R.N TRAVELS P. LTD,MUMBAI vs. ITO 8(1)(1), MUMBAI

O R D E R Per Shamim Yahya, A. M.: These are appeals by the assessee against the order of ld. Commissioner of Income Tax (Appeals) pertaining to the assessment years 2010-11 and 2011-12 respectively.

1. The learned CIT(A) erred in facts in confirming the addition of Rs. 17,14,960/- made by the learned Assessing Officer in respect of payments made to the Credit Card Company towards use of Corporate Petro Card.

2. The learned CIT(A) failed to appreciate the fact that the business operations of the appellant company were closed on 31.03.2009 and the said petro card had been used during the year under consideration by the sister concern of the appellant and payments to the credit card company were made directly by the sister concern.

3. The learned CIT(A) erred in facts in confirming the addition made by the learned Assessing Officer only on the basis of a transaction reported in Individual Transaction Statement without appreciating the fact that the appellant had neither made any payment nor claimed any expenditure in respect of credit card expenses and hence there is no question of substantiating the source of the impugned expenditure.

4. The learned CIT(A) erred in confirming the addition made by the learned Assessing Officer without giving due weightage to the fact that the payments made by the sister concern of the appellant were duly reflected in the bank statements as well as in books of accounts of the sister concern which were furnished to the learned Assessing Officer.

For assessment year 2010-11 – Rs. 17,14,960/- For assessment year 2011-12 – Rs.8,21,160/-

Addition on the basis of Form 26AS: 5. The learned CIT(A) erred in confirming the addition made by the learned Assessing Officer in respect of amount of Rs. 12,372/- received by the appellant during the year under consideration and reflected in Form 26AS without appreciating the fact that the said amount is received in respect of debt which was duly reflected in the books of the appellant as income in earlier years.

6. Without prejudice to what is stated in Ground no. 5 and strictly in the alternative, the appellant claims that the learned CIT(A) erred in not allowing credit for tax deducted at source Rs. 135/- on recovery of old debt which was also reflected in Form 26AS.

are being referred and considered hereunder:

Brief facts of the case is that notice u/s 148 was issued as the income to the extent of Rs.17,14,964/- has escaped assessment. The Assessing Officer writes that no income tax return has been filed by the assessee on the premise that it has shut down its business operations and the bank statement could not be obtained as banks were charging heavy operating account charges which the assessee could not bear. The assessee did not file return in compliance of notice u/s 148 also. It was noted that the assessee has spent Rs.17,02,592/- on credit card bills of American Express Banking Corporation and has also receipt of Rs.12,372/- as per ITS/26AS statement. The assessee was given copy of these statements. During the assessment proceedings, the assessee submitted that Rs.12,372/- actually pertains to income of earlier year though reported in form N. 26AS of the current year as the same was received in this year. As regards credit card payments, it was submitted that its petro card was used by R.N Logistics Pvt. Ltd and all these payments were made by M/s R.N. Logistics Pvt. Ltd and not by the assessee. It was submitted that for the purpose of convenience, the petro card was used by other company. Since no explanation was given in this aspect, the Assessing Officer added the amount.

4 & 3083/Mum/2017 M/s. R. N. Travels Pvt. Ltd. vs. ITO From the facts of the case it is clear that the credit card belongs to the assessee and the expenses were paid through this card. The assessee has simply submitted that the payments are made by M/S R N Logistics Pvt. Ltd for the sake of convenience. It is not understood as to how the card can be handed over to some other company for its use. There also does not appear to be any such written arrangement between the two companies. The Assessing Officer has noted in the assessment order that the appellant was given sufficient opportunity to furnish details of the expenses which were not filed. It appears that no evidence in support of the claim is furnished before Assessing Officer despite various opportunities. No such evidence is filed even during appellate proceeding. In absence of requisite details, return of income etc, it is to be assumed under the facts of the case that the expenses actually pertain to the assessee company as it is through its card that the payments are made. Since the source of such payments are not clearly established therefore, the addition made by the Assessing Officer is sustained.