MESERS TALBRO FORGINGS, JALANDHAR V. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-2, JALANDHAR

ITA 324/ASR/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6934 (ITAT-AMRITSAR)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 23-05-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BHAWANI SHANKAR
• Assessee Lawyers: SANDIP VIJH

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CAMP BENCH AT JALANDHAR BEFORE SH. N. K. SAINI, HONBLE VICE PRESIDENT AND SH. RAVISH SOOD, JUDICIAL MEMBER ITA NO.324/ASR./2018 : ASSTT. YEAR : 2015-16 M/S TALBRO FORGINGS, C/O V.P. VIJH & CO., CA, K.K. TOWER, IST & 2 ND FLOOR, OPP. CIRCUIT HOUSE, JALANDHAR VS ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE-2, JALANDHAR (APPELLANT) (RESPONDENT) PAN NO. AAAFT4939K ASSESSEE BY : SH. SANDIP VIJH, CA REVENUE BY : SH. BHAWAN I SHANKAR, DR DATE OF HEARING : 07.01.2019 DATE OF PRONOUNCEMENT : 08.01.2019 ORDER PER N. K. SAINI, VICE PRESIDENT: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 28.03.2018 OF LD. CIT(A)-1, JALANDHAR. 2. THE ONLY GROUND RAISED IN THIS APPEAL READS AS U NDER: 1. THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) , HAS ERRED IN SUSTAINING AN ESTIMATED DISALLOWANCE O F RS.75,000/- FROM OUT OF AN ESTIMATED DISALLOWANCE O F RS.150,000/- MADE BY ASSESSING OFFICER OUT OF CAR MAINTENANCE, JEEP MAINTENANCE, TRUCK AND TEMPO MAINTENANCE, SCOOTER MAINTENANCE AND TELEPHONE EXPENSES ETC. THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS), HAS NOT APPRECIATED THE SUBMISSION INCLUDING ONE THAT NO SPECIFIC INSTANCE OF DISALLOW ANCE WAS MENTIONED IN THE ASSESSMENT ORDER. ITA NO. 324/ASR./2018 TALBRO FORGINGS 2 3. FACTS OF THE CASE IN BRIEF ARE THAT THE AO DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS CALLED THE BILLS & VOUCHERS OF CERTAIN MAJOR EXPENSES LIKE CAR, JEEP, TRUCK TEMPO & SCOOTER MAIN TENANCE, TELEPHONE ETC. ACCORDING TO HIM MOST OF THE PETTY V OUCHERS WERE SELF-GENERATED AND NONE OF THOSE VOUCHERS WERE ACCO MPANIED BY ANY THIRD PARTY DOCMENTARY EVIDENCE, IN CERTAIN VOU CHERS ONLY CASH PAID WAS MENTIONED. HE MADE THE AD-HOC DISALLOWANCE OF RS.1,50,000/-. 4. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED THAT THE DISALLOWANCE HAD BEEN MADE ON THE BASIS OF PRESUMPTION AND NO SPECIFIC ITEM OF EXPENS ES WHICH WAS NOT CONNECTED TO BUSINESS HAD BEEN POINTED OUT. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE R ESTRICTED THE DISALLOWANCE TO RS.75,000/-. 5. NOW THE ASSESSEE IS IN APPEAL. THE LD. COUNSEL F OR THE ASSESSEE SUBMITTED THAT THE AO NOWHERE POINTED OUT THAT THE EXPENSES W ERE NOT INCURRED FOR THE BUSINESS PURPOSES AND THAT THE MAKING THE PAYMENT I N CASH FOR SMALL EXPENSES IS NOT PROHIBITED. ALTERNATIVELY, IT WAS SUBMITTED THAT THE DISALLOWANCE SUSTAINED BY THE LD. CIT(A) WAS EXCESSIVE. 6. IN HIS RIVAL SUBMISSIONS, THE LD. DR SUPPORTED T HE IMPUGNED ORDER PASSED BY THE LD. CIT(A). 7. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE, IT IS AN ADMITTED FACT THAT THE AO HAD NOT POINTED OUT ANY SPECIFIC ITEM OF THE EXPENSES WHICH WAS NOT ITA NO. 324/ASR./2018 TALBRO FORGINGS 3 INCURRED FOR THE BUSINESS PURPOSES. AT THE SAME TIM E, THE CASH VOUCHERS MAINTAINED BY THE ASSESSEE WERE NOT FULLY VERIFIABL E. THEREFORE, IN SUCH TYPE OF CASES, TO COVER THE LEAKAGE SOME DISALLOWANCE IS CA LLED FOR ON ACCOUNT OF EXPENSES OF PERSONAL NATURE. HOWEVER, IN OUR OPINIO N, THE DISALLOWANCE SUSTAINED BY THE LD. CIT(A) APPEARS TO BE EXCESSIVE . WE, THEREFORE, TO MEET THE ENDS OF JUSTICE REDUCE THE DISALLOWANCE TO RS.25,00 0/-. THUS, THE ASSESSEE WILL GET A RELIEF OF RS.50,000/-. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. (ORDER PRONOUNCED IN THE COURT ON 08/01/2019) SD/- SD/- (RAVISH SOOD) (N. K. SAINI) JUDICIAL MEMBER V ICE PRESIDENT DATED: 08/01/2019 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR