Dy. Commissioner of Income Tax-6, Kanpur V. M/s Ghari Industries Pvt. Ltd., Kanpur

ITA 95/LKW/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1159 (ITAT-LUCKNOW)
• Duration Of Justice: 2 year(s) 11 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 30-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Corroborative evidences; Commercial expediency

Judgement Text

I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI T. S. KAPOOR, ACCOUNTANT MEMBER ITA NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 DY.C.I.T.-6, KANPUR. VS. M/S GHARI INDUSTRIES PVT. LTD., 117/H-2/202, PANDU NAGAR, KANPUR. PAN:AAACL 4598 F (APPELLANT) (RESPONDENT) O R D E R PER T. S. KAPOOR, A.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) DATED 21/10/2014. THE REVENUE HAS TAKEN VAR IOUS GROUNDS OF APPEAL WHICH ARE REPRODUCED BELOW: 1. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS E RRED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS .18,75,000/- OUT OF INTEREST AND BANK CHARGES WITHOUT APPRECIATI NG THE FACTS AND MATERIAL AS WELL AS MERITS OF THE CASE BROUGHT ON RECORD BY THE AO AFTER EXAMINING THE ISSUE IN DETAIL. 2. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS .18,75,000/- OUT OF INTEREST AND BANK CHARGES WITHOUT APPRECIATI NG THE FACT THAT ASSESSEE AVAILED ITS OD LIMIT AND PAID INTERES T THEREON AMOUNTING TO RS.60,12,652/- WHEREAS ASSESSEE COMPAN Y AS PLACED INTEREST FREE FUND OF RS.2.5 CRORE TO THE DE LHI UNIT TO ITS ASSOCIATE CONCERN M/S KANPUR DETERGENT & CHEMICAL P VT. LTD. 3. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERR ED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS .7,53,702/- APPELLANT BY SHRI P. K. KAPOOR, C. A. RESPONDENT BY SHRI AJAY KUMAR MISHRA, D. R. DATE OF HEARING 05/12/2017 DATE OF PRONOUNCEMENT 16/01/2018 I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 2 OUT OF ADVERTISEMENT WITHOUT APPRECIATING THE FACT THAT ASSESSEE COMPANY FAILED TO JUSTIFY THE REASON FOR C LAIMING EXPENDITURE PERTAINING TO ADVERTISEMENT NOT FOUND T O BE RELATABLE TO THE RELEVANT ACCOUNTING PERIOD SPECIAL LY IN THE LIGHT OF THE FACT THAT ASSESSEE COMPANY IS FOLLOWING MERC ANTILE SYSTEM OF ACCOUNTING. 4. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS .6,08,896/- OUT OF SALES PROMOTION WITHOUT CONSIDERING THE FACT THAT ASSESSEE FAILED TO JUSTIFY THE CLAIM IN ABSENCE OF CONVINCING EVIDENCE AND ITS BUSINESS EXPEDIENCY WITH THE ASSES SEE'S BUSINESS ESPECIALLY IN VIEW OF THE ILLUSTRATION PUT FORTH BY THE AO IN THE ASSESSMENT ORDER UNDER REFERENCE. 5. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS .50,000/- OUT OF REPAIRS AND MAINTENANCE WITHOUT NOT TAKING INTO CONSIDERATION THE FACT THAT MOST OF PORTION OF EXPE NDITURE INCURRED IN CASH AND NOT OPEN FOR VERIFICATION IN A BSENCE OF PROPER VOUCHERS. 6. