SHOBHANA DESAI PRODUCTIONS P.LTD, MUMBAI V. ASST CIT CIR 11(1), MUMBAI

ITA 6367/MUM/2012

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9097 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 05-01-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 17-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: DR K SHIVARAM; RAHUL R SARDA
• Keywords: Opportunity of being heard; Corroborative evidences
• Section: 40A(3); 133A; 154

Judgement Text

, , , , , ,, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER ITA NO.6366/MUM/2012 ASSESSMENT YEAR: 2008-09 M/S SHOBHANA DESAI PRODUCTION PVT. LTD. 303/303A, PATEL INDUSTRIAL ESTATE, B-40, NEW LINK ROAD, ANDHERI (W), MUMBAI-400053 ! ! ! ! / VS. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-11(1), ROOM NO.-439, 4 TH FLOOR, AAYKAR BHAVAN, M.K. MARG, MUMBAI-400020 ( ! $% /ASSESSEE) ( & / REVENUE) P.A. NO.AAFCS1655R ITA NO.6367 TO 6368/MUM/2012 ASSESSMENT YEAR: 2008-09 & 2009-10 M/S SHOBHANA DESAI PRODUCTION PVT. LTD. 303/303A, PATEL INDUSTRIAL ESTATE, B-40, NEW LINK ROAD, ANDHERI (W), MUMBAI-400053 ! ! ! ! / VS. THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-11(1), ROOM NO.-439, 4 TH FLOOR, AAYKAR BHAVAN, M.K. MARG, MUMBAI-400020 ( ! $% /ASSESSEE) ( & / REVENUE) P.A. NO.AAFCS1655R ( ! $% ' ( ' ( ' ( ' ( / // / ASSESSEE BY) DR. K. SHIVARAM & SHRI RAHUL R. SARDA ( & ' ( ' ( ' ( ' ( / REVENUE BY : SHRI NEIL PHILIP - DR ! ' %) / / / / DATE OF HEARING : 05/01/2015 *+, ' %) / DATE OF ORDER : 08/01/2015 M/S SHOBHANA DESAI PRODUCTION PVT. LTD 2 - - - - / / / / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) : THIS BUNCH IS OF THREE APPEALS, FILED BY THE ASSE SSEE. FIRST, WE SHALL TAKE UP APPEAL IN ITA NO.6366/MUM/2 012, CHALLENGING THE IMPUGNED ORDER DATED 08/08/2012 OF THE LD. FIRST APPELLATE AUTHORITY. GROUND NO. 1 AND 2 ARE A S UNDER:- 1.THE LEARNED CIT(A) ERRED IN CONFIRMING THE AD HOC DISALLOWANCE @ 50% CASH EXPENSES OF RS.1,05,72,568/-, I.E. RS.52,8 6,284/- BEING CASH EXPENSES INCURRED INCLUDING THE EXPENSES INCUR RED ON THE CONSTRUCTION OF THE SET FOR SERIAL HAMARI DEVRANI , WITHOUT APPRECIATING THAT COMPLETE DETAILS OF EXPENSES SUPP ORTED BY BILLS WERE FURNISHED, THEREFORE DISALLOWANCE MAY BE DELET ED. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) AND ASSESSING OFFICER ERRED IN MAKING THE OBSERVATION THAT THE VO UCHERS ARE SELF MADE AND WITHOUT SUPPORTING EVIDENCE WHICH IS FACTU ALLY INCORRECT AND WITHOUT ANY BASIS, AS ALL THE EXPENSE ARE AUTHO RIZED BY THE PRODUCTION IN CHARGE SUPPORTED BY THE SIGNATURE OF RECIPIENT ALSO NO DEFECTS ARE FOUND IN THE BOOKS OF ACCOUNT MAINTAINE D BY THE ASSESSEE AND NEITHER THE PROVISIONS OF SEC.40A(2) O R 40A(3) ARE APPLICABLE, THEREFORE CONSIDERING THE NATURE OF APP ELLANTS BUSINESS THE AD-HOC DISALLOWANCE OF CASH EXPENSES MAY BE DIR ECTED TO BE DELETED. 