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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI A. MOHAN ALANKAMONY
आदेश /O R D E R
PER N.R.S. GANESAN, JUDICIAL MEMBER: Both the appeals filed by different assessees are directed against the respective orders of the Principal Commissioner of Income Tax, Puducherry, dated 24.02.2015 and pertain to assessment year 2010-11.
Sh. R. Vijayaraghavan, the Ld.counsel for the assessees, submitted that the Assessing Officer after considering all the relevant materials on available record, estimated the income of the assessees. While considering the net profit of the assessees, the Assessing Officer made disallowance with regard to salary paid, repair expenses, freight charges and miscellaneous expenditure. However, the Principal Commissioner found that the Assessing Officer has not properly investigated the claim of the assessees. According to the Ld. counsel, the Assessing Officer has examined each and every facts with regard to salary paid, repair expenses, etc. and the gross profit declared by the assessees, therefore, it is not the case of the non-examination by the Assessing Officer. Therefore, the Principal Commissioner is not justified in revising the orders of the Assessing Officer.
On the contrary, Shri S. Balasubramanian, the Ld. Departmental Representative, submitted that the Assessing Officer made addition only in respect of certain heads of expenses accounted in Profit & Loss account. The assessee could not produce any new materials which were called for from any outside persons or authorities. Therefore, according to the Ld. D.R., the Assessing Officer has not properly investigated the claim of the assessees. In the absence of proper investigation, according to the Ld. D.R., the orders of the Assessing Officer are not only erroneous but also prejudicial to the interests of Revenue. Therefore, according to the Ld. D.R., the Principal Commissioner has rightly revised the orders of the Assessing Officer.
We have considered the rival submissions on either side and perused the relevant material available on record. The Principal Commissioner found that the assessee in is a trader in foodgrains and the assessee in I.T.A.
No.1014/Mds/2015 is engaged in the business of oil trade. By considering the turnover of the assessees, the Principal Commissioner found that in both the cases, the profit declared by the assessees is very low and the Assessing Officer without any investigation other than the heads which were disclosed in the Profit & Loss account allowed the claim of the assessees. Therefore, the Principal Commissioner found that the orders of the Assessing Officer are erroneous and prejudicial to the interests of Revenue.
The Assessing Officer, in both the cases, after considering the net profit declared by the assessees and the expenditure claimed by the assessees, found that certain additions would need to be made.
Accordingly, the Assessing Officer made addition with regard to salaries, repair expenditure and freight charges. Therefore, this Tribunal is of the considered opinion that it is not a case of non- investigation of the matter. The Assessing Officer after considering the relevant facts found that certain expenses claimed by the assessees were not substantiated by the material available on record. Therefore, he disallowed the claim of the assessees. In those circumstances, the Principal Commissioner is not justified in saying that the Assessing Officer has not investigated the case properly. Therefore, this Tribunal is of the considered opinion that the Principal Commissioner is not justified in revising the orders of the Assessing Officer. Accordingly, the orders of the lower authority are set aside.
In the result, both the appeals filed by the assessees are allowed.
Order pronounced on 1st April, 2016 at Chennai.