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERR ED IN LAW AND ON FACTS IN RESTRICTING THE DISALLOWANCE OF RS.4,35,775/- OUT OF MISC. EXPENSES (REPAIR AND MAINTENANCE) TO RS.1,00,000/- WITHOUT APPRECIATING THE FACT THAT AS SESSEE FAILED TO FULLY SUBSTANTIATE ITS BUSINESS EXPEDIENCY TO TH E ASSESSEE BUSINESS IN ABSENCE OF SUPPORTING EVIDENCE. 7. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND ON FACTS IN RESTRICTING THE DISALLOWANCE OF RS.62,226/- OUT OF TELEPHONE EXPENSES TO RS.20,000/- WITHOUT AP PRECIATING THE FACT THAT SIGNIFICANT PORTION OF THE EXPENDITUR E CLAIMED UNDER THE HEAD PERTAINED TO THE MOBILE PHONES USE B Y THE DIRECTORS AND THEREFORE PERSONAL USE OF THE SAME CA NNOT BE FULLY RULED OUT. 8. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND ON FACTS IN RESTRICTING THE DISALLOWANCE OF RS.1,15,484/- OUT OF CAR RUNNING & MAINTENANCE INCLUDING DEPRECIA TION THEREON TO RS.30,000/- WITHOUT APPRECIATING THE FAC T THAT ASSESSEE FAILED TO FULLY SUBSTANTIATE THE CLAIM IN ABSENCE OF PROPER BILLS AND VOUCHERS AND MOST OF THE EXPENDITU RE WERE INCURRED IN CASH AND NOT OPEN FOR VERIFICATION. I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 3 9. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ER RED IN LAW AND ON FACTS IN RESTRICTING THE DISALLOWANCE OF RS.1,21,066/- OUT OF STAFF WELFARE TO RS.25,000/- WITHOUT APPRECI ATING THE FACT THAT MOST OF THE EXPENDITURE INCURRED UNDER THE HEA D WERE MADE IN CASH AND NOT SUPPORTED WITH PROPER BILLS AN D VOUCHERS. 10. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS E RRED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS .29,457/- OUT OF ELECTRICITY EXPENSES PERTAINING TO FAZALGANJ UNI T WITHOUT APPRECIATING THE FACT THAT ASSESSEE FAILED TO OFFER ANY EXPLANATION THAT THE SAID PREMISE WAS EXCLUSIVELY U SED FOR BUSINESS PURPOSES. 2. AT THE OUTSET, LEARNED D. R. HEAVILY PLACED HIS RELIANCE ON THE ORDER OF THE ASSESSING OFFICER AND SUBMITTED THAT CIT(A), WITHOUT APPRECIATING THE FACTS OF THE CASE, HAS ALLOWED RELIEF TO THE ASSESS EE ON ACCOUNT OF VARIOUS ADDITIONS WHICH THE ASSESSING OFFICER HAD RIGHTLY M ADE KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. LEARNED A. R., ON THE OTHER HAND, HEAVILY PLACED HIS RELIANCE ON THE ORDER OF CIT(A) AND SUBMITTED THAT CIT(A) HAS PASSE D A SPEAKING AND REASONED ORDER WHEREBY EACH AND EVERY ADDITION HAS BEEN DEALT WITH. 4. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE T HROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT DURING THE ASSESSME NT PROCEEDINGS THE ASSESSING OFFICER MADE VARIOUS ADDITIONS SUCH AS DI SALLOWANCE OF INTEREST US 36(1)(III), DISALLOWANCE OUT OF ADMINISTRATIVE AND OTHER EXPENSES, DISALLOWANCE OUT OF VARIOUS EXPENSES ETC. WE FIND THAT ON THE DETAILED SUBMISSIONS MADE BY THE ASSESSEE, THE CIT(A) HAS DE LETED THESE ADDITIONS BY HOLDING AS UNDER: DISALLOWANCE