TaxTMI 
TaxTMI 
TaxTMI 
2018 (1) TMI 659
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....-, that comprises of Rs. 1,93,60,639/- as Power and Fuel Expenses and Rs. 48,65,671/- towards purchase from three suppliers. 1.2 That the Ld. CIT(A) has further sustained this adhoc disallowance of Rs. 25,00,000/-, made by the AO, ignoring the facts on record that the items so purchased by the appellant company from these suppliers (i) are duly recorded in the books of accounts of the company, kept and maintained in regular course of business, (ii) entered in the boundary of State of Uttar Pradesh on the basis of UP Sales Tax Road Permit „Form No. 31‟ issued for each purchase, (iii) item so purchased were consumed in the production of the Company and (iv) these purchases have been accepted by the UP. Sales Tax Authorities in its assessment order. 2. That the Ld. CIT(A) has further erred in law and as well as on facts in sustaining the adhoc disallowance of Rs. 4,00,000/;. pn account of meeting and conference expenses ignoring the fact that the expenses incurred during the year under this head are just 0.16% as against 0.166% in the preceding assessment year. 3. That the Ld. CIT (A) has further erred in law as well as on facts in sustaining the disallowance of R....
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....the AO for reconsidering the issues which are agitated before us. Accordingly, we remand the matter back to the file of the AO with a direction to reconsider the issue is which are raised before the tribunal in all the grounds and passed the order in accordance with the law. We clarify that the entire assessment is not to be done de novo but only those issues are to be reconsidered which are agitated before the tribunal. In doing so, the AO shall give due opportunity of being heard to the assessee and assessee shall be at liberty to adduce any evidence it feels necessary." 5. Considering the above direction, Ld. assessing officer passed an assessment order under section 143 (3) on 29/11/2006, making additions with respect to a. Rs. 25 Lacs out of power and fuel expenses and purchases from 3 parties, b. disallowance of Rs. 1 lakh out of expenses of meeting and conference under section 37 of the Income Tax Act and c. disallowance of Rs. 58950/- under section 40 A (3) of the Income Tax Act, 1961. 6. The Ld. CIT (A) decided the issue as per order dated 18/10/2010 dismissing the appeal of the assessee. He confirmed disallowance of Rs. 25 Lacs in respect of unexplained purcha....
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....tunity given, he disallowed Rs. 25 Lacs out of power and fuel expenses. The Ld. authorised representative submitted before us copies of the bills of these parties and stated that the assessee has purchased goods from these parties which are showing the description of the material purchased as well as the quantity purchased. The bills also shows the address of the parties which are available with the assessees as well as the respective telephone numbers. In all the bills the material receipt stamp was also shown. He also mentioned that all the bills have the stamp of the sales tax authorities at respective check posts. He further submitted that there is no doubt expressed by the AO about the purchase price paid to them. He submitted that assessee has also submitted the confirmation of the above parties sent by those parties directly to the assessing officer and merely because there are some differences in the address as well as the reference number the addition have been made in the hands of the assessee. He further stated that the above parties have been paid purchase consideration through account payee cheques. He further drew our attention to the form No. 31 issued by the respect....
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....details assessee should have furnished before the assessing officer. In the result we do not find any reason to confirm the orders of the lower authorities. Therefore we reverse the finding of the lower authorities and the direct the Ld. assessing officer to delete the disallowance of Rs. 25 Lacs out of the power and fuel expenditure. In the result ground No. 1 of the appeal of the assessee is allowed. 10. The Ld. assessing officer has disallowed a sum of Rs. 1 lakh on account of meeting and conference expenses ignoring the fact that the expenses incurred during the year under the said are just 0.16% as against 0.1616% in the earlier years. During the year assessee has incurred an expenditure of Rs. 899601/- on account of various meetings, conferences, gifts and presents etc. However before the Ld. assessing officer the assessee has failed to furnish complete details of these expenses like payments to clubs etc. Assessee also failed to substantiate that these expenses are incurred for the business purposes. Therefore, the disallowance of Rs. 1 lakh was made by the Ld. assessing officer. Before the Ld. CIT the assessee reiterated the same submission and therefore the Ld. CIT (A) ha....