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TMI Blog2013 (2) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... A) restricted the disallowance - Held that:- no proper findings have been given by the CIT(A) while restricting the disallowance except mentioning that certain transportation vouchers had not been provided to the AO. Since the lorry receipts and proof of expenditure had not been furnished, the AO made the disallowance. In these circumstances, we set aside the order of the CIT(A) and remit the issue to the file of the AO to decide the issue afresh by recording proper findings and in accordance with law. Disallowance of adhoc portion of 40% of the temple expenditure while accepting the genuineness of the expenditure - Held that:- Do not find any infirmity in the order of the CIT(A) in sustaining the 40% of the disallowance, out of the di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee company had debited total consultancy charges of Rs. 23,88,239/-under the head Manufacturing, Administration and Selling expenses . He further noted that though the assessee had furnished details of parties, the other information related to the services rendered by the said parties had not been furnished and tax at source had been deducted. Since the full information had not been furnished, the AO disallowed a portion of the expenditure of Rs. 15,00,000/- out of the said expenditure. 4. On appeal before the CIT(A), the assessee stated that full details had already been given to the AO. The CIT(A) held that the details furnished before the AO were produced during appeal proceedings and he found from the ledger account that there ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by bills/invoices. Hence, the AO disallowed 50% of the said expenses, which comes to Rs. 22,00,000/- in view of the nature of deficiencies found. 9. Before the CIT(A), the assessee stated that each and every expenditure was properly vouched and submitted the detailed ledger accounts, which were given to the AO and also explained that each and every expenditure was incurred after going through the company hierarchy and after going through proper process. He pointed out that each and every voucher is subject to audit both internal and external. After considering the submissions of the assessee, the CIT(A) held that the ledgers were detailed and contained all the entries and the AO had not pointed out a single unvouched expenditure nor had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ials, fertilizers (for farmers) handling bagasse, firewood, charcoal, ash, press mud, raw sugar, stocks material etc. would be included. It was submitted that copies of the ledger accounts and a statement showing broad details of the quantities were given. It was further submitted that all the expenditure was incurred at factory with due documentation, authorization and approvals, therefore, there is no scope for any excess expenditure to be incurred other than what is required for the purpose at hand. 14. After considering the submissions of the assessee, the CIT(A) held that the detailed ledgers had been provided by the assessee, however, some details regarding certain transportation vouchers had not been provided to the AO. He, therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the genuineness of the expenditure. 20. The AO noted that the assessee had debited a sum of Rs. 14,55,868/- under the head manufacturing, administration and selling expenses. He further noted that there was no such expenditure in the earlier year. He, therefore, held that this expenditure was not relatable to the carrying on of the business of the assessee and hence not allowable u/s 37 of the Act. Accordingly, he added the said amount to the income of the assessee. 21. Before the CIT(A), the assessee stated that the expenditure in question relates to the administration of the temple complex within the business premises. It was further stated that the temple complex is the main recreation centre for thousands of employees. The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture except for a few bills, the AO disallowed 50% of the said expenditure, which comes to Rs. 13,00,000/-. 27. Before the CIT(A), the assessee stated that it is in the commodities manufacturing and trading, dealing with customers and commission agents and, besides it has to deal with a large number of Government and non-government agencies to pursue its works like obtaining licenses, release orders, exports etc., for sugars, molasses and power, which require huge marketing and public relation efforts as the turnover of the company is Rs. 246 crores comprising of sugars, molasses and power all controlled by various policies. It was, therefore, submitted that the expenditure incurred is less than 0.1% which may kindly be considered as re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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