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TMI Blog2018 (4) TMI 987X X X X Extracts X X X X X X X X Extracts X X X X ..... operative in prosecution of his appeals. We are of the view that these appeals should be disposed of on merits after hearing the Ld. D.R. Accordingly, these appeals are being disposed of in the ensuing paras after hearing the Ld. D.R. and considering the merits of the respective cases. ITA No.7642/M/2012 for A.Y. 2009-10 3. The grounds raised by the assessee are as under: "1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in confirming 1.1 Invocation of section 40(a)(ia) to transaction entered into with non banking finance companies; 1.2 Addition of Rs. 88,85,487/- u/s 40(a)(ia) for non deduction of tax at source. 2. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in confirming addition of Rs. 7,98,000/- u/s 40A(3) of Income Tax Act, 1961. 3. Appellant craves leave to add, alter and/or modify the grounds of appeal on or before the date of hearing of the appeal." 4. The issue involved in ground No.1 is against the confirmation of addition of Rs. 88,85,487/- as made by the AO under section 40(a)(ia) of the Act on account of non deduction of TDS on the payments made to non banking finance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... level of the AO whether the payees have disclosed these payments as receipts in their respective returns of income. Therefore, we, in the interest of justice and fairplay restore the matter back to the file of AO to decide the issue as per the 2nd proviso to section 40(a)(ia) after affording a reasonable opportunity of being heard to the assessee. Needless to say that if the payees have shown the said receipts of income then these payments should be allowed to the assessee. The ground No.1 of the appeal of the assessee is allowed for statistical purposes. 8. The second issue raised by the assessee is as regards confirmation of addition of Rs. 7,98,000/- by CIT(A) as made by the AO u/s 40A(3) of the Income Tax Act on account of cash payments exceeding Rs. 20,000/-. 9. The facts in brief are that the assessee purchased river sand and water by making cash payments to the tune of Rs. 7,98,000/-. According to the AO the said payments are not admissible as allowable expenses u/s 40A(3) of the Act and while rejecting the contentions of the assessee that as per rule 6DD(f) the said payments by way of cash are exempted as these expenses were incurred for purchase of products manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in law, the Ld.CIT(A) erred in deleting the addition of Rs. 20,65,289/- made by the Assessing officer on account of non-genuine purchase and by admitting additional evidence in the form of ledger accounts of purchase parties, confirmation letter and copies of bank statement in contravention of Rule 46A despite several opportunities given by the Assessing officer during assessment proceedings; 4. On the facts and in the circumstances of the case and in law, Ld.CIT(A) erred in deleting the addition of Rs. 8,52,725/- made by the Assessing officer on account of various expenses incurred in cash when the assessee failed to furnish supporting evidences to prove genuineness of expenses and their relation with the business. The appellant prays that the order of the CIT(A) on the grounds be set aside and matter may be decided according to law. The appellant craves leave to amend or alter any ground or add new ground which may be necessary." 14. The issue raised in ground No.1 is against the deletion of addition of Rs. 1,39,300/- by Ld. CIT(A) as made by the AO on account of refundable deposit to BMC and MHADA. 15. The facts in brief are that on the examination of details furnis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised by the Revenue is dismissed. 18. The issue raised in ground No.2 is against the accepting the loss incurred by proprietary concern namely, S.D. Hospitality (Restaurant) by ignoring the fact that assessee does not maintain consumption register and has shown different ratio of consumption of materials for different restaurants. 19. The facts in brief are that the S.D. Hospitality (Restaurant) is a proprietary concern of assessee which is engaged in operation of three restaurants. The AO during the course of assessment proceedings called upon the assessee to furnish the details of consumption of various materials as per the stock records/register maintained. However, it was found that assessee has not maintained any records of consumption of raw materials and finally the AO reworked the loss by working out the consumption at 35% of the turnover at Rs. 34,25,574/- as against 65,04,598/- claimed by the assessee and thus added Rs. 30,79,024/- to the income of the assessee on account of differential loss. 20. In the appellate proceedings, the Ld. CIT(A) allowed the appeal of the assessee by observing and holding as under: "5.3 l have careful ly considered the submi ssions made b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is clear that both White and Zing Café are not a high end Restaurants which are having teething trouble which the AO fails to understand. 