TaxTMI 
TaxTMI 
2008 (6) TMI 588
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....oceedings that as per the balance sheet of the assessee, there is unsecured loan of ₹ 18,01,975 outstanding as on 31.3.2001. The A.O. asked the assessee to furnish details and confirmations. It is noted by the A.O. in para no.4 of the assessment order that the assessee has furnished confirmations only from 3 parties and confirmations were not furnished from the remaining three parties. Total loan outstanding in the name of remaining 3 parties for which confirmation could not be filed by the assessee before the A.O. was ₹ 9,54,475 including interest. The A.O. made addition of this amount u/s 68 by holding that the same is unexplained cash credit. Being aggrieved, the assessee carried the matter in appeal before'the ld.CIT(A). Before the ld.CIT(A), it was submitted by the assessee that details of unsecured loans as on 31.3.2001 giving particulars of amount outstanding as on 1.4.2000 (i.e. opening balances), additions made during the year including unpaid interest and closing balance was submitted before the AO and out of six parties, three confirmations were also submitted before him. The assessee also submitted confirmations for the remaining three parties before the....
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....ld. CIT(A) that since the AO has not commented on the correctness of these confirmations, the same are considered in appeal. After considering these three loan confirmations, the ld.CIT(A) confirmed the two additions i.e. regarding loan of ₹ 2,97,600 from Mr.Prabjeer Mighani and ₹ 2,50,000 from Mr. Venkat Raman. He deleted addition of ₹ 4,06,875 on account of loan from Mr.R.C.Venkatesh, Now, the Revenue is in appeal regarding the addition deleted by the ld.CIT(A) and the assesse is in appeal regarding the addition confirmed by ld. CIT(A). 4. It was submitted by the ld.A.R, of the assessee that additional evidence had been rightly admitted by the ld.CIT(A) under Rule 46A because in the course of assessment proceedings, the assessee has submitted before the AO three loan confirmations and in letter dt. 12.1.2004 submitted to the AO as appearing on page no.5 of the paper book, it was submitted by the assessee that confirmations from parties is awaited and will be submitted soon. It was submitted that the AO has completed the assessment on 17.2.2004 but the confirmations were received by the assessee in March, 2004. In this regard our attention was drawn to page 15 o....
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....he appellant was prevented from sufficient cause from producing the evidence, which he was called upon to produce by the Assessing Officer; or.." 7. From the above, we feel that the ld.CIT(A) had rightly admitted the additional evidence because we feel that there were sufficient cause for the inability of the assessee to obtain the confirmations and produce before the A.O. We also feel that in the interest of justice, the assessee should be allowed to produce the evidence if the same could not be produced by the assessee before the AO because of a reasonable cause. We, therefore, uphold the order of the ld.CIT(A) regarding admission of additional evidence. 8. Regarding the merit of the addition, we feel that the addition cannot be sustained because as per the details appearing on page no. 10 of the paper book which was submitted before the AO also, in case of all the three parties, there was opening balance of ₹ 3,50,000 in case of Mr.R.C.Venkatesh, ₹ 2,56,000, in case of Mr,Prabjeev Miglani and ₹ 2,50,000 in case of Mr.Venkatraman, total ₹ 8,56,000. There is unpaid interest on these loans ₹ 56,875 and ₹ 41,600 totaling ₹ 98,475. Sin....
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....n the course of assessment proceedings that the assessee is proprietor of M/s Chanakya Service Station, which is engaged in servicing and repairing of motor vehicles. It is also noted by the AO that the assesse has incurred ₹ 2,84,344 on account of foreign traveling. The AO asked the assessee to furnish details regarding foreign travel and to justify the expenses by furnishing relevant documentary evidences. It has also been observed by the AO that the assessee did not furnish any evidence in this regard. It is also observed by the A.O., that by letter dt, 10.2.2004, it was submitted that the assessee had met two persons during foreign travel to whom letters are written and replies are expected soon. It is also observed by the AO that no further details are furnished till the completion of the assessment. It is also observed by the AO that the nature of the business of the assessee is such that there is no requirement of any foreign travel. On this basis he disallowed entire claim of the assessee regarding foreign travel expenses. Being aggrieved, the assessee carried the matter in appeal before the CIT(A). 9. Before the ld.CIT(A), details of foreign travel expenses were su....
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....nal judgements:- a) Mahendra Oil Cake Industries P.Ltd. vs. ACIT, 55 TTJ(Ahd)711 b) Yogeshwar Prasad vs. ITO 16 TTJ (Del) c) A.R.Santhanakrishnan and Co. vs. ITO 11 TTJ (Mad) 74 11. Regarding expenses on local travel, no specific argument was raised. Our attention was drawn to page no.9 of the paper book which contains the details of local travel expenses of ₹ 36,012. It was pointed out by the Bench that there were visits to Mumbai and Chandigarh and hence the purpose of visit should be explained, but no explanation could be furnished by the ld.AR of the assessee. Regarding foreign travel expenses, our attention was drawn to page no.8 of the paper book which is a copy of the ticket for foreign travel cost ₹ 22,148 and at page 7 of the paper book which contains the cash memo for purchase of 4800 US dollars at a cost of ₹ 2,25,784 for the purpose of foreign visit. Our attention was also drawn to the confirmation certificate of M/s Chira Automotive and Export Co. Ltd. of Bangkok as appearing on page 21 of the paper book. It was submitted that as per this confirmation certificate, the assessee has visited Bangkok between 27th September, 2000 to 4th October, 200....
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....onsistency in the certificate of M/s Chira Automotive and Export Co.Ltd. that the assessee visited Bangkok between 27,9.2000 to 4.10.2000 because as per copy of ticket appearing on page 8 of the paper book, the return date is 1.10.2000. Under these facts, we are of the considered opinion that the expenses incurred for visiting Bangkok only can be allowed and the expenses incurred for visit to Hong Kong cannot be allowed as business expenditure. Since no separate break up is furnished by the assessee regarding expenses incurred on Hong Kong visit, we feel that no interference is called for in the order of the CIT(A) because he had already allowed expenses to the extent of 50%. Regarding Tribunal judgment relied upon by the ld.A.R. of the assessee rendered in the case of Mahendra Oil Cake Industries P.Ltd. vs. ACIT (supra), we find that the judgment is not applicable in the present case, because the facts are different. In that case, l/4th of the total foreign tour expenses were disallowed without pointing out any specific item for disallowance of travel expenses. In the present case, we have seen that the expenses had been incurred for visiting Bangkok and Hong Kong and the assessee....