TaxTMI 
TaxTMI 
2018 (1) TMI 659
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....side) was against the total expenses of Rs. 2,42,26,310/-, 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 fu....
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.... not get a fair opportunity of presenting its case and therefore, the matter needs to be sent back to 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 ....
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.... record. Therefore according to the Ld. assessing officer since the purchases have not been confirmed, despite adequate opportunity 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....
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....nly for the reason that assessee has not produced further details but he has not given any reason or any clue about what further 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....
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....argument before us and the Ld. departmental representative also relied upon the orders of the lower authorities. 15. We have carefully considered the rival contentions and also perused the orders of the lower authorities. In the present case the assessee has made the payment in excess of the amount specified and could not also justify the claim of the assessee that such payment falls under the exception covered under rule DD of the Income Tax Rules, 1962. In view of this, we do not find any infirmity in the order of the Ld. assessing officer in making the above disallowance of Rs. 48650/-. In the result ground No. 3 of the appeal of the assessee is dismissed. 16. In the result appeal of the assessee in ITA No. 1316/Del/2012 is partly allowed. 17. Now we come to the appeal of the Revenue in ITA No. 669/Del/2014 is against the order of the ld CIT(A) dated 28.11.2013 deleting the penalty u/s 271(1)(c) levied by the ld Assessing Officer vide order dated 27.03.2012 of the Rs. 1172400/-. 18. Ld DR relied upon the order of the ld Assessing Officer and ld AR relied upon the order of the ld CIT(A). 19. As by the order in ITA No. 1316/Del/2012 the addition of Rs. 25 lacs with ....