JALORI TABEWARES PRIVATE LIMITED, AJMER V. INCOME TAX OFFICER, WARD-2-2, AJMER

ITA 924/JPR/2018

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 4225 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 30-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J. C. KULHARI
• Keywords: Bogus
• Section: 143(3)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA. NO. 924/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2015-16 JALORI TABLEWARES PRIVATE LTD., F-17-A, RIICO INDUSTRIAL AREA PARBATPURA, AJMER. CUKE VS. THE ITO, WARD-2(2), AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABCJ 4182 C VIHYKFKHZ@ APPE LLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI SANJEEV JAIN (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SHRI J.C. KULHARI (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 03/10/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 05/10/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF LD. CIT(A), AJMER DATED 21.05.2018 FOR THE ASSESSMENT Y EAR 2015-16 CHALLENGING THE ADDITION OF RS. 52,500/- ON ACCOUNT OF DISALLOWANCE OF TRAVELLING AND MISCELLANEOUS EXPENSES. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSE SSMENT IN THIS CASE WAS COMPLETED U/S 143(3) VIDE ORDER DATED 26.12.201 7 WHEREIN THE AO MADE DISALLOWANCE OF TRAVELLING EXPENSES AMOUNTING TO RS. 80,000/- ITA NO. 924/JP/2018 JALORI TABLEWARES PVT. LTD. VS. ITO 2 AND DISALLOWANCE OUT OF MISC. EXPENSES AMOUNTING TO RS. 25,000/-. AS PER THE ASSESSING OFFICER, THE EXPENDITURE SHOWN TO HAVE BEEN INCURRED BY THE ASSESSEE ON TRAVELLING EXPENSES, IT CANNOT B E HELD THAT WHOLE EXPENDITURE HAS BEEN INCURRED FOR BUSINESS EXPEDIEN CY AND INVOLVEMENT OF PERSONAL ELEMENT CANNOT BE DENIED. REGARDING MI SCELLANEOUS EXPENSES, THE AO OBSERVED THAT THE ASSESSEE FAILED TO DISCHARGE ITS ONUS THAT THE EXPENDITURE WERE INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS. ON APPEAL, THE LD. CIT(A) HELD THAT SOME DISALLOWANCE OUT OF TRAVELLING EXPENSES AND MISCELL ANEOUS EXPENSES WAS REQUIRED TO BE MADE BY THE AO. HOWEVER, THE DI SALLOWANCE MADE BY THE AO APPEARS TO BE ON HIGHER SIDE AND HE, THER EFORE, RESTRICTED THE DISALLOWANCE TO RS. 52,500/- AND GRANTED RELIEF IN RESPECT OF BALANCE DISALLOWANCE. NOW THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE QUANTUM OF DISALLOWANCE SO CONFIRMED BY THE LD CIT( A). 3. DURING THE COURSE OF HEARING, THE LD. AR HAS SUB MITTED THAT THE DISALLOWANCE HAS BEEN MADE ON AD HOC BASIS, SIMPLY ON MERE SUSPICION, SURMISES AND CONJECTURES. NO SPECIFIC INSTANCE OF A NY NATURE HAS BEEN GIVEN BY THE A.O. IN THE IMPUGNED ORDER TO SUPPORT HIS CONTENTION THAT THE EXPENDITURE WERE INCURRED FOR NON-BUSINESS PURP OSES. IT WAS FURTHER SUBMITTED THAT THE ASSESSEES BOOKS OF ACCOUNTS WER E DULY AUDITED AND NO SPECIFIC DEFECT WAS POINTED OUT IN THE AUDIT REP ORT. THE EXPENDITURES WERE INCURRED BY THE ASSESSEE ON DAY TO DAY BUSIN ESS ACTIVITY AND THE ASSESSEE HAS DULY PRODUCED BOOKS OF ACCOUNTS AND V OUCHERS FOR VERIFICATION. REGARDING PERSONAL USAGE OF THE EXPEN DITURE, THE LD. AR HAS SUBMITTED THAT THE ASSESSEE IS A PRIVATE LIMITE D COMPANY, THERE CANNOT BE ANY PERSONAL ELEMENT AND IN SUPPORT, REL IANCE WAS PLACED ON ITA NO. 924/JP/2018 JALORI TABLEWARES PVT. LTD. VS. ITO 3 THE DECISION OF HONBLE GUJARAT HIGH COURT IN CASE OF SAYAJI IRON & ENGINEERING CO. VS. CIT (2002) 172 CTR 339. 4. THE LD. DR IS HEARD WHO HAS SUBMITTED THAT THE A O HAS BEEN MORE THAN REASONABLE IN MAKING DISALLOWANCE OF RS. 105000/- AND WHICH HAS BEEN REDUCED FURTHER BY THE LD. CIT(A) TO RS. 52,500/-. IT WAS ACCORDINGLY SUBMITTED THAT THERE IS NO BASIS FO R INTERFERING WITH THE ORDER OF THE LD. CIT(A) AND THE SAME MAY KINDLY BE CONFIRMED. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN ABSENCE OF ANY SPECIFIC FIN DINGS RECORDED BY THE LOWER AUTHORITIES THAT THE EXPENDITURE HAS NOT BEEN INCURRED FOR THE PURPOSES OF BUSINESS OR THE ASSESSEE HAS CLAIMED AN Y BOGUS EXPENDITURE AND A MERE APPREHENSION CANNOT BE A BAS IS FOR DISALLOWANCE. THE ADDITION SO MADE ON AN ADHOC BAS IS THEREFORE CANNOT BE SUSTAINED IN THE EYES OF LAW AND THE SAME IS HER EBY DISMISSED. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 05/10/2018. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 05/10/2018. *SANTOSH ITA NO. 924/JP/2018 JALORI TABLEWARES PVT. LTD. VS. ITO 4 VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- JALORI TABLEWARES PRIVATE LTD., AJME R. 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD- 2(2), AJMER. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE { ITA NO. 924/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR