PARMES DIAMONDS EXPORTS P. LTD, MUMBAI V. ACIT CEN CIR 1(2), MUMBAI

ITA 2016/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8147 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 29-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: H N SINGH
• Keywords: Search and seizure
• Section: 133A; 132

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO.2016/MUM/2016 ASSESSMENT YEAR: 2012-13 PARMES DIAMONDS EXPORTS PVT. LTD. 2205 PANCHRATNA, 22 ND FLOOR, M.P. MARG, OPERA HOUSE, MUMBAI-400004 / VS. ACIT, CENTRAL CIRCLE-1(2), OLD. C.G.O. BUILDING, M.K. ROAD, MUMBAI-400020 ( /ASSESSEE) ( ! / REVENUE) PAN. NO. AAACP2104P / ASSESSEE BY SHRI MANAN MATHURIA ! / REVENUE BY SHRI H.N.SINGH CIT-DR ' !# $ % / DATE OF HEARING : 21/12/2017 $ % / DATE OF ORDER: 21/12/2017 PARMES DIAMONDS EXPORTS PVT. LTD. ITA NO.2016/MUM/2016 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 21/01/2016 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, CONFIRMING THE DISALLOWANCE TO THE TUNE OF RS.1,82, 609/-, BEING 5% OF VEHICLE EXPENSES AND MISCELLANEOUS EXPE NSES, ON AD-HOC BASIS. 2. DURING HEARING, SHRI MANAN MATHURIA, LD. COUNSEL FOR THE ASSESSEE, ADVANCED ARGUMENTS, WHICH IS IDENTICAL TO THE GROUND RAISED BY SUBMITTING THAT A D-HOC ADDITION HAS BEEN MADE BY THE ASSESSING OFFICER, WH ICH IS HIGHLY EXCESSIVE. ON THE OTHER HAND, SHRI H.N. SIN GH, LD. CIT-DR, DEFENDED THE IMPUGNED ORDER. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND EXPORTING OF DIAMONDS AND ALSO PROVIDING JOB WORK. A SEARCH AND SEIZURE ACTION U/S 132 OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT) WAS CARRIED OUT BY THE INVESTIGATION WING IN THE CASE OF MAHIND RA PARMES DIAMONDS EXPORTS PVT. LTD. ITA NO.2016/MUM/2016 3 BROTHERS EXPORTS PVT. LTD., ASSOCIATE CONCERN OF TH E ASSESSEE, DIRECTORS, AND RELATED PERSON FROM THE GR OUP. A SURVEY ACTION 133A OF THE ACT WAS ALSO CARRIED OUT UPON THE ASSESSEE ON 08/08/2011. THE ASSESSEE DECLARED TOTA L INCOME OF RS.83,01,565/- U/S 139(1) OF THE ACT ON 25/09/2012 AND THE ASSESSMENT WAS COMPLETED AT A LO SS OF RS.88,49,390/- AFTER MAKING DISALLOWANCE OF RS.5,47,827/-. THE ASSESSEE, DURING THE YEAR INCUR RED AN AMOUNT OF RS.2,58,960/- TOWARDS MOTOR CAR OUT OF WH ICH THE LD. ASSESSING OFFICER DISALLOWED AN AMOUNT OF RS.38,844/-, BEING 15% OF THE VEHICLE EXPENSES. THE ASSESSEE ALSO INCURRED AN AMOUNT OF RS.33,93,224/- TOWARDS TEA AND SUNDRY EXPENSES. THE LD. ASSESSING OFFICER DISALLOWED AN AMOUNT OF RS.5,08,983/-, BEIN G 15%, OUT OF THESE SUNDRY EXPENSES ON AD-HOC BASIS. ON A PPEAL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL), THE SUBMISSION OF THE ASSESSEE WAS CONSIDERED AND THE DISALLOWANCE WAS RESTRICTED TO 5% OF SUCH EXPENSES (RS.36,52,184/-) GRANTING RELIEF OF RS.34,69,575/-. THE ASSESSEE IS STILL AGGRIEVED AND IS IN APPEAL BEFORE THIS TRIBUNAL. CONSIDERING THE TOTALITY OF FACTS, WE FIN D THAT THE PARMES DIAMONDS EXPORTS PVT. LTD. ITA NO.2016/MUM/2016 4 VEHICLE EXPENSES, TEA AND SUNDRY EXPENSES WERE SUPP ORTED BY BILLS AND VOUCHERS. ADMITTEDLY, THE BURDEN IS U PON THE ASSESSEE TO FURNISH NECESSARY EVIDENCE TO SUBSTANTI ATE THE CLAIM. TO PUT AN END TO THE LITIGATION, WE DEEM IT APPROPRIATE TO REDUCE THE ADDITION TO RS.1 LAKH OUT OF RS.1,82,609/- SUSTAINED BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL) AS THE PERSONAL USE OF THESE EX PENSES CANNOT BE RULED OUT. THUS, THE APPEAL OF THE ASSESS EE IS PARTLY ALLOWED. FINALLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOW ED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVE OF BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 21/12/2017. SD/- SD/- ( RAMIT KOCHAR ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER ' # MUMBAI; ' DATED : 21/12/2017 F{X~{T? P.S/. .. PARMES DIAMONDS EXPORTS PVT. LTD. ITA NO.2016/MUM/2016 5 %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. )*+, / THE APPELLANT 2. -.+, / THE RESPONDENT. 3. / / ' 0 ( )* ) / THE CIT, MUMBAI. 4. / / ' 0 / CIT(A)- , MUMBAI 5. 2!3 - , / )*% ) 4 , ' # / DR, ITAT, MUMBAI 6. 5 6# / GUARD FILE. / BY ORDER, .2* - //TRUE COPY// / (DY./ASSTT. REGISTRAR) , ' # / ITAT, MUMBAI