ACIT, New Delhi V. M/s. Richa & Co., New Delhi

ITA 6027/DEL/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1273 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2008-2009
• Appeal Filed On: 04-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHIM SINGH
• Assessee Lawyers: K V V S R KRISHNA
• Keywords: Depreciation; Business expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI B.C. MEENA ITA NO. 6027/DEL/2012 ASSTT. YR. 2008-09 ACIT CIR. 27(1), VS. M/S RICHA & CO., NEW DELHI. 2/2, WHS, KIRTI NAGAR, NEW DELHI-110015. PAN: AAAFR0114L ( APPELLANT ) ( RESPONDENT ) APPELLANT BY : SHRI BHIM SINGH SR. DR RESPONDENT BY : SHRI K. V.V.S.R. KRISHNA CA O R D E R PER R.P. TOLANI, J.M: : THIS IS REVENUES APPEAL AGAINST CIT(A)S ORDER DAT ED 27-9-2012 RELATING TO A.Y. 2008-09. FOLLOWING GROUNDS ARE RAI SED. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN LAW AS WELL AS ON FACTS BY 1. IN DELETING THE ADDITION OF RS. 9,17,254/- MADE BY THE AO ON ACCOUNT OF FOREIGN EXCHANGE OF PARTNERS OUT OF T RAVELLING EXPENSES. 2. IN DELETING THE ADDITION OF RS. 5,00,000/- MADE BY THE AO ON ACCOUNT OF SAMPLING EXPENSES. 3. IN DELETING THE ADDITION OF RS. 3,30,296/- MADE BY THE AO ON ACCOUNT OF TELEPHONE EXPENSES. 4. IN DELETING THE ADDITION OF RS. 4,13,279/- MADE BY THE AO ON ACCOUNT OF CAR, DEPRECIATION ETC. ITA NO. 6027/DEL/12 RICHA & CO. 2 5. WHETHER LD. CIT(A) IS JUSTIFIED IN DELETING THE ADDITIONS MADE BY THE AO ON THE GROUND THAT AO HA SNOT REJECT ED THE BOOKS OF ACCOUNTS AND ASSESSEE HAS PAID FBT. 2. LD. DR RELIED ON THE ORDER OF ASSESSING OFFICER AND CONTENDS THAT THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAD SP ENT DISPROPORTIONATE AMOUNT ON FOREIGN TRIPS OF PARTNERS AS COMPARED TO EMPLOYEES. BESIDES, ON RANDOM BASIS, THE REMAINING EXPENDITURES WERE RIGHT LY DISALLOWED. 3. LD. COUNSEL FOR THE ASSESSEE ON THE OTHER HAND V EHEMENTLY ARGUES THAT ASSESSING OFFICER HAS HIMSELF ACCEPTED THAT FOREIGN TRAVELS OF PARTNERS WERE FOR BUSINESS PURPOSES. WHEN THERE IS NO DISCREPANCY OR DEFICIENCY IN THE BOOKS OF A/CS, METHOD OF ACCOUNTING, SUPPORTING VOU CHERS, IN THESE CIRCUMSTANCES, THERE IS NO JUSTIFICATION FOR AD HOC DISALLOWANCE OUT OF BUSINESS EXPENSES ON COMPARISON BASIS. NOT A SINGL E ITEM OF EXPENDITURE HAS BEEN OBJECTIVELY QUESTIONED AND ON SURMISES THE ADDITIONS HAVE BEEN MADE. FBT RETURN FILED BY THE ASSESSEE HAS BEEN ACC EPTED IN TOTO. THUS IN THE ABSENCE OF ANY MISTAKE WHAT-SO-EVER, THE ADDITIONS HAVE BEEN RIGHTLY DELETED BY CIT(A) ON PERTINENT OBSERVATIONS THAT SAME HAVE BEEN DISALLOWED BY ASSESSING OFFICER ON GENERAL REASONS AND GUESS WORK . 4. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD. IT EMERGES FROM THE RECORD THA T NO SPECIFIC DISCREPANCY HAS BEEN POINTED OUT IN ASSESSEES BOOKS OF A/C. AD HOC DISALLOWANCE HAS ITA NO. 6027/DEL/12 RICHA & CO. 3 BEEN MADE PURELY ON GUESS WORK AND SURMISES. ALL OT HER DETAILS OF THE ASSESSEE, ACCOUNTS AND INCOME INCLUDING FBT HAVE BE EN ACCEPTED. IN THESE FACTS AND CIRCUMSTANCES, WE SEE NO INFIRMITY IN THE ORDER OF CIT(A), WHICH IS UPHELD. 5. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 13-02-2013. SD/- SD/- ( B.C. MEENA ) ( R.P. TOLANI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 13-02-2013. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR