Chiranjilal Ramkumarlal, Bhadrak V. ITO, Bhadrak Ward, Bhadrak

ITA 335/CTK/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7556 (ITAT-CUTTACK)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 12-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B N DASH
• Keywords: Business expenditure; Corroborative evidences

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK SMC BENCH, CUTTACK BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER ITA NO. 335 /CTK/2016 ASSESSMENT YEAR : 2012 - 2013 CHIRANJILAL RAJKUMARLAL, CHANDAN BAZAR, BHADRAK VS. ITO, BHADRAK WARD, CHARAMPA, BHADRAK PAN/GIR NO. AAAFC 9213 F (APPELLANT ) .. ( RESPONDENT ) ASSESSEE BY : SHRI M OHIT SETH, AR REVENUE BY : SHRI B.N.DASH, DR DATE OF HEARING : 21 /11 / 2016 DATE OF PRONOUNCEMENT : 21 /11 / 2016 O R D E R THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - CUTTACK, DATED 19.7.2016, FOR THE ASSESSMENT YEAR 2012 - 2013. 2. THE SOLE GRIEVANCE OF THE ASSESSEE IN THIS APPEAL IS THAT THE LD CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS.3,16,145/ - AND RS.30,600/ - MADE BY THE ASSESSING OFF ICER DISALLOWING EXPENDITURE UNDER THE HEAD FREIGHT CHARGES & LABOUR CHARGES. 2 ITA NO. 335/CTK/2016 ASSESSMENT YEAR : 2012 - 2013 3. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE , THE ASSESSEE HAS CLAIMED RS.63,22,901/ - AS FREIGHT CHARGES BUT WAS UNABLE TO PRODUCE FULLY VERIFIABLE VOUCHERS, PAYMENTS RECEIVED OR IN OTHER CORROBORATIVE EVIDENCE TO JUSTIFY THE HUGE EXPENDITURE. HENCE, THE ASSESSING OFFICER MADE THE ESTIMATED DISALLOWANCE OF 5% OF TOTAL EXPE NDITURE. THE ASSESSING OFFICER ALSO DISALLOWED 10% OF THE LABOUR CHARGES CLAIMED BY THE ASSESSEE ON THE GROUND THAT THE ASSESSEE COULD NOT PRODUCE SUPPORTING AND FULLY VERIFIABLE VOUCHERS, PAYMENT RECEIPTS AND OTHER CORROBORATIVE EVIDENCES. 4. ON APPEAL, LD CIT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 5. I FIND THAT IN THE INSTANT CASE, THE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE COULD NOT PRODUCE FULLY VERIFIABLE VOUCHERS WHILE MAKING THE DISALLOWANCE OF RS.3,16,145/ - @ 5% OF TOTAL EXPEN DITURE OF RS.63,22,901/ - UNDER THE HEAD FREIGHT CHARGES AND DISALLOWANCE @ 10% OF TOTAL LABOUR CHARGES OF RS.3, 06,009/ - , WHICH WORKED OUT TO RS.30,600/ - . I FIND THAT THE ASSESSING OFFICER HAS NOT POINTED OUT FOR WHICH OF THE SPECIFIC EXPENDITURE, THE A SSESSEE DID NOT MAINTAIN FULLY VERIFIABLE VOUCHERS. IN ABSENCE OF THE SAME, I AM OF THE CONSIDERED VIEW THAT THE ASSESSING OFFICER IS NOT JUSTIFIED IN MAKING THE ESTIMATED DISALLOWANCE OUT OF GENUINE BUSINESS EXPENDITURE CLAIMED BY THE ASSESSEE. HENCE, I AM UNABLE TO SUSTAIN THE SAME. I 3 ITA NO. 335/CTK/2016 ASSESSMENT YEAR : 2012 - 2013 THEREFORE, SET ASIDE THE ORDERS OF LOWER AUTHORITIES AND DELETE THE DISALLOWANCE OF RS.3,16,145/ - MADE UNDER THE HEAD FREIGHT CHARGES AND RS.30,600/ - MADE UNDER THE HEAD LABOUR CHARGES AND ALLOW GROUND OF APPEAL OF TH E ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCE D IN THE OPEN COURT ON 21/ 11 /2016 IN THE PRESENCE OF PARTIES. SD/ - ( N.S SAINI) A CCOUNTANT MEMBER CUTTACK; DATED 21 /11 /2016 B.K.PARIDA, SPS COPY OF THE ORDER FORWARDED TO : BY ORDER, ASST.REGISTRAR, ITAT, CUTTACK 1. THE APPELLANT : CHIRANJILAL RAJKUMARLAL, CHANDAN BAZAR, BHADRAK 2. THE RESPONDENT: ITO, BHADRAK WARD, CHARAMPA, BHADRAK 3. THE CIT(A) , CUTTACK 4. CIT , CUTTACK 5. DR, ITAT, CUTTACK 6. GUARD FILE. //TRUE COPY//