TaxTMI 
TaxTMI 
TaxTMI 
2018 (7) TMI 2373
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.... Bangalore vide the impugned order dated 31/8/2017 allowed the assessee partial relief . Aggrieved by the order of the CIT(A)-6, Bangalore both the assessee and Revenue have filed cross appeals which will be disposed hereunder: 3. Assessee's appeal in ITA No. 2145/Bang/2017 (Asst. Year 2012-13) The assessee has filed this appeal wherein he has raised the following grounds:- 1. The learned CIT (A) erred in upholding the disallowance of Rs. 49,834/- claimed under vehicle maintenance charges of M/s. Thirumala Wines and Legend Bar & Restaurant. 2. The learned CIT (A) failed to appreciate that the running expenditure claimed was in the course of business in respect of servicing and repair charges which was required to be incurred in the course of business which had total turnover of Rs. 3,50,81,171/-. 3. The learned CIT (A) ought to have appreciated that the expenditure was reasonable and compared well with similar expenditure in the past and accordingly he ought to have allowed the same. 4. The learned CIT (A) erred in disallowing the interest claimed to the tune of Rs. 12,24,714/- which was on the loans borrowed for the purpose of business of the Appellant. 5. The lear....
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....he learned CIT (A) ought to have appreciated that though the arrack business stood banned, the Appellant was continued to be in business and the loans outstanding were liable to be discharged by him and there being no waiver of loan, the impugned addition as made was uncalled for. 15. The learned CIT (A) ought to have appreciated that the outstanding unsecured loans were not of the relevant year and carried over figures and were outstanding from the financial year 2006-07 onwards and consequently the impugned addition alleging them to be bogus was uncalled for and thus the impugned addition is liable to be deleted. 16. The learned CIT (A) failed to appreciate that the principles of natural justice were not followed in that the information collected behind the back of the Appellant was not produced to the Appellant for rebuttal and accordingly the impugned addition is against the principles of natural justice and opposed to law, and accordingly liable to be deleted. 17. The learned CIT (A) ought to have refrained from upholding the disallowance of rent payable to Excise Department which was outstanding as unexplained cash credit. 18. The learned CIT (A) ought to have acc....
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....thorities below. 5. Grounds 4 to 7 - Disallowance of interest on loan - Rs. 12,24,714/- 5.1 In these grounds (Supra), the assessee contends that the authorities below erred in disallowing interest claimed on loans which were borrowed for the purpose of his business through his mother from the bank u/s 40(a)(ia) of the Act. It was also contended that the judicial pronouncement of the Hon'ble Apex Court referred to was distinguishable. The ld AR for the assessee was heard in support of the grounds raised . 5.2 Per contra, the ld DR for Revenue supported the order of the AO in disallowing the interest. According to the ld DR, it is not the assessee but the assessee's mother, Smt. Vijaylakshmi, herself as Income-tax assessee, who had availed the said loan from Corporation Bank and the facts on record establish that it is the assessee who has made payment of the interest on the said loan of his mother directly to the Bank on behalf of his mother. The ld DR drew the attention of the Bench to page 250 of the assessee's paper book which is the assessee's balance sheet as on 31/2/2012 wherein the loan of mother does not appear as a loan creditor. It is contended that, since the said expe....
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....n the grounds No. 8 & 9 raised by the assessee, we dismiss the same. 7. Ground No. 12 - Disallowance of Vehicle Maintenance expense - Rs. 72,925/- 7.1 In this ground, the assessee challenges the disallowance of Rs. 72,925/- out of vehicle maintenance expenses claimed. After being heard both parties, we have perused and carefully considered the material on record. It is seen from the order of assessment that the AO, after putting the assessee on notice vide letter dated 7/8/2014, disallowed an amount of Rs. 72,925/- out of vehicle maintenance expenses claimed; in the absence of supporting documentary evidence is being filed. On appeal, the ld CIT(A) has upheld the above disallowance made by the AO for the reason that no documentary evidence was filed before her to support the assessee's claim. Before us also, since no supporting documentary evidence is filed to establish the assessee's claim, we uphold the disallowance of Rs. 72,925/- out of vehicle maintenance expenses, made and sustained the orders of the authorities below. Consequently, ground No. 12 raised by the assessee is dismissed. Ground Nos. 10 & 11 - Disallowance of Interest paid - Rs. 3,23,106/- 8. In these grounds (....
