DHARMENDRA PRASAD MORE,BALASORE vs. INCOME TAX OFFICER, WARD-1, , BALASORE
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Income Tax Appellate Tribunal, IN THE INCOME TAX APPELLATE TRIBUNAL,
Before: ARUN KHODPIA & ARUN KHODPIA & ARUN KHODPIA
IN THE INCOME TAX APPELLATE TRIBUNAL, IN THE INCOME TAX APPELLATE TRIBUNAL, IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE BEFORE S/SHRI GEORGE MATHAN, JUDICIAL JUDICIAL MEMBER AND ARUN KHODPIA, ACCOUNTANT MEMBER AND ARUN KHODPIA, ACCOUNTANT MEMBER AND ARUN KHODPIA, ACCOUNTANT MEMBER ITA No.215/CTK/2022 Assessment Year : 2011-12 Dharmendra Prasad More, Dharmendra Prasad More, Vs. Income Tax Officer, Ward Income Tax Officer, Ward-1, Nil, Sahadev Khunta, PO: Nil, Sahadev Khunta, PO: Balasore Sahadev Sahadev Khunta, Khunta, Dist: Dist: Balasore PAN/GIR No. PAN/GIR No.AGFPM 2413 A (Appellant (Appellant) .. ( Respondent Respondent) Assessee by : Shri P.K.Mishra, AR P.K.Mishra, AR Revenue by : Shri S.C.Mohanty S.C.Mohanty, Sr DR Date of Hearing : 28/0 02/2023 Date of Pronouncement : 28/0 /02/2023 O R D E R Per Bench This is an appeal filed by the assessee against the order of the ld This is an appeal filed by the assessee against the order of the ld This is an appeal filed by the assessee against the order of the ld CIT(A), , NFAC, NFAC, Delhi, Delhi, dated 5.9.2022 in Appeal No. ITBA/NFAC/S/250/2022 ITBA/NFAC/S/250/2022-23/1045172764(1) for the assessment year for the assessment year 2011- 12.
Shri P.K.Mishra, ld AR appeared for the assessee and Shri Shri P.K.Mishra, ld AR appeared for the assessee and Shri Shri P.K.Mishra, ld AR appeared for the assessee and Shri S.C.Mohanty, ld Sr DR appeared for the revenue. S.C.Mohanty, ld Sr DR appeared for the revenue.
It was submitted by ld AR that the assessee is an individual, who is It was submitted by ld AR that the assessee is an individual, who is It was submitted by ld AR that the assessee is an individual, who is deriving income as a clearing & forwarding agent of Lafarge India Pvt Ltd.. iving income as a clearing & forwarding agent of Lafarge India Pvt Ltd.. iving income as a clearing & forwarding agent of Lafarge India Pvt Ltd..
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ITA No.215/CTK/2022 Assessment Year : 2011-12
It was the submission that in the course of assessment, the Assessing Officer had disallowed 5% out of labour charges and transportation charges on the ground that the vouchers were self made vouchers and complete details of the labourers as also the vehicles used for transportation was not available. It was the submission that this was nothing but adhoc disallowance. It was the submission that the ld CIT(A) has admittedly dismissed the assessee’s appeal on account of non-representation. It was the submission that the addition involved in the appeal is meager and restoring the issue to the file of the ld CIT(A) would just prolong the issue. It was the prayer that the addition as made by the AO and confirmed by the ld CIT(A) is liable to be deleted in view of the decision of the Hon’ble Supreme Court in the case of Pr. CIT vs. R.G.Buildwell Engineers Ltd., (2018) 99 taxmann.com 284 (SC), wherein, the Hon’ble Supreme Court has upheld the action in deleting the adhoc disallowance by the Tribunal on the ground that there was omission to reject the books of account of the assessee and historical treatment of such expenses cannot be termed as unreasonable. Ld AR has also placed reliance on the decision of the Co- ordinate Bench of this Tribunal in the case of Bhikari Charan Meher vs DCIT in ITA No.111/CTK/2022 for A.Y. 2017-18 order dated 17.11.2022, wherein, the Co-ordinate Bench in para 6, under similar circumstances, has held as under:
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ITA No.215/CTK/2022 Assessment Year : 2011-12
“6. We have considered the rival submissions. The fact in the present case clearly shows that the disallowance out of land development expenses is clearly on adhoc basis. Admittedly, the books of account have not been rejected. Once this is so, adhoc disallowance is not permissible. If any disallowance is called for, specific identifiable disallowance could have been made. This has not been done in the present case. This being so, the addition made by the AO and confirmed by the ld CIT(A) stands deleted.” 4. It was the prayer that the addition as made by the AO and confirmed by the ld CIT(A) may be deleted.
In reply, ld Sr DR vehemently supported the order of the AO and ld CIT(A). It was the submission that the assessee has not produced all the details before the AO, which has compelled the AO to make the adhoc disallowance. It was the prayer that the addition as made by the AO and confirmed by the ld CIT(A) be upheld.
We have considered the rival submissions. A perusal of the facts in the present case shows that the disallowance as made by the AO at 5% out of labour charges and transportation expenses are clearly on adhoc basis. If the AO had found that there was discrepancy in the vouchers produced, it was very much open to the AO to identity the defect and disallows the same. This has not been done. Also the books of account of the assessee have not been rejected. The assessee is in the business of clearing & forwarding agent in respect of cement. This admittedly involves substantial labour charges and transportation charges. Considering these facts, we are of the view that the adhoc disallowance made by the AO is uncalled for.
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ITA No.215/CTK/2022 Assessment Year : 2011-12
Consequence, adhoc disallowance as made by the AO and confirmed by the ld CIT(A) stands deleted.
In the result, appeal filed by the assessee stands allowed.
Order dictated and pronounced in the open court on 28/02/2023.
Sd/- sd/- (Arun Khodpia) (George Mathan) ACCOUNTANT MEMBER JUDICIAL MEMBER Cuttack; Dated 28/02/2023 B.K.Parida, SPS (OS) Copy of the Order forwarded to : 1. The Appellant : Dharmendra Prasad More, Nil, Sahadev Khunta, PO: Sahadev Khunta, Dist: Balasore 2. The Respondent: Income Tax Officer, Ward- 1, Balasore 3. The CIT(A)-, NFAC, Delhi 4. Pr.CIT-, Cuttack 5. DR, ITAT, Cuttack 6. Guard file. //True Copy// By order
Sr.Pvt.secretary ITAT, Cuttack
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