AMIYA PRASAD MISHRA,CUTTACK vs. ACIT, CIRCLE-2(2), CUTTACK

This is an appeal filed by the assessee against the order of CIT(A)-

Cuttack, dated 19.2.2016, for the assessment year 2011-2012 .

ld CI(A) erred in confirming the adhoc disallowance @ 20% from the following

expenses and making the addition of Rs.1,02,490/- to the income of the

assessee:

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a) Travelling expenses : Rs. 74,541/- b) Vehicle maintenance : Rs.1,42,563/- c) Printing & stationary : Rs.1,81,330/- d) General Expenses : Rs. 71,420/- e) Consultancy charges : Rs. 45,6000/- Total: Rs.5,12,454/-

authorities and materials available on record. In the instant case, the

Assessing Officer found that the assessee has debited Rs.5,12,454/- in total

under the head: (i) travelling expenses, (ii) vehicle maintenance, (iii)printing

and stationary, (iv) general expenses and (v) consultancy charges. The

Assessing Officer required the assessee to produce the details of such

expenses to substantiate the above claim of expenditure. The assessee filed

ledger copy of some of the expenses but did not produce bills and vouchers

for verification. The assessee stated that the expenses have been incurred

wholly for the purpose of business. Since the assessee did not furnish

supporting documentary evidences regarding the expenses incurred, the

Assessing Officer disallowed 20% out of the above expenses and made an

addition of Rs.1,02,490/- to the income of the assessee.

Assessing Officer was not justified in making adhoc disallowance out of

genuine business expenditure claimed by the assessee. He relied on the

decision of this Bench of the Tribunal in the case of Shri Mahendra Kumar

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Saha vs ACIT (ITA No.54/CTK/2015) order dated 23.2.2016, wherein, it was

held as under:

“………..Further, in this case, regular books of account have been maintained and audited u/s.44AB of the Act. No adverse inference has been drawn by the auditor. Taking the guidance of various judicial pronouncements, we concur with the findings of higher judicial authority that the tax authorities must consider the claims in reasonable and practical manner. The disallowance of petty nature of expenses makes hardly any impact on overall revenue collection, but such disallowance creates a lots of dissatisfaction amongst tax payers. Therefore, considering all these factors and in the interest of justice, we delete the addition of Rs.1,00,000/- sustained by the ld CIT(A).”

of business expenses claimed by the assessee. He has not pointed out for which

specific expenditure claimed by the assessee, the vouchers were not produced

before him for verification. In the absence of the same, the disallowance made

in a summary manner cannot be sustained in law. Hence, I set aside the orders

of lower authorities and vacate the disallowance of Rs.1,02,490/- and allow the

ground of appeal of the assessee.

CIT(A) erred in confirming the disallowance of Rs.16,901/- made under the head

“donation” by the assessee.

authorities and materials available on record. In the instant case, the

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Assessing Officer observed that the assessee has claimed deduction of

Rs.16,901/- under the head “donation”. He required the assessee to produce

details of such donation which could not be produced by the assessee.

Therefore, he disallowed the same for not having incurred for the purpose of

business and not incidental to the business of the assessee.

donation of Rs.15,900/- was paid to Smt. Tota Shreelaxmi as she was

suffering from cancer. The assessee was approached and requested by M/s

Orissa Cricket Association and some of the players to help her from the

humanitarian point of view. Since the assessee was working as Consultant

Engineer under Orissa Cricket Association, he accepted the request in the

greater interest of business. Further, donation of Rs.1001/- was paid to Seikh

Bazar durga Puja Committee on the request of local people.

confirmed the action of the Assessing Officer on the ground that the expenses

claimed are not incidental to the business of the assessee.

the expenses claimed are wholly and exclusively incurred for the business

purposes of the assessee. Hence, I find no good and justifiable reason to

interfere with the order of ld CIT(A), which is hereby confirmed and dismiss

this ground of appeal of the assessee.

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ASST.REGISTRAR, ITAT, Cuttack