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Income Tax Appellate Tribunal, HYDERABAD BENCHES “B”: HYDERABAD
Before: SHRI V. DURGA RAO & SHRI D.S. SUNDER SINGH
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”: HYDERABAD
BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER
I.T.A. No. 44/HYD/2018 Assessment Year: 2013-14 M/s. Kamini Mettaliks Deputy Commissioner of Private Limited, Vs Income Tax, Hatnoora Mandal, Circle-8(1), Medak Hyderabad [PAN: AACCK9324N] (Appellant) (Respondent) For Assessee : Shri Sunil Kumar Jain, AR For Revenue : Smt. M.Narmada, DR Date of Hearing : 16-10-2019 Date of Pronouncement : 18-10-2019 O R D E R PER D.S. SUNDER SINGH, A.M. : This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax(Appeals)-2, Hyderabad, dated 11-10-2017.
The only issue in this appeal is the disallowance of 10% miscellaneous expenses amounting to Rs. Rs.5,04,644/- on estimation basis, out of the total expenditure debited to Profit & Loss account of Rs.50,46,442/-.
During the course of assessment proceedings, the AO found that the assessee has debited the sum of Rs.50,46,442/- under the head ‘Miscellaneous Expenses’
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relating to staff welfare, vehicle repairs & maintenance, Director’s travelling, office maintenance and travelling expenses etc. The AO called for the complete details such as bills and vouchers etc., to support the claims made by the assessee. The assessee produced some bills but not furnished the complete information. From the bills produced, the AO found that the same were self-made vouchers and some of the expenses were personal in nature. Therefore, after discussing with the AR of the assessee, the AO made the disallowance of 10% of expenses amounting to Rs.5,04,644/- on estimation basis. The assessee’s AR also agreed for the disallowance expenditure.
Against the said assessment order, the assessee went on appeal before the CIT(A) and the CIT(A) did not find merit in filing the appeal before him, since the assessee had agreed for the disallowance, made by the AO. Accordingly, the Ld.CIT(A) dismissed the appeal of assessee.
Against the said order of Ld.CIT(A), the assessee is in appeal before the Tribunal.
During the appeal hearing, Ld.AR argued that the AO made disallowance of expenditure on adhoc basis without considering the complete details and requested to restrict the disallowance to 5% of expenditure as held in the earlier years.
On the other hand, Ld.DR vehemently opposed for the reduction in disallowance and brought to our notice that
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Ld.AR had agreed for the addition. Hence, she argued that there is no case for any relief to the assessee.
We have heard both the parties and gone through the material placed on record and the assessment record. In the instant case, the assessee has not produced the complete details and vouchers. The assessee produced some self-made vouchers from which the AO found that the personal expenses were also debited to the P&L account. Having failed to furnish the complete details and the relevant evidences, the Ld.AR agreed for the addition. In the facts and circumstances and in all fairness, assessee ought not to have agitated the same in appeal. Instead, the assessee ought to have produced the complete details and proved expenses. In the instant case, we observe from the order of the Ld.AO that the assessee failed to furnish the complete details and prove the genuineness of expenditure, hence agreed for disallowance of expenditure on estimation basis. This being the case, we find no merit in the appeal of assessee. Accordingly, we dismiss the Grounds of appeal raised by assessee.
In the result, the appeal of assessee is dismissed.
Order pronounced in the open court on 18th October, 2019
Sd/- Sd/- (V. DURGA RAO) (D.S. SUNDER SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated: 18-10-2019 TNMM
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Copy to :
M/s.Kamini Metalliks Private Limited, Sy.No.372, Chandapur Village, Hatnoora Mandal, Medak.
The Deputy Commissioner of Income Tax, Circle-8(1), Hyderabad.
CIT(Appeals)-2, Hyderabad.
The Pr.CIT-2, Hyderabad.
D.R. ITAT, Hyderabad.
Guard File.