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TMI Blog2018 (12) TMI 458X X X X Extracts X X X X X X X X Extracts X X X X ..... actual matrix of the case, as discussed above, the additions made by the AO and upheld by the CIT(A) on account of Rent for Assessment Years 2011-12 to 2013-14 are hereby deleted. Disallowance of Excise Licence Fees paid - as per assessee assessee’s accounts have been audited u/s 44AB of the Act and the amounts in question have admittedly been claimed in the assessee’s accounts and therefore no disallowance can be made for want of challan - Held that:- as the assessee’s books of accounts have been audited u/s 44AB of the Act; copies of challans for payment of Excise Licence Fees to government are filed to corroborate the assessee’s claims for such expenditure and the fact that the assessee admittedly carried on the business of sale of liquor during the impugned Assessment Years 2012-13 and 2013-14, I am of the view that the same is allowable expenditure. In the light of the aforesaid evidence and in this view of the matter, the disallowance of the expenditure on Excise Licence Fee made by the AO and sustained by the CIT(A) is factually unsustainable - Decided in favour of assessee. Liable to be charged interest u/s 234B and 234D - Held that:- The charging of interest is cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tanding in the name of the assessee. Therefore, the purchase and sale of liquor business of M/s. A. R. Habib Wines were made in the name of the assessee. Certain material in the form of loose sheets, note books and diaries were also found and impounded in the survey action. On the basis thereof, a statement of one Shri. Anil Kashinath Khode, son of the aforesaid Shri. Kashinath Khemsa Khode was recorded on the date of survey. In his statement, Shri. Anil Kashinath Khode in Answer to Question No. 3, stated that his father Shri. Kashinath Khemsa Khode was carrying out the purchase and sale of liquor of branded companies in the trade name and style of M/s. A. R. Habib Wines. On verification of the impounded material, it was noticed that an amount of ₹ 2,250/- and ₹ 1,750/- was paid every day to Shri. Raju Ambasa Habib and Shri. Vinayaka Ambasa Habib towards rent and that the said amounts were paid by Shri. Kashinath Khemsa Khode through his son Shri. Anil Kashinath Khode. It was noticed that the total rent of ₹ 11,34,000/- was paid to the assessee for Assessment Year 2011-12; ₹ 16,97,400/- for Assessment Year 2012-13 and ₹ 12,60,000/- for Assessment Y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ach of the three years, the notings in the impounded materials are unambiguous; are written in the normal course of business and that Shri. Anil Kashinath Khode who looks after the wine business had clearly deposed that the payments are nothing but payments of rent for the use of the liquor licence exploited by Shri. Kashinath Khemsa Khode. The CIT(A) also held that the statement denying the receipt of rental income by the assessee was an afterthought; that it was a self-saving statement and also that the subsequent statement of Shri. Kashinath Khemsa Khode was not reliable. The other disallowance of ₹ 4,18,000/- in respect of excise licence fee for Assessment Years 2012-13 and 2013-14 was also upheld by the CIT(A). 3.1 The assessee, being aggrieved by the separate orders of CIT(A)- Hubli, all dated 31.08.2017 for Assessment Years 2011-12 to 2013-14, preferred these appeals before the Tribunal. Since common issues are involved in all three Assessment Years (as regards the addition in respect of rental income except for change in the quantum of additions made), I am extracting and considering hereunder the grounds raised for Assessment Year 2012-13 for the purposes of adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to be cancelled. For the above and other grounds that may be urged at the time of hearing of the appeal, your appellant humbly prays that the appeal may be allowed and Justice rendered and the appellant may be awarded costs in prosecuting the appeal and also order for the refund of the institution fees as part of the costs. 3.2 I have heard the rival contentions of both parties and perused and carefully considered the material on record. 4. Ground Nos. 1 and 6 (Assessment Year 2011-12) Ground Nos. 1 and 7 (Assessment Years 2012-13 and 2013-14) 4.1 These grounds being general in nature, and not being urged before me, require no adjudication and are accordingly dismissed as infructuous. 5. Ground No. 5 (Assessment Year 2011-12) Ground No. 6 (Assessment Years 2012-13 and 2013-14) Charging of Interest u/s 234B and 234D of the Act 5.1 In these grounds, the assessee denies itself liable to be charged interest u/s 234B and 234D of the Act. The charging of interest is consequential and mandatory and the AO has no discretion in the matter. This proposition is upheld by the Hon ble Apex Court in the case of Anjum H. Ghaswala (252 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 28.08.2014 of Shri. Anil Kashinath Khode. In this regard, it was further contended that the assessee has filed the returns of income for the aforesaid three Assessment Years declaring income from the business of purchase and sale of liquor in the name and style of M/s. Jayalaxmi Wine Centre and thus making an addition on account of rent on the very same business amounts to double taxation. 6.2 Per contra, the learned DR for Revenue submitted that the statement recorded from Shri. Anil Kashinath Khode in the course of survey on 28.08.2014 clearly states that the assessee was receiving daily rent and cannot be ignored as it is an important piece of evidence. According to the learned DR, the subsequent Affidavits of Shri. Kashinath Khemsa Khode and Shri. Anil Kashinath Khode dated 19.11.2015 and statements dated 17.03.2016 and 18.03.2016 were only afterthoughts and the same ought not to be considered. 6.3 In rejoinder, the learned AR of the assessee submitted that the statement of Shri. Anil Kashinath Khode recorded on 28.08.2014 in the course of survey, has no evidentiary value and cannot be the sole basis for making an addition. In support of this proposition, the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... borate the submissions in the Affidavits filed by Shri. Anil Kashinath Khode and Shri. Kashinath Khemsa Khode; all of which have been merely brushed aside by the authorities below as mere afterthoughts and as being unreliable without controverting the declarations made therein. It is settled position that Affidavit filed have evidentiary value and the same cannot be ignored; as has been held by the Hon ble Apex Court in the case of M/s. Mehta Parikh Co., Vs. CIT (30 iTR 181) (SC). Therefore, the Affidavits filed by Shri. Anil Kashinath Khode and Shri. Kashinath Khemsa Khode explaining the facts which has not been controverted by authorities below, cannot be disbelieved, ignored and brushed aside as an afterthought. In the case on hand, the facts on record indicate that the impounded diaries are not prepared by the assessee but by third party and there is no signature of the assessee to even remotely suggest that the assessee has been paid rent by Shri. Kashinath Khemsa Khode for carrying out liquor business under the Excise Licence of the assessee. While it is true that admission is an important piece of evidence; unless corroborated, it cannot be said to be conclusive and it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Excise Licence Fees to government are filed to corroborate the assessee s claims for such expenditure and the fact that the assessee admittedly carried on the business of sale of liquor during the impugned Assessment Years 2012-13 and 2013-14, I am of the view that the same is allowable expenditure. In the light of the aforesaid evidence and in this view of the matter, the disallowance of the expenditure on Excise Licence Fee made by the AO and sustained by the CIT(A) is factually unsustainable for Assessment Years 2012-13 and 2013-14 and therefore the same are deleted. Ground No. 5 raised by the assessee for Assessment Years 2012-13 and 2013-14 are allowed. 8. Ground No. 2 8.1 Since the assessee s grievances/grounds raised on the merits of the additions of rental income for Assessment Years 2011-12 to 2013-14 and disallowance of payments of Excise Licence Fees to the state government for Assessment Year 2012-13 and 2013-14 have been addressed by deleting the said additions/disallowances, ground No. 2 challenging the AO s assumption of jurisdiction u/s 147 / 148 of the Act is rendered academic and requires no adjudication at this stage. 9. In the result, the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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