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....(A) after considering the AO's view in the order of assessment, the assessee's claim and the material on record has upheld the addition u/s 68 of the Act to the extent of Rs. 2,47,73,480/- (out of the addition of Rs. 3,49,112/-) and Rs. 50 lakhs made by the AO; holding as under at paras 19 to 28 of her order. 19. Addition of Rs. 3,4977,112/- on account of unsecured loans. - The AO disallowed a sum of Rs. 3,49,77112/- shown as unsecured loan by the appellant. Perusal of assessment order reveal that appellant had not provided PAN, date of loan transaction, address of creditors, identity etc. However appellant stated before AO that these were old loans appearing in earlier years. It is noted that appellant was provided several opportunities by AO to furnish confirmations in respect of these unsecured loans. However, appellant furnish PAN in respect of 13 creditors out of a total of 43 creditors. Therefore AO held that 30 creditors identity of creditors, genuineness of transaction and credit worthiness of these creditors were not proven . In respect of 13 creditors wherein PAN was furnished, AO issued letters requiring confirmations. However, it is noted that in 7 cases, the creditor....
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....ing clarification from appellant. The remand report merely stated since the information in the letter was not furnished the same was brought to taxation'. 24. In view of the fact that amount of Rs. 55,94,0911- was sum paid to HDFC Bank by M/s Brigade Gateways and in view of the fact that amount of Rs. 46,09,541/- represented closing balance of appellant's mother in appellant's books, addition of the said amounts under the head unsecured loan totalling Rs. 3,49,77,1121- is found to be unsustainable. Hence the same stands deleted. Appellant gets relief of Rs. 1,02,03,632/-i.e. (3,49,77,112-55,94,091- 46,09,541). Consequently addition of Rs. 2,47,73,4801- is sustained and confirmed. 25. Addition of Rs- 6457,200/- under the head excise duty payable. - AD held that appellant had shown Rs. 64,57,200/- as rent payable to Excise Department as unexplained since appellant failed to file documentary evidence in support of his contentions. 26. During appellate proceedings, AR of appellant stated that since arrack business was closed down, the appellant was not in a position raise funds and clear his liability and hence balance payable was Rs. 64,57,200/-. However, no evide....
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....e CIT(A) erred in deciding the matter based on the fresh evidences submitted by the assessee without giving an opportunity to the assessing officer to examine such evidences which is contravened to the provision of Rule 46A(3). 3. For these and such other grounds that may be urged at the time of hearing, it is humbly prayed that the order of the CIT(A) in so far as it relates to the above grounds may be reversed and that of the Assessing Officer be restored. 4. The appellant craves leave to add, alter, amend or delete any of the grounds that may be urged at the time of hearing of the appeal." 13. Ground Nos: 1 and 4 (Supra) being general in nature, no adjudication is called for thereon and consequently these grounds are dismissed as infructuous. 14. Ground No: 2 & 3 - Violation of provisions of Rule 46A(3) 14.1.1 In this ground (supra), Revenue contends that the ld CIT(A) erred in deciding the matter and granting relief to the assessed based on fresh evidences submitted by the assessee and without affording any opportunity of being heard and to examine such evidence, which tentamounts contravention/violation of the provisions of Rule 46A(3) of the rules. In view of this it....
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.... at any stage of proceedings and what the ld CIT(A) refers to as ' remand report dated 19/5/2015 is actually para wise comments of the AO with respect to the points raised in assessee's appeal petition for asst. year 2012-13 filed on 19/3/2015 on statement of facts, etc. 14.2 The ld AR for the assessee supported the impugned order of the ld CIT(A). On being queried by the bench the ld AR could not place on record any order of the remand u/s 250(4) of the Act called for by the ld CIT(A) from the AO; and more particularly in respect of the fresh details/evidence filed in respect of the cash credits of Brigade Gateway's and Smt Vijayalakxmi; which is the subject matter of Revenue's appeal. 14.3.1 We have heard the rival contention and perused and carefully considered the material on record before us. In our view, an appraisal of the facts of the matter clearly indicate that the ld CIT(A) in the course of appellate proceedings had admitted fresh evidence/details on record which was not before AO and based thereon, granted relief to the assessee ; without affording the AO adequate opportunity of being heard in the matter; to examine and submit the fresh evidence filed which is in cont....