SUMAN ORGANICS & FERTILIZERS (P) LTD,,DHULE vs. DEPUTY COMMISSIONER OF INCOME TAX,, DHULE

At the time of hearing, we find no representation on behalf of the assessee nor any application filed seeking adjournment. The assessee called absent and set ex-parte. Therefore, we proceed to hear ld. DR and pass order on merits in terms of material available on record.

Heard ld. DR and perused the materials available on record. The assessee is a Private Limited Company engaged in the business of manufacturing of fertilizers and allied products and conducts its business under the name and style as “Suman Organics & Fertilizers Private Limited.” The assessee filed return of income declaring a total income of Rs.68,66,470/- and under scrutiny, notices u/s. 143(2) and 142(1) of the Act were issued. The Assessing Officer assessed total income of the assessee at Rs.87,18,722/- by making disallowances on account of professional or technical services, addition to fixed assets, donation for charity purpose, employees contribution, repairs and maintenance of vehicles, excess depreciation and other expenses relating to office stationery and travelling. We note that the Assessing Officer proceeded for above said disallowances for failure of furnishing of details relating thereto by the assessee. Further, it is noted that the Assessing Officer sought supporting evidences in terms of claims made by assessee but however, in spite of having opportunity, the assessee could not produce the details as sought by the Assessing Officer.

As aggrieved by the order of Assessing Officer, the assessee preferred an appeal before the CIT(A). The CIT(A) issued notice dated 19-08-2016 fixing the date of hearing on 14-09-2016 by Speed Post and the same was returned with an endorsement of “assessee left”. We find on which date no appearance was made on behalf of the assessee but however written submissions were filed. Since 14-09-2016 the said appeal was adjourned from time to time for non-appearance of any authorized representative on behalf of the assessee or for change of authorized representatives by the assessee. Taking into consideration the negligent attitude of the assessee the CIT(A) held that the assessee is not interested in prosecuting the appeal and proceeded to adjudicate the appeal on merits as per material

Before us, the assessee raised three grounds of appeal challenging the action of CIT(A) in confirming the additions made on account of repairs and maintenance of vehicles, depreciation and expenses relating to office stationery and travelling in the facts and circumstances of the case.

The assessee filed this appeal on 24-05-2017. After scrutiny of appeal memo the Registry, ITAT, Pune Benches issued notice dated 12-07-2019 to assessee intimating fixation of date of hearing by Post. On such date, no representation whatsoever made before this Tribunal and the appeal was adjourned to 23-09-2019 by ordering issuance of fresh notice. Again Registry issued another notice dated 02-08-2019 intimating the fixation of date of hearing on 23-09-2019 and the record shows that no representation on behalf of the assessee and again the appeal was

The ground No. 1 raised involving the addition made on account of repairs and maintenance of vehicles.

During the course of assessment proceedings, the Assessing Officer compared immediate preceding A.Ys. income of truck lease rent with that of the current year of income wherein he found that the assessee has not shown any income during the year under consideration. The Assessing Officer asked the assessee to explain why there was no income during year under consideration on truck lease rent compared to immediate preceding assessment year of Rs.1,86,00,000/-. The assessee explained the trucks were used for lease purpose earlier and there was no lease in the year under consideration and the trucks were used for assessee itself. The Assessing Officer considering the same disallowed Rs.4,00,000/- only to the extent expenditure that have been incurred in cash under the head repairs and maintenance. Admittedly, there was no evidence filed in this regard before the CIT(A) as well as before this Tribunal. We find the Assessing Officer specifically requested the details of repairs and maintenance such as vouchers, work/services/goods relating to repairs and maintenance of vehicles. The assessee did not file any evidence whatsoever in support of ground No. 1 raised before us by way of paper book, therefore, in view of the same in the absence of any evidence

The ground No. 2 raised challenging the action of CIT(A) in confirming the addition made on account of depreciation on trucks in the facts and circumstances of the case.

The assessee claimed depreciation on trucks @ 30%. According to Assessing Officer the trucks were not used for a business purpose and held it is an excess claim and restricted deprecation to 20%. The CIT(A) considering the profit and loss accounts and found no lease rent were shown by the assessee on trucks and in the absence of evidence showing that the said trucks were used for business confirmed the order of Assessing Officer in restricting the depreciation @ 20% as against claim of @ 30% by the assessee. We find no evidence before the two authorities below including this Tribunal. Therefore, we find no infirmity in the order of CIT(A) in confirming the order of Assessing Officer. Thus, ground No. 2 raised by the assessee fails and it is dismissed.

Ground No. 3 involving the addition made on account of expenses relating to office printing and stationery and travelling in the facts and circumstances of the case.

The assessee claimed expenses relating to above said three heads to an extent of Rs.6,57,491/-. The Assessing Officer disallowed to the extent which have been incurred in cash of Rs.1,31,498/-. As discussed above, the assessee is engaged in the business of manufacturing of fertilizers and allied products and declared income of Rs.68,66,470/- in the return of

In the result, the appeal of assessee is partly allowed.