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TMI Blog2016 (12) TMI 180X X X X Extracts X X X X X X X X Extracts X X X X ..... idence to justify the disallowance made by the AO or to enhance the same, it can safely be presumed that the payment in question has been made by the assessee as brokerage. The impugned order is therefore not sustainable in the eyes of law. Accordingly, we set aside the findings of the Ld. CIT(A) - Decided in favour of assessee. Disallowance of repairs and maintenance expenses - Held that:- We notice that the AO has disallowed 20% of expenses for want of evidence, however, the Ld. CIT(A) has taken altogether new ground and taken the view that the expenditure other than the society charges aforesaid, are capital in nature. We also notice that the CIT(A) did not seek any explanation from the assessee before arriving at such a conclusion. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment order was challenged before the Ld. CIT(A). In appeal the Ld. CIT(A) after hearing the assessee enhanced the disallowance claimed as brokerage from ₹ 14,25,020/-determined by the AO to ₹ 21,91,020/- and also confirmed the disallowance claimed as repairs and maintenance expenses. 3. Aggrieved, the assessee is in appeal before the Tribunal. The assessee has raised the following effective grounds of appeal:- 1) The learned Commissioner of Income-tax (Appeals) erred in disallowing brokerage paid to the tune of ₹ 21,19,020/-. 2) The learned Commissioner of Income-tax (Appeals) erred in assuming jurisdiction to make an enhancement, without satisfying the jurisdictional conditions prescribed by section 251(2). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant/assessee paid brokerage of ₹ 21,91,020/- in respect of the said leave and license agreement to Viwa Chem Pvt. Ltd. i.e. 2% security deposits of ₹ 7 crores plus 2% of license fees for the period of 36 months and service tax @ 12.36%. The Ld. Counsel further submitted that Viwa Chem Pvt. Ltd. has confirmed the payment. The AO has wrongly applied the provisions of section 40A(2)(b) of the Act and disallowed ₹ 14,25,020/- out of the total amount claimed wrongly holding that one of the directors of the company is the son of a partner of the assessee firm. Shri. F.A.Vakil, one of the directors of Viwa Chem Pvt. Ltd. is the husband of one of the partners of the assessee firm, Smt. S.F. Vakil and he is not son of the partners. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) 260 ITR 8 (Bom.), disallowed the entire amount claimed by the assessee holding that the company to whom the brokerage was paid has failed to establish that it was authorized to act as a broker. Moreover, mere payment of money by the assessee in this case is not sufficient to prove the genuineness of the transaction and real substance of the transaction is required to be seen. 7. Admittedly, the assessee has made payment of ₹ 19,42,777/-vide cheque dated 27.3.2008 issued in favour of Viwa Chem. Pvt. Ltd. and deposited TDS of ₹ 2,48,243/- thereon vide cheque dated 27.3.2008 issued by the assessee firm. The said facts prima facie establish the claim of the assessee that it has paid net brokerage of ₹ 19,42,777/-and deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wance becomes academic hence we do not consider it necessary to adjudicate this issue separately. 8. Second issue pertains to disallowance of repairs and maintenance expenses of ₹ 3,14,322/-. The Ld. Counsel for the assessee referring to the profit and loss account, in which a sum of ₹ 15,71,612/-had been debited being expenses for repair and maintenance of premises, submitted that the Ld. CIT(A) has wrongly confirmed the disallowance made by the AO. Per contra the Ld. DR relying on the findings of the Ld. CIT(A) submitted that since the assessee had incurred the expense of ₹ 11,83,241/- in connection with maintenance of assessee s office premises at 3rd floor, Liberty Building, the Ld. CIT(A) has rightly confirmed the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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