHERS IN RELATION TO ABOVE EXPENSES. MERELY ON PRESUMPTI ON OF ABSENCE OF PROPER EVIDENCE DO NOT LEND AUTHORITY TO THE AO TO JUSTIFY AD HOC DISALLOWANCE OF EXPENSES. THE AO CONSIDERED THE QUESTION OF THE EXPENSES IN THIS CONTEXT IN THE ABSTRACT WITH PRECONCEIVED NOTION OF HALLMARKS OF DOCUMENTATION. HIS APPROACH WAS THEREFORE CIRCUMSCRIBED AND NOT IN TUNE WITH THE PRACTICES PREVALENT IN THE LINE OF ACTIVITY CARRIED ON BY THE APPELLANT. THE APPELLANT HAS BEEN CARRYING ON SUCH ACTIVITIES FROM YEAR TO YEAR AND NO ADVERSE INFERENCE CAN BE DRAWN THEREFROM. IT IS NOT T HE CASE OF THE AO THAT THE EXPENSES DEBITED ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 7 UNDER THE IMPUGNED HEADS WERE UNREASONABLE OR EXCESSIVE. ADMITTEDLY, THE RELEVANT RATIOS HAD NOT BEEN DEMONSTRATED TO BE LOPSIDED OR ADVERSE. THE MODE OF MAINTENANCE OF DOCUMENTARY EVIDENCE IS IN ACCORD WITH THE PRACTICE PREVALENT IN THE TRADE AND CORRESPONDS TO YIELD WHICH IS THE ULTIMATE YARDSTICK FOR JUDGING THE REASONS AND BUSINESS RELEVANCE THEREOF. FURTHER, THE AO HAS NOT MADE ANY EFFORTS TO IDENTIFY ANY SPECIFIC EXPENDITURE WHICH WAS, ACCORDING TO HIM, NOT INCURRED IN RELATION TO APPELLANT'S BUSINESS OR WHICH EXPENDITURE DOES NOT TALLY WITH THE VOUCHERS. HE SIMPLY DISALLOWED ON LUMP SUM BASIS 20% OF SUCH EXPENDITURE UNDER THE ABOVE NINE HEADS. 6.3. THE BOOKS OF THE APPELLANT WERE DULY PRODUCED BEFORE THE AO WHO, APART FROM HIS CONTRADICTORY FINDINGS, DID NOT DISPUTE THE COMPLETENESS OR CORRECTNESS THEREOF. IN THE TEETH OF SUCH ADMISSION, IT IS OBSERVED THAT THE AO INDULGED IN SPECULATION, SURMISE, SUSPICION AND CONJECTURE IN RESORTING TO THE IMPUGNED DISAL LOWANCE ON THIS ACCOUNT. SINCE THE A O HAD SPECULATED UPON A PRESUMPTION OF 'ABSENCE OF PROPER EVIDENCE', SUCH FINDING DOES NOT HAVE ANY LEGS TO STAND UPON. IN THE INSTANT CASE, NO DEFECTS IN THE DETAILS UNDERLINED BY EVIDENCE HAVE BEEN FOUND IN THE HEAD WI SE EXPENSES BY THE AO AND AS SUCH, HE WAS PRECLUDED FROM RESORTING TO AN AD HOC DISALLOWANCE ON ESTIMATE. IT IS ALSO OBSERVED THAT THERE IS NO BASIS FOR HOLDING THAT A PORTION OF THE EXPENSE @ 20% AS THE INCOME OF THE APPELLANT. IT IS A MERE SURMISE AND CO NJECTURE OF THE A O TO SUGGEST SUCH IMAGINATIVE SPECULATION WHICH VITIATES THE ADDITION MADE AND IS THUS DEVOID OF MERITS. IT IS OBSERVED THAT THE A O IS NOT ENTITLED TO MAKE A PURE GUESS AND MAKE AN ASSESSMENT WITHOUT REFERENCE TO ANY EVIDENCE OR ANY MATERI AL AT ALL. IN THIS RESPECT, IT IS IMPERATIVE TO REFER ON THE RATIO IN THE CASE OF DHAKESWARI COTTON MILLS LTD. VS. CIT (1954) 26 ITR 775 (SC) WHEREIN IT WAS HELD AS UNDER: 'AS REGARDS THE SECOND CONTENTION, ALTHOUGH ITO IS NOT FETTERED BY TECHN ICAL RULES OF EVIDENCE AND PLEADINGS, AND THAT HE IS ENTITLED TO ACT ON MATERIAL WHICH MAY NOT BE ACCEPTED AS EVIDENCE IN A COURT OF LAW, BUT THERE THE AGREEMENT ENDS; BECAUSE IT IS EQUALLY CLEAR THAT IN MAKING THE ASSESSMENT UNDER SECTION 23(3) HE IS NOT ENTITLED TO MAKE A PURE GUESS AND MAKE AN ASSESSMENT WITHOUT REFERENCE TO ANY EVIDENCE OR ANY MATERIAL AT ALL AND THERE MUST BE SOMETHING MORE THAN BARE SUSPICION TO SUPPORT THE ASSESSMENT UNDER SECTION 23(3). THE RULE OF LAW ON THIS SUBJECT HAS BEEN FAIRL Y AND RIGHTLY STATED BY THE LAHORE HIGH COURT IN THE CASE OF SETH GURMUKH SINGH V. CIT [1944]12 393. IN THE INSTANT CASE, THE TRIBUNAL VIOLATED CERTAIN FUNDAMENTAL RULES OF JUSTICE IN REACHING ITS CONCLUSIONS. FIRSTLY, IT DID NOT DISCLOSE TO THE ASSESSEE W HAT INFORMATION HAD BEEN SUPPLIED TO IT BY THE DEPARTMENTAL REPRESENTATIVE. NEXT, IT DID NOT GIVE ANY