2023 (6) TMI 46 - AT - Income Tax

Ad hoc disallowance related to pilferage expenses, some expenses on transport vehicle hire charges and repair and maintenance and addition was made on rent received by IOC - HELD THAT - After considering orders, it is very much clear that there is a lack of representation by the representative of the assessee. The assessment was completed during insurgency in the Kashmir Valley. Same is not applicable for the appeal order. We consider the hardship of the assessee for representation the matter before the ld. assessing authority. We accept the ground of the assessee and set aside the matter to the ld. AO for further adjudication afresh on the expenses, disallowed.

Issues Involved:
The appeal against the order of the ld. Commissioner of Income Tax (Appeals) for A.Y. 2014-15, challenging additions made by the ld. Income Tax Officer under various heads like Pilferage Expenses, Some Expenses, Expenses Claimed against Transport Receipts, Vehicle Hire Charges, Rent received by IOC, and Deduction u/s 80 C.

Pilferage Expenses:
The appellant contested the addition of Rs. 2,09,878 on account of Pilferage Expenses, arguing that it was unjustified and should be deleted. The ld. CIT (A) upheld the addition due to lack of proper explanation. The appellant failed to submit documents before the ld. AO, resulting in the addition to the total income. The Tribunal noted the lack of representation by the appellant and set aside the matter for further adjudication by the ld. AO, emphasizing the need for a reasonable opportunity of hearing.

Some Expenses:
Similarly, the appellant challenged the addition of Rs. 73,314 on account of Some Expenses, claiming it was unjustified and should be deleted. The ld. CIT (A) confirmed the addition due to lack of proper explanation. The Tribunal, considering the lack of representation by the appellant, set aside the matter for fresh adjudication by the ld. AO, emphasizing the need for a reasonable opportunity of hearing.

Expenses Claimed against Transport Receipts:
The appellant disputed the addition of Rs. 3,00,000 on account of Expenses Claimed against Transport Receipts, arguing it was unwarranted and should be deleted. The ld. CIT (A) upheld the addition due to lack of proper explanation. The Tribunal, noting the lack of representation by the appellant, remanded the matter to the ld. AO for further adjudication, stressing the importance of a fair hearing.

Vehicle Hire Charges:
The appellant objected to the addition of Rs. 1,56,509 on account of Vehicle Hire Charges, contending it was baseless and should be deleted. The ld. CIT (A) affirmed the addition due to lack of proper explanation. The Tribunal, observing the absence of representation by the appellant, referred the matter back to the ld. AO for fresh consideration, highlighting the necessity of a proper hearing.

Rent received by IOC:
Regarding the addition of Rs. 44,928 on account of Rent received by IOC, the appellant argued it was unjust and should be removed. The ld. CIT (A) upheld the addition due to lack of proper explanation. The Tribunal, recognizing the appellant's lack of representation, remitted the issue to the ld. AO for reevaluation, stressing the importance of a reasonable opportunity for the appellant to present their case.

Deduction u/s 80 C:
The appellant contested the addition of Rs. 1,00,000 on account of Deduction u/s 80 C, claiming it was erroneous and should be eliminated. The ld. CIT (A) supported the addition due to lack of proper explanation. The Tribunal, noting the appellant's non-appearance, directed the matter back to the ld. AO for fresh consideration, emphasizing the need for a fair hearing.

Conclusion:
Ultimately, the Tribunal allowed the appeal of the assessee for statistical purposes, setting aside the additions made by the ld. AO under various heads. The Tribunal emphasized the importance of providing the appellant with a reasonable opportunity of hearing before the ld. AO in the reassessment proceedings.

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