2. DURING HEARING OF THESE APPEALS, WE HAVE HEARD, LD. DR, SHRI K.SHIVARAM ALONGWITH SHRI RAHUL R. SARDA, LD. COUNSELS FOR THE ASSESSEE AND SHRI NEIL PHILIP, LD. DR. THE CRU X OF ARGUMENT ADVANCED ON BEHALF OF THE ASSESSEE IS THAT IDENTICA L ISSUE AROSE FOR ASSESSMENT YEAR 2006-07 FOR WHICH OUR ATTENTION WAS INVITED TO PAGES 20 AND 21 OF THE PAPER BOOK (ITA NO.1127/M UM/2011). THE LD. COUNSEL ALSO INVITED OUR ATTENTION TO PAGES 102, 103,104 AND 106 OF THE PAPER BOOK BY CLAIMING THAT THE CLAI M OF THE M/S SHOBHANA DESAI PRODUCTION PVT. LTD 3 ASSESSEE IS SUPPORTED BY BILLS/EVIDENCE. ON THE OT HER HAND, THE LD. DR, DEFENDED THE CONCLUSION ARRIVED AT IN THE I MPUGNED ORDER BY CONTENDING THAT THE CLAIMED DEDUCTION WAS RIGHTL Y DENIED TO THE ASSESSEE AS THE CLAIM WAS NOT SUPPORTED BY ANY EVIDENCE/BILLS. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. BEFORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION O F THE ORDER DATED 26/03/2014 OF THE TRIBUNAL FOR ASSESSMENT YEA R 2006-07. 5.EFFECTIVE GROUND OF APPEAL IS ABOUT DISALLOWANCE OF CASH EXPENSES OF RS.14.39 LAKHS ON ESTIMATE BASIS. DURIN G THE ASSESSMENT PROCEEDINGS AO FOUND THAT AN ACTION U/S. 133A OF THE ACT WAS CARRIED OUT THE BUSINESS PREMISES OF THE ASSESSEE WAS CARRIED OUT ON 01/08/2008 ,THAT MEMBER S OF THE SURVEY PARTY HAD FOUND THAT THE ASSESSEE HAD IN CURRED HEAVY CASH EXPENDITURE. HE CALLED FOR DETAILS IN TH IS REGARD. REJECTING THE CLAIM MADE BY IT, AO HELD THAT THE EX PLANATION OF THE ASSESSEE-COMPANY WAS NOT ACCEPTABLE, THAT TH ERE WAS NO EVIDENCE TO PROVE THAT THE PARTIES HAD INSIS TED ON PAYMENT IN CASH AND THAT THEY HAD EXPRESSED UNWILLINGNESS TO RENDER SERVICES OTHER -WISE, THAT ASSESSEE HAD SIMPLY SUBMITTED BREAK UP OF CASH EXPENSES AND NO FURTHER DETAILS WERE FURNISHED, THAT ASSESSEE HAD S IMPLY SUBMITTED BREAK UP OF CASH EXPENSES AND NO FURTHER DETAILS WERE FURNISHED, THAT IT WAS NOT DENIED THAT THE REC IPIENT PARTIES ALSO HAD BANK ACCOUNTS AND THE BANK TRANSAC TIONS WOULD HAVE BEEN FAR MORE EXPEDIENT AND CONVENIENT. FINALLY, HE ALLOWED 20% OF THE TOTAL EXPENSES AND DISALLOWED THE BALANCE 80% OF THE EXPENSES. M/S SHOBHANA DESAI PRODUCTION PVT. LTD 4 5.1.IN THE APPELLATE PROCEEDINGS FAA HELD THAT THE ASSESSEE HAD CLAIMED DIRECT EXPENSES OF RS.3,57,26,324/-,THA T THE ASSESSEE HAD CLAIMED CASH EXPENSE TO THE TUNE OF RS.71,99,877/-,THAT THAT A SURVEY ACTION WAS CARRIE D OUT IN ASSESSEES PREMISES ON WHEREIN DETAILS WITH REGARD TO HUGE CASH WITHDRAWALS WERE FOUND, THAT QUERY WAS PUT ACR OSS TO THE ASSESSEE-COMPANY TO EXPLAIN SUCH HUGE CASH WITHDRAWALS AND CORRESPONDING EXPENSES, THAT IT HAD SUBMITTED THAT CASH EXPENSES WERE INDISPENSABLE IN THE TV SERIAL MAKING INDUSTRY AND FORMED PART OF REGULAR B USINESS ACTIVITY, THAT THE AOS ORDER DID NOT INDICATE AS I F A SINGLE BILL OR VOUCHER PERTAINING TO CASH EXPENSES WAS CAL LED FOR/VERIFIED, THAT ASSESSMENT ORDER DID NOT REFLECT THAT THE AO HAD IDENTIFIED BILLS OR VOUCHERS OF CASH EXPENSE S THAT COULD BE DISALLOWED, THAT AO DID NOT FIND THAT THE PARTIES DID NOT EXIST OR THAT THE BILLS/ VOUCHERS WERE BOGU S, THAT THERE WAS NO VERIFICATION BY THE AO TO INDICATE AS TO WHETHER ANY PAYMENTS HAD BEEN MADE IN EXCESS OF SEC TION 40A(3) OF THE ACT, THAT THE ASSESSEE HAD FURNISHED A DETAILED EXPLANATION.FAA FURTHER HELD THAT THAT THE DETAILS OF CASH EXPENSES FILED INDICATED THAT A NUMBER OF T HE EXPENSES WOULD BE ON THE BASIS OF CASH VOUCHERS ONL Y WITHOUT ANY SUPPORTING BILL OR RECEIPT, THAT SUCH B ILLS INCLUDED VARIOUS PAYMENTS OF WAGES AND FOOD MADE BY ASSESSEE IN THE COURSE OF ITS PRODUCTION, THAT THER E WAS ALSO A POSSIBILITY OF EXPENSES BEING PERSONAL/NON-PROFES SIONAL IN NATURE TO BE INCLUDED THEREIN, THAT THE ASSESSEE HA D CLAIMED A LARGE PROPORTION OF EXPENSES FOR PRODUCTI ON AS HAVING BEEN INCURRED IN CASH, THAT THE DISALLOWANCE OF 80% OF EXPENSES INCURRED IN CASH WAS VERY HIGH. FINALLY , SHE RESTRICTED IT TO 20% . M/S SHOBHANA DESAI PRODUCTION PVT. LTD 5 5.2.BEFORE US, AR SUBMITTED THAT THE NATURE OF THE ASSESSEES BUSINESS AND THE INDUSTRY IN WHICH THE ASSESSEE OPERATED WAS SUCH THAT IT HAD TO MAKE CASH PAYMENTS, THAT AO AND THE FAA FAILED TO APPRECIATE THE BUSINESS EXPEDIENCY FOR MAKING PAYMENT IN CASH, THA T THERE WAS NO CONTRAVENTION OF THE PROVISIONS OF THE ACT R ELATING TO PAYMENTS OF EXPENSES IN CASH [SECTION 40(A)(3) READ WITH RULE 6(DD)]BY THE ASSESSEE, THAT INFORMATION CALLED FOR WAS SUBMITTED ALONG WITH FULL BREAK-UP OF CASH EXPENSES , THAT DATE WISE DETAILS OF HEADS OF EXPENSES AND AMOUNT O F EXPENSES INCURRED WAS FURNISHED BY THE ASSESSEE, TH AT EXPENDITURE INCURRED WAS SUPPORTED BY PAYMENT VOUCH ERS, THAT AFTER THE ASSESSEE SUBMITTED THE DETAILS NO FU RTHER QUERY WAS RAISED, THAT THE BOOKS OF ACCOUNTS WERE N OT REJECTED, THAT IN THE EARLIER YEAR DISALLOWANCE OF 1% OF THE EXPENDITURE WAS MADE BY THE AO, WHILE PASSING THE ASSESSMENT ORDER U/S.143(3)OF THE ACT. HE REFERRED TO PAGES 56-57,94,239,257-262 OF THE PAPER BOOK(PB).DR SUBMI TTED THAT THE ASSESSEE DID NOT ESTABLISH THAT THE EXPEND ITURE WAS NOT INCURRED FOR BUSINESS PURPOSES, THAT DISALL OWANCE SUSTAINED BY THE FAA WAS QUITE REASONABLE. 5.3.WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US. WE FIND THAT THE ASSESSEE HAD C LAIMED CASH EXPENSE TO THE TUNE OF RS.71,99,877/-,THAT DUR ING THE SURVEY OPERATION DETAILS OF CASH EXPENSES WERE CALL ED FOR BY THE MEMBERS OF THE TEAM, THAT LATER ON THE AO HAD D IRECTED THE ASSESSEE TO FILE THE ENTIRE CASH EXPENSE DETAIL S OF EXPENSES ABOVE RS.2,000/-,ON 07. 