VENKATESH LOGISTICS PVT. LTD., ,KOLKATA vs. JCIT, RANGE - 5, KOLKATA , KOLKATA

I notice at the outset that the instant appeal suffers from 55 days delay in filing. The assessee has filed its condonation petition citing communication gaps and other procedural lapses. Learned Departmental Representative is very fair in not disputing correctness thereof. I therefore condone the impugned delay of 55 days in filing this appeal. Main case is not taken up for adjudication on merits. A.Y 2010-11 Venkatesh Logistics Pvt Ltd. Vs. JCIT, Rng-5, Kol. Page 2 3. The assessee’s first substantive ground challenges both the lower authorities’ action disallowing its claim of ₹18,11,509/- pertaining to cases and fines paid to traffic authority for having transported the goods in question beyond the specified dimensional vehicles. They hold the impugned claim to be in the nature of penalty payment not allowable u/s 37 of the Act. This tribunal’s co-ordinate bench’s decision (2011) 46 SOT 258 (Mum) DCIT vs. Bharat C. Gandhi holds similar cases and fines as necessary business expenditure not in the nature of penalty. I therefore delete the impugned disallowance / addition of ₹18,11,509/-. This first substantive ground is accepted.

The assessee’s second substantive ground seeks to delete vehicle trip expense disallowance of ₹81,20,300/- @ 20% of ₹4,06,01,502/- on ad hoc basis in both the lower proceedings. The Assessing Officer as well as CIT(A) hold that the relevant bills are in the nature of self-made vouchers only. Both parties reiterate their respective stands against and in support of the impugned disallowance during the course of hearing. I find that neither the lower authorities have drawn any comparison of impugned expenditure in the nature of vehicle trip expense vis-à-vis the corresponding figures in preceding and succeeding assessment years nor the assessee itself has proved its case to the hilt. There is further no reason for invoking this disallowance @ 20%. I therefore deem it appropriate in peculiar facts and circumstances that a lump sum disallowance of ₹20 lac out of ₹81,20,300/- in issue would meet ends of justice with a rider that the same shall not take as a precedent in any other assessment year. The assessee gets part relief to the extent of ₹61,20,300/- accordingly.

Learned counsel representing assessee does not press for next addition of ₹1.50 lac with respect to ITS bills This ground is therefore decline as not pressed.