9911796707
TMI Blog2024 (9) TMI 283X X X X Extracts X X X X X X X X Extracts X X X X ..... tement that vouchers submitted are not verifiable, personal element of expenses cannot be ruled out , etc would not suffice. The assessee is a private limited company and the books of accounts were duly subjected to statutory and tax audit as per the provisions of the Companies Act and Income Tax Act. Admittedly, the lower authorities had not resorted to reject the book results of the assessee company by invoking the provisions of section 145(3) of the Act. no scope for making any adhoc disallowance. Decided in favour of assessee. Addition made on account of cash deposits made during the demonetization period - HELD THAT:- The entire cash book for the whole year is duly produced before the AO and learned NFAC, Delhi. Hence, it is established beyond reasonable doubt that the cash deposits made in bank account are properly explained by available cash balance with the assessee as per its cash book. Hence, there is absolutely no case for making any addition towards cash deposits - Decided in favour of assessee - Sh. Challa Nagendra Prasad, Judicial Member And Sh. M. Balaganesh, Accountant Member For the Assessee : Shri Neeraj Mangla, C.A. For the Revenue : Shri Anuj Garg, Sr. D.R. OR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Apart from that, there was separate consumable expenses which were not forming part of raw material consumed. The assessee enclosed the ledger account of Consumable expenses in that regard to prove that the same were incurred wholly and exclusively for the purpose of business and there was no duplication of deduction claimed by the assessee. With regard to salary and wages, the assessee submitted that it had maintained all proper records along with documentary evidences for the same. The month wise employee wise details were enclosed by the assessee for the kind reference of the ld. NFAC, Delhi. With regard to expenses such as Works Contract Tax, Rent charges, business promotion expenses, consultancy expenses, conveyance and vehicle expenses, vehicle running expenses, insurance, newspapers periodicals, repairs maintenance and telephone expenses, the assessee submitted that it had maintained proper books of accounts, vouchers and supporting evidences and the entire books of accounts were duly produced for the verification of the ld. NFAC, Delhi. It was also pointed out that the ld. AO had taken incorrect amounts while making disallowance in respect of legal and professional expe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l bald statement that vouchers submitted are not verifiable, personal element of expenses cannot be ruled out , etc would not suffice. The assessee is a private limited company and the books of accounts were duly subjected to statutory and tax audit as per the provisions of the Companies Act and Income Tax Act. Admittedly, the lower authorities had not resorted to reject the book results of the assessee company by invoking the provisions of section 145(3) of the Act. In any event, there is no scope for making any adhoc disallowance in the facts and circumstances of the instant case. Accordingly, the Ground Nos. 2 to 7 raised by the assessee are hereby allowed. 7. Ground No. 8 raised by the assessee is challenging the addition made on account of cash deposits made during the demonetization period in the sum of Rs. 39,80,500/-. 8. We have heard the rival submissions and perused the material available on record. The learned AO observed that assessee had made cash deposit of Rs. 39,80,500/- during the demonetization period. In pages 2 and 3 of his assessment order, the learned AO prepared a tabulation of cash withdrawals, cash deposits, opening balance and closing cash balance from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein there is huge requirