Mani Ram Verma, Faizabad V. Asstt. Commissioner of Income Tax, Faizabad

ITA 383/LKW/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87716 (ITAT-LUCKNOW)
• Duration Of Justice: 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 18-11-2014
• Assessment Year: 2010-2011
• Appeal Filed On: 12-05-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: K C MEENA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO. 383 /LKW/201 4 ASSESSMENT YEAR:20 10 - 11 A.C.I.T., CIRCLE - FAIZABAD. VS SHRI MANI RAM VERMA, KATRA, GOSAINGANJ, FIAZABAD. PAN:ABLPV1619E (RESPONDENT) (APPELLANT) SHRI M. P. MISHRA , ADVOCATE APPELLANT BY SHRI K. C. MEENA, D. R. RESPONDENT BY 1 8 /11/2014 DATE OF HEARING 07 /01/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS AN ASSESSEES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - I, LUCKNOW DATED 1 1 / 02 /201 4 FOR THE ASSESSMENT YEAR 20 10 - 20 11 . 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THAT THE LEARNED CIT(A) ERRED IN LAW AND ON FACTS IN ARBITRARILY SUSTAINING ADDITION ( TO THE EXTENT OF 10 % OF DISALLOWANCE ) OF RS.93,120/ - OUT OF SALARY EXPENSES CLAIMED BY THE ASSESSEE AS PER AUDITED BOOKS OF ACCOUNT. 2. THAT THE LEARNED CIT(A) ERRED IN LAW AND ON FACTS IN ARBITRARILY SU STAINING ADDITION ( TO THE EXTENT OF 10% OF DISALLOWANCE ) OF RS.59,320/ - OUT OF 'OTHER EXPENSES' CLAIMED BY THE ASSESSEE AS PER AUDITED BOOKS OF ACCOUNT. 2 3. LEARNED A.R. OF THE ASSESSEE REITERATED THE SAME CONTENTIONS WHICH WERE RAISED BEFORE CIT(A) WHE REAS LEARNED D.R. OF THE REVENUE SUPPORTED THE ORDER OF LEARNED CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THE FIRST ISSUE REGARDING DISALLOWANCE OF RS.93,120/ - WAS DECIDED BY CIT(A) AS PER PARA 2.3 OF HIS ORDER, WHICH IS REPRODUCE D BELOW FOR THE SAKE OF READY REFERENCE: - 2.3 I HAVE CONSIDERED THE MATTER. I FIND THAT THE NET PROFIT RATE OF M/S VERMA TRANSPORT CO. IN WHICH THE APPELLANT IS RUNNING A PETROL PUMP HAS DECLINED FROM 0.41% TO 0.18%. THE ARGUMENT OF THE APPELLANT THAT T HE SALARY EXPENSE DURING THE YEAR WAS COMPARABLE WITH THE SALARY PAID IN EARLIER YEARS IS ALSO NOT TENABLE BECAUSE IN NONE OF THE EARLIER YEARS ASSESSMENT WAS COMPLETED U/S 143(3). IT IS ALSO SEEN THAT IN THE AUDIT REPORT THE AUDITOR HAS MADE SEVERAL ADVE RSE COMMENTS. ONE OF SUCH COMMENTS IS IN RESPECT OF FEW EXPENSES PROPER SUPPORTING VOUCHERS HAD NOT BEEN PRODUCED, THE AO ALSO POINTED OUT A NUMBER OF DISCREPANCIES IN THE SALARY REGISTERS MAINTAINED BY THE APPELLANT. CONSIDERING THE SUBMISSIONS OF THE APP ELLANT I FIND IT REASONABLE TO RESTRICT THE ADDITION TO 10% OF SALARY EXPENSES OF RS.9,31,200/ - CLAIMED BY THE APPELLANT THE APPELLANT GETS THE RELIEF ACCORDINGLY. 4.1 FROM THE ABOVE PARA FROM THE ORDER OF CIT(A), WE FIND THAT IT IS NOTED BY CIT(A) THAT THE A UDITOR HAS MADE SEVERAL ADVERSE COMMENTS IN THE AUDIT REPORT. HE HAS ALSO NOTED THAT ONE OF SUCH COMMENTS IS IN RESPECT OF FEW EXPENSES WHERE PROPER SUPPORTING VOUCHERS HAD NOT BEEN P RODUCED . HE HAS ALSO NOTED THAT THE ASSESSING OFFICER ALSO POINTED OUT A NUMBER OF DISCREPANCIES IN THE SALARY REGISTERS MAINTAINED BY THE ASSESSEE . CONSIDERING ALL THESE FACTS, THE CIT(A) HAS CONFIRMED 10% DISALLOWANCE OF SALARY EXPENSES OUT OF TOTAL EX PENSES OF RS.9,31,200/ - . THESE FINDINGS OF CIT(A) COULD NOT CONTROVERTED BY LEARNED A.R. OF THE ASSESSEE AND IT COULD NOT BE SHOWN THAT FULL DETAILS ARE AVAILABLE. HENCE, WE DECLINE TO INTERFERE IN THE ORDER OF CIT(A). GROUND NO. 1 IS REJECTED. 3 5. REGARDING GROUND NO. 2 OF THE APPEAL, WE FIND THAT THE ISSUE WAS DECIDED BY CIT(A) AS PER PARA 3.2 OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 3.2 I HAVE CONSIDERED THE MATTER. I FIND THAT THE NET PROFIT RATE OF M/S VERMU T RANSPORT CO. IN WHICH THE APPELLANT IS RUNNING A PETROL PUMP HAS DECLINED FROM 0.41% TO 0.18%. THE ARGUMENT OF THE APPELLANT THAT THE EXPENSES CLAIMED DURING THE YEAR WERE REASONABLE IS NOT SUPPORTED BY ANY MATERIAL EVIDENCE. IT IS ALSO SEEN THAT IN THE AU DIT REPORT THE AUDITOR HAS MADE SEVERAL ADVERSE COMMENTS. ONE OF SUCH COMMENTS IS - IN RESPECT OF FEW EXPENSES PROPER SUPPORTING VOUCHERS HAD NOT BEEN PRODUCED. THE AO ALSO POINTED OUT A NUMBER OF DISCREPANCIES IN THE BILLS/ VOUCHERS FURNISHED BY THE APPEL LANT CONSIDERING THE SUBMISSIONS OF THE APPELLANT I FIND IT REASONABLE TO RESTRICT THE ADDITION TO 10% OF OTHER EXPENSES OF RS.5,93,195/ - CLAIMED BY THE APPELLANT THE APPELLANT GETS THE RELIEF ACCORDINGLY. GROUND NO. 3 IS OF GENERAL NATURE. 6. WE FIND TH AT THIS DISALLOWANCE WAS ALSO CONFIRMED BY CIT(A) WITH THE SAME FINDING AS GIVEN BY HIM FOR CONFIRMING THE FIRST DISALLOWANCE AND FOR THIS DISALLOWANCE ALSO , LEARNED A.R. OF THE ASSESSEE COULD NOT CONTROVERT THE FINDING OF CIT(A). WE, THEREFORE, DECLINE T O INTERFERE IN THE ORDER OF CIT(A). 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 07 /01/2015. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR