DCIT, Cir-36, Kolkata, Kolkata V. M/s. Rohit & Co., Kolkata

ITA 454/KOL/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 2526 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2010
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 10-05-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 25-03-2009
• Court: TRIBUNAL
• Department Lawyers: HARI PRASAD
• Assessee Lawyers: S BANDYOPADHYAY
• Keywords: Opportunity of being heard; Principle of natural justice; Assessment record; TDS; Set aside
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA [BEFORE HONBLE SRI D. K. TYAGI, JM & HONBLE SRI C. D. RAO , AM] I.T.A. NO.454/KOL/2009 ASSESSMENT YEAR: 2005-06 DEPUTY COMMISSIONER OF INCOME-TAX, -VS- M/S. ROH IT & CO. CIRCLE-36, KOLKATA. (PA NO.AADFR 3190 D) (APPELLANT) (RESPONDENT) APPELLANT BY : SRI HARI PRASAD RESPONDENT BY : SRI S. BANDYOPADHYAY O R D E R PER D. K. TYAGI, JM: THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AG AINST THE ORDER OF THE LD. CIT(A), KOLKATA DATED 15 TH JANUARY.2009 FOR ASSESSMENT YEAR 2005-06 ON THE FO LLOWING TWO GROUNDS : GROUND NO. 1. THAT ON THE FACTS AND IN THE CIRCUM STANCES OF CASE, THE LD. CIT(A)-XX, KOLKATA ERRED IN DELETING THE ADDITION OF RS.1,20,4 1,265/-. GROUND NO. 2 THAT ON THE FACTS AND THE CIRCUMSTANCE S OF THE CASE THE LD. CIT(A)-XX, KOLKATA ERRED IN ALLOWING THAT THE EXPENSES UNDER T HE HEAD CUTTING CHARGES AMOUNTING TO RS.5,63,402/-. 2. GROUND NO. 1 RELATES TO DELETION OF ADDITION OF RS. 1,20,41,265/- ON ACCOUNT OF COMMISSION PAYMENT. BRIEF FACTS OF THE CASE ARE TH AT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER FOUND THAT PAYMEN TS ON ACCOUNT OF COMMISSION TO VARIOUS PARTIES WERE FALSE. THE A.O. MADE AN ENQUIR Y IN THE CASE OF M/S. TOBU ENGINEERING LTD. AT 3A, MANGOE LANE, KOLKATA-700 00 1 TO WHOM PAYMENT OF COMMISSION HAS BEEN SHOWN. THE INCOME-TAX INSPECTOR DID NOT FIND ANY ONE OF THAT NAME ON THE GIVEN ADDRESS. HE FURTHER MADE ENQUIRIE S FROM DIFFERENT TENANTS BUT NONE OF THEM COULD RECOGNIZE ANY SUCH PARTY AS TOBU ENGINEE RING LTD. EVEN THE OWNER OF THE BUILDING AND CARE TAKER OF THE BUILDING FAILED TO I DENTIFY ANY SUCH CONCERN. THE A.O. IN THE ASSESSMENT ORDER VERY CLEARLY MENTIONED THAT TH E SALES WERE MADE BY THE ASSESSEE IN THE STATES OF GUJRAT AND MAHARASHTRA BUT THE ASSESS EE HAS PAID RS.43,46,155/- TO M/S. TOBU ENGINEERING LTD. WHO IS BASED IN KOLKATA. ON B EING ASKED TO JUSTIFY THE CLAIM OF PAYMENT OF COMMISSION TO THE AFOREMENTIONED CONCERN THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE IN THIS REGARD. SIMILARLY, VARIOUS OTH ER LETTERS SENT FOR VERIFICATION OF THE 2 COMMISSION REMAINED UNSERVED. THE LETTER SENT TO PA NKAJ M. VIMANI CAME BACK UNSERVED WITH THE POSTAL REMARK NOT KNOWN.IN VIEW OF THE ABOVE FINDINGS THE A.O. REACHED THE CONCLUSION THAT THE CLAIM OF PAYMENT OF COMMISSION WAS COMPLETELY BOGUS AND HE DISALLOWED THE AMOUNT OF RS. 1,20,41,265/-. IN APPEAL, THE LD. CIT(A) DELETED THE ADDITION ON THE GROUND THAT THE DECISION OF THE ASSESSING OFFICER IS NOT BASED ON PROPER FINDINGS. THE ASSESSEE PAID COMMISSIONS TO M ORE THAN 350 PARTIES. THE ASSESSING OFFICER PICKED UP ONLY A FEW OF THEM FOR VERIFICATION, BUT DID NOT PROPERLY ANALYSE THE MATERIAL AND EVIDENCES AVAILABLE ON REC ORD IN RESPECT OF SUCH PARTIES. AND THEN, HE DISALLOWED THE ENTIRE COMMISSION PAYMENT M ADE BY THE ASSESSEE, INCLUDING THOSE COMMISSION PAYMENTS ALSO WHICH HE DID NOT EVE N ATTEMPT TO VERIFY. THE ADDITION MADE BY THE ASSESSING OFFICER IS ARBITRARY AND WITH OUT ANY BASIS AND IS BASED ON PRESUMPTIONS THAN ON FACTUAL GROUND. IT IS ALSO CON TRARY TO THE EVIDENCES AND MATERIAL AVAILABLE ON RECORD. SUCH ADDITIONS ARE NOT SUSTAIN ABLE IN THE EYES OF LAW. THE ADDITION OF RS.1,20,41,265/-, MADE BY THE ASSESSING OFFICER, IS DELETED. AGGRIEVED BY THE SAID ORDER, NOW THE REVENUE IS IN APPEAL BEFORE US. 3. AT THE TIME OF HEARING BEFORE US, THE LD. DR SUB MITTED THAT THE LD. CIT(A) HAS NOT CONSIDERED THE FINDINGS OF THE AO RECORDED IN T HE ASSESSMENT ORDER WHILE GIVING RELIEF TO THE ASSESSEE. HE ALSO SUBMITTED THAT THE LD. CIT(A) DID NOT APPRECIATE THE FACT THAT THE AO MADE ENQUIRY IN THE CASE OF M/S. TOBU E NGINEERING LTD. TO WHOM PAYMENT OF COMMISSION HAS BEEN SHOWN. THE INCOME-TAX INSPEC TOR DID NOT FIND ANY ONE OF THAT NAME ON THE GIVEN ADDRESS. EVEN THE OWNER OF THE B UILDING AND ALSO THE CARETAKER OF THE BUILDING DID NOT RECOGNIZE ANY SUCH PARTY AS TOBU ENGINEERING LTD. EVEN ON BEING ASKED TO JUSTIFY THE CLAIM OF PAYMENT OF COMMISSION TO THE AFOREMENTIONED CONCERN THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE IN THIS REG ARD. HENCE, THE AO HAS RIGHTLY CONCLUDED THAT THE CLAIM OF PAYMENT OF COMMISSION W AS COMPLETELY BOGUS AND HE DISALLOWED THE AMOUNT OF RS.1,20,41,265/-. HE FURTH ER SUBMITTED THAT THE REPLY FROM NIOMESH A. CHITALIA WAS RECEIVED BY THE AO ON 1.1.2 008 I.E. AFTER THE ASSESSMENT HAS BEEN COMPLETED, THEREFORE, HE REQUESTED TO SET ASID E THE MATTER TO THE FILE OF THE AO FOR FRESH VERIFICATION. 4. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSES SEE RELIED ON THE ORDER OF THE LD,. CIT(A) AND URGED BEFORE THE BENCH TO CONFIRM THE SA ME. 3 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT WHILE GIVING RELIEF TO THE AS SESSEE THE LD. CIT(A) HAS HELD AS UNDER : 3.3 I HAVE PERUSED THE ASSESSMENT ORDER AND CONSID ERED THE SUBMISSIONS MADE BY THE APPELLANT. I HAVE ALSO CALLED FOR THE ASSESSMENT RE CORD AND VERIFIED THE FACTS. IN ORDER TO VERIFY THE GENUINENESS OF COMMISSION PAYMENTS, THE ASSESSING OFFICER IDENTIFIED A FEW PARTIES TO WHOM COMMISSION WAS PAID - M/S. TOBU ENG INEERING, PANKAJ M VIMANI, HEMAL A CHITALIA AND NIMESH A CHITALIA. (A) IN CASE OF M/S. TOBU ENGINEERING LTD., THE APPE LLANT FILED ITS REPLY DATED 26.12.2007 BEFORE THE ASSESSING OFFICER. IT WAS SUBMITTED THAT M/S. TOBU ENGINEERING LTD. IS REGULARLY ASSESSED TO INCOME TAX WITH PAN - AABCT 8 936 C. THE APPELLANT FILED COPY OF ACKNOWLEDGEMENT OF INCOME TAX RETURN FOR THE ASS ESSMENT YEAR 2005-2006 OF M/S. TOBU ENGINEERING LTD. AND ALSO COPIES OF ITS PROFIT & LOSS ACCOUNT AND BALANCE SHEET. SCHEDULE T ATTACHED TO THE PROFIT AND LOSS ACCOUNT CLEARLY SHOWS RECEIPT OF RS.43,47,274/- FROM THE APPELLANT, ON WHICH TDS OF RS.4,347/- WAS ALSO DEDUCTED. THE APPELLANT ALSO FILED COPIES OF BILLS RAISED BY M/S. TOBU ENGINEERING LTD., ON WHICH IT IS MENTIONED BEING COMMISSION ON GOODS SOLD ON YOUR BEHALF OF TAX PAID. THE APPELLANT FILED COPIES OF BANK STATEMENTS OF M/S. T OBU ENGINEERING LTD. WITH HDFC BANK AND CORPORATION BANK, IN WHICH RECEIPTS OF RS. 43,42,927/- (COMMISSION RS.43,47,274/- MINUS TDS RS.4,347/-) ARE DULY REFLE CTED. ALL THE ABOVE DOCUMENTS ARE AVAILABLE IN THE ASSESSMENT RECORD. SECONDLY, M/S. TOBU ENGINEERING LTD. HAS SUBMITTED A REPLY DATED 24.12.2007 DIRECTLY TO THE ASSESSING OFFICER BY POST, WHICH IS AVAILABL E IN THE ASSESSMENT RECORD. THE STAMP ON THE ENVELOPE, CONTAINING THE ABOVE REPLY, SHOWS THAT THE SAID REPLY WAS RECEIVED IN THE OFFICE OF THE ASSESSING OFFICER ON 27.12.2007. M/S. TOBU ENGINEERING LTD. SUBMITTED, ALONG WITH THE SAID REPLY, THE FOLLOWING DOCUMENTS - BALANCE SHEET, ACKNOWLEDGEMENT OF INCOME TAX RETURN FOR THE ASSESSMENT YEAR 2005-2006 , XEROX COPY OF PAN CARD, COPY OF BILLS RAISED, COPIES OF BANK STATEMENTS SHOWING PAY MENT OF COMMISSION AND FORM NO. 18 HELD WITH THE ROC KOLKATA SHOWING ITS OFFICE ADD RESS. (B) IN CASE OF PANKAJ M. VIMANI, THE APPELLANT SUB MITTED ITS REPLY DATED 28.12.2007 BEFORE THE ASSESSING OFFICER. THE SUBMISSIONS MADE BY THE APPELLANT BEFORE THE ASSESSING OFFICER ARE REPRODUCED HEREUNDER - REGARDING NOTICE U/S 133(6) ISSUED TO PANKAJ M VIM IANI I LIKE TO INFORM YOU THAT THE ADDRESS PROVIDED IN DETAILS SUBMITTED BEFO RE YOUR GOOD SELF WAS THE LAST RECORDED COMMUNICATION ADDRESS AND MY CLIENT IS NOT HAVING ANY BUSINESS DEALING DURING THE YEAR 2005-06 & 2006-0 7. AFTER G ETTING THE INFORMATION FROM YOUR GOOD SELF, MY CLIENT MAKE ARRANGEMENT TO CONTR ACT PANKAJ M VIMANI AND CAME TO KNOW THAT HE HAS SHIFTED HIS OFFICE FROM PL OT NO. 127B, 3RD LANE, KASARA, MUMBAI TO C/O JAYANTILAL CHANDULAL, 38/14, AHMEDABAD STREET, CABIN NO. 1, CARNAC BUNDER, MUMBAI 9 WITH RESIDENTIAL A DDRESS 4/23, DATTANI NAGAR, S.N. ROAD, BORIVALI (W), MUMBAI 92, THROUG H WHICH PARTY IS FILING HIS RETURN OF INCOME. HOWEVER, I AM SUBMITTING HEREWITH THE FOLLOWING DOCUMENT FOR YOUR DOING THE NEEDFUL. A. XEROX COPY OF I. T RETURN ACKNOWLEDGEMENT FOR A. Y. 2005-06 B. STATEMENT OF ACCOUNT DULY CONFIRMED BY PARTY C. COPY OF BANK STATEMENT FOR UNION BANK OF INDIA F ROM 13.07.2004 TO 21.07.2006 IN WHICH TRANSACTION ARE DULY REFLECTED . 