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TMI Blog2020 (2) TMI 1723X X X X Extracts X X X X X X X X Extracts X X X X ..... n the basis of the factor of abuse of the land by the appellant which was not envisaged by the Delhi Government while laying down the different multiplicative factors as 1,2 and 3 for permissible uses of lands. Since such a situation was not envisaged by the Delhi stamp Rules, the factor of 3 is held to be invalid. Therefore, we are fully agree with the findings of the Ld. CIT(A) passed in his impugned order and we are of the view that no interference is called for in the well reasoned order passed by the Ld. CIT(A). Assessee appeal allowed. - Shri H.S. Sidhu, Judicial Member And Shri Prashant Maharishi, Accountant Member For the Assessee : Sh. Raj Kumar Gupta, CA; Sh. Sumit Goyal Sh. Sunil Goyal, CA For the Department : Sh. R.K. Gupta, Addl. CIT(DR) ORDER PER H.S. SIDHU, JM Revenue has filed an appeal and Assessee has filed the Cross Objection and an Appeal against the impugned order dated 09.06.2015 passed by the Ld. CIT(A)-16, New Delhi relating to assessment year 2011-12. Since these appeals and cross objection are related to same assessment year, hence, the same were heard together and are being disposed of by this common order for the sake of convenience, by first dealing w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces of the case and the legal position, the Ld. CIT(A) has erred in confirming the disallowance of 1/10th of telephone expenses and conveyance expenses amounting to ₹ 81,818/- for alleged personal use. 5. That the appellant, craves, leave to add/ alter/ delete/ amend any ground(s) of appeal before or at the time of hearing. 5. The brief facts of the case are that the assessee field its return of income electronically on 07.09.2011 declaring total income of ₹ 16,68,42,068/-. After processing the case u/s. 143(1) of the I.T. Act, 1961 was selected for scrutiny by reason of manual selection process after taking approval of the Chief Commissioner of Income Tax-VI. Thereafter statutory notices u/s. 143(2) of the Act and 142(1) were issued to the assessee. In response thereto, the AR of the Assessee attended the assessment proceedings and furnished the requisite details. After considering the same, AO passed assessment order dated 27.3.2014 determining total income at ₹ 39,89,10,068/- as against returned income of ₹ 16,68,42,034/- and made various additions. Against the assessment order dated 27.3.2014, assessee appealed before the Ld. CIT(A) who vide his impugne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny other law for the time being in force adopted or assessed, if it were referred to such authority for the purposes of payment of stamp duty. It implied that even if the property was not registered or not assessed to stamp valuation authorities, it was covered u/s. 50 C for valuation purposes supposing that the said property had been referred to the stamp valuation authority for the purposes of payment of stamp duty. Hence, this contention of the appellant stands rejected. Consequently, the contention of the appellant that where the property could not be registered due to any reason (here being in extended lal-doora) the transaction in relation thereto was outside the scope of Sec. 50 C stands rejected. 4.02 The SECOND ISSUE, was as to in which category whether G or H , the said property lay. As per the AO, it was in G category while as per the appellant it was in H category. The appellant furnished the copy of printouts from the MCD authentic website for house tax purposes. As per the said website, the area of Samaypur village (urban) fell in H category and Shamaypur village in G category. 4.03The appellant while filing the print outs from the MCD's authenticated website also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issible/ sanctioned use of lands either as agricultural or residential or industrial or commercial. So long as the legislation was not in place to cover situations of abuse of lands as above, the prevalent law was to be applied without any extrapolation and permutations and combinations. Any departure therefrom would tantamount to adding or subtracting words from the statute. In such a scenario I am of the considered view that the multiplicative factor prescribed for agricultural / residential lands was applicable. In the above backdrop, it is held by me that the multiplicative factor of '3' applied by the AO was misdirected as the same was done by the AO on the basis of the factor of abuse of the land by the appellant which was not envisaged by the Delhi Government while laying down the different multiplicative factors as 1,2 and 3 for permissible uses of lands. Since such a situation was not envisaged by the Delhi stamp Rules, the factor of 3 is held to be invalid. Accordingly the AO shall work out the value of the land by applying the factor of 1 The appellant gets relief of the consequential reduction resulting from the decrease in the multiplicative factor from 3 to 