Case Law Details
PCIT Vs Utech Developers Ltd. (Delhi High Court)
Addition by assessing officer without providing any cogent reasoning or working, based on which such disallowances were made are not sustainable.
Appellant states that the ITAT has erred in deleting the additions made by the Assessing Officer on account of disallowance of travel expenses without considering that the assessee had failed to explain the purpose of the journey and that it was ‘wholly and exclusively’ for business.
However, a perusal of the paperbook reveals that both the CIT(A) as well as ITAT have given concurrent findings of fact that in the year under consideration, the assessee had provided the details vis-à-vis name of its employees as well as justification/ purpose of travel. It was further held by both the authorities below that the assessing officer arbitrarily made an addition on an estimated basis @ of 20% of the total travelling expenditure which includes domestic as well as foreign travel and conveyance of the employees. Both the CIT (A) and ITAT emphasised that the assessing officer had failed to provide any cogent reasoning or working, based on which such disallowances were made.
In State of Haryana & Ors. vs. Khalsa Motor Limited & Ors., (1990) 4 SCC 659, the Supreme Court has held that the High Court would not be justified in law in reversing in second appeal, the concurrent finding of fact recorded by two Courts below. This Court is further of the opinion that the impugned order calls for no interference as it suffers from no perversity. No substantial questions of law arise in this matter. Accordingly, the present appeal and application are dismissed.
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