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TMI Blog2010 (12) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... e settled law, when the expenditure is not unlawful or illegal the same was allowable. We, therefore, accept the alternate plea of the assessee that custom duty being a statutory duty payable by the assessee and it is a business expenditure to the extent of the addition, the same is to be allowed as business expenditure. - ITA No.7l75/Mum/2007 - - - Dated:- 10-12-2010 - SHRI R.S. PADVEKAR, SHRI RAJENDRA SINGE, JJ. Assessee by: Bhupendra Shah Revenue by: Shri Rajarshi Dwivedy ORDER PER R. S. PADVEKAR. JM This appeal is filed by the assessee challenging the impugned order of the Ld. CIT (A)-XIV Mumbai dated 17.9.2007 for the A.Y. 1986-87. The assessee has taken the following effective grounds:- I. The Income Tax Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he file and assessment order on page-2 reads as under:- The Assessing Officer has recorded a categorical finding-that the payment of customs duty amounting to Rs. 46,76,745/- has not been reflected in the cash book of the assesses. it is also categorically stated that the aforesaid sum was paid as customs duty during the previous year relevant to the assessment under appeal There is no material before us to doubt the correctness of the aforesaid finding recorded by the A.O. The burden was indeed on the assessee to offer satisfactory explanation regarding the nature and source of customs duty payment amounting to Rs. 46,76,745/-. The assessee failed to do so. The Learned CIT (A) has given reasons for deleting the addition in the fact of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plain satisfactory nature and source of custom duty payment of Rs. 61,74,263/-. The A.O., therefore, made the addition of Rs. 61,74,263/- i.e. in respect of alleged custom duty paid by the assessee from undisclosed sources in respect of High Sea sales made to those seven parties i.e. Rs. 14,97,518/-Rs. 46,76,745/- by rejecting the contention of the assessee that the custom duty was paid by the parties/buyers. The assessee challenged the assessment order before the Ld. CIT (A) raising the grievance against the addition made in respect of alleged payment of the custom duty but without success. The Ld. CIT (A) confirmed addition by giving the following reasons: - 4.4 I have carefully considered the facts and submissions and am not convince ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is presumed that assessee has paid the custom duty on the high seas sales then the same is allowable. We find force in the argument with the Ld. Counsel, the section 69C reads as under:- Where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof or the explanation, if any, offered by him is not in the opinion of the Assessing Qfficer, satisfactory, the amount covered by such expenditure or part thereof as the case may be, may be deemed to be the income of the assessee for such financial year: (Provided that notwithstanding anything contained in any other provision of this Act, such unexplained expenditure which is deemed to be the income o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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