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TMI Blog2012 (8) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... wance made out of Cooly and Delivery charges claimed Rs. 52,198/- 2. Short facts apropos are that assessee, a wholesale grain dealer, had filed its return of income declaring a total income of Rs. 1,18,978/- for the impugned assessment year. Assessing Officer noted from the records produced by the assessee that it had made purchases to the tune of Rs. 28,27,500/- from the following parties:- (1) Kumaresan, Chengalpattu Rs. 1,65,000 (2) Gopi, Arumbakkam Rs. 1,50,000 (3) Selvan, Thiruvallur Rs. 1,65,000 (4) G. Uma Shankar, Arumbakkam Rs. 17,12,500 (5) Kannan, Ponneri Rs. 1,60,000 (6) Munusamy Naidu, Chengalpattu Rs. 1,70,000 (7) Murugan, Madurantakam Rs. 1,60,000 (8) Muthukumar, Arani Rs. 1,45,000 Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led for application of Section 68 of the Act. Payments for purchases were all effected in cash and such purchases were supported only by self-made vouchers. Insofar as disallowance under Section 40A(3) was concerned, CIT(Appeals) was of the opinion that assessee could not establish that the recipient was an agriculturist. He also confirmed disallowance of Rs. 2,54,791/- made on interest for not proving the genuineness and creditworthiness of concerned creditors. Insofar as disallowance of Cooly and Delivery charges was concerned, CIT(Appeals) was of the opinion that the A.O. was liberal in restricting the disallowance to 25%. In this view of the matter, he confirmed the order of the A.O. 7. Now before us, learned A.R., strongly assailing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere from agriculturists. It would not generally be possible to obtain bills from agriculturists and therefore, the best that could be done in such circumstances was to have self-made vouchers. This the assessee had done. No defect in such self-vouchers has been pointed out. There is no finding by the A.O. that the said amounts were appearing as payable to the said parties at the end of the previous year. The disallowances were made disbelieving the purchases and not because any trade credit balance stood unproved. Application of Section 68 is called for only where any credit balance stands unproved. Here, all the amounts due to the said parties, stood paid before the end of the relevant previous year. There were no trade credit balances a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ners' current account was showing a debit balance, interest expenses could not have been disallowed. 12. Insofar as 25% disallowance on total Cooly and Delivery charges are concerned, the only reason given by the A.O. is that proper vouchers were not produced. What was considered by the A.O. as not proper in the vouchers produced by the assessee, has not been mentioned at all. Defects in vouchers produced by the assessee were not pointed out. Generalised reasons for disallowances cannot stand the test of reason. 13. We are of the opinion that the disallowances and additions were uncalled for and have to be deleted. Appeal filed by the assessee is allowed. The order was pronounced in the Court on Tuesday, the 19th of June, 2012, at Chenna ..... X X X X Extracts X X X X X X X X Extracts X X X X
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