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TMI Blog2016 (1) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... increased by 5% and the expenditure has reduced. The Tribunal has lost sight of the fact that the expenditure claimed under the head manufacturing expenses, which forms part of the "profit and loss account", showing expenses made by the assessee are required to be proved by production of bills and vouchers. Disallowance of 5% in the facts of the case is justified. - Decided against assessee Expenses attributable on the conveyance and telephone of the Directors of the assessee-company - should be included in the expenses of the assessee-company as held by ITAT - Held that:- nothing has been brought on record by the Department to indicate as to what was the direction given by the authority for the assessment year 2001-02. We are of the vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessment year 2004-05 is that the company under the profit and loss account had claimed a sum of ₹ 22,06,84,916/- under the head manufacturing expenses indicating it as consumable stores. During the course of assessment proceedings, the assessee was directed to file details in respect of the expenses claimed for and also justify them. The Assessing Authority, after examining the matter, came to the conclusion that the bills and vouchers and other supporting documents in relation to various expenses could not be produced. The Assessing Officer also found that no stock register was maintained and therefore balance consumable stores could not be verified. Considering the totality of the facts and non-maintenance of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee's case was covered by a decision of the Gujarat High Court in Sayaji Iron And Engg. Co. Vs. Commissioner of Income Tax, (253) 2002 ITR 749. Having heard the learned counsel for the parties, we find that there is an express finding given by the Assessing Authority as well as by the Ist Appellate Authority with regard to non-production of bills and vouchers and for not maintaining the stock register. In the absence of non-production of bills and vouchers, the Assessing Officer was justified in disallowing certain expenditure by 10%, which was reduced by the Ist Appellate Authority to 5%. This aspect had not at all been considered by the Tribunal and the same had only been allowed on the ground that the turnover has in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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