Tribunal confirms disallowances of brokerage charges and depreciation for assessment years 2006-09.

The Tribunal upheld the disallowances of brokerage charges paid to Shri Ishwarchand Goel and depreciation on an additional factory building in the appeals for assessment years 2006-07, 2007-08, and 2008-09. The decisions were based on the assessee's failure to provide adequate evidence to substantiate the expenses claimed, as required by law.

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Issues:
1. Disallowance of brokerage charges paid to Shri Ishwarchand Goel.
2. Disallowance of depreciation on additional factory building.

Issue 1: Disallowance of Brokerage Charges
The appeals filed by the assessee for assessment years 2006-07 and 2007-08 involved a dispute regarding the disallowance made by the Assessing Officer (AO) on account of brokerage claimed to be paid to Shri Ishwarchand Goel. The AO disallowed the brokerage claim as similar claims in the past were also disallowed. The Commissioner of Income Tax (Appeals) [CIT(A)] confirmed the disallowance citing lack of evidence to prove the expenditure was incurred for business purposes. The Tribunal upheld the CIT(A)'s decision, emphasizing the assessee's failure to establish the purpose of the brokerage payments, despite payment by cheque and TDS deduction. The onus was on the assessee to prove the expenditure was wholly and exclusively for business purposes, as per the Supreme Court's ruling in CIT v. Calcutta Agencies.

Issue 2: Disallowance of Depreciation on Building
In the appeal for assessment year 2008-09, the assessee challenged the disallowance of depreciation on an additional factory building. The AO disallowed the claim due to lack of documentary evidence supporting the expenses incurred on construction. The CIT(A) upheld the disallowance, stating that the onus was on the assessee to prove the genuineness of the expenditure. The Tribunal, after considering arguments from both sides, found no fault in the CIT(A)'s decision. Although some documents indicated the utilization of sales proceeds for building work, the Tribunal held that this alone was insufficient to prove the expenditure on construction. The onus was on the assessee to substantiate the claim with relevant documentary evidence, such as bills or building plans. As the assessee failed to do so, the disallowance of depreciation was upheld. The Tribunal dismissed the appeal for the assessment year 2008-09.

In conclusion, the Tribunal dismissed all three appeals of the assessee, upholding the disallowances of brokerage charges and depreciation on the additional factory building. The decisions were based on the assessee's failure to provide sufficient evidence to support their claims, as required by law.

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