Case Law Details
M/s. Goodwill Impex Limited Vs DCIT (ITAT Jaipur)
Assessee has challenged the sustenance of 10% of telephone, conveyance & car maintenance expenses amounting to Rs. 65,448/. As per Assessing Officer, the expenses in the profit & loss account are related to such facilities which are certainly proved to be used for other than business purposes. The ld. CIT(A) confirmed the addition so made (except the addition on account of depreciation) holding that the assessee has failed to file any evidence which established that the observation made by the Assessing Officer are not correct. In our view, these are purely adhoc addition made by the Assessing Officer which cannot be sustained in eyes of law. It is not the case of the Revenue that these are bogus expenditure or the expenditure has not been incurred for the purposes of business. A mere suspicion that given the nature of expenses, it is likely that incurrence of such expenditure is for non-business purposes, in our view, cannot be a basis for making the addition in the hands of the assessee. Accordingly, the adhoc addition so made is hereby directed to be deleted.
FULL TEXT OF THE ITAT JUDGEMENT
This is an appeal filed by the assessee against the order of ld. CIT(A)-3, Jaipur dated 09.02.2018 wherein the assessee has taken the following grounds of appeal:-
“1. That the learned Commissioner of Income Tax (Appeals) has erred in law and in facts in confirming rejection of books of account o f appellant and making trading addition of Rs. 2,00,000/-.
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