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2019 (9) TMI 825 - ITAT PUNEAddition on account of commission paid being 10% of the remaining domestic commission - HELD THAT:- It is observed from the factual narration made above that the assessee adopted a non co-operative attitude and did not produce books of account and other relevant bills before the AO. Since the AO was debarred from examining the details of commission along with necessary details, he could not have made a specific disallowance for want of evidence or genuineness etc. It is in such backdrop of the facts that he made disallowance on ad hoc basis. CIT(A), too, reduced the disallowance to 10% without giving any reasons. We have already vacated the finding of the CIT(A) in holding that the AO should have acceded to the assessee’s request for going ahead with partial books and truncated details. In view of the fact that the AO was not allowed access to the books of account and other relevant bills, we set-aside the impugned order and remit the matter to the file of AO for fresh consideration of the issue and then decide it after allowing reasonable opportunity of hearing to the assessee. Thus, the grounds raised by the assessee as well as the Revenue are allowed for statistical purposes. Disallowance of depreciation at 80% in respect of certain items of plant and machinery and instead allowing depreciation @ 25% - HELD THAT:- It is found as an admitted position that similar issue has been decided in favour of the assessee by the Tribunal in the assessee’s own case for the immediately preceding assessment year 2005-06 vide order. Both the sides are in agreement that the facts and circumstances of this ground are mutatis mutandis similar to those of the preceding year. Respectfully following the precedent, we decide this issue in the assessee’s favour. This ground is allowed. Disallowance under the head Repairs to machinery - HELD THAT:- CIT(A) sustained the above additions on the ground that the assessee could not produce any document to substantiate such claim. AR fairly conceded that no such document was still available with the assessee. In the absence of any substantiation of the claim of deduction for such expenses, we uphold the impugned order. Thus, the two grounds stand dismissed. Deduction on account of bad debts - HELD THAT:- It is found as an admitted position that the assessee, in fact, wrote off the amount of bad debts in its books of account. The Hon’ble Supreme Court in TRF Ltd. Vs. CIT [2010 (2) TMI 211 - SUPREME COURT] has held that after 01-04-1989, the assessee is not required to establish that the debt had became bad in the previous year. It was further held that the deduction has to be allowed on a mere write off. Since in the instant case, admittedly the assessee wrote off the amount in its books of account and it is not the case of the Revenue that the conditions stipulated u/s.36(2) were not satisfied, we uphold the impugned order in deleting the addition. Disallowing 5% of balance Legal and Professional charges - CIT(A) deleted the addition - HELD THAT:- The factual position in the year under consideration is different inasmuch as the assessee turned hostile and went to the extent of not producing the books of account etc. before the AO despite repeated reminders, thereby depriving the latter from examining the details. In line with our decision on restoring the issue of commission for a fresh decision , which was disallowed by the AO at 30% and reduced to 10% by the ld. CIT(A), we set aside the impugned order on this score and send the matter back to the AO with a direction to the assessee to produce the books of account and other relevant evidence etc. as directed by the AO, who, in turn, will specifically point out defects in the books of account and relevant evidence qua this expense before making any disallowance. No ad hoc addition should be made. Addition on stamp expenses - HELD THAT:- It is found as an admitted position that the stamp expenses in question do not relate to increase in the authorised share capital of the company and hence the judgment in the case of Punjab Industrial Development Corporation Ltd. [1996 (12) TMI 6 - SUPREME COURT] is not attracted to the facts of the instant case. Since such expenses are in relation to conducting business of the company, we uphold the impugned order in deleting the disallowance. Disallowance made on account of Public Relation expenses, Miscellaneous expenses, Vehicle expenses, Telephone expenses, Miscellaneous Foreign Travel expenses, Staff Welfare and Freight expenses - HELD THAT:- We find that the facts of this ground are similar to ground for commission and legal expenses discussed above, which we have restored to the AO for a fresh consideration and decision after examining the books of account and relevant documents. Adopting the same reasoning, we set aside the impugned order and send the matter to the AO for deciding it afresh. Needless to say, the assessee will produce the books of account and the relevant details, as called for by the AO.
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