4 AS MENTIONED IN THE REPLY, THE APPELLANT SUBMITTED ACKNOWLEDGEMENT OF INCOME TAX RETURN FOR THE ASSESSMENT YEAR 2005-06 OF PANKAJ M. VIMANI AND ALSO HIS BANK STATEMENT, IN WHICH COMMISSION PAYMENT WAS DULY REF LECTED. C) IN CASES OF HEMAL A. CHITALIA AND NOIMESH A. CH ITALIA, THE APPELLANT FILED BROKERAGE BILLS AND COPIES OF COMMISSION ACCOUNT BEFORE THE A SSESSING OFFICER. IT IS SEEN FROM THE ASSESSMENT RECORD THAT IN THESE CASES ALSO, REPLIES WERE SENT TO THE ASSESING OFFICER BY POST. HOWEVER, THE STAMP ON ENVELOPES CONTAINING T HE SAID REPLIES SHOWS THAT THEY WERE RECEIVED IN THE OFFICE OF THE ASSESSING OFFICER ONL Y ON 01.01.2008. 3.4. I HAVE PERUSED THE ASSESSMENT RECORD AND CONS IDERED THE SUBMISSIONS MADE BY THE APPELLANT. I FIND THAT THE APPELLANT HAS, BEFORE TH E ASSESSING OFFICER, DULY DISCHARGED ITS ONUS OF ESTABLISHING THE IDENTITY OF THE PERSONS, T O WHOM COMMISSIONS WERE PAID, AND ALSO THE GENUINENESS OF THE TRANSACTIONS. ON THE OT HER HAND, THE ASSESSING OFFICER COULD BRING NO POSITIVE MATERIAL ON RECORD TO ESTABLISH T HAT THE CLAIM REGARDING PAYMENT OF COMMISSION WAS NOT GENUINE. THE ASSESSING OFFICER H AS FAILED TO PROPERLY ANALYZE THE FACTS AND MATERIAL AVAILABLE ON RECORD. THE EXPLANA TIONS AND ALSO THE EVIDENCES FILED BY THE APPELLANT SEEM TO HAVE BEEN SUMMARILY REJECTED BY THE ASSESSING OFFICER. THE EVIDENCES FILED BY THE APPELLANT WERE NOT DISPUTED BY THE ASSESSING OFFICER THEY HAVE NOT EVEN BEEN DISCUSSED IN THE ASSESSMENT ORDER. AN ASSESSMENT HAS TO BE COMPLETED ON THE BASIS OF RECORDS AND MATERIAL AVAILABLE BEFORE THE ASSESSING OFFICER. PRESUMPTIONS OR CONJECTURES AND SURMISES SHOULD NOT LEAD THE AS SESSING OFFICER TO A STATE OF AFFAIRS WHERE SALIENT EVIDENCES ARE OVERLOOKED. THE DECISION OF THE ASSESSING OFFICER IS NOT BASED ON PROPER FINDINGS. THE APPELLANT PAID COMMISSIONS TO MORE THAN 350 PARTIES. THE ASSE SSING OFFICER PICKED UP ONLY A FEW OF THEM FOR VERIFICATION, BUT DID NOT PROPERLY ANAL YZE THE MATERIAL AND EVIDENCES AVAILABLE ON RECORD IN RESPECT OF SUCH PARTIES. AND THEN, HE DISALLOWED THE ENTIRE COMMISSION PAYMENT MADE BY THE APPELLANT, INCLUDING THOSE COMMISSION PAYMENTS ALSO WHICH HE DID NOT EVEN ATTEMPT TO VERIFY. THE ADDITI ON MADE BY THE ASSESSING OFFICER IS ARBITRARY AND WITHOUT ANY BASIS AND IS BASED ON PRE SUMPTIONS THAN ON FACTUAL GROUND. IT IS ALSO CONTRARY TO THE EVIDENCES AND MATERIAL AVAI LABLE ON RECORD. SUCH ADDITIONS ARE NOT SUSTAINABLE IN THE EYES OF LAW. THE ADDITION OF RS. 1,20,41,265/-, MADE BY THE ASSESSING OFFICER, IS DELETED. THE APPELLANT GETS R ELIEF OF RS.1,20,41,265/-. THE APPEAL ON THIS GROUND IS ALLOWED. AFTER HEARING THE RIVAL SUBMISSIONS AND PERUSING TH E MATERIAL AVAILABLE ON RECORD, IT IS OBSERVED