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TMI Blog2013 (2) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... enses claimed at a time of assessment. Therefore, the expenses remained unexplained and A.O. rightly disallowed @ 50% of total expenses. 2. That the Ld. CIT(A) has erred in law and on facts in restricting the addition on account of unconfirmed creditors of Rs. 1,26,51,811/- to 40,998/-, since the genuineness of these creditors could not be proved beyond doubt at the time of assessment." 4. In ITA No.212/Agr/2012 for A.Y. 2008-09, the amount involved in ground no.1 is Rs. 23,34,020/- and in ground no.2 the amount is Rs. 84,60,000/-. 5. The brief facts of the case noticed from the A.O.'s order for the A.Y. 2006- 07 are that original assessment was made under section 143(3) of the Income Tax Act, 1961 ('the Act' hereinafter) on total income of Rs. 3,81,780/- against the returned income of Rs. 1,87,201/-. Subsequently order under section 263 of the Act was passed by the CIT. The A.O. made the impugned assessment. The A.O. asked the assessee to produce books of account and the case was adjourned to 27.12.2010. On this date none appeared before the A.O. The A.O. observed that it seems that the assessee has nothing to say and as the case is going to be time barred on 31.12.2010, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sh can not be faulted with, if supported by vouchers. Few supports on letter head etc. is also justified. Though un-supported payment can not be accepted fully which depend on factual verification but even after examination AO failed to indicate any specific example in support of his general observations. From the above, I find that the book of accounts and records are properly maintained which are backed by vouchers generally. However, as per the original order dt. 18.03.08 book of accounts are produced and examined where specific items of expenses are considered and disallowance of Rs. 1,94,580/- was added to the income. Though the said order is cancelled u/s 263 but still may provide a basis for disallowance of expenses. Assessee is right in his argument that out of the said disallowance a sum of Rs. 1,00,105/- are taxed under accepted FBT return. Balance amount remains Rs. 94,475/-. Considering the nature of business and observations of than AO and now in remand, I am of the opinion that an addition of around 5 times of the said amount shall meet both the ends of justice. In view of the above, I hold that the rejection of accounts and addition made by AO in the abse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Representative submitted that merely non-mentioning of section regarding rejection of books of account does not mean that the A.O. did not invoke the relevant provisions for rejecting the books of account. The ld. Departmental Representative submitted that that A.O. has rightly disallowed the expenses for the purpose of estimation of income. Ld. Departmental Representative in support of his contention relied upon a decision of I.T.A.T., Mumbai Bench in the case of Wal Street Construction Limited vs. DCIT, 87 ITD 47 (Mumbai) (TM). Ld. Departmental Representative submitted that the assessee did not produce books of account and other details before the A.O. and the same was furnished before the CIT(A). The A.O. has therefore did not get opportunity to go through all the details and hence the matter may be sent to the file of A.O. Ld. Departmental Representative in support of his contention relied upon the judgment of Hon'ble Bombay High Court in the case of CIT vs. Gilbert & Barker Manufacturing Co., 111 ITR 529 (Bom). 10. Ld. Authorised Representative, on the other hand, submitted that the assessee has furnished all the required details including books of account before the A.O. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irmation Copy of Statement Recorded on Oath Pg. No.89 Pg. No.112 Copy of Confirmation Pg. No.90 Copy of Confirmation Copy of Statement Recorded on Oath Pg. No.91 Pg. No.111 11. We have heard the ld. Representatives of the parties and records perused. We do not find substance in the submission of the ld. Departmental Representative that the matter should be sent back to the file of A.O. as the details were filed before the CIT(A). We notice that the A.O. has wrongly recorded the fact that on the date of hearing dated 27.12.2010 the assessee/Authorised Representative did not appear before the A.O. whereas the fact is that the assessee/Authorised Representative appeared before the A.O. and the A.O. himself recorded statement of some parties which are filed in the Paper Book. The A.O. has recorded blind in correct fact which is not appreciable. Merely mentioning that the case is going to be barred by limitation on 31.12.2010 the A.O. has taken shelter and on the basis of incorrect fact made the assessment under section 144 of the Act. Such a practice is not in accordance with law, therefore, such action of the A.O. is not sustainable. As regards the submission of the ld. Depa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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