Amiya Prasad Mishra, Cuttack V. ACIT, Cuttack

ITA 160/CTK/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90802 (ITAT-CUTTACK)
• Duration Of Justice: 1 year(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 09-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RABIN CHOUDHURI
• Assessee Lawyers: S N SAHU

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK B ENCH, CUTTACK , . . , BEFORE SHRI SUNIL KUMAR YADAV, JM & SHRI B.P.JAIN, AM ./ ITA NO.160/CTK/2014 ( ! ! ! ! / ASSESSMENT YEAR :2010-11) AMIYA PRASAD MISHRA, DEULA SAHI, TULSIPUR, CUTTACK VS. ACIT, CIRCLE-2(2), CUTTACK ' ./ # ./ PAN/GIR NO. AJMPM 3560 A ( '$ / ASSESSEE ) .. ( %&'$ / RESPONDENT ) ( * * * * /ASSESSEE BY : SHRI S.N.SAHU * * * * /REVENUE BY : SHRI RABIN CHOUDHURI + ( / DATE OF HEARING : 28 TH MAY, 2015 -.! ( / DATE OF PRONOUNCEMENT 29 TH MAY,2015 / / / / / O R D E R PER B.P.JAIN, AM THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER O F THE LD CIT(A), BERHAMPUR DATED 3.3.2014 FOR THE ASSESSMENT YEAR 2. THE ASSESSEE HAS RAISED THE FOLLOWING CONCISE G ROUNDS: 1.THAT THE LD CIT(A) SHOULD HAVE DELETED THE ENTIR E ADDITION MADE BY THE AO AND HE IS NOT JUSTIFIED SUSTAINING 50% OF THE ADHOC DISALLOWANCE MADE BY THE AO ESPECIALLY WHERE THE AS SESSEE HAD DISCLOSED 33.07% OF NET PROFIT WHICH IS VERY MUCH R EASONABLE AND REGULAR BOOKS OF ACCOUNT MAINTAINED AUDITED U/S.44A B OF THE I.T.ACT. 2. THAT BOOK RESULT SHOWN BY THE ASSESSEE SHOULD HA VE BEEN ACCEPTED IN VIEW OF THE FACT THAT THE ASSESSEE MAIN TAINS BOOKS OF ITA NO.160/CTK/201 ASSESSMENT YEAR :2010-11 2 ACCOUNT AUDITED U/S.44AB OF THE ACT. THE AUTHORITI ES BELOW ARE NOT JUSTIFIED IN REJECTING THE SAME TO MAKE ADHOC DISAL LOWANCE ON GENERAL ALLEGATION OF WANT OF BILLS AND VOUCHERS. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN ARCHITECT AND CARRIES ON HIS PROFESSION THROUGH ITS PROPRIETARY C ONCERN UNDER THE NAME & STYLE OF M/S. MISHRA ENGINEERS. HE FILED HIS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR ON 04.10.2010 DISCLOSING TOTAL INCO ME OF RS. 34,28,840/-. DURING THE SCRUTINY PROCEEDING THE DETAILED BILLS A ND VOUCHERS RELATING TO VARIOUS EXPENSES WERE NOT PRODUCED BEFORE THE AO. THE AO, ACCORDINGLY, DISALLOWED AN AMOUNT OF RS.62,150/- UNDER THE HEAD ENTERTAINMENT EXPENSES (OUT OF CLAIM OF RS. 2,48,600/-), RS. 28.030/- UNDE R THE HEAD GENERAL EXPENSES (OUT OF CLAIM OF RS.1,40,151/-), RS. 79,788/- UND ER THE HEAD PRINTING & STATIONERY EXPENSES (OUT OF CLAIM OF RS. 3,98,942/- ), RS. 73,350/- UNDER THE HEAD VEHICLE MAINTENANCE EXPENSES (OUT OF CLAIM OF RS.3,66,752/-), RS.36,388/- UNDER THE HEAD TRAVELLING EXPENSES (OUT OF CLAIM OF RS. 1,81,940/- ), RS.76,300/- UNDER THE HEAD BONUS & EX-GRATIA (OU T OF CLAIM OF RS. 3,81,500/- ) AND OF RS.23,634/- UNDER THE HEAD REPAIR & MAINT ENANCE EXPENSES (OUT OF CLAIM OF RS.1,18,173/-). 