5.3.3. The appellant is liable to VAT under Sates Tax Law. The appellant had been regularly assessed to sales tax and no discrepancy in sales was noticed or pointed out by the Sales Tax Authorities. The Assessing Officer had not brought any material on record to show that the sale made to the sister concerns is fictitious. The Assessing Officer had not noticed any discrepancy with regard to the correctness and completeness of the account maintained by the appellant. Further the Assessing Officer had relied on the statement of the Accountant who is not an expert in the hotel industry particularly with regard to the consumption of raw material. In the statement recorded by the Assessing Officer, in answer to Q.No.11 Shri Vijay Mondkar has stated that "it appears the consumption ratio is high as compared to the normal standard. However. I am unable to acknowledge this question. My primary job is just to account for the sales and purchase transactions". The above clearly reveals that the accountant do not posses any knowledge in the hotel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ails qua the said purchases and parties. 24. In the appellate proceedings, the Ld. CIT(A) deleted the entire addition when the assessee filed the necessary evidences as regards these three parties such as details of PAN, ledger accounts, bank statements etc. and the payments details by way of cheques and after considering the facts that all these parties were having VAT and GST numbers and thus justified the deletion the addition. 25. Having heard the Ld. D.R. and perusing the materials on record, we find that the addition was deleted by the Ld. CIT(A) after verifying the evidences filed by the assessee which were not filed before the AO despite sufficient opportunities being given to the assessee. The Revenue has also challenged that this has caused a contravention of rule 46 and AO has not been afforded opportunity to examine these documents as furnished by the assessee. Under these circumstances, we are of the view that the CIT(A) clearly erred in not confronting the evidences to the AO and therefore of the view that AO should be given an opportunity to examine these records and documents as filed before the Ld. CIT(A). Accordingly the issue is restored to the file of the AO w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by the AO that cash bills in respect of various expenses were not produced by the assessee is not sufficient to justify the adhoc disallowance. Under these circumstances, we are of the view that the order of Ld. CIT(A) is correct on this issue as no disallowance can be made on adhoc basis without pointing out specific defect and deficiency in the records maintained by the assessee. Accordingly, we dismiss the ground raised by the Revenue by affirming the order of Ld. CIT(A) on this issue. 29. In the result, the appeal of the Revenue is partly allowed for statistical purposes. ITA No.1032/M/2017 for A.Y. 2010-11(Assessee) 30 The issue raised in ground Nos.1 & 2 is identical to one as decided by us in ground Nos.1 & 2 in ITA No.7642/M/2012 for A.Y. 2009-10. Therefore, our decision in the said appeal would,mutatis mutandis, apply to this ground as well. Accordingly, the issue is set aside to the file of the AO. Ground Nos.1 & 2 are allowed for statistical purposes. 31. The issue raised in ground No.3 is against the confirmation of Rs. 18,00,000/- paid to Prabodhan Goregaon, a Public Charitable Trust registered u/s 12A of the Act under an agreement entered into between the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO with a direction to see whether the case is covered under 2nd proviso to section 40(a)(ia) of the Act and decide the issue as per law and fact. The ground by the assessee is allowed for statistical purpose. 35. Accordingly, appeal of the assessee is allowed for statistical purposes. ITA No.2411/M/2017 for A.Y. 2011-12(Assessee) 36. The issue raised in ground Nos.1 & 2 is identical to one as decided by us in ITA No.7642/M/2012 for A.Y. 2009-10 in ground No.1. Therefore, our findings in ground No.1 in ITA No.7642/M/2012 would,mutatis mutandis, apply to this ground as well. Accordingly, the issue is restored to the file of the AO and appeal is allowed for statistical purposes.The appeal is allowed for statistical purpose. ITA No.1033/M/2017 for A.Y. 2012-13(Assessee) 37. The issue raised in ground Nos.1 & 2 is identical to one as decided by us in ground No.1 in ITA No.7642/M/2012 for A.Y. 2009-10 and therefore, our findings in ground No.1 in ITA No.7642/M/2012 would, mutatis mutandis, apply to this ground of the present appeal also. Accordingly, the issue is restored to the file of the AO. The ground Nos.1 & 2 are allowed for statistical purposes. 38. The issue raised i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entical to one as decided by us in ground No.1 in ITA No.7642/M/2012 for A.Y. 2009-10 and therefore, our findings in ground No.1 in ITA No.7642/M/2012 would mutatis mutandis apply to ground Nos.1 & 2 of the present appeal also. Accordingly, the issue is restored to the file of the AO. The ground Nos.1 & 2 are allowed for statistical purposes. 44. The issue raised in ground No.3 is identical to one as decided by us in ground No.3 in ITA No.1032/M/2017 for A.Y. 2010-11 and our findings in ground No.3 in ITA No.1032/M/2017 for A.Y. 2010-11 would mutatis mutandis apply to this ground as well. Accordingly, the issue is restored to the file of the AO and is allowed for statistical purposes. 45. The issue raised in ground No.4 is identical to one as decided by us in ground No.4 in ITA No.1033/M/2017 for A.Y. 2012-13 and our decision in ground No.4 in ITA No.1033/M/2017 for A.Y. 2012-13 would mutatis mutandis apply to this ground as well. Accordingly, the order of the Ld. CIT(A) is confirmed on this issue and ground raised by the assessee is dismissed. 46. The appeal of the assessee is partly allowed for statistical purposes. 47. In the result, appeals of assessee in ITA No.7642/M/2012 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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