SURINDER BABU BUDHIRAJA ,DELHI vs. ITO WARD 36(2), DELHI

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ITA 4980/DEL/2025Status: DisposedITAT Delhi23 September 2025AY 2017-18Bench: Sh. Satbeer Singh Godara (Judicial Member)1 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that there was no dispute regarding the allowability of the expenditure in principle. The lower authorities failed to discuss market comparables for the assessee's commission agent business. A lump sum disallowance of Rs.1,00,000 was deemed appropriate in the interest of justice, with no precedential value.

What were the facts?

The assessee's appeal for AY 2017-18 arose from an order disallowing various expenditure claims. The lower authorities disallowed a total of Rs.63,98,658, representing 30% of the expenditure, amounting to Rs.19,45,956.

What were the issues?

Whether the disallowance of expenditure by lower authorities was justified without considering market comparables for the assessee's business.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI

Before: Sh. Satbeer Singh Godara

For Appellant: CA &
Hearing: 23.09.2025Pronounced: 23.09.2025

Asstt. Year : 2017-18 Surinder Babu Budhiraja, Vs Income Tax Officer, Prop. Star Fruit & Vegetable Co. Ward-36(2), Shiv Shanker Alu Co., Shive Shanker New Delhi Lehsun Co., 147, Tower-10, Supreme Enclave, Mayur Vihar, Phase-1, Delhi-110091 (APPELLANT) (RESPONDENT) PAN No. AFDPB4251N Assessee by: Sh. Pankaj Kumar Mishra, CA & Sh. G. D. Singla, CA Revenue by : Sh. Manoj Kumar, Sr. DR Date of Hearing: 23.09.2025 Date of Pronouncement: 23.09.2025 ORDER This assessee’s appeal for Assessment Year 2017-18, arises against the Addl./JCIT(A)-3, Bengaluru’s DIN & order No. ITBA/APL/S/250/2025-26/1076808001(1) dated 09.06.2025, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”).

2.

Heard both the parties at length. Case file perused.

3.

It emerges during the course of hearing that both the learned lower authorities have disallowed the assessee’s various expenditure claims; totaling to Rs.63,98,658/- to the extent of 30% thereof coming to Rs.19,45,956/-; in assessment

4.

Suffice to say, it is therefore clear that there is no dispute between the parties regarding allowability of the expenditure claim(s) in principle. This is indeed coupled with the fact that both the learned lower authorities have not even discussed the corresponding market comparables in the assessee’s commission agent business whilst invoking the impugned commission disallowance @ 30%. It is thus deemed appropriate in the larger interest of justice that a lump sum disallowance/addition of Rs.1,00,000/- only herein would be just and proper with a rider that the same shall not be treated as a precedent. The assessee gets relief of Rs.18,19,596/- in other words. Necessary computation shall follow as per law.

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