11.2008.ON 19.11.2 008 ASSESSEE FILED DETAILS LIKE DATE WISE PAYMENT/PARTY WISE PAYMENT/HEAD WISE PAYMENT. IT MADE A REQUEST TO THE AO TO FIX A SUITABLE TIME WHEN THE PERSONNEL OF THE AS SESSEE- M/S SHOBHANA DESAI PRODUCTION PVT. LTD 6 COMPANY COULD SHOW ALL THE RELEVANT VOUCHERS FOR CR OSS VERIFICATION. AS PER THE DIRECTIONS OF THE AO ASSES SEE FILED FURTHER INFORMATION ON 24.11.2008.WE FIND THAT AO D ID NOT FIX THE DATE FOR VERIFYING THE MATERIAL SUBMITTED B Y THE ASSESSEE, THAT HIS ORDER ALSO DID NOT MENTION THE E NQUIRIES MADE BY HIM. IT IS NOT KNOWN AS HOW DID HE ARRIVE A T THE CONCLUSION THAT 80% OF THE EXPENDITURE COULD NOT BE ALLOWED. AS PER HIS DIRECTIONS ASSESSEE HAD FURNISH ED ALL THE NECESSARY DETAILS, BUT HE CHOOSE NOT TO EXAMINE THEM. AO.S ARE NOT SUPPOSED TO MAKE DISALLOWANCES WITHOUT ASSIGNING REASONS FOR REJECTING THE CLAIM MADE BY A N ASSESSEE. IT IS DUTY OF THE AO NOT TO MENTION AS TO WHY THE EXPLANATION OF THE ASSESSEE IS NOT ACCEPTABLE. WE F IND THAT IN HIS ORDER NO REASONS HAVE BEEN ASSIGNED FOR REJE CTING THE CLAIM MADE BY THE COMPANY.FAA HAS CLEARLY MENTIONED THAT AO HAD NOT VERIFIED EVEN A SINGLE BILL OR VOUCHER T HAT COULD BE TREATED AS BOGUS. HE MADE A LUMP SUM ADDITION ON AD HOC BASIS. IN OUR VIEW, SUCH APPROACH HAS BEEN RIGH TLY REJECTED BY THE FAA. BUT, WHILE GRANTING RELIEF, FA A RESTRICTED THE DISALLOWANCE TO 20%.WE FIND THAT FAA HAS ALSO NOT IDENTIFIED THE BILLS/VOUCHERS THAT COULD B E DISALLOWED.FAA COULD HAVE DIRECTED THE AO TO FURNIS H A REMAND REPORT IN THIS REGARD OR COULD HAVE DIRECTED THE ASSESSEE TO FILED FURTHER DETAILS OF PAYMENTS OF WA GES AND FOOD. BUT, FAA CHOOSE NOT TAKE ANY OF THOSE STEPS A ND HELD THAT THERE WAS POSSIBILITY OF EXPENSES BEING PERSON AL/ NON- PROFESSIONAL IN NATURE. WE ARE NOT INCLINED TO ENDO RSE THE VIEW THAT IN THE MATTER OF A COMPANY THERE CAN BE A NY PERSONAL EXPENDITURE. IN ABSENCE OF ANY DETAIL WE A RE UNABLE TO UNDERSTAND AS WHICH EXPENDITURE COULD BE TERMED AS NON-PROFESSIONAL EXPENDITURE. POSSIBILITY OF INC URRING OF EXPENDITURE CANNOT TAKE PLACE OF EVIDENCES AND TAX LIABILITY M/S SHOBHANA DESAI PRODUCTION PVT. LTD 7 CANNOT BE FASTENED TO AN ASSESSEE ON THE BASIS OF S OME POSSIBILITY. THEREFORE, WE ARE NOT ABLE TO PERSUADE OURSELVES TO CONFIRM THE ORDER OF THE FAA. REVERSING THE ORDE R OF THE FAA, WE DECIDE EFFECTIVE GROUND OF APPEAL IN FAVOUR OF THE ASSESSEE. APPEAL FILED BY THE ASSESSEE IS ALLOWED. 2.2. IF THE OBSERVATION MADE IN THE ASSESSMENT ORDE R, CONCLUSION DRAWN IN THE IMPUGNED ORDER AND THE BASIS ON WHICH RELIEF GRANTED BY THE TRIBUNAL (SUPRA) AND THE MATERIAL FA CTS AVAILABLE ON RECORD, THE FINDING OF THE ASSESSING OFFICER AS WELL AS OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ARE THAT THE A SSESSEE INCURRED EXPENSES IN CASH AMOUNTING TO RS.1,05,72,5 68/- AND THE VOLUMINOUS VOUCHERS PRODUCED BEFORE THE ASSESSI NG OFFICER WAS EXAMINED BY THE INSPECTOR WERE AS PER THE REPOR T OF THE INSPECTOR EITHER THE VOUCHERS WERE SELF MADE OR NOT SUPPORTED BY THIRD PARTY EVIDENCE. IT HAS ALSO BEEN OBSERVED TH AT PURPOSELY, THE AMOUNT WAS KEPT BELOW RS.20,000/- TO ESCAPE THE PROVISIONS OF SECTION 40A(3) OF