OUT OF INTEREST AND BANK CHARGES 5.1 I HAVE GONE THROUGH THE FACT OF THE CASE AND TH E SUBMISSIONS AND ARGUMENTS PLACED BEFORE ME BY THE L D. COUNSEL. IT IS A FACT THAT THE DISALLOWANCE MADE BY THE ASSESSING OFFICER WAS ON THE PREMISES THAT INTEREST FREE I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 4 ADVANCE HAD BEEN MADE TO M/S KANPUR DETERGENTS & CH EMICALS PVT. LTD. THE AO FOR MAKING SUCH AN ADDITION STATED THAT THERE WAS OPENING DEBIT BALANCE AS WELL AS CLOSING DEBIT BALANCE WHICH MEANT THAT CERTAIN ADVANCES HAD ALSO BEEN MAD E ON ACCOUNT OF WHICH DISALLOWANCE OUT OF INTEREST AND B ANK CHARGES WERE TO BE RESERVE AND CURRENT YEAR PROFIT WHICH WO ULD COVER AND OVERLAP THE DEBIT BALANCE IN THE CASE OF KANPUR DETERGENTS & CHEMICALS (P) LTD. THE VIEW IS SUPPORTED BY THE H ON'BLE SUPREME COURT IN THE CASE OF MUNJAL SALES CORPORATI ON VS. CIT (2008) 168 TAXMAN 43. THE DECISIONS OF THE HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT V/S PREM HEAVY ENGINE ERING WORKS PVT. LTD. 285 ITR 554, CIT V/S HARBHAJAN SARA BJEET AND ASSOCIATES 151 TAXMAN 27, CIT V/S MOTOR SALE LTD. ( 2008) 308 ITR 123 AND THE APEX COURT DECISION IN S.A.BUILDERS LTD. V/S CIT (2007) 158 TAXMAN 74 ALSO SUPPORT THE SAME VIEW . THE OD LIMIT HAD BEEN USED FOR WORKING CAPITAL OF THE A PPELLANT BUSINESS. FURTHER, THE APPELLANT HAD ENOUGH AND SUF FICIENT AMOUNT OF MONEY TOWARDS SHARE CAPITAL, SURPLUS, IT IS SETTLED LAW AND PRACTICE THAT WHEN THERE ARE BUSINESS TRANS ACTIONS WITH ANY CONCERN AND KEEPING IN VIEW THE COMMERCIAL EXPE DIENCY, CERTAIN ADVANCES RELATING TO BUSINESS IN THE NORMAL COURSE OF BUSINESS HAVE BEEN MADE RESULTING IN ANY DEBIT BALA NCE, IT CAN NOT BE INFERRED THAT AN INTEREST FREE ADVANCE HAS B EEN MADE. THE COMMERCIAL EXPEDIENCY NEEDS TO BE VIEWED FROM T HE POINT OF VIEW OF THE BUSINESSMAN. THE ACCOUNT OF THE APPE LLANT IN THE BOOKS OF KANPUR DETERGENTS & CHEMICALS (P) LTD. CLE ARLY SHOWS THAT ALL TRANSACTIONS RELATED TO TRADING ACTIVITIES AND THERE WAS NO SINGLE SPECIFIC TRANSACTION POINTED OUT BY THE A O WHICH WAS IN THE NATURE OF ANY LOAN. ANY DEBIT BALANCE ARISIN G IN THE ACCOUNTS HAS TO BE SEEN WITH THIS IN MIND THAT IF T HE PARTY IN WHOSE ACCOUNT THERE IS DEBIT BALANCE WAS INVOLVED I N ANY BUSINESS ACTIVITIES. IF SO THEN THE BALANCES/TRANSA CTIONS THEREIN HAVE TO BE VIEWED AS COMMERCIAL TRANSACTIONS AND NO T AS LOANS AND ADVANCES GIVEN. IT CANNOT BE PRESUMED THAT THE APPELLANT COMPANY HA D MADE INTEREST FREE ADVANCE TO M/S KANPUR DETERGENTS & CH EMICALS PVT. LTD. OUT OF BORROWED FUNDS AS THE APPELLANT HA D SUFFICIENT SHARE CAPITAL RESERVE ON SURPLUS WHICH WAS SELF OWN ED AND WAS INTEREST FREE FUND AVAILABLE WITH THE APPELLANT EXC EEDING RS.40 CRORES WHICH WAS SUFFICIENT ENOUGH TO MEET ENDS OF THE BUSINESS. FURTHER, I AM OF THE VIEW THAT, THE ACCO UNT OF KANPUR DETERGENTS & CHEMICALS PVT. LTD. WAS ENTIRELY A TRA DE ACCOUNT AND THE DEBIT BALANCE OUTSTANDING NEEDS TO BE CONSI DERED AS A I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 5 TRADE BALANCE OUTSTANDING WHICH SHOULD NOT BE CONSI DERED FOR CHARGING ANY INTEREST. QUESTION OF DISALLOWING ANY INTEREST OUT OF INTEREST AND BANK CHARGES DOES NOT ARISE. CONSIDERING THE VARIOUS FACTS AND CASES ON SUCH ISS UES DISCUSSED ABOVE, I DELETE THE DISALLOWANCE OUT OF I NTEREST OF RS.18,75,000/- MADE BY THE AO. DISALLOWANCE OUT OF ADVERTISEMENT EXPENSES 6.1 I HAVE CONSIDERED THE VIEW OF THE AO WHILE DISA LLOWING THE EXPENDITURE OF RS.7,53,702/- THE SUBMISSION OF THE LD. COUNSEL HAS ALSO BEEN CAREFULLY GONE THROUGH. IT IS A FACT THAT THE ACCOUNTING ENTRIES ARE MADE AND HAVE TO BE MADE ON RECEIPT OF BILLS RAISED BY SUPPLIERS AND SERVICE PR OVIDERS. THE LIABILITY CRYSTALLIZES ONLY WHEN THE DEMAND IS RAIS ED BY ISSUE OF BILLS. IN THE INSTANT CASE THE ADVERTISEMENT WERE M ADE IN THE MONTHS OF FEBRUARY & MARCH, FOR WHICH BILLS WERE SU BSEQUENTLY RAISED AND RECEIVED BY THE APPELLANT FROM APRIL ONW ARDS. IT IS BUT NATURAL THAT THE ACCOUNTING ENTRIES ARE PASSED ON RECEIPT OF BILLS WHICH WAS IN AY 2004-05 AS THE LIABILITY TO P AY AROSE THEN. CONSIDERING THE FACTS OF THE CASE AND ALSO RELYING ON THE CASES CITED, I AM OF THE OPINION THAT THE APPELLANT DID N OT COMMIT ANY MISTAKE BY CLAIMING EXPENSES IN THE RELEVANT ASSESS MENT YEAR. I ACCORDINGLY AM OF THE VIEW THAT NO DISALLOWANCE I S CALLED FOR ON THIS ACCOUNT AND I DELETE THE ADDITION MADE BY T HE ASSESSING OFFICER OF RS.7,53,702/- OUT OF ADVERTISEMENT EXPEN SES CLAIMED BY THE APPELLANT. ESTIMATED AND AD HOC DISALLOWANCES 7.1 I HAVE GONE THROUGH THE FACTS OF THE CASE AND SUBMISSIONS AND ARGUMENTS PLACED BY THE LD. COUNSEL BEFORE ME. THE VARIOUS RULINGS QUOTED BY THE LD. COUNSEL A ND INCORPORATED ABOVE HAVE ALSO BEEN CONSIDERED BY ME. IT IS A FACT THAT THE DISALLOWANCES MADE BY THE AO ARE ESTI MATED WITHOUT ANY SPECIFIC ANOMALY BEING POINTED OUT. THE DISALLOWANCES RELATES TO ESTIMATED DISALLOWANCE MAD E ON AD HOC BASIS OUT OF THE EXPENSES CLAIMED AND HAVE BEEN DISALLOWED EITHER WITH REMARKS OF CASH PAYMENT, OR IN ORDER TO COVER UP ANY POSSIBLE LEAKAGE, AND FOR WANT OF VOUC HERS/SELF MADE VOUCHERS. THE OBSERVATIONS ARE DEVOID OF ANY S PECIFIC FINDINGS AND ARE VERY GENERAL IN NATURE. FOR DISALL OWING OR DISBELIEVING THE EXPENDITURE CLAIMED, THE AO HAS TO POINT OUT A I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 6 SPECIFIC FINDING WHICH MAY PROMPT FOR CERTAIN DISAL LOWANCE. DEFINITELY IN BUSINESS CERTAIN CASH EXPENSES HAVE T O BE INCURRED WHICH NEED TO BE ALLOWED PROVIDED THEY ARE WITHIN B OUNDS OF ALLOWABLE CASH EXPENSES AS PER ACT. IN PRACTICAL SI TUATIONS AND IN PETTY EXPENSES AT TIMES SELF MADE VOUCHERS ARE A LSO UNAVOIDABLE. IF ANY DISALLOWANCE