2023 (1) TMI 1017

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.... 2. In its appeal, the assessee has raised the following grounds:- "(1) On The Facts and circumstances of The Case The Learned Commissioner of Income Tax has erred in Law in confirming the Addition made by The Assessing Officer of 10% of Officer expenditure of 1,16,452/- which is most unjustified & Arbitrary. (2) On The facts and the circumstances of the case the learned Commissioner of Income Tax (Appeals) confirmed the addition of 20% of expenses incurred of Rs.29,67,302.4/- For Drug Analysis expenses, Which is most unjustified and Arbitrary. (3) On the facts of the learned Commissioner of Income Tax has disallowed the grounds of levy of penalty under section 271(1)(c). (4) The appellant craves leave....

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....agreed by the assessee during the assessment proceedings and no appeal against the same was filed by the assessee. Finding no material change in facts and circumstances of the case, the AO vide order passed under section 143(3) of the Act disallowed 10% of the aforesaid office expenses and accordingly, made an addition of Rs.1,16,452. The learned CIT(A) vide impugned order dismissed the appeal filed by the assessee on this issue. Being aggrieved, the assessee is in appeal before us. 6. Having heard the submissions of both sides and perused the material available on record, we find that apart from claiming that the impugned expenditure has been incurred for the purpose of business, no material has been brought on record to substantiate th....

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....issions of both sides and perused the material available on record, we find that the assessee is in the business of drug analysis, clinical trials, and other research activities and as part of the said business, the assessee does lab study of various drugs before their launch in the market. As per the assessee, for the purpose of such lab study, the assessee conducts the trial on various persons, who acts as a volunteer and as a consideration, the assessee pays such volunteers in cash. During the hearing, reliance was placed upon cash vouchers of drug analysis expenses, forming part of the paper book from pages No. 214 - 245. From the perusal of said vouchers, we find that the said vouchers mention the volunteer centre ID, the amount paid, ....