TaxTMI 
TaxTMI 
2021 (6) TMI 1020
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....er s. 143(3) of the Income Tax Act, 1961 (the Act) concerning AY 2015-16. 2. The grounds of appeal raised by Revenue read as under: "1. That in the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the additions made by the Assessing Officer in a superficial manner, without conducting necessary inquiries and examination of facts, as explained by the Hon'ble High Court in Jansampark Advertising & Marketing (P) Ltd. 375 ITR 373 (Delhi), regarding the obligation of the CIT(A) to conduct proper inquiry. 2. That in the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the additions made towards expenses, without examining the expenses claimed, and without cons....
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.... operative para of the order of the CIT(A) is extracted herein for ready reference: "4.3. I have considered the submission of the Ld. Authorized Representative and order of the Assessing Officer, From the record it is seen that in A.Y. 2012-13 and 2014-15 also similar expenses were claimed by the appellant, however, no additions were made by the Assessing Officer. I have disposed these appeals on 23.09.2016 and 25.05.2017 and these facts are verifiable from these appeal folders. The books of accounts of the appellant are audited and there is no whisper in the order of the Assessing Officer that the expenses are bogus or unreasonable. Since, there is no specific defect pointed out by the A.O. in the books of accounts and considering....
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.... A.R. of the appellant has vehemently argued that income and advances is recorded in books as and when party approaches the bank for settlement, since the bank is liquidated since 2003-04, the system of accounting is regularly applied and followed. Further, pleaded that the investment of Rs. 1,94,50,000/- is totally bad and non recoverable, entire asset is loss asset. Reliance is placed in the case of Dhankeshwari Cotton Mills Ltd. Vs CIT Supreme Court vide order dated 29.10.1954, the Hon'ble Supreme Court held that "In making an assessment U/s. 23(3) of the Indian Income tax Act, the income tax officer is not fettered by technical rules of evidences and pleadings and he is entitled act on material which may not be accepted as evidences....
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....ties. As stated, the assessee, a co-operative Bank, is in the process of liquidation and Government appointed a liquidator to conduct its day-to-day affairs. As further stated, no banking activities have been carried out by the bank since initiation of liquidation proceedings. A reference has been made to the communication dated 22.03.2007 issued by the Reserve Bank of India whereby the license to carrying on banking business in India under the Banking Regulation Act, 1949 was cancelled and the assessee was debarred from carrying on banking business forthwith. The activity of banking thereafter, as stated, is thus restricted to collect advances outstanding as on date and it also passively earns interest income from deposits lying with banks....
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....on facts. Merely because the expenses incurred appears excessive qua the corresponding business activities, it cannot be a ground for ad hoc disallowance as long as the expenses incurred are commercially expedient. We thus see not merit in the grievance of the Revenue in this regard. 7.3. As regard the addition of Rs. 2,96,37,269/- being 10% out of sundry credits of Rs. 29,63,72,698/-. The CIT(A) found force in the claim of assessee for reversal of additions on the ground that there is no mismatch or non-tallying with figures of sundry creditors. The Revenue could not point out any specific defect in the order of the CIT(A) in its rebuttal before us. We totally fail to understand the rationale for disallowance of ad-hoc sum out of existi....