4. THE LD CIT(A) VIDE THE IMPUGNED ORDER AT PARA 5. 3 OBSERVED THAT SOME DISALLOWANCES ARE IN ORDER EXCEPT SALARY, BONUS & E XGRATIA, FOR WHICH, DETAILS HAVE BEEN SUBMITTED BEFORE THE AO ON 20.11.2012 AND , ACCORDINGLY, DELETED THE DISALLOWANCE OF RS.76,300/-. HOWEVER, CONSIDER ING THE FACTS OF THE CASE, THE LD CIT(A) RESTRICTED THE OTHER DISALLOWANCE AT 50% AND SUSTAINED THE ADDITION AMOUNTING TO RS.1,51,670/-. ITA NO.160/CTK/201 ASSESSMENT YEAR :2010-11 3 5. THE LD COUNSEL FOR THE ASSESSEE ARGUED THAT THE ASSESSEE IS AN ARCHITECT AND CARRIES ON BUSINESS IN ARCHITECTURAL CONSULTANCY AND CIVIL WORKS ON TURNKEY BASIS. THE REGULAR BOOKS OF ACCOUNT HAV E BEEN MAINTAINED U/S.44AB OF THE ACT. THE NET PROFIT DECLARED IS 33 .07%,WHICH AFTER ADDITION BY THE AO HAD RAISED TO 36%, WHICH IS EXCESSIVE, ARBI TRARY AND WITHOUT ANY BASIS. THE BOOKS OF ACCOUNT OF THE ASSESSEE ARE AU DITED. THE DISALLOWANCE OF THE EXPENDITURE CANNOT BE MADE SINCE WITHOUT THE EXPENDITURE, THE CONSULTANCY PROFESSION OF THE ASSESSEE CANNOT BE RU N AND, THEREFORE, THE DISALLOWANCE SUSTAINED ON VARIOUS HEADS BY THE LD C IT(A) ARE REQUIRED TO BE DELETED AND, ACCORDINGLY, HE PRAYED FOR DELETION OF THE ADDITION. 6. ON THE OTHER HAND, THE LD D.R. RELIED UPON THE O RDER OF THE LD CIT(A). 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THE UNDISPUTED FACTS OF THE PRESENT CASE IS THAT TH E ASSESSEE HAS NOT PRODUCED BILLS AND VOUCHERS OF VARIOUS EXPENSES EXC EPT SALARY, BONUS AND EXGRATIA PAYMENT FOR WHICH THE LD CIT(A) HAS ALREAD Y DELETED THE ADDITION SO MADE BY THE AO. AS REGARDS THE ARGUMENTS MADE BY T HE LD COUNSEL FOR THE ASSESSEE THAT THE BOOKS OF ACCOUNTS OF THE ASSESSEE ARE AUDITED AND WITHOUT THE EXPENSES HAVING BEEN INCURRED, THE CONSULTANCY PROFESSION OF AN ARCHITECT CANNOT BE RUN. KEEPING IN VIEW THE CIRCUMSTANCES A ND FACTS OF THE CASE, THE DISALLOWANCE HAVING ALREADY BEEN DELETED BY THE LD CIT(A) ON VARIOUS HEADS TO THE EXTENT OF RS.1,51,670/-, WE FIND THAT THE DISAL LOWANCE SUSTAINED IS ON HIGHER SIDE AND IN THE INTEREST OF JUSTICE, WE REST RICT THE DISALLOWANCE OF RS.50,000/- AND ALLOW A RELIEF OF RS.1,01,670/-. I T IS ORDERED ACCORDINGLY. THUS GROUNDS OF APPEAL RAISED BY THE ASSESSEE ALLOWED IN PART. ITA NO.160/CTK/201 ASSESSMENT YEAR :2010-11 4 8. IN THE RESULT, APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29 / 05/2015. SD/- SD/- ( ) (SUNIL KUMAR YADAV) ( . . ) (B.P.JAIN) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK; DATED 29 /05/2015 B.K.PARIDA, SPS / / / / %( %( %( %( 2!( 2!( 2!( 2!( / COPY OF THE ORDER FORWARDED TO : / / / / / BY ORDER, SR. PRIVATE SECRETARY, , / ITAT, CUTTACK 1. '$ / THE ASSESSEE : AMIYA PRASAD MISHRA, DEULA SAHI, TULSIPUR, CUTTACK 2. %&'$ / THE RESPONDENT.: ACIT, CIRCLE-2(2), CUTTACK 3. 3 ( ) / THE CIT(A), CUTTACK 4. 3 / CIT , CUTTACK 5. 4 %( , / DR, ITAT, CUTTACK 6. 6 7+ / GUARD FILE. &( %( //TRUE COPY//