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TMI Blog2019 (9) TMI 1514X X X X Extracts X X X X X X X X Extracts X X X X ..... ding that the claim of expenditure is either excessive or bogus having regard to the facts of turnover during the year under consideration and nature of business of the assessee. There is no dispute that in the business of the assessee, the freight expenses are inevitable and therefore, if the claim is not found to be excessive or bogus then merely because of the some of the expenses are not supported by proper vouchers, no ad hoc disallowance is called for. If certain claim of expenditure is not found to be incurred wholly and exclusively for the business purpose of the assessee then the same is liable to be disallowed. However, if the expenditure incurred by the assessee is found for the business purpose of the assessee then due to certai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partnership firm and engaged in the business of wholesales cum retails in the trade of fertilizers. The assessee filed its return of income U/s 139(1) of the Income Tax Act, 1961 (in short, the Act) on 28/11/2014 declaring total income of ₹ 2,74,260/-. During the scrutiny assessment, the A.O. has made trading addition of ₹ 1,50,000/- on account of certain expenses due to non-production of complete details/papers in support of the claim. On appeal, the ld. CIT(A) has confirmed the addition but on account of claim of expenses instead of trading addition. 3. Before the Tribunal, the ld AR of the assessee has submitted that the only defect pointed out by the A.O. was that the freight expenses of ₹ 5,06,360/- on pesticides, se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The A.O. has given reasons for making ad hoc disallowance of ₹ 1.50 lacs that too as a lump sum trading addition as the freight expenses were not fully supported by proper bills and vouchers. Though the term used by the A.O. in the assessment order being the trading addition is not justified when there is no rejection of books of account U/s 145(3) of the Act. However, in substance, the A.O. has made this addition on account of claim of expenses not verifiable. The A.O. has not given the finding that the claim of expenditure is either excessive or bogus having regard to the facts of turnover during the year under consideration and nature of business of the assessee. There is no dispute that in the business of the assessee, the freigh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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