THE ACT. CONSIDERING THE TOTA LITY OF FACTS, THE AD-HOC DISALLOWANCE WAS MADE TO THE TUNE OF 50% OF THE CASH EXPENSES. WE HAVE EXAMINED THE MATERIAL AVAILABLE ON RECORD, CONSIDERED THE ARGUMENTS ADVANCED FROM BOTH SIDES A ND FOUND THAT NEITHER THE ASSESSING OFFICER NOR THE LD. COMM ISSIONER OF INCOME TAX (APPEALS) EXAMINED THE CLAIM OF THE ASSE SSEE AND THE ADDITION IS MADE ON AD-HOC BASIS WHICH IS ALSO PURE LY ON THE BASIS OF REPORT OF THE INSPECTOR, WHICH IN OUR VIEW CANNOT BE SUSTAINED. IT IS ALSO A FACT THAT SOME OF VOUCHERS ARE EITHER SELF MADE OR NOT SUPPORTED WITH EVIDENCE. HOWEVER, MAJO RITY OF THE VOUCHERS ARE DULY SUPPORTED. WE NOTE THAT VIDE COMM UNICATION DATED 25/11/2010, ADDRESSED TO THE LD. ACIT, THE AS SESSEE HAS M/S SHOBHANA DESAI PRODUCTION PVT. LTD 8 CLARIFIED ITS POSITION AND DULY FURNISHED THE BREAK UP OF CASH EXPENSES (ANNEXURE-3) AND CASH VOUCHERS WERE PRODUC ED FOR VERIFICATION. HOWEVER, DUE TO THE VOLUMINOUS NATURE OF THE DOCUMENTS, THE ASSESSING OFFICER COULD NOT EXAMINE HIMSELF AND HE MERELY RELIED UPON THE REPORT OF THE INSPECTOR. THEREFORE, IN THE ABSENCE OF EXAMINATION OF THE SAME BY THE ASSES SING OFFICER, UPHOLDING THE SAME, IDENTICALLY, BY THE LD. COMMISS IONER OF INCOME TAX (APPEALS), THAT TOO WITHOUT GIVING ANY R EASONING, WE NOTE THAT AT LEAST RANDOMLY THE VOUCHERS ARE SUPPO RTED BY EVIDENCE, THOUGH IN PART. AS AGREED BY BOTH THE SID ES BEFORE US, THE DISALLOWANCE IS RESTRICTED TO 10% IN PLACE OF 5 0%, SUSTAINED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS), TH US, THIS GROUND OF THE ASSESSEE IS PARTLY ALLOWED. 3. THE NEXT GROUND IS AS FOLLOWS:- 3. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERR ED N NOT ADMITTING AND CONSIDERING THE ADDITIONAL GROUND OF APPEAL RAISED BY THE APPELLANT IN REGARD TO TAXING THE INTEREST OF R S.7,35,462/- ON LATE PAYMENT OF SERVICE TAX WHICH WAS WRONGLY DISAL LOWED IN THE COMPUTATION OF INCOME, THEREFORE THE SAME OUGHT TO BE ALLOWED. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) FAI LED TO APPRECIATE THAT AS PER ARTICLE 265 OF THE CONSTITUTION OF INDI A TAX CAN BE COLLECTED OR LEVIED ONLY IN ACCORDANCE WITH LAW, TH US IF ANY AMOUNT IS WRONGLY OFFERED FOR TAX THE ASSESSING OFFICER CA NNOT TAX THE SAME. 3.1. AT THE TIME OF HEARING, LD. COUNSELS FOR THE A SSESSEE, CONTENDED THAT THE CLAIM WAS MADE BY THE ASSESSEE V IDE LETTER DATED 25 TH NOVEMBER, 2010 AND ALSO ON 29 TH NOVEMBER. ON THE OTHER HAND, THE LD. DR DEFENDED THE CONCLUSION ARRI VED AT IN THE IMPUGNED ORDER. 3.2. WE HAVE PERUSED THE RECORD AND FIND THAT THE A SSESSEE, VIDE COMMUNICATION DATED 27 TH OCTOBER, 2010 (PAGE 8 TO 11 OF THE M/S SHOBHANA DESAI PRODUCTION PVT. LTD 9 PAPER BOOK) HAS CLAIMED THAT THE INTEREST ON SERVIC E TAX HAS WRONGLY BEEN DISALLOWED IN COMPUTATION OF INCOME. HOWEVER, THE ASSESSING OFFICER DID NOT EXAMINE THE ISSUE, THUS, TO SAFEGUARD THE INTEREST OF BOTH SIDES AND ARTICLE 265 OF CONST ITUTION OF INDIA, TO THE EFFECT THAT ONLY LEGITIMATE TAXES CAN BE LEV IED/COLLECTED, THEREFORE, THIS GROUND IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER TO EXAMINE THE CLAIM OF THE ASSESSEE AND DE CIDE IN ACCORDANCE WITH LAW. NEEDLESS TO MENTION HERE THAT DUE OPPORTUNITY OF BEING HEARD WITH FURTHER LIBERTY TO FURNISH EVIDENCE, IF ANY, IN SUPPORT OF ITS CLAIM BE PROVID ED TO THE ASSESSEE, CONSEQUENTLY, THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 4. OUR ABOVE VIEW/DECISION WILL ALSO COVER ITA NO. 6367/MUM/2012 (ASSESSMENT YEAR 2008-09) ORDER DATED 08/08/2012, U/S 154 OF THE ACT, THUS, IN VIEW OF TH E ABOVE, THIS APPEAL IS ALSO ALLOWED FOR STATISTICAL PURPOSES. 5. NOW WE SHALL TAKE UP APPEAL IN ITA NO. 6368/MUM/ 2012, WHEREIN, THE ASSESSEE HAS CHALLENGED THE IMPUGNED O RDER DATED 24/08/2012 OF THE LD. FIRST APPELLATE AUTHORITY. TH E FIRST GROUND IS IDENTICAL TO THE GROUND, DISPOSED OFF HEREINABOV E CONFIRMING AD-HOC DISALLOWANCE OF 10% OF CASH EXPENSES. SINCE , WE HAVE ALREADY OPINED THAT DISALLOWANCE TO THE EXTENT OF 10% OF THE CASH EXPENSES IS REASONABLE, THEREFORE, ON THIS ISS UE, THE STAND OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IS AFFIRMED. THIS GROUND OF THE ASSESSEE IS, THEREFORE, DISMISSED. 5.1. NEXT GROUND PERTAINS TO AD-HOC DISALLOWANCE OF 20% OF CASH EXPENSES, INCURRED ON PAYING WAGES TO VARIOUS WORKE RS AT SITE. THE STAND OF THE ASSESSEE IS IDENTICAL TO THE GROUN D RAISED, M/S SHOBHANA DESAI PRODUCTION PVT. LTD 10 WHEREAS THE LD. DR DEFENDED THE CONCLUSION ARRIVED AT IN THE IMPUGNED ORDER. KEEPING IN VIEW, THE TOTALITY OF F ACTS AND ON EXAMINATION OF MATERIAL AVAILABLE ON RECORD AND CON SIDERING THE ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, THE AD-HOC DISALLOWANCE IS RESTRICTED TO 10% AGAINST 20%, SUST AINED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS), THEREFORE , THIS GROUND IS PARTLY ALLOWED. THIS APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. FINALLY, THE APPEAL IN 1. ITA NO. 6366/MUM/2012 IS PARTLY ALLOWED FOR STATIS TICAL PURPOSES. 2. APPEAL IN ITA NO.6367/MUM/2012 IS ALLOWED FOR STATI STICAL PURPOSES, AND, 3. APPEAL IN ITA NO.6368/MUM/2012 IS PARTLY ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 05/01/2015. - ' *+, .!/ 05/01/2015 + ' 4 SD/- (SANJAY ARORA) SD/- (JOGINDER SINGH) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; .! DATED : 08/01/2015 F{X~{T? P.S/. !.. - ' 6%7 87,% - ' 6%7 87,% - ' 6%7 87,% - ' 6%7 87,%/ COPY OF THE ORDER FORWARDED TO : 1. 9: / THE APPELLANT 2. 6;9: / THE RESPONDENT. 3. < ( ) / THE CIT, MUMBAI. 4. < / CIT(A)- , MUMBAI 5. 7>4 6%! , , / M/S SHOBHANA DESAI PRODUCTION PVT. LTD 11 DR, ITAT, MUMBAI 6. 4? @ / GUARD FILE. -! -! -! -! / BY ORDER, ;7% 6% //TRUE COPY// A AA A/ // /B & B & B & B & (DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI