2019 (9) TMI 996

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....g AY 2010-11. 2. As per grounds of appeal, the assessee has challenged the imposition of penalty under s. 271(1)(c) of the Act in respect of additions to the extent of Rs. 6,58,616/- towards claim of various expenses, such as, car loan interest, petrol expenses, salary expenses, telephone bill etc. 3. When the matter was called for hearing, the learned AR for the assessee assailed the order of the AO and the CIT(A) and submitted that the assessee has inter alia had claimed certain expenses of Rs. 6,58,616/- from income reflected under the head 'income from other sources'. The AO framed assessment by disallowing expenses and made additions on estimated basis. It was submitted that all the material facts relevant for assessment were placed ....

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....zation of such expenses for the purpose of business of various firms where assessee is a partner, the income of which received by way of salary interest is assessed as 'business income'. 5. We have considered the rival submissions. The imposition of penalty under s. 271(1)(c) of the Act on disallowance of business expenses claimed is in controversy. While rejecting the claim of expenses of assessee in quantum proceedings the co-ordinate bench of ITAT in ITA No. 1243/Ahd/2014 order dated 06.01.2017 has recorded its findings as under: "4. We now come to assessee's latter substantive ground that the CIT(A) as well as the Assessing Officer have erred in disallowing business expenses of Rs. 6,44,023/-. We first come to assessee's tabulation i....

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....of expenditure much less than the substantive evidence of ownership of the corresponding vehicles and their nexus with assessee's business income. We thus find no reason to agree with assessee's expenditure claim in question amounting to Rs. 6,44,023/-. We thus confirm the same. The assessee losses in its latter substantive ground as well." 6. A bare reading of the quantum order shows that the assessee could not substantiate the claim of expenses claimed by him by any documentary evidence in the quantum proceedings. Even in the penalty proceedings, the assessee has failed to substantiate the expenses except for making generalized observations towards existence of car in the balance sheet and incurring other expenses. The entry shown in an ....