OPPORTUNITY TO THE ASSESSEE TO REBUT THE MATERIAL FURNISHED TO IT BY HIM, AND LASTLY, IT DECLINED TO TAKE ALL THE MATERIAL THAT THE ASSESSEE WANTED TO PRO DUCE IN SUPPORT OF ITS CASE. THE RESULT WAS THAT THE ASSESSEE HAD NOT HAD A FAIR HEARING. THE ESTIMATE OF THE GROSS RATE OF PROFIT ON SALES, BOTH BY THE ITO AND THE TRIBUNAL, WAS BASED ON SURMISES, SUSPICIONS AND CONJECTURES. THE TRIBUNAL TOOK FROM THE REP RESENTATIVE OF THE DEPARTMENT A STATEMENT OF GROSS PROFIT RATES OF OTHER COTTON MILLS BUT DID NOT SHOW THAT STATEMENT TO THE ASSESSEE DID NOT GIVE HIM A OPPORTUNITY TO SHOW THAT STATEMENT HAD NO RELEVANCY WHATSOEVER TO THE CASE OF THE MILL IN QUESTION. IT WAS NOT KNOWN WHETHER THE MILLS WHICH HAD DISCLOSED THESE RATES WERE SIMILARLY SITUATED AND CIRCUMSTANCED. NOT ONLY DID THE TRIBUNAL NOT SHOW THE INFORMATION GIVEN BY THE REPRESENTATIVE OF THE DEPARTMENT TO THE ASSESSEE, BUT IT REFUSED EVEN TO LOOK AT BOOK S AND PAPERS WHICH ASSESSEE'S REPRESENTATIVE PRODUCED BEFORE THE ACCOUNTANT MEMBER IN HIS CHAMBER. THE ASSESSMENT IN THIS CASE AND IN THE CONNECTED APPEAL, WAS ABOVE THE FIGURE OF RS. 55 LAKHS AND IT WAS JUST AND PROPER WHEN DEALING WITH A MATTER OF THIS M AGNITUDE NOT TO EMPLOY UNNECESSARY HASTE AND SHOW IMPATIENCE, PARTICULARLY WHEN IT WAS KNOWN TO THE DEPARTMENT THAT THE BOOKS OF THE ASSESSEE WERE IN THE CUSTODY OF THE SUB DIVISIONAL OFFICER. THUS BOTH THE ITO AND THE TRIBUNAL IN ESTIMATING THE GROSS PROF IT RATE ON SALES DID NOT ACT ON ANY MATERIAL BUT ACTED ON PURE GUESS AND SUSPICION. ' MOST RESPECTFULLY FOLLOWING THE AFORESAID RATIO, IT IS OBSERVED THAT THE ACTION OF THE AO IN RESORTING TO THE IMPUGNED DISALLOWANCE BY AD HOC ESTIMATION OF TREATING A P ART OF THE EXPENSES AS INCOME OF THE APPELLANT IS UNJUSTIFIED IN THE CIRCUMSTANCES. SUCH SPECIOUS ACTION OF THE AO ACCORDINGLY RENDERS HIS IMPUGNED FINDINGS BEING WITHOUT ANY VALID BASIS AS SUCH DISALLOWANCE DOES NOT STAND THE TEST OF JUDICIAL SCRUTINY. 6. 4 THEREFORE, CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, I FIND SUBSTANCE IN THE ARGUMENT OF THE A/R THAT THE DISALLOWANCE OF RS.44,49,647/ IS UNCALLED FOR SINCE IT IS CONTRARY TO THE SETTLED LEGAL PRINCIPLES AND THEREFORE, I HAVE NO HESITATION TO HOLD THAT SUCH DISALLOWANCE BY THE AO MADE ON THIS ACCOUNT IS DIRECTED TO BE DELETED. THUS, GROUND NO. 4 OF THE APPEAL ARE ALLOWED. 11. IT IS NOTED FROM PARA 7.1 OF AO THAT THE ASSESSE IN RESPONSE TO THE SHOW CAUSE EXPLAINED THE NATURE OF EXPENSES AND FILED DETAILED OF STATEMENT OF EXPENDITURE HEADWISE. BUT, HOWEVER, THE AO WITHOUT ITA NO . 1392/KOL/2016 M/S. SRE E AUTOMOTIVE PVT. LTD 8 CONSIDERING THE SAME ESTIMATED THE DISALLOWANCE @ 20% AS POINTED OUT BY THE CIT - A. THE AO DID NOT DISPUTE THE GENUINENESS OF EXPENDITURE AND MAKE OUT A DVERSE COMMENT WITH THE VOUCHERS. THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT - A AND IT IS JUSTIFIED. GROUND NO. (III) RAISED BY THE REVENUE IS DISMISSED. 12. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRON OUNCED IN THE OPEN COURT ON 27 - 0 7 - 2018 SD/ - SD/ - J. SUDHAKAR REDDY S .S. VISWANETHRA RAVI ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 27 - 0 7 - 2018 ** PP(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APP ELLANT/ REVENUE: DEPUTY COMMISSIONER OF INCOME - TAX, CIRCLE - 10(2), AAYKAR BHAWAN, 3 RD FLOOR,P - 7 CHOWRINGHEE SQUARE, KOLKATA - 700 069. 2 RESPONDENT / ASSESSEE: M/S. SREE AUTOMOTIVE PVT. LTD 8 CAMAC STREET, 10 TH FLOOR, KOLKATA - 700 017. 3. THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER SR.P.S,H.O.O, ITAT.KOL