JAYANTILAL M THADESHWAR,MUMBAI vs. INCOME TAX OFFICER, WARD 18(1)(5), MUMBAI

The present appeal has been preferred by the assessee against the order dated 17.11.2017 of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the CIT(A)] relevant to assessment year 2012-13.

The only issue raised by the assessee primarily in various grounds of appeal is against the violation of principle of natural justice due to non granting of reasonable opportunity to the assessee. Thus the assessee has challenged the order of Ld. CIT(A) on the ground that no sufficient opportunity was allowed before passing the order.

We observe from the order of lower authorities that the issue involved is the confirmation of disallowance by CIT(A) as made by the AO of Rs.63,383/- on account of disallowance of various expenses relating to personal use and Rs.7,440/- on account of discrepancies in AIR information. We are inclined to decide the issue on merits instead of sending the matter back to the AO for the petty nature of additions and the setting aside entailing lot of wastage of time and effort of the authorities below. After hearing the Ld. D.R. and perusing the order of lower authorities, we find that the AO has disallowed 10% of the expenses in respect of car depreciation, car expenses, telephone expenses aggregating to Rs.2,01,917/- thereby making a disallowance of Rs.20,192/- and likewise the expenses in respect of conveyance and office aggregating to Rs.4,31,907/- were disallowed to the extent of 10% for the reason that the same were not verifiable and were incurred mostly through cash and thereby further making a disallowance of Rs.43.191/-. In our opinion, the said disallowance is based upon the presumptions and conjectures of the AO. In our opinion the same is excessive and should be reduced to lump sum disallowance of Rs.20,000/- only.

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