AI Drafter 
TaxTMI 
TaxTMI 
2017 (3) TMI 689
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....nder consideration, filed its return of income declaring total income of Rs. 5,22,846/- which was processed u/s 143(1) of the Act. Subsequently, the case was selected for scrutiny and accordingly notices u/s 143(2) and 142(1) of the Act were issued upon the assessee. The assessment was framed u/s 143(3) of the Act at a total income of Rs. 21,65,180/-, after making certain additions/disallowances to the total income of the assessee. The disallowances/additions are discussed herein below. 3. The first issue raised in this appeal is that, the Ld. CIT(A) erred in confirming the order of AO by sustaining the addition of Rs. 15,07,636/-, on account of undisclosed purchases and profit thereon. 4. The assessee in the year under consideration ....
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.... to set aside the matter to the ITO for further verification. However, the Ld. CIT(A) has disregarded the contention of the assessee and confirmed the order of the AO by observing as under: "2.3 Appellant's submission and facts available on record has been carefully considered. It is seen that the discrepancy in purchases were confronted to the assessee during the assessment proceeding. In the case of M/s. Universal Sales where there is major discrepancy of sales, the bills, vouchers, stock register and output VAT for the seller were called for and examined. Accordingly, the A.O. had concluded that the sales shown by M/s. Universal sales but not accounted for by assessee was genuinely done to the assessee. During the appellate proceeding....
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....ement of Rs. 21,548/- can be added to the total income of the assessee. On the other hand, the Ld. DR vehemently supported the order of the authorities below. 7. We have heard the rival contention of both the parties and perused the materials available on record. The issue in the instant case relates to the addition made by the lower authorities on account of undisclosed purchases and the profit attributable to such purchases. Admittedly, MUS has shown its sales to the assessee and which was duly verified by the AO on the basis of supporting evidence. However, on examination of the details submitted by the assessee, we find that the goods were purchased on credit basis. As there is outstanding credit balance in the books of the assess....
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....he above, we restrict the disallowance to Rs. 21,548/-. Accordingly, AO is directed. Hence, this ground of appeal of the assessee is partly allowed. 8. The second issued raised by the assessee in this appeal is that the Ld. CIT(A) has confirmed the order of the AO by sustaining the disallowance of expenses on estimated basis. 9. The AO during the assessment proceedings has disallowed several expenses claimed by the assessee on the basis of estimation as detailed under: SI No. Particulars of expenses Amount of expenses Percentage of Disallowance Reasons for the disallowance Reasons for disallowances 1. Delivery charges Rs.3,25,700/- 10% Rs.32,570/- Self-made vouchers and cash payment 2. Install....
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....rs were produced at the time of assessment. The lower authorities have made the disallowances on surmises and conjunctures without pointing out any defect in the details submitted at the time of assessment. The Ld. AR prayed to the bench for the deletion of the aforesaid sum. On the other hand the Ld. DR vehemently supported the order of the authorities below. 13. We have heard the rival contention and perused the materials available on record. The issue in the instant case relates to the disallowances made by the lower authorities in respect of various expenses on estimated basis on the ground of non-availability of supporting evidence. The facts of the case have already been elaborated in the preceding paragraph and the same are not....
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....ces based on some unreasonable apprehensions. The AO has not brought on record any cogent reasons as to why this expenditure was to be disallowed. It is not the case that the expense was considered to be bogus or short comings in the vouchers in this regard as observed by the Revenue. No material has been placed before us by the Revenue to controvert the arguments of the ld. AR. In that view of the matter we find ourselves in no agreement with the reasoning and conclusion contained in the order of ld. CIT(A). With the result we reverse the finding of ld. CIT(A) with regard to delivery expenses. Now coming to the disallowance for Installation and teas & tiffin charges we find that the assessee has failed to provide the supporting evidence....