M/S. SCAN HOLDINGS PVT. LTD.,NEW DELHI vs. ACIT, NEW DELHI
In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal found that the assessee had submitted relevant bills and vouchers before the Assessing Officer, which were not duly considered. Therefore, the disallowance of expenses was deemed unreasonable.
What were the facts?
The assessee claimed various expenses, including car running, courier, and stationery, which were disallowed by the Assessing Officer for lack of bills/vouchers. The CIT(A) sustained these disallowances. The assessee appealed to the ITAT.
What were the issues?
Whether the disallowance of expenses made by the Assessing Officer for lack of substantiation was justified when the assessee had provided bills/vouchers.
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH ‘G’, NEW DELHI
Before: Sh. Kuldip SinghDr. B. R. R. Kumar
Heard together (2 matters)
Read from the judgment's own cause title. This page is filed under one of them.
Per Dr. B. R. R. Kumar, Accountant Member:
The present appeals have been filed by the assessee against the orders of ld. CIT (A)-17, New Delhi dated 20.01.2017.
Since, the issues involved in both the appeals are common, they were heard together.
In 2007-08, following grounds have been raised by the assessee: “1. On the facts & in the circumstances of the case and in law, the CIT(A) erred in sustaining estimated addition of Rs.1,00,000 on account of cash expenses.”
4. The lone ground in the appeal relates to the contention of the assessee against ad-hoc disallowance made by the Assessing Officer. The Assessing Officer made disallowance of Rs.1,00,000/- out of the car & 1464/Del/2017 2 Scan Holdings Pvt. Ltd. running expenses, courier and postage expenses, miscellaneous expenses, printing and stationery, staff welfare and conveyance expenses on the ground that no bills/vouchers were produced to substantiate the claim of expenses and the expenses were claimed to have been incurred in cash and since, the Assessing Officer found the claim of the aassessee as non- verifiable, therefore, he disallowed Rs.1,00,000/- out of the same.
During the arguments before us, the ld. AR referred to the entire bills submitted before the authorities below and argued that the bills have not been duly considered by the revenue authorities. The ld. DR relied on the orders of the revenue.
Heard the arguments of both the parties and perused the material available on record.
On perusal of the facts and paper book filed before us, we find that the assessee has discharged the onus and allowability of the expenses by furnishing the relevant bills/vouchers before the Assessing Officer, which they failed to give due consideration. Under these circumstances, we hold that the authorities are not reasonable to disallow Rs.1,00,000/- out of the car running, courier & postage, printing & stationery, conveyance and staff welfare expenses. Therefore, appeal of the assessee on this ground is allowed.
In for the assessment year 2012-13, following grounds have been raised by the assessee:
1. On the facts & in the circumstances of the case and in law, the CIT(A) erred in sustaining estimated addition of Rs.2,00,000 on account of cash expenses.”
The lone ground relate to contention of the aassessee against ad- hoc disallowance of Rs.2,00,000/- made by the Assessing Officer, out of car running, staff welfare and conveyance expenses. The disallowance was & 1464/Del/2017 3 Scan Holdings Pvt. Ltd. made on the ground that no bills/vouchers of boarding and lodging charges were furnished.
During the arguments before us, the ld. AR referred to the entire bills submitted before the authorities below and argued that the bills have not been duly considered by the revenue authorities. The ld. DR relied on the orders of the revenue.
Heard the arguments of both the parties and perused the material available on record.
On perusal of the facts and paper book filed before us, we find that the assessee has discharged the onus and allowability of the expenses by furnishing the relevant bills/vouchers before the Assessing Officer, which they failed to give due consideration. Under these circumstances, we hold that the authorities are not reasonable to disallow Rs.2,00,000/- out of the car running, courier & postage, printing & stationery, conveyance and staff welfare expenses. Therefore, appeal of the assessee on this ground is allowed.
In the result, the appeals of the assessee are allowed. Order Pronounced in the Open Court on 07/02/2020.
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