TaxTMI 
TaxTMI 
2021 (5) TMI 438
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....I.T. Act, on account of unexplained share application money. 2. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of assessing officer in making ad hoc disallowance of Rs. 80,97,725/- being 10% of various expenses. 3. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in not granting setoff of unabsorbed depreciation loss and carried forward business loss of previous years from the assessed income of the assessee. 4. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in not granting setoff of current year business loss as returned from the assessed income of the assessee. 5. It is therefore prayed addition made by Assessing Officer and confirmed by learned Commissioner of Income-tax (Appeals) may please be deleted. 6. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal." 3. Now, we shall take Ground No.1 raised by the assessee which relates to addition of Rs. 12,10,00,000/- made by assessing ....
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....le finalizing the assessment U/s l43(3) of the Act, the following additions were made:- (i) Unexplained cash credit U/s 68 of the Act : Rs. 12,10,00,000/- (ii) Out of business Expenses : Rs. 80,97,725/- 2. On perusal of the case records and assessment folder, it is seen that the following errors have been crept in to the computation of income which is forming part of the assessment order while arriving at the assessed total income of the assessee company. It is seen that the addition of Rs. 12,10,00,000/- made U/s 68 of the I.T. was remained to be added back in the computation of income. On account of the above error in the computation of income, the total income of the company was assessed at Rs. 4,61,36,009/- instead of assessing the total income at Rs. 7,48,63,991/- which has resulted into underassessment of income by Rs. 2,87,27,982/-. 3. However, it is clear from the assessment records that the additions were made after elaborate discussion in the body of the assessment order and the disallowance on each head is clearly specified in the body of the assessment order at the end of the last paragraph after discussion in respect of each issue wh....
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..... This is the sine qua non for raising any ground of appeal or filing of appeal. Since no tax liability has been fastened against assessee nor any demand has been raised in respect of Share application money of Rs. 12,10,00,000/-, there is no occasion for the assessee to be "aggrieved". During the appellate proceedings, the AR of the assessee has filed copy of order passed u/s 154 of the Act dtd 09.04.2014 by which the AO has made addition of Rs. 12,10,00,000/- towards Share Application Money. As discussed earlier order passed u/s 154 of the Act is a separate order for which assessee need to file appeal separately. In view of these facts, I am of considered view that ground No. 1 raised in the appeal is not maintainable, hence, dismissed being infructuous. Before parting, it may be clarified that appellant is free to file separate appeal against the order passed u/s 154 of the Act dtd. 09.04.2014 whereby addition of Rs. 12,10,00,000/- have been made. Without prejudice, I am of the considered view that assessee deserves full sympathetic consideration with regard to condonation of delay in filing appeal against order passed u/s 154 of the Act. In view of the above discussion....
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....ure has been incurred wholly and exclusively for the purpose of the business. Therefore, an amount of Rs. 80,97,725/- being 10% of the above mentioned expenses of Rs. 8,09,77,259/- was disallowed and added to the total income of the assessee. 11. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the ld. CIT(A) who has confirmed the addition made by the Assessing Officer. Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before us. 12. We have heard both the parties and perused the material available on record. Learned Counsel for the assessee relied on the submission made before the authorities below. On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. We note that Assessing Officer has passed the order under section 143(3) of the Act. The assessing officer on the basis of his observation reproduced at para no. 9 [ vide Page No.7 to 8 of assessment order ] made ad hoc addition of Rs. 80,97,725/- @ 10% of Rs. 8,09,77,259/-, without appreciating the sales/....
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....e assessee-company and the reasonableness of such expenditure he deemed it fit to disallow 50 per cent of the expenditure on gift items as detailed in the table being of a non-business nature and thus disallowable as per provisions of s. 37(1) of the IT Act and initiated penalty proceedings under s. 271(1)(c) of the Act separately on this issue. 27. The CIT(A) mentioned about the disallowance of sale promotion expenses of Rs. 11,83,585 and allowed Rs. 10 lakhs, which according to her was related to business and a part of Rs. 1,83,585 was confirmed as used in personal gifts and personal expenditure. 28. The Tribunal has observed that the CIT(A) has allowed bulk of the relief by observing that the expenditure was related to business expenditure. The CIT(A) has sustained the disallowance which accounts for about 5 per cent of the total claim. The Tribunal observed that "In our opinion, the disallowance of Rs. 75,000 under this head will meet the end of justice. Thus, we confirm the disallowance to the extent of Rs. 75,000 under this head and delete the balance amount". 29. It may be pertinent to mention that Mr. Gupta argued that there was no materi....
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....ears, he should be allowed such benefit in accordance with law. The assessee submitted before us copy of return of income wherein he claimed carry forward business loss, vide paper book page No. 13, which is given below: Details of Losses to be carried forward to future years Sl. No Assessment Year Date of Filing (YYYY/MM/DD) House property loss Loss from business other than loss from speculative business Loss from speculative business Loss from specified business Short-term capital loss Long-term Capital loss Other sources loss from owning race horses i. 2003-04 2003-08-31 0 318846 0 0 ii. 2004-05 2004-08-30 0 17752 0 0 iii. 2005-06 2005-10-31 0 42327 0 0 iv. 2006-07 2006-07-17 0 57602 0 v. 2007-08 2007-10-31 0 1382371 0 0 0 vi. 2008-09 2008-10-3! 0 23832966 0 0 0 vii. 2009-10 2010-03-31 0 949280 0 0 0 ....