M/S KASHMIR CEMENT,UDHAMPUR vs. INCOME TAX OFFICER, WARD-2(4), UDHAMPUR

Per Dr. M. L. Meena, AM:

This appeal has been filed by the assessee against the order dated 16.08.2018 passed by the Ld. Commissioner of Income Tax (Appeals),

Jammu, in respect of Assessment Year 2014-15, arising out of the Assessment Order dated 08.12.2016 of the Income Tax Officer, Ward-2(4), Udhampur, challenging disallowance of expenses under the head loading

ITA No. 584/Asr/2018 2 Kashmir Cements v. ITO and unloading expenses, repair and maintenance expenses, Staff Welfare

expenses, Travelling expenses, and Vehicle Diesel and working

allowances paid to partners.

adjournment application filed is rejected. Considering the facts on record

and after hearing the ld. Addl. CIT-DR, it is decided to hear the appeal on

merits in the interest of the justice. The issue of selection of the case under

scrutiny as challenged by the assessee is not arising out of the order of the

impugned order. Therefore, this ground is dismissed as not maintainable.

assessee in grounds of appeal and facts discussed by the ld. CIT(A) that

since the freight paid to M/s Punjab Kashmir Roadlines a sum aggregating

to Rs.1,49,470/- which exceeds Rs.75,000/-. Thus, it was hit by section

194C of the Act, and therefore, the assessee was liable to deduct tax at

source while making payment in respect of M/s Punjab Kashmir Roadlines.

The ld. DR contended that the ld. CIT(A) was justified in confirming the

addition of Rs.1,49,470/- made by the AO on account of disallowances of

expenses of freight charges by invoking provisions of section 40(a)(ia). She

further argued that other disallowances have been confirmed by the ld.

ITA No. 584/Asr/2018 3 Kashmir Cements v. ITO CIT(A) for want of complete details of either production of proper

bills/vouchers or the persons/labourers in respect of which the expenditure

was claimed.

impugned order, it is noted that the assessee has paid freight to M/s

Punjab Kashmir Roadlines a sum of Rs.1,49,470/- without deducting TDS

as required under the proviso to section 194C of the Act. The ld. CIT(A)

has concurred with the observation of the ld. Assessing Officer without

taking a rebuttal of the assessee on the issue of regarding details of TDS

deduction on the freight payment if any, accordingly, the issue of TDS is

remitted back to the file of the ld. CIT(A) to adjudicate afresh after calling

for the details from the assessee by way of granting sufficient opportunity of

being heard. The assessee is directed to cooperate in the fresh

proceedings before the ld. CIT(A) with the direction to provide the

information regarding details of TDS if any deducted as per the provisions

of law.

for want of bills/vouchers in respect of payment, under the heads staff

welfare, miscellaneous expenses, travelling expenses, and Vehicle Diesel

ITA No. 584/Asr/2018 4 Kashmir Cements v. ITO expenses for want of proper bills/vouchers besides expenses claimed

under the head loading and unloading expenses, repair and maintenance

expenses, Staff Welfare expenses, Travelling expenses, and Vehicle

Diesel and working allowances. The ld. CIT(A) has not brought on record

any evidences to disprove the disputed expenses claimed by the appellant

assessee. He has merely mentioned in the order that bills/vouchers are not

produced in respect of person or labourers. However, to disprove the claim

of assessee, he is required to bring on record, the supporting corroborative

documentary evidences. Further, the CIT(A) has not discussed any

circumstantial evidences to substantiate that the expenses claimed by the

appellant assessee were bogus expenses or otherwise not incurred for the

business purposes. Taking into consideration, the totality of the facts and

the circumstances of the case, such disallowances of expenses confirmed

by the ld. CIT(A) on the basis of presumption and assumption are not

justified. In our view, the additions confirmed on account of such

miscellaneous expenses in respect of claims of unloading expenses, repair

and maintenance expenses, Staff Welfare expenses, Travelling expenses,

and Vehicle Diesel and working allowances, are not justified. Accordingly,

the same are deleted.

ITA No. 584/Asr/2018 5 Kashmir Cements v. ITO 6. In the result, the appeal filed by the assessee is partly allowed.

Order pronounced in the open court on 13.10.2022

Sd/- Sd/- (Anikesh Banerjee) (Dr. M. L. Meena) Judicial Member Accountant Member *GP/Sr/PS* Copy of the order forwarded to: (1) The Appellant: (2) The Respondent: (3) The CIT(Appeals) (4) The CIT concerned (5) The Sr. DR, I.T.A.T