TaxTMI 
TaxTMI 
2021 (2) TMI 1079
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....ce, determining the income at Rs. 27789100/- against the declared income of Rs. 7616860/-. 1(a) The learned CIT (Appeals) as well as the learned Assessing officer failed to appreciate that:- i) The assessee should have knowledge of the material that is proposed to be used against him, in order to enable him to rebut it, no proper opportunity and/or show cause notice was given to the appellants before making the exorbitant additions. ii) Though it is mentioned in the assessment order, specific details were called, were not filed, but in fact no notice or proceedings asking for specific details were received by the appellants and no assessment proceedings were made by the learned Assessing officer. iii) The learned CIT (Appeals) have based his order on the Remand Report dated 05/01/2018 prepared by Dy. CIT 10 (2) (1), which is without considering the details/explanation filed by the appellants vide letter dated 31/01/2018. 2) Under the facts and circumstances of the case and in law, the learned CIT (Appeals) erred in confirming the disallowance of the Rill amount of fuel expenses of Rs. 926624/- by the learned Assessing officer. 2 (a) The learned CIT (Appeals) and the lea....
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....port as required by law. No proper opportunity was given to file the specific details/explanation. iv) the details/explanation filed during Remand Report not considered. v/the addition are based on assumptions having no basis and/or corroborative evidences. 7) The Appellants crave leave to add, amend, alter, delete the ground/s of appeal at or before the hearing of appeal." 4. The brief facts of the case are that the assessee filed its return of income on 28.11.2006 declaring total income to the tune of Rs. 76,16,860/- for the A.Y. 2006-07. The return was processed u/s. 143(1) of the I.T. Act. Subsequently, the case was selected for scrutiny. Notices u/s. 143(2) & 142(1) of the I.T. Act, 1961 were issued and served upon the assessee. The assessee company was engaged in the business of running a water park under the name & style of M/s. Suraj Water Park. The assessee claimed the fuel expenses in sum of Rs. 9,26,624/- which was disallowed on account of non-submission of sufficient evidence. The assessee also claimed Repair & Maintenance Expenses in sum of Rs. 50,87,434/- which was also disallowed on account of non-submission of evidence. After some more disallowance, the incom....
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.... submission of bills which are on record. Any how the voucher/bills were produced before the AO. An another reason to decline the claim is that in the preceding year the fuel expenses were not allowed. It is not a good ground to decline the claim of the assessee. At least produced documents should be examined. No doubt the assessee submitted the undertaking before us in which the assessee claimed that the ledger as well as the vouchers/bills of petrol were produced before the AO which lies at page no. 1 to 18 of the paper book no. 2. The accounts were duly audited. The books of account were not rejected. It seems that the evidence given by assessee was not properly considered. No reasons were given to decline the claim. Taking into account have been available on record. We are of the view that the claim of the assessee has wrongly been declined which is infact liable to be examined. Accordingly, we set aside the finding of the CIT(A) on this issue and restore the issue before the AO to decide the issue after giving an opportunity of being heard to the assessee in accordance with law. Accordingly, this issue is allowed for statistical purposes. ISSUE NO. 3 7. Issue no. 3 is connec....
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....at an opportunity to be heard is liable to be given in accordance with law. Accordingly, this issue is allowed for statistical purposes. ISSUE NO. 4 8. Issue no. 4 is connection with the disallowance of Directors Remuneration in sum of Rs. 660000/- paid to Shri Arunkumar Muchhala and Rs. 300000 paid to Shri Ritika A. Muchhala. It is argued that the Directors of Shri Arunkumar Muchhala had conceived the idea of Suraj Water Park and had run it so successfully. It is also argued that he put his heart and soul in the project. He also gave the bank guarantee without charging of any bank commission. Ritika Muchhala was also running cosmetic department of the park. She has also given bank guarantee without charging any bank commission. The Hon'ble ITAT has allowed the remuneration in the assessee's own case bearing ITA. No. 7605/Mum/2012 for the A.Y. 2009-10 dated 06.01.2017. There is no change and variation. The copy of order dated 06.01.2017 for the A.Y. 2009-10 is on the file in which the claim of remuneration has been allowed by the Hon'ble ITAT in the assessee's own case. The Hon'ble ITAT has given the following finding as under.:- "7. Next ground of appeal is....
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....here was no justification for restricting the expenditure to Rs. 3 lakhs. Reversing the order of the FAA, we decide ground number six in favour of the assessee." 9. It is not justifiable that in one year the claim of the assessee has been allowed and in an another year the claim of the assessee has been disallowed. There should be some reason to decline the claim of the assessee. Moreover, we find that the assessee has shown these incomes in their return of income and offered the tax. Taking into account all the facts and circumstances and by honoring the decision of Hon'ble ITAT in the assessee's own case (supra), we allowed the claim of the assessee. Accordingly, this issue is decided in favour of the assessee against the revenue. ISSUE NO. 5 10. Under this issue the assessee has challenged the disallowance of Depreciation in sum of Rs. 3,67,182/-. The Ld. Representative of the assessee has argued that the assessee has submitted the details of addition of fixed assets and all necessary documents were filed before the AO but the AO did not allow the depreciation in accordance with law. It is also argued that the vouchers were also produced before the AO which lies at pa....
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....ee or the same was unexplained. Taking into account all the facts and circumstances, we are of the view that the finding of the CIT(A) is not justifiable to decline the claim of Assessee, hence, we set aside the finding of CIT(A) in this regard, we ordered accordingly and allowed the claim of the assessee. Accordingly, this issue is decided in favour of the assessee against the revenue. In the result, the appeal of the assessee is hereby partly allowed for statistical purposes. ITA. NO. 6932/M/2019 12. The assessee has filed the present appeal against the order dated 11.09.2019 passed by the Commissioner of Income Tax (Appeals)-17, Mumbai [hereinafter referred to as the "CIT(A)"] relevant to the A.Y. 2013-14. 13. The assessee has raised the following grounds:- "I. Under the facts and circumstances and in law the learned CIT (Appeals) erred in confirming the disallowance of Rs. 40546020/- being payment to Forest Department out of commercial expediency and the same does not in any way contribute to the acquisition of any capital assets, made by the learned Assessing officer. I (a) The learned CIT (Appeals) as well as the learned Assessing officer failed to appreciate that i....
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....and as Disney land. In the year 2002, the assessee took the necessary NOC to run the park. The assessee also took the no objection certificate from the Municipal Corporation of Thane and copy of which lies at page no. 73 of the paper book. In the year of 2006, the lands was treated as forest land under the Maharashtra Private Forest Acquisition Act, 1975. Some other land owners in the area were also affected by the said order and they took the matter upto the Supreme Court and the Hon'ble Supreme Court constituted the Central Empowered Committee and under the decision of the committee, the appellant has to pay a sum of Rs. 4,05,46,020/- to the Forest Department. In order to regularize the land and to continue its business, the assessee was under obligation make the payment. Non payment of the said amount will ruin the business. It is business exigency to make the payment. No new assets came into the existence. The said amount was paid in view of the order of the Hon'ble Supreme Court. The AO treated the said amount as capital in nature. The facts speak that at the time of purchase title of the assessee was clear and thereafter the assessee invested for the development of am....