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TMI Blog2021 (1) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in confirming the addition made by the Ld. AO for Rs. 22,28,560/- being the difference between the amount stated in Form 26AS and the gross receipts declared in the return of income. (ii) The Ld. CIT(A) has erred in enhancing the addition made by the Ld. AO towards salary and benefits paid to the Managing Director and Vice President of the assessee company and further confirmed the addition made by the Ld. AO towards salary and benefits paid to the employees of the assessee company. (iii) The Ld. CIT(A) has erred in not adjudicating the ground raised towards the addition made by the Ld. AO of Rs. 1,47,721/- being the disallowance of expenditure on estimate basis. (iv) The Ld. CIT(A) has erred in not adjudicating the ground raise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reflected as Rs. 1,74,37,095/-. Thus, there was a difference of Rs. 22,28,560/- which was not reconciled by the assessee. Therefore, the Ld. AO made addition of Rs. 22,28,560/- in the hands of the assessee. During the remand proceedings, the assessee reconciled the difference substantially and only an amount of Rs. 55,082/- remained to be reconciled. However, the Ld. CIT(A) confirmed the addition of Rs. 22,28,560/- by stating in his order in para 8.1 as under:- "8.1...........Even though in the remand report, the AO has stated with regard to reconciliation difference of receipts as per Form 26AS, the appellant has not taken any ground on this issue. Therefore, this issue is not to be adjudicated. Therefore, the addition made on this acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . AO opined that 10% of the aggregate amount should be disallowed on estimate basis. Accordingly, the amount of Rs. 11,02,482/- was disallowed and added to the income of the assessee. In the remand proceedings, the assessee furnished the details of the salary paid and the Ld. AO observed that the expenditure was genuine. However, the Ld. CIT(A) opined that the assessee had paid an amount of Rs. 52,20,000/- to the Managing Director and Rs. 15,29,964/- to the Vice President of the assessee company which is exorbitant and does not commensurate with the turnover of the assessee which is only Rs. 1,52,08,535/-. Therefore, the Ld. CIT(A) enhanced the disallowance from 10% to 50%. 9. Before us, the ld. AR submitted that the Managing Direct and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the entire addition made on this count. 11. Ground No. (iii):- Disallowance of Rs. 1,47,721/-:- 12. During the course of scrutiny assessment, the Ld. AO disallowed an amount of Rs. 1,47,721/- being 10% of the expenditure claimed towards Travelling & Conveyance, Internet & Telephone charges, office maintenance, Petrol & Diesel expenditure because the assessee could not produce proper bills and vouchers. In the remand proceedings, the Ld. AO observed that bills & vouchers were not available only with respect to Petrol & Diesel expenses amounting to Rs. 1,32,692/-. However, it appears that the Ld. CIT(A) failed to adjudicate the issue. Since, the issue is a petty issue, We are of the considered view only to the extent of 1/3rd of the expen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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