SAKSHI ENTERPRISE,AGRA vs. INCOME TAX OFFICER, AGRA

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA (SMC) BENCH, AGRA BEFORE: SHRI M BALAGANESH, ACCOUNTANT MEMBER AND SHRI SUNIL KUMAR SINGH, JUDICIAL MEMBER ITA No. 78/Agr/2026 Assessment Year: 2016-17 Sakshi Enterprise, 15-B, Block- Vs. ITO, Ward 2(1)(4),Agra-282002 77, Sanjay Place, Agra-282002 PAN : AARFS4580J (Appellant) (Respondent) Assessee by Shri Sushil Kumar Maheshwari, CA Department by Shri Shailendra Srivastava, Sr (DR) Date of hearing 19.03.2026 Date of pronouncement 19.05.2026 ORDER

PER: SUNIL KUMAR SINGH, JM. This appeal has been preferred against the impugned order dated 30.11.2025 passed in Appeal No CIT(Appeal) 2, Agra/10355/2018-19 by the ld Commissioner of Income Tax, Faridabad [hereinafter referred to as the “CIT(A)] u/s. 250 of the Income Tax Act, 1961 (hereinafter referred to as the ‘Act), for the A.Y. 2016-17, wherein ld CIT(A) has dismissed assessee’s appeal, confirming the assessment order. 2. Brief facts state that the assessee has e-filed its return of income on 17.02.2017, declaring net taxable income of Rs. 4,80,670/- in the status of partnership firm. Subsequently, the case was selected for scrutiny under CASS to examine the assessee’s claim of deduction on account of business expenses of Rs. 13,20,000/-. Statutory notices u/s. 143(2) and

ITA No.78/Agr/2026 142(1) of the Act were issued and served upon the assessee. Assessee filed coy of computation of income, copy of bank statement and copy of form 26AS vide reply dated 28.06.2018. Assessee was further asked to submit reply in respect of evidence regarding the said business expense. Assessee filed pointwise reply dated 24.11.2018 through e-filing portal, wherein it was stated that the assessee is a clearing and forwarding agent of Bridgestone India Pvt Ltd. and is earning commission there from after incurring certain expenses as per terms of agreement made with principal. The details of commission earned as well as confirmed copy of account in respect of unsecured loan was also filed. However, the details of expenses under the head salary and wages amounting to Rs. 13,20,000/- supported by bills and vouchers were not filed. The assessing officer, was thus, unable to verify the same and a sum of Rs. 2,64,058/- being adhoc 25% of the total expenses was disallowed and added to the total income of the assessee. 3. Aggrieved, assessee preferred an appeal before ld CIT(A), who dismissed assessee’s appeal, sustaining the assessment order dated 31.11.2025, observing that the documentary evidence showing a direct link between expenditure and the business alongwith bills and vouchers were not furnished.

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ITA No.78/Agr/2026 4. Appellant assessee has preferred this second appeal on the ground that ld CIT(A) has erred in confirming the adhoc addition of Rs. 2,64,058/- being 25% of the salary paid by the appellant. 5. Perused the records and heard ld representative for the appellant assessee and ld Sr DR for the respondent revenue. 6. The main point for determination under appeal is as to whether ld CIT(A) has erred in confirming the adhoc additions of Rs. 2,64,058/- being 25% of total expenses under head salary and wages amounting to Rs. 13,20,000/-? 7. Ld representative for the assessee has submitted that assessee has earned with the business income, against which the expenses of Rs. 13,20,000/- were incurred. Revenue authorities have wrongly disallowed 25% of the total expenses despite the fact that the assessee’s books were not rejected. Ld AR prayed to allow the appeal. 8. Ld Sr DR has submitted that the no bills/vouchers were submitted by the assessee in respect of the said business expenses before the revenue authorities. Ld Sr DR thus, supports the impugned order. 9. We notice that assessee, no doubt, submitted before the assessing officer, copy of the computation of income, the copy of bank statement, copy of form 26AS, details of commission earned, the confirmations in respect of unsecured loans etc, however, the assessee could not support his claim by the relevant bills and vouchers in respect of the claim of 3 | P a g e

ITA No.78/Agr/2026 business expenses of Rs. 13,20,000/-. That caused the revenue authorities to make adhoc addition at the rate of 25% of the total expenses for want of verification. In such circumstances and in the interest of justice, we deem it just an appropriate to afford an opportunity of hearing to the assessee to file the required details alongwith bills and vouchers to enable the assessing officer to verify the same. The matter is restored to the file of the assessing officer, who shall pass order a fresh, after affording an opportunity of hearing to the assessee and after considering assessee’s submissions. We direct the assessee to file the details related to the said expenses alongwith the specific bills and vouchers before the assessing officer. If the assessing officer, find the same as genuine after verification, the credit of such expenses shall be given to the assessee. The aforesaid point is determined accordingly. This appeal is liable to be allowed for statistical purposes. 10. In the result, the appeal is allowed for statistical purposes. Impugned order dated 30.11.2025 is set aside. Order pronounced on – 19.05.2026

Sd/- Sd/- (M BALAGANESH) (SUNIL KUMAR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated: 19.05.2026

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ITA No.78/Agr/2026

*Aamir Siddiqui, PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, Agra

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