THAT THE AO HAS COMPLETED THE ASSESSMENT O N 31.12.2007, BUT, SOME OF THE REPLIES HAVE BEEN RECEIVED SUBSEQUENT TO THE ASSESS MENT BASED ON WHICH THE LD. CIT(A) HAS DELETED THE SAME. IN OUR CONSIDERED OPINION, T HIS REQUIRES FRESH VERIFICATION AT THE END OF THE AO. IT IS FURTHER OBSERVED THAT THE AO HAS MADE ONLY ENQUIRIES IN RESPECT OF FOUR PERSONS AND CAME TO THE CONCLUSION THAT THE E NTIRE COMMISSION IS BOGUS. THE LD. CIT(A) ALSO CONFIRMED THIS FACT BY OBSERVING THAT T HE AO HAS NOT PROPERLY ANALYSED THE MATERIAL AND EVIDENCE AVAILABLE ON RECORD. THEREFO RE, IN THE INTEREST OF NATURAL JUSTICE, WE SET ASIDE THIS ISSUE TO THE FILE OF THE AO TO DE CIDE AFRESH AS PER LAW AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. THIS GROUND OF APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 5 6. GROUND NO.2 RELATES TO DELETION OF DISALLOWANCES OF RS.24,38,420/- ON ACCOUNT OF INFLATING THE EXPENSES UNDER THE HEAD CUTTING CHAR GES CLAIMED BY THE ASSESSEE. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE WAS ASKED T O PRODUCE EVIDENCE TO JUSTIFY THE HUGE DIFFERENCE OF THE RATE OF CUTTING CHARGES IN AHMEDA BAD AND MUMBAI BUT THE ASSESSEE COULD NOT PRODUCE PROPER EVIDENCES TO JUSTIFY THE C LAIM. HENCE, THE ASSESSING OFFICER MADE THE ABOVE ADDITION. IN APPEAL, THE LD. CIT(A) DELETED THE ADDITION. AGGRIEVED BY THE SAID ORDER, NOW THE REVENUE IS IN APPEAL BEFORE US. 7. AT THE TIME OF HEARING BEFORE US, THE LD. DR REL IED ON THE ORDER OF THE AO AND SUBMITTED THAT THE CIT(A) IN HIS ORDER STATED THAT THE DIFFERENCE IN THE CUTTING CHARGES IS DUE TO SEVERAL REASONS AS GIVEN BY THE APPELLANT, I .E. HIGH CUTTING CHARGES IS INVOLVED THE THICKNESS WHERE THE CUTTING MATERIALS IS MORE, COST OF LAND AND MACHINES OPERATION, COST COMPONENTS ARE MUCH HIGHER IN MUMBAI, CUTTING MACHI NES AVAILABLE IN MUMBAI ARE TECHNOLOGICALLY MORE ADVANCED THEREBY GENERATING LO WER SCRAP, LABOUR CHARGES FOR LOADING AND UNLOADING ARE ALSO HIGHER IN MUMBAI. BU T THE CIT(A) HAS FAILED TO APPRECIATE THAT THE ASSESSING OFFICER HAS ALREADY C ONSIDERED THESE ASPECTS AND HAS DISALLOWED ONLY 30% OF THE TOTAL CUTTING CHARGES. I N VIEW OF THE ABOVE, HE CONCLUDED THAT THE LD. CIT(A) HAS ERRED IN DELETING THE ABOVE ADDITION. 8. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSES SEE RELIED ON THE ORDER OF THE LD. CIT(A) AND PRAYED BEFORE THE BENCH TO CONFIRM THE S AME. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE HAS SHOWN CUTTIN G CHARGES OF RS.81,28,067/- IN RESPECT OF ITS MUMBAI UNITS. THE AO MADE THE DISAL LOWANCE @ 30% ON ESTIMATE BASIS. WHILE VERIFICATION OF BOOKS OF ACCOUNTS THE AO FOUN D THAT THERE WAS A LARGE DISCREPANCY OF THE RATE OF CUTTING CHARGES BETWEEN AHMEDABAD BR ANCH AND MUMBAI BRANCH. THE ASSESSEE WAS ASKED TO SUBSTANTIATE WHICH DISCREPANC Y, WHICH HAS RESULTED IN LABOUR CHARGES OF