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Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK
Before: S/SHRI N.S SAINI & PAVAN KUMAR GADALE
IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK
BEFORE S/SHRI N.S SAINI, ACCOUNTANT MEMBER AND PAVAN KUMAR GADALE, JUDICIAL MEMBER
ITA No.375/CTK/2017 Assessment Year : 2013-2014
Binod Kumar Agarwalla,Plot Vs. DCIT, Circle -4(1), No.87, Kharavel Nagar, Bhubaneswar. Bhubaneswar. PAN/GIR No.AAOPA 1368 L (Appellant) .. ( Respondent)
Assessee by : Shri S.K.Agarwalla, AR Revenue by : Shri Suvendu Datta, DR
Date of Hearing : 08/08/ 2018 Date of Pronouncement : 9 /08/ 2018
O R D E R Per N.S.Saini, AM This is an appeal filed by the assessee against the order of the
CIT(A)-2, Bhubaneswar dated 28.6.2017 for the assessment year 2013-
2014.
The assessee has raised the following grounds of appeal:
“That the AO erred in facts in circumstances in disallowing the 20% of the expenses debited under different heads in ad hoc manner amounting to Rs.4,63,010/- and the CIT(A) is wrong in confirming the disallowance to the extent of 10% of the expenses in adhoc manner amounting to Rs.2,31,505/- which are liable to be deleted.”
The brief facts of the case are that the Assessing Officer has
disallowed 15% of repair and maintenance, shop expenses, telephone
expenses, travelling & conveyance expenses totalling to Rs.23,15,050/-
2 ITA No .375/ CTK/ 2017 Asse ssment Year : 20 13- 201 4
on the ground that the assessee failed to furnish any documentary
evidence in support of claim of expenses.
On appeal, the CIT(A) restricted the disallowance to 10% for the
reason that the very nature of these expenses is such that third party bills
and vouchers are difficult to maintain and sustained the addition to
Rs.2,31,505/-.
Being aggrieved by the said order of the CIT(A), the assessee is in
appeal before us.
Before us, ld A.R. of the assessee submitted that the assessee has
incurred the expenses on normal course of business of the assessee. Ld
A.R. submitted that in the preceding assessment year 2012-13 and in the
succeeding assessment years 2014-15, in an assessment u/s.143(3) of
the Act, the Assessing Officer has not disallowed any such claim of
expenses under the above heads. He submitted that there is no rejection
of books of account. Therefore, he prayed for allowing the appeal of the
assessee.
Ld D.R. supported the order of the CIT(A).
We have heard the rival submissions, perused the orders of lower
authorities and materials available on record. In the instant case, we find
that as the assessee failed to furnish any documentary evidences in
support of the expenses incurred under the head “repair and
maintenance, shop expenses, telephone expenses, travelling &
3 ITA No .375/ CTK/ 2017 Asse ssment Year : 20 13- 201 4
conveyance expenses totalling to Rs.23,15,050/-, the Assessing Officer
disallowed 15% of the expenses claimed of the assessee.
On appeal, the CIT(A) restricted the disallowance to 10% as against
15% made by the Assessing Officer.
We find that the CIT(A) has observed that the very nature of
expenses is such that third party bills and vouchers are difficult to
maintain It has also been argued and submitted by ld A.R. that the
genuineness of the expenditure is not doubted and it is not the case of
the revenue that the assessee has claimed bogus expenditure to reduce
its income. On perusal of assessment order para 2 page 1, we find that
the assessee appeared from time to time and filed details. The Assessing
Officer has not mentioned which details have been furnished by the
assessee. Ld A.R. submitted that in the preceding assessment year 2012-
13 and in the succeeding assessment years 2014-15, in an assessment
u/s.143(3) of the Act, the Assessing Officer has not disallowed any such
claim of expenses by the assessee under the above heads. Considering
the totality of the facts and circumstances of the case, we are of the
considered opinion that it would meet the ends of justice, if the expense
is estimated at 5% of the expenses claimed by the assessee. We order
accordingly. This ground is partly allowed.
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In the result, appeal of the assessee is partly allowed.
Order pronounced on 9 /08/2018.
Sd/- sd/- (Pavan Kumar Gadale) (N.S Saini) JUDICIALMEMBER ACCOUNTANT MEMBER Cuttack; Dated 9/08/2018 B.K.Parida, SPS
Copy of the Order forwarded to : 1. The Appellant : Binod Kumar Agarwalla,Plot No.87, Kharavel Nagar, Bhubaneswar. 2. DCIT, Circle -4(1), The Respondent. Bhubaneswar 3. The CIT(A)-2, Bhubaneswar 4. Pr.CIT-2, Bhubaneswar 5. DR, ITAT, Cuttack BY ORDER, 6. Guard file. //True Copy// SR.PRIVATE SECRETARY ITAT, Cuttack