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TMI Blog2021 (5) TMI 182X X X X Extracts X X X X X X X X Extracts X X X X ..... TA HIGH COURT] where it was held that the expenditure claimed by the assessee could not be reduced quantitatively when it was qualitatively found to be eligible for deduction. Keeping in view the ratio of the said decision of the Hon'ble Jurisdictional High Court and having regard to the facts of the case, hold that the ad hoc disallowance made by the AO and confirmed by the ld. CIT(A) out of claim charges is not sustainable and deleting the same - Decided in favour of assessee. Disallowance of repairs and maintenance - AO Found that the said expenses involved petty amounts and the claim of the assessee was supported mainly through self made vouchers - As submitted on behalf of the assessee company before the authorities below as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO and confirmed by the Ld. CIT(A) on account of claim charges. 3. The assessee in the present is a company which is engaged in the business of transport. The return of income for the year under consideration was filed by it on 17.03.2012 disclosing total income of ₹ 18,43,384/-. In the capital loss account filed along with the said return, a sum of ₹ 3,37,72,755/- was debited by the assessee on account of claim charges. In this regard, it was explained on behalf of the assessee before the AO during the course of assessment proceeding that it was in the business of transporting tea on behalf of the Tea Estates to the consignees and the transit loss in weight of consignments in the course of handling tea bags had to be borne b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure on account of claim charges was incurred by the assessee company in the preceding as well as succeeding years and even in the assessments completed u/s. 143(3), no disallowance on account of claim charges was made by the AO in assessment year 2010-11, 2012-13 and 2013-14. He has submitted that disallowance out of claim charges however was made by the AO to the extent of 2% in the assessment completed u/s. 143(3) for assessment year 2014-15 but the same was deleted by the ld. CIT(A) vide his appellate order dated 10.07.2018. A copy of the said order is placed on record and perusal of the same shows that a similar disallowance made out of claim charges to the extent of 2% was deleted by the ld. CIT(A) for the following reasons give ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , there was no reason to reject the balance 10% attributing it to the possibility of having the shade of a personal expenditure. Except for this reasoning, we do not find any justification in the Revenue's contention that the disallowance of 10% is warranted in the facts of the case, which, being a pure factual issue, we reject the appeal at the admission stage itself. The jurisdictional ITAT in the case of ITO Wd-7(3), Kolkata vs M/s. Delite Properties Pvt. Ltd. in I.T.A. No. 261/Kol/2016, following the decision of the Hon'ble Madras High Court in the matter of CIT vs Lakshmi Vilas Bank Ltd. (supra) on the same issues has held taking into consideration the entire aspect of the matter and the judgement cited above we are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or assessment year 2014-15 by relying inter alia on the decision of Hon'ble Kolkata High Court in the case of M/s. Ravi Marketing Pvt. Ltd. (supra) where it was held that the expenditure claimed by the assessee could not be reduced quantitatively when it was qualitatively found to be eligible for deduction. Keeping in view the ratio of the said decision of the Hon'ble Jurisdictional High Court and having regard to the facts of the case, I hold that the ad hoc disallowance made by the AO and confirmed by the ld. CIT(A) out of claim charges is not sustainable and deleting the same, I allow ground no. 1 of the assessee's appeal. 7. The issue raised in ground no. 2 relates to the disallowance of ₹ 1,53,818/- made by the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10% made out of the said expenses on ad hoc basis is not sustainable. Keeping in view the ratio of the decision of Hon'ble Jurisdictional High Court in the case of M/s. Ravi Marketing Pvt. Ltd. (supra) and having regard to the facts of the case that the ad hoc disallowance of 10% out of repairs and maintenance expenses has been made by the AO without pointing out even a single specific instance of the unverifiable element involved therein, I am of the view that the said disallowance is not sustainable. The same is accordingly deleted and ground no. 2 of the assessee's appeal is allowed. 10. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 28th April, 2021. - - TaxTMI - TMITax - I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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