MUMBAI UNIT TO THE TUNE OF RS.81,28,067/ -. IN THE ABSENCE OF ANY CONVINCING EVIDENCE WITH REGARD TO CUTTING CHARGES CLAIMED IN MUMBAI, THE AO WAS OF THE OPINION THAT DUE TO LOCATIONAL DIFFERENCE AT MOST 50% HIGHE R RATE MAY BE ALLOWED AND THE REST IS INFLATED. HENCE, ON ESTIMATE HE DISALLOWED 30% OF TOTAL CUTTING CHARGES I.E. RS.24,38,420/-. WHILE IN APPEAL, THE LD. CIT(A) DE LETED THE ENTIRE ADDITION BY OBSERVING AS UNDER : 6 4.3. I HAVE PERUSED THE ASSESSMENT ORDER AND ALSO CONSIDERED THE SUBMISSIONS OF THE APPELLANT. THE APPELLANT HAS GIVEN SEVERAL REASONS FOR DIFFERENCE IN THE RATE OF CUTTING CHARGES IN AHMEDABAD AND MUMBAI, E. G., HIGHER CUTT ING COST IS INVOLVED WHEN THICKNESS OF THE CUTTING MATERIAL IS MORE, COST OF LAND AND MACHINE OPERATION COST COMPONENTS ARE MUCH HIGHER IN MUMBAI, CUTTING MACHI NES AVAILABLE IN MUMHAI ARE TECHNOLOGICALLY MORE ADVANCED THEREBY GENERATING LO WER SCRAP, LABOUR CHARGES FOR LOADING AND UNLOADING ARE ALSO HIGHER IN MUMBAI. IT WAS ALSO CONTENDED THAT THE EXPENSES ARE ACTUAL EXPENSES AND THEY ARE SUPPORTED BY PROPER BILLS. ON THE OTHER HAND, THE ASSESSING OFFICER COULD BRING NO POSITIVE MATER IAL ON RECORD TO ESTABLISH THAT THE EXPENSES ARE NOT GENUINE. HE HAS ALSO FAILED TO BRI NG ON RECORD THE EXPENSES WHICH HE BELIEVES OR NOT GENUINE. THE DISALLOWANCE MADE BY T HE ASSESSING OFFICER IS NOT BASED ON PROPER FINDINGS. THE ASSESSING OFFICER COULD NOT BRING ON RECORD A SINGLE INSTANCE OF AN EXPENDITURE WHICH WAS NOT SUPPORTED BY PROPER BI LLS. THE ARGUMENTS PUT FORTH AND ALSO THE EVIDENCES FILED BY THE APPELLANT SEEM TO H AVE BEEN REJECTED SUMMARILY BY THE ASSESSING OFFICER ON THE GROUNDS OF PRESUMPTION THA N ON FACTUAL GROUND. THE ADHOC ADDITION MADE BY THE ASSESSING OFFICER BY WAY OF DI SALLOWANCE ON ESTIMATE BASIS IS ARBITRARY AND IS NOT BASED ON ANY MATERIAL FACTS. S UCH ADDITIONS ARE NOT SUSTAINABLE IN LAW. THE ADDITION OF RS.24,38,420/- IS DELETED. THE APPELLANT GETS RELIEF OF RS.24,38,420/. THE APPEAL ON THIS GROUND IS ALLOWE D. IN THE ABSENCE OF ANY CONTRARY MATERIAL/EVIDENCE BR OUGHT ON RECORD BY THE REVENUE AUTHORITIES AT THE TIME OF HEARING BEFORE US TO CON TROVERT THE AFORESAID FINDING OF THE LD. CIT(A), WE DO NOT FIND ANY JUSTIFICATION TO INTERFE RE WITH HIS ORDER AND THE SAME IS HEREBY UPHELD. THIS GROUND OF APPEAL OF THE REVENUE IS ALSO DISMISSED. 10. IN THE RESULT, THE APPEAL OF THE REVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. 11. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 30.6.2 010 SD/- SD/- (C. D. RAO) (D. K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 30TH JUNE, 2010 COPY TO : 1. DCIT, CIRCLE-36, KOLKATA. 2. M/S. ROHIT & CO. 22, STRAND ROAD, 1 ST FLOOR, KOLKATA-1. 3. CIT(A), KOLKATA. 4. CIT, KOLKATA. 5. D.R., ITAT, KOLKATA. TRUE COPY BY ORDER DEPUTY REGISTRAR JD.(SR.P.S.) I.T.AT., KOLKATA