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Facts
The assessee filed an appeal against the CIT(A)'s order which confirmed the AO's disallowance of Rs. 3,43,868/- for expenses claimed against business income due to alleged non-submission of documentary evidence. The CIT(A) dismissed the appeal on similar grounds.
Held
The Tribunal noted the assessee's submission that they were not given a proper opportunity by the CIT(A) to demonstrate the genuineness of expenses. The Tribunal found it appropriate to restore the matter to the CIT(A) for a fresh decision.
Key Issues
Whether the CIT(A) erred by not providing adequate opportunity to the assessee to prove the genuineness of claimed expenses.
Sections Cited
250, 143(3)
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Before: MS. KAVITHA RAJAGOPAL & SMT.RENU JAUHRI
This appeal is filed by the assessee against the order of the ADDL/JCIT (A) Faridabad [hereinafter referred to as “CIT(A)”] dated 30.03.2025 passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for the Assessment Year [A.Y.] 2014-15.
The grounds of appeal are as follows:
1. THE ORDER IS BAD IN LAW, ILLEGAL AND WITHOUT JURISDICTION 1.1. In the facts and the circumstances of the case, and in law the appellate order framed by the Additional Joint Commissioner of Income tax (Appeals), Faridabad [Ld. CIT (A)'] is bad in law, illegal and without jurisdiction, as the same is framed in breach of the statutory provisions of the Income tax Act. 1961 [the Act'] and the scheme and as otherwise also is not in accordance with the law 1.2. Without prejudice to the generality of the above, the appellate order so passed is bad in law, illegal and void as the same is arbitrary and perverse 2. VIOLATION OF PRINCIPLES OF NATURAL JUSTICE
2.1. In the facts and the circumstances of the case, and in law, the appellate order so framed in bad in law and illegal, as the same is framed in breach of the principles of Natural Justice.
2.2 Without prejudice to the generality of the above ground. in the facts and the circumstances of the case, the Ld. CIT (A) erred in- (i) not granting proper. sufficient, reasonable and fair opportunity of being heard to the Appellant while passing the appellate order: (ii) not granting an opportunity of personal hearing.
WITHOUT PREJUDICE TO THE ABOVE 3. DISALLOWANCE OF RS. 3,43,868/- AS ALLEGED EXPENSES NOT RELATED TO BUSINESS ACTIVITIES 3.1. The Ld. CIT (A) erred in confirming the action of the A.O. in making disallowance of the amount of Rs. 3,43,868/-, being claim of various expenses incurred wholly and exclusively for the purposes of the business of the Appellant, on the ground of alleged non-submission of documentary evidences in support of this claim. 3.2 While doing so, the CIT (A) erred in: (i) Basing her action on surmises, suspicion and conjecture: (ii) Taking into account irrelevant and extraneous considerations, and (iii) Ignoring relevant material and considerations as submitted by the Appellant. (iv) Not treating the amount paid towards service tax and securities transaction tax as a part of the cost of acquisition of shares, if these expenses were not allowable as business expenditure. 3.3 It is submitted that in the facts and the circumstances of the case. and in law. no such disallowance was called for 3.4 Without prejudice to the above, in the alternative, assuming but not admitting that some disallowance was called for, the Ld. CIT (A) failed to appreciate that the computation of the disallowance made by the A.O. was arbitrary, excessive and not in accordance with the law.
4. LIBERTY The Appellant craves leave to add, alter, delete or modify all or any the above ground at the time of hearing.” 2. Brief facts of the case are that the assessee filed his return for A.Y. 2014- 15 on 09.09.2015 declaring income of Rs. 40,44,280/-. The case was selected for scrutiny and the assessment was completed u/s. 143(3) on 23.12.2016 determining total income at Rs. 45,74,530/- after making disallowance of Rs. 3,43,868/- out of expenses claimed against business income.
Aggrieved, the assessee preferred an appeal before ld. CIT(A). Vide order dated 03.03.2025, ld. CIT(A) dismissed the appeal of the assessee on the ground that no supporting documentary evidences were furnished besides a reply containing general submissions. Further aggrieved, the assessee has filed an appeal before the Tribunal.
Before us, ld. AR has submitted that the assessee was not given proper opportunity by ld. CIT(A) to demonstrate the genuineness of expenses claimed. He has therefore, requested that the matter be remanded to ld. CIT(A) for fresh adjudication on merits after giving due opportunity to the assessee. Ld. DR has also not opposed this proposition.
After hearing the rival submissions, we deem it appropriate to restore the matter to ld. CIT(A) for a fresh decision on merits after providing adequate opportunity to the assessee.
In the result, assessee’s appeal is allowed for statistical purposes.
Order Pronounced in Open Court on 17.11.2025