2018 (1) TMI 321 - AT - Income Tax

Addition on account of difference between commission receipt declared by the assessee and as per Form 26AS - Held that - The assessee has not submitted any evidence, which could reconcile the difference between the commission received as per Form 26AS at ₹ 7,67,404/- as against commission declared by the assessee in its P&L account of ₹ 5,63,670/-. The payer of commission is a group concern and director is common. The onus is on the assessee to explain the discrepancy. The assessee cannot get away simply stating that the Assessing Officer of payer and payee is same. Since the assessee has failed to discharge the primary onus with regard to explain the difference in the receipts of the commission, the Bench find no merit in the contention of the ld. AR of the assessee. The assessee has miserably failed to provide a satisfactory explanation with regard to difference in commission declared by the assessee and commission receipt as per Form 26AS. Hence this ground of assessee s appeal stands dismissed. Disallowance of expenses - Held that - The Bench is of the view that this issue needs a fresh look at the level of the Assessing Officer wherein the assessee shall be at liberty to produce the persons to whom the salary was paid as the ld AR claimed that these persons are still working with the assessee company. Accordingly, this issue is restored back to the file of the Assessing Officer. This appeal is partly allowed for statistical purposes.

Summary

Issues Involved:
1. Addition of commission income difference.
2. Disallowance of expenses.
3. Disallowance of depreciation, interest on car loan, and car insurance.

Issue 1: Addition of Commission Income Difference:
- The appeals arose from separate orders of the ld. CIT(A)-4, Jaipur for the A.Y. 2010-11, 2011-12, and 2012-13.
- The key issue was the addition of ?2,03,404 due to a variance in commission income between the P&L account and Form 26AS.
- The CIT(A) upheld the addition, stating the appellant failed to explain the difference adequately.
- The appellant's arguments were considered, but as no evidence reconciling the variance was provided, the addition was confirmed.

Issue 2: Disallowance of Expenses:
- The dispute centered on the disallowance of ?2,26,863 in expenses.
- The CIT(A) affirmed the disallowance, citing defects in vouchers and bills provided by the appellant.
- The matter was remanded to the Assessing Officer for further verification as the appellant claimed the expenses were valid and related to specific individuals still working for the company.

Issue 3: Disallowance of Depreciation, Interest on Car Loan, and Car Insurance:
- The controversy involved the disallowance of ?2,94,838 for depreciation, interest on a car loan, and car insurance.
- The CIT(A) upheld the disallowance due to the absence of a log book proving business usage of the cars.
- The appellant argued that the cars were provided to specific individuals to increase commission income, but the lack of a log book led to the disallowance.
- The matter was sent back to the Assessing Officer for a fresh review, considering the appellant's submissions.

In conclusion, the ITAT Jaipur partially allowed one appeal for statistical purposes and allowed two other appeals for similar reasons. The judgments addressed various issues, including discrepancies in income, disallowance of expenses, and the usage of assets for business purposes. The decisions were based on the evidence presented and the legal interpretations of the tax laws involved in each case.