Case Law Details
Kailas Chand Agrawal Vs DCIT (ITAT Raipur)
Our careful consideration of assessment records and the records of appellate proceedings it transpired that, neither of the lower tax authorities had pointed any such voucher, the genuineness of the expenditure therein claimed to have been incurred by the assessee wholly and exclusively for the purpose of its business did not inspire any confidence, nor it was the case of the revenue that any part of the expenditure in question was either found to be bogus or fictitious, nor was found to have not been incurred by the assessee wholly and exclusively for the purpose of his business. Indeed, it showcased an exercise of running around the circle by both the lower tax authorities while dealing with the present case.
We neither could come across any provision in the present Income Tax Statute nor it has been brought to our notice by either parties to dispute, which subscribes vis-à-vis authorises the tax authorities to arrive at this logic of subscribing ad-hoc disallowances. Evidently, there has been no clear findings as to number of vouchers requiring denial of allowances with the amount of expenditure and nature of defects therein or therewith, moreover department could not bring out any deprecative material on record to substantiate its conclusion as logical. We couldn’t also see remotely there is any mention of rationale in arriving at the percentile of disallowance in the present case, consequently we find substantial force in the claim of the assessee that devoid of any specific infirmity qua the assessee’s claim for deduction of the aforementioned expenditure by the lower tax authorities, and for the reason, the ad-hoc disallowance carried out in a most arbitrary manner could by no means be held to be justified.
FULL TEXT OF THE ORDER OF ITAT RAIPUR
The present appeal is filed by the assessee against the first appellate order of Commissioner of Income Tax – Appeals, Bilaspur [for short “CIT(A)”] passed u/s 250 vide order dt 07/03/2016, which in turn sprung from the assessment order [for short “AO”] dt 18/03/2013 passed by the Ld Assessing Officer [for short “Ld AO”] u/s 143(3) of the Income-tax Act, 1961 [for short “the Act”] for assessment year [for short “AY”] 2010-2011.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