HAS TO BE MADE THE N SPECIFIC FINDING AND ENTRIES ARE TO BE POINTED OUT BY THE AO . ESTIMATED DISALLOWANCES WITH GENERAL REMARKS ARE BAD IN LAW. IT IS NOT GOOD LAW TO MAKE AN ESTIMATED AND ARBITRARY ADDITIO N OUT OF EXPENSES CLAIMED UNLESS AND UNTIL SOME SPECIFIC ANO MALY IS POINTED OUT. THE APPELLANT HAS RELIED ON VARIOUS DE CISIONS WHICH HAVE BEEN QUOTED AND REPRODUCED ABOVE WHICH SUPPORT THE APPELLANTS CONTENTION. CONSIDERING THE FACTS OF THE CASE AND RELYING ON THE DECISIONS AS REFERRED ABOVE. I AM ON THE OPINION AND HOLD THAT THERE CANNOT BE ANY DISALLOWANCE MADE ON ESTIMATE BASIS WITHOUT ANY SPECIFIC REASONING. THER E IS NO BINDING ON MAKING CASH EXPANSES AS EACH AND EVERY E XPENSES CANNOT BE MADE BY CHEQUE/DRAFT. THE MONITORY LIMIT OF CASH EXPENDITURE AS SPECIFIED IN THE ACT, OF COURSE NEED S TO BE FOLLOWED. JUST BECAUSE CERTAIN EXPENSES HAVE BEEN I NCURRED IN CASH AND ARE DOUBTED FOR VERIFICATION, NO DISALLOWA NCE CAN BE MADE FOR WANT OF SUFFICIENT EVIDENCE KEEPING IN VIE W THE DECISION TAKEN IN THE CASE OF FRIENDS CLEARING AGEN CY PVT. LTD. V/S CIT (2011) 199 TAXMAN 265 (MAG)/ 237 TTR 464/23 2 ITR 269/9 TAXMAN.COM 238 (DEL). WHEREIN IT IS NOT PRACT ICAL TO HAVE VOUCHERS FOR MINOR AMOUNTS RELATING TO BUSINES S EXPENSES, SAME SHOULD NOT BE DISALLOWED FOR WANT OF SUFFICIENT EVIDENCE. THE LD. COUNSEL HAS CLAIMED THAT NO DISALLOWANCE SH OULD BE MADE OUT OF TELEPHONE & CAR MAINTENANCE AND DEPRECI ATION THEREON ON ESTIMATED AND AD HOC BASIS FOR PERSONAL USAGE AS THE EXPENSES WERE FOR BUSINESS PURPOSES. HOWEVER, KEEPING THE ABOVE FACTS IN VIEW AND ALSO CONSIDERING THE VA RIOUS DECISIONS CITED ABOVE AND CONSIDERED, DISALLOWING P ART EXPENSES OUT OF TOTAL EXPENSES CLAIMED ON AD HOC. A ESTIMAT ED BASIS WITHOUT ASSIGNING OR POINTING OUT ANY SPECIFIC DEFE CT IS BAD IN LAW. HOWEVER, THOUGH NO SPECIFIC DISALLOWABLE EXPEN SE HAS BEEN POINTED OUT BY THE AO, CERTAIN EXPENSES CAN AL WAYS BE THERE WHICH MAY NOT BE FULLY VERIFIABLE AND IN ORDE R TO DISALLOW A JUSTIFIED AMOUNT, AND ALSO TO PROVIDE JUSTICE TO THE APPELLANT, THE DISALLOWANCES MADE OUT OF REPAIR A MAINTENANCE AND STAFF WELFARE RESTRICTED RS.1,00,000/- IN THE CASE OF REP AIR & MAINTENANCE RS.25,000/- IN THE CASE OF STAFF WELFAR E. THE AO I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 7 HAS DISALLOWED RS.62,226/- OUT OF TELEPHONE EXPENSE S AND RS.1,15,484/- OUT OF CAR RUNNING & MAINTENANCE AND DEPRECIATION THEREON ON ESTIMATE & AD HOC BASIS. HO WEVER, THE ELEMENT OF PERSONAL USE OF TELEPHONE, CAR MAINTENAN CE CANNOT BE RULED OUT. IN ORDER TO MEET THE END OF JUSTICE, THE ADDITION MADE BY THE AO OUT OF TELEPHONE EXPENSES IS RESTRIC TED TO RS.20,000/- AND OUT OF CAR MAINTENANCE IS RESTRICTE D TO RS.30,000/- DISALLOWANCE OUT OF SALES PROMOTION EXPENSES 8.1 I HAVE CAREFULLY GONE THROUGH THE FACTS AND THE SUBMISSIONS MADE