2017 (12) TMI 522

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....ition of Rs. 1,80,000/- on account of rent paid. 4. During the course of assessment proceedings, the AO found from Annexure-C of Tax Audit Report from the assessee that the assessee paid rent of Rs. 1,80,000/- to one Shri Ramesh Kr. Agarwal. According to AO, the said Shri Ramesh Kr. Agarwal is a relative of the Director of the assessee-company and sought explanation from the assessee how the said payment is related to its business. The assessee through its Authorized Representative submitted that the said amount was paid towards rent for room at 5, Gokhale Road, Kolkata which was taken by the assessee for official purpose temporarily. The AO directed the assessee to produce Trade Licence or similar authentic documents to prove the genuinen....

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....foresaid premises and the Board accepted the said proposal moved by the Chairman. The ld. AR argued that the assessee started its business in the previous year relevant to year under consideration initially at the time as there was no registered office ready by that time. Accordingly, in order to conduct its operations, the assessee availed the aforesaid premises from Shri Ramesh Kr. Agarwal on rent basis. Thereafter, the assessee moved to its registered office premises at 12, Government Place (East), Kolkata. Therefore, the rent as claimed by the assessee is incurred towards rent and is business expenditure and claimed as deduction. 7. The ld. DR relied on the order of AO. 8. Heard both and perused the materials available on record, we f....

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.... had claimed an amount of Rs. 1,30,19,266/- under the sub-head "transportation and labour charges of godown". On perusal of the party-wise details, the AO found that the assessee has paid a sum of Rs. 1,11,659/- to "other transportation and labour charges of godown below Rs. 50,000/-. Therefore, the AO was of the opinion that the assessee did not furnish actual details and an amount Rs. 20,000/- was disallowed. Again the AO on perusal of the list under the basic head of "freight and transportation charges", the assessee claimed an amount of Rs. 91,69,650/- under the sub-head "loading and unloading charges of godown and wreck". The AO on perusal of the details of party-wise chart found that the assessee disclosed expenses of Rs. 17,71,446/- ....

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.... the payments aggregating to Rs. 73,98,204/- constituting more than 80% of total expenditure, the details of parties with amount of tax deducted was furnished to the AO and was accepted without being any defect. The number of parties whose payments were below Rs. 50,000/- were numerous and no TDS was deducted from payments made to them and the amounts were clubbed and shown as an aggregate amounts of Rs. 17,71,446/-. The ld. AR further submits that small payments were consolidated to simplify the information to submit and AO did not find any defect in the 80% of payments. In respect of the balance 20%, no opportunity was given to the appellant to furnish further details and no details were asked for during the course of scrutiny proceedings....