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Income Tax Appellate Tribunal, KOLKATA BENCH “B” KOLKATA
Before: Shri P.M.Jagtap & Shri S.S.Godara
आदेश /O R D E R PER S.S.Godara, Judicial Member:- This assessee’s appeal for assessment year 2010-11 arises from the Commissioner of Income Tax (Appeals)-13, Kolkata’s order dated 23.02.2016 in case no. 378/CIT(A)-13/Kol/Cir 45/14-15, upholding Assessing Officer’s action adding difference in incentives received from Samsung India Electronics Pvt. Ltd. of ₹18,43,189/- as well as making other disallowance / addition of ₹ 4 lacs qua expenditure claim; in proceedings under section 143(3) of the Income Tax Act, 1961; in short ‘the Act’. Heard both the parties. Case file perused.
Babita Bajaj Vs. ACI, Cir-40 Kol. Page 2 2. The assessee’s former substantive ground challenges both the lower authorities action making addition of ₹18,43,189/- on account of incentive received from Samsung India Electronics Pvt. Ltd. We notice that the CIT(A)’s detailed discussion on the instant issue reads as follows:- “Ground number 03 relates to the issue of making addition of Rs18431189/- on the ground that Ms Samsung India issued credit limit of Rs.3342813/- but appellant as shown only Rs.1499624/- therefore, the remaining difference of Rs.1843189/- was not shown. Subsequently the AO received information from Ms Samsung India Ltd., wherein opening balance was shown at Rs.107980/- and closing balance was shown at Rs.615770/-, detailed of credit note was Rs.4677348/- towards material return and Rs.2912559 was towards rebate credit note. The appellant submitted that difference of incentive would be Rs.1412935/- at a balance on Rs.1843189/-. Perusing the above detail AO observed that there was no difference of opening & closing as per account of the appellant and as per the company account. Therefore did not accept the difference worked out at Rs.1412935/- by the appellant and added entire difference of account of incentive of Rs.1843189/-. The appellant during the course of appellate proceeding has not submitted any detail working to arrive at his figure. The appellant has relied over the mathematical working mentioned in the assessment order whereas AO has relied over the confirmation filed by the company M/s Samsung and copy of account of the appellant and arrived at difference of Rs.1843189/-. During the course of appellate proceeding the A/R of appellant was confronted with the credit note details which were submitted by the appellant A//R dated 11-01-2013 which is totaling at Rs.3342918/- and it was duly signed by the AR Sri Pankaj Baidh. No explanation could be offered on this account. Therefore, while computing the disallowance the AO has rightly taken the detail figure of credit note at Rs.3342813/- which is supported by opening & closing balance and other details of M/s Samsung. The appellant has failed to support its claim of Rs.14,12,935/- only and his same was without evidence. Hence, the disallowance of Rs.1843189/- is hereby upheld and the ground of the appeal is dismissed.”
Learned counsel representing assessee submits that the instant issue is that of mere reconciliation of incentive figures than a substantive one. He therefore urges to remit the same back to the for carrying out necessary verification. Learned Departmental Representative highlights that assessee’s counsel had himself accepted the correct figure to be ₹33,42,813/- with regard to the said company’s credit note during the course of lower appellate proceedings. We notice in this backdrop that the M/s Samsung has made it clear as per the opening and closing balance followed by the corresponding details that the correct amount comes up to ₹33.42 lakhs only. The assessee’s counsel had admittedly accepted the said very figure before the CIT(A). We therefore affirm the CIT(A)’s above extracted findings upholding the Assessing Babita Bajaj Vs. ACI, Cir-40 Kol. Page 3 Officer’s action making the impugned addition of ₹18,43,189/-. This former substantive ground raised
in the instant appeal is rejected accordingly.
4. This leaves us with of assessee’s latter substantive ground challenging correctness of both the lower authorities’ action making above disallowance of expenditure amounting to ₹4 lakh on ad hoc basis. The CIT(A)’s discussion qua the instant issue reads as under:- “Next ground of appeal relates to the addition of Rs.400000/- on account of non submission of detail. The AO found that against the claim of Rs.2875604/- evidences of only Rs.89193/- were submitted remaining evidences were not submitter. Therefore, the AO disallowed Rs4,00000/- on this account. On the contrary the appellants has submitted that these bills were partial and on sample basis of each head. The AO has not insisted over the details of evidences which could have been produced. I have perused the submission of the appellant. It is seen from the am order that in all respect more than 23 opportunity were given to the appellants but appellants failed to explain the issue raised by the AO. It was also seen that the ape has not made any attempt to explain the bogus sundry creditor s and undisclosed difference in credit notes given by the Samsung India. Even if it is assumed for sake of argument that these were sample bills for three months as it is seen in the assessment order even then if it is multiplied by four quarters o the year it reaches to the extent of only Rs.356770/-, as against total claim made by the appellant to the tune of Rs.2875604/-. Similarly if these sample bills are multiplied by twelve then it reaches to Rs.1070316/- only. At no stretch of imagination it goes at Rs.2875604/-. Considering the concealing tendency of the appellant, non-cooperative attitude, non submission of detail non submission of any details at appellate stage which could have been examined and no relevant details, evidence, supporting evidences were submitted at assessment stage or appellate stage which could have been enquired or re-enquired. It is concluded that the appellant had no evidence of remaining expenses to the extent of his claim and made vague claim against it without any basis. Therefore it was merely statement of the appellant without any sustentative material and without any evidence. Hence the addition made by the AO is upheld and the ground of the appeal is dismissed.”
5. Learned Authorized Representative pleads during the course of hearing that the Assessing Officer has made the impugned disallowance of ₹ 4 lakhs on ad hoc basis without appreciating all the facts on record. He submits that the assessing authority had not even verified assessee’s books recording this regular expenditure incurred in a routine manner wholly and exclusively for the purpose of its business. The Revenue’s case is that the Assessing Officer had afforded numerous opportunities to the assessee for proving genuineness of the impugned expenditure with the help of cogent evidence. It transpires from assessment order that the Assessing Officer has not given any basis for arriving at the disallowance figure of ₹4 lakh after 28.75 lakh. Nor is it Babita Bajaj Vs. ACI, Cir-40 Kol. Page 4 his case that the impugned expenditure is excessive or unreasonable with regard to assessee’s line of business vis-à-vis that incurred in preceding and succeeding assessment year(s). The fact also remains that assessee has not been able to produce all relevant vouchers in support of the impugned expenditure claim. We take into account all these facts to partly confirm the impugned disallowance to the extent of ₹2 lakh only with a rider that the same shall not be taken as a precedent in any earlier or latter assessment year in assessee’s case. This assessee’s instant substantive ground is partly allowed to the extent of ₹2 lakh in above terms.