BY THE LEARNED COUNSEL. IT IS A F ACT THAT PAYMENTS ARE MADE TO VARIOUS ORGANIZATIONS FOR SUPP ORTING THEM IN THEIR EXPENDITURE FOR ACHIEVING THEIR RESPE CTIVE GOALS. THE NATURE OF THE ORGANISATION AT TIMES DOES SUGGES T THAT PAYMENTS MADE ARE IN THE NATURE OF DONATIONS. DONAT IONS RELATES TO SUCH PAYMENTS WHICH ARE MADE WITHOUT ANY SERVICE IN LIEU THEREOF. BUT PAYMENTS MADE TO ORGANISATION WHI CH IN LIEU THEREOF PROVIDE CERTAIN BENEFITS LIKE PRINTING OF T HE ASSESSES PRODUCTS IN SOUVENIRS OR ADVERTISEMENTS IN BANNER H ANGINGS ETC. DO NOT QUALIFY AS DONATION AS SUCH PUBLICATIONS ARE IN THE NATURE OF ADVERTISEMENTS AND ARE ALLOWABLE IN NATURE. ACCO RDINGLY IN MY OPINION, PAYMENTS MADE TO ANY TYPE OF ORGANIZATI ON WHICH IN LIEU OF PAYMENT RECEIVED PRINTS ADVERTISEMENTS IN SOUVENIRS ETC. DO NOT CALL FOR ANY DISALLOWANCE. I, THEREFORE , DELETE THE ADDITION MADE OF RS.6,08,896/- BY THE AO. DISALLOWANCE OUT OF REPAIR & MAINTENANCE 9.1 I HAVE GONE THROUGH THE FACTS OF THE CASE AND THE SUBMISSIONS AND ARGUMENTS PLACED BY THE LD. COUNSEL BEFORE ME. THE VARIOUS RULING QUOTED AND REFERRED BY THE L D. COUNSEL HAVE ALSO BEEN CONSIDERED. THE DISALLOWANCE HAVE BE EN MADE ON ESTIMATE BASIS WITHOUT POINTED OUT ANY SPECIFIC ANOMALY. I HAVE ALREADY EXPRESSED MY VIEW AND OPINION ON SUCH ESTIMATED/AD HOC DISALLOWANCES WHERE NO SPECIFIC DI SALLOWABLE EXPENDITURE HAS BEEN POINTED OUT BY THE AO IN PARA 6 ABOVE. BASED ON THE SAME AND CONSIDERING THE FACTS, NO SUC H DISALLOWANCE CAN BE MADE IN SUCH A ARBITRARY AND CA SUAL MANNER. ACCORDINGLY, I DELETE THE ADDITION MADE OF RS.50,000/- BY THE AO. I.T.A. NO.95/LKW/2015 ASSESSMENT YEAR:2004-05 8 DISALLOWANCE OUT OF ELECTRICITY EXPENSES 10.1. THE FACTS AND CIRCUMSTANCES OF THE ISSUE ALON G WITH THE SUBMISSIONS MADE AND ARGUMENTS PLACED BY THE ID. CO UNSEL HAVE BEEN EXAMINED CAREFULLY BY ME. THERE IS NOTHIN G ON RECORD TO PROVE OR JUSTIFY THAT THE PREMISES FOR WH ICH ELECTRICITY EXPENSES WERE PAID WAS NOT BEING USED FOR THE BUSIN ESS OF THE APPELLANT. IN THE ABSENCE OF ANY SUCH EVIDENCE, THE AO WAS LEFT WITH NO OPTION BUT TO ACCEPT THE CLAIM OF THE ASSES SEE. ACCORDINGLY, IN MY OPINION NO DISALLOWANCE OUT OF E LECTRICITY EXPENSES PAID FOR FAZALGANJ PROPERTY IS JUSTIFIED. I, THEREFORE, DELETE THE ADDITION OF RS.29,457/- MADE BY THE AO. 4.1 FROM THE ABOVE FINDINGS OF CIT(A), WE FIND THAT CIT(A) HAS PASSED A DETAILED AND EXHAUSTIVE ORDER AND LEARNED D. R. WAS NOT ABLE TO DEMONSTRATE ANY CONTRARY FACT AND THEREFORE , WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A). IN VIEW OF T HE ABOVE, THE APPEAL FILED BY THE REVENUE IS DISMISSED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 16/01/2018) SD/. SD/. (SUNIL KUMAR YADAV) (T. S. KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:16/01/2018 *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