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Income Tax Appellate Tribunal, “A” BENCH, MUMBAI
Before: SHRI R. C. SHARMA, AM & SHRI AMARJIT SINGH, JM
Assessee by: Shri Arun Mehta Department by: Shri Chaitanya Anjaria (DR) Date of Hearing: 28.08.2018 Date of Pronouncement: 19.09.2018 O R D E R
PER AMARJIT SINGH, JM:
The present appeal has been filed by the assessee against the order dated 07.12.2016 passed by the Commissioner of Income Tax (Appeals)-5, Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the assessment year 2012-13.
The assessee has raised the following grounds: - “1Ground No. 1 r Addition u/s. 68: 1.1 On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in deleting the addition made by the Assessing Officer u/s. 68 on account of cheque No.0787818 dated 23/02/2012 for Rs.4,12,500/- received
ITA. No.2129/M/2017 A.Y.2012-13 from LIC towards maturity amount of the LIG policy No 891203224 although the relevant proof in the form of copy of the LIC Policy and the Status Report of the said Policy clearly stating the cheque number, date and amount, also reflecting the same in the copy of the bank passbook of the Appellant were provided to the Learned Assessing Officer. (Copies Attached, Annexures "A" and "B" respectively). On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in not deleting the said addition Ground No. 2 - Addition of Miscellaneous Expenses @_50%: 2.1 On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in not granting relief in respect of Miscellaneous expenses although he discussed about the same in the order along with the similar other ad-hoc addition made by the Assessing Officer and granted relief in respect of other expenses.”
The brief facts of the case are that the assessee filed his return of income on 27.09.2012 declaring total income to the tune of Rs.2,56,16,859/- for the A.Y 2012-13. The return was processed u/s 143(1) of the Act. Thereafter, the case was selected for scrutiny. Subsequently, notice u/s 143(2)& 142(1) of the Act were issued and served upon the assessee. The assessee is an Advocate by profession and declared his income under the head income from profession, capital gain and income from other sources. The income of the assessee was assessed to the tune of Rs.2,72,33,270/-. Thereafter, the assessee has filed an appeal before the CIT(A) who dismissed the appeal of the assessee but assessee was not satisfied on the issues raised above, therefore, the assessee has filed the present appeal before us.
ISSUE NO. 1:-
ITA. No.2129/M/2017 A.Y.2012-13
Under this issue the assessee has challenged the confirmation of the disallowance of Rs.4,12,500/- u/s 68 of the Act. The assessee received the LIC maturity amount of Rs.4,12,500/-. The AO rejected the claim of the assessee on account of non-furnishing the cogent document. The CIT(A) has rejected the claim of the assessee on account of this fact that the AO has rectified the same. Nothing came into notice that the claim of the assessee has been rectified by the AO. The Ld. Representative of the assessee has argued that the necessary documents in connection with the receipt of amount of LIC maturity were furnished which were not considered properly, therefore, the finding of the CIT(A) is liable to be set aside in accordance with law. On appraisal of the CIT(A) order, we noticed that the CIT(A) has the passed the one line order in which it has been mentioned that the Assessing Officer has rectified the order whereas there is no rectification on the file. The assessee has received the amount through cheque bearing no.0787818 dated 23.02.2012 of Rs.4,12,500/- received from the LIC towards maturity of the LIC policy no.891203224 and also ready to furnish the status report etc. The CIT(A) has not decided the issue on the basis of any cogent and convincing evidence of record, therefore, the finding of the CIT(A) is hereby ordered to be set aside and the issue is hereby order to be restored before the AO to examine the issue afresh in the light of the evidence adduced on record. Needless to say that the Assessing Officer would provide an opportunity of being heard to the assessee
ITA. No.2129/M/2017 A.Y.2012-13 before passing the order in accordance with law. Accordingly, this issue is decided in favour of the assessee against the revenue. ISSUE NOS. 2 :- 5. Issue no. 2 is in connection with the confirmation of the miscellaneous expenses to the extent of 50%. The miscellaneous expenses are in connection with the dining, refreshments and travelling etc. The payment was made through credit card. The AO declined the claim of the assessee to the extent of 50% on account of expenses of personal element of the assessee. However, the assessee failed to prove the nexus of the expenses with the business. The CIT(A) has confirmed the addition of disallowance to the extent of 50%. The expenses have duly been reflected in the ledger account. Admittedly, the payment was in connection with the dining, refreshment, travelling etc. The assessee is an advocate by profession. He has to arrange the meeting with the clients and to expand the amount in connection with his profession but it is incumbent upon the assessee to prove his claim. Declining, the claim of the assessee to the extent of 50% is in the higher side. Taking into account, all the facts and circumstances, we are of the view that it would be in the interest of justice if the claim of the assessee be restricted to the extent of 10% of the expenses credited by him. Accordingly, we allowed the claim of the assessee. Accordingly, this issue is being decided in favour of the assessee against the revenue.
ITA. No.2129/M/2017 A.Y.2012-13