1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... violating the provisions of Sec. 40a(ia) of the Act. In this regard the appellant was observed to have discharged initial burden of proof during the assessment proceedings by explaining to the AO as to how the entire transactions were not affected under a contract. It was clarified with the help of bills and vouchers that the said payments did not bear the features of a contractual payments. The submissions of appellant are as under:- G. N. 3 (SUBMISSIONS DTD. 16.03.2015) DISALLOWANCE OF 100% PACKING EXPENSES OF '.95,75,917/- U/s.40(a)(ia) This issue has been discussed an Pg. 9, Para - 2 of the Asstt. Order. The assessee has been dealing into electrical goods. Packing expenses of ₹ 95,75,917/- have been incurred during the year for packing material required for sale of products. The AO has been of the opinion that these packing expenses are paid to packers is in the nature of payment to contractors, therefore covered u/s. 194 C. Since, no TDS have been deducted, therefore, the AD has invoked Sec. 40 (a) (ia) and disallowed the whole expenses. Further, the AD has also held that these expenses are incurred in cash and are supported by self made internal vouchers rendering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of N no. of items in N no. of quantities which differs from client to client. Hence, for sales, the packing is a must for the items in the quantities as requisitioned by a particular client. The AO has not given any basis for doubting these expenses in the case of C F agent. The nature of business has been similar in the past. The nature of these expenses is also similar as in the past. No disallowance has ever been made. Thus, there is no reason for taking a departed view in this year without any valid reason and basis. D. That another contention of the AO has been that these expenses are incurred in cash and supported by self made internal vouchers rendering them un - verifiable. This finding of the AO is grossly erroneous and without any basis. These packing material sellers are stray moving persons without any establishment at all. They work in a most unorganised manner. They keep on moving in the market, wherever they get a customer, sell their product and earn their livelihood on day to day basis only. They are in the nature of daily earners and daily spenders out of their daily earnings. These vendors do not have any business working name and any business working address. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oceedings also. Therefore I am of the considered view that the entire cash expenses of the impugned amount were not free from stains as the appellant did not have supporting evidence of each and every item mentioned in the bills and vouchers. Such being the reason the addition of Rs. six lacs ₹ 6.00 lacs is sustained out of the above addition. Ground No. 4 Concerning adhoc disallowance of ₹ 10,66,284/- being 1I10th out of expenses on loading and unloading, cartage outward, general expenses, staff welfare, business promotion and printing and stationery the appellant's submissions were carefully examined by me. The appellant submitted as under: Ground No. 4 (SUBMISSIONS DTD. 16.03.2015) AD - HOC DISALLOWANCE OF ₹ 10,66,284/- BEING 1I10TH OUT OF EXPENSE ON LOADING AND UNLOADING, CARTAGE OUTWARD, GENERAL EXPENSES, STAFF WELFARE, BUSINESS PROMOTION AND PRINTING AND STATIONERY This issue has been discussed on Pg. 9, Para - 3 of the Asstt. Order. The AO identified from the P Laic. the following expenses as under :- Loading and unloading expense 40,53,036/- Cartage outward 56,26,049/- ~ General expenses 1,71,4311- Staff welfare 2,43,415/- Business promotion 50,842/- P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing submissions. D. The findings that bills and vouchers have not been submitted is not correct. The assessee maintains all bills and vouchers. The same can be produced before your goodself also, if desired The accounts are audited with a clean report. There is no qualification in audit report regarding non - maintenance and non - productions of vouchers during audit. The assessee is run only by the staff. In that situation, it is not possible to incur and book any such expenses which is not supported by voucher / evidence. Hence, the disallowance on the ground of non - submission of bills and vouchers is un - sustainable. E. The expenses are comparative to earlier year as under:- A. Y. 2010 2011 A.Y.2011 - 2012 Loading and unloading expense 34,14,448/- 40,53,036/- - Cartage outward 48,69,274/- 56,26,049/- General expenses 1,75,268/- 1,71,431/- Staff welfare 2,47,401/- 2,43,415/- Business promotion 54,255/- 50,842/- Printing and stationery 3,93,908/- 5,18,069/- All expenses are fully vouched. The nominal variation is for various reasons. This includes normal escalation in cost from last year, cartage depends upon the no. of times the cartage event took place, staff welfare depends ..... X X X X Extracts X X X X X X X X Extracts X X X X
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