SHRI HARISH BHIMANDAS ROHERA,,AHMEDABAD vs. THE INCOME TAX OFFICER, WARD-2(1),, AHMEDABAD

The assessee’s first grievance in the instant appeal seeks to reverse both the lower authorities’ action disallowing vehicle expenses of Rs.6,950/- on assumption than on actual basis. The assessee had claimed total vehicle expenses of Rs.20,312/- alongwith petrol expenses of Rs.1,28,625/- aggregating to Rs.1,48,937/-. The Assessing Officer observed in assessment order that there was no logbook indicating running of the vehicle in question for business purposes only. He therefore disallowed 1/5th of the amount including assessee’s suo motto disallowance of Rs.22,836/-. The CIT(A) confirms the same.

We have heard rival submissions. It has come on record that the assessee had on his own offered disallowance of Rs.22,836/- in the instant head on account of personal use of the relevant vehicle(s). There is no indication in the lower orders as to how the same was unreasonable. We therefore direct the Assessing Officer to delete this first disallowance/addition of Rs.6,950/-.

Next issue is that of disallowance of travelling expenditure of Rs.25000/- out of Rs.1,17,811/-. Both the lower authorities rejected assessee’s claim on account of his alleged failure in filing relevant evidence such as ticket and hotel bills etc. The same admittedly turns out to be almost 20% of the above gross figure. We discuss in these facts that it is on a little higher side as majority of the impugned expenditure stands accepted in principle. We therefore confirm the impugned disallowance to the tune of Rs.10,000/- only. The assessee gets part relief in his instant ground.

The third grievance assails correctness of addition on account of GP estimation @ 2% instead of 1.66% coming to Rs.2,64,730/-. There is no indication in the case file as to how the impugned gross profit involving a marginal variation is unjust or unfair. We make it clear that there is no pleading in assessee’s ground challenging rejection of books. We therefore uphold the CIT(A)’s action making the impugned addition.

This leaves us with the last issue of unexplained cash addition of Rs.15,663/- made by both the lower authorities on account of assessee’s failure in filing necessary reconciliation of cash found of Rs.2.8lacs during survey and its explanation offered. We observe in above peculiar facts that the impugned sum of Rs.15,663/- can be assumed to have come from assessee’s past savings. The Assessing Officer is directed to delete the same.