TaxTMI 
TaxTMI 
2019 (2) TMI 791
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....ed CIT(A) from assessment order dated 29.03.2016 passed by learned Assessing Officer (hereinafter called as "the AO") u/s 143(3) of the Income-tax Act, 1961 (hereinafter called "the Act") for AY 2013-14. 2. The grounds of appeal raised by Revenue in the memo of appeal filed with the Income-Tax Appellate Tribunal, Mumbai (hereinafter called "the tribunal") reads as under:- "1) "On the facts and circumstances of the case and in law, the learned CIT(A) has erred in deleting the adhoc disallowance of Rs. 37,70,055/- being 50% of the cash expenses of Rs. 75,40,109/-, relying on the assessee's assessment order for A.Y.2014-15, ignoring the crucial fact that the assessee had inspite of numerous opportunities provided during the cou....
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....rtation Expenses Rs. 38,75,776/- Rs. 75,40,109/- The AO asked the assessee to provide the details of these expenses debited to Profit and Loss account. The assessee in response filed ledger copy of the above expenses appearing in the assessee's books of accounts. The AO observed from the ledger accounts of these expenses submitted by the assessee that most of these expenses are incurred in cash . The AO asked assessee to produce vouchers/bills in respect of these expenses claimed by the assessee. The assessee failed to produce the same before the AO which led AO to make addition to the tune of 50% of these expenses leading to the addition to the tune of Rs. 37,70,055/- as the AO observed that assessee has credit....
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....15 and also AY 2013-14. 5. We have considered rival contentions and perused the material on record. We have observed that the assessee is engaged in the business as a clearing , forwarding and shipping agent. The assessee has earned net agency commission of Rs. 1,71,50,290/- which is arrived at after adjusting the reimbursement of the expenses claimed by the assessee from its clients. The assessee has debited expenses to the tune of Rs. 75,40,109/- in its Profit and Loss Account for the year under consideration , as under:- a) Custom Examination Expenses Rs. 2,54,122/- b) Dock Expenses - Rs. 5,29,228/- c) Documentation Charges Rs. 15,24,148/- d) Incidental Charges Rs. 2,92,165/- e) Sundry Expense....
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.... has claimed various expenses against the net agency commission. a) Custom Examination Expense Rs. 2,44,331/- b) Dock Expenses Rs.8,35,074/- c) Incidental Charges Rs.1,45,483/- e) Sundry Expenses Rs. 3,64,559/- f) Office expenses Rs. 1,33.080/- g) Container grounding expenses Rs. 9,51,806/- . Rs. 26,74,333/- From the details of these expenses it is noted that these expenses are incurred mainly in cash and supported only by self-generated vouchers and no third party evidence in this regard are not available with the assessee. Further some expenses are found unverifiable for want of complete bills and vouchers. Hence, 5% of these expenses on estimate basis a....
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....vouchers for these expenses for AY 2013-14 even before us while for AY 2014-15 , the assessee duly submitted invoices/vouchers before the AO and in our considered view, the matter need to be remitted back to the file of the AO for de-novo adjudication of this issue after giving the assessee an opportunity of being heard in accordance with principles of natural justice in accordance with law. The assessee is directed to produce all relevant invoices/bills/ vouchers before the AO in set aside de-novo proceedings and also to provide justification for incurring these Documentation Expenses and Transportation Expenses in this year under consideration which was stated to be not incurred in immediately succeeding year i.e. AY 2014-15. The Revenue ....
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....f these expenses, Profit and Loss Account and sample invoices it raised on its clients to make home a point that these expenses incurred by the assessee were on behalf of its clients . It is also claimed that income embedded in these reimbursement of the expenses to the tune of Rs. 13,08,911/- was also offered for taxation by the assessee and no prejudice is caused to Revenue. The assessee has placed on record details of these expenses, claim of reimbursement of these expenses and income of Rs. 13,08,911/- embedded in these expenses which was transferred to Profit and Loss Account which is placed on record in the file. The said details were stated to have not been filed before lower authorities. The assessee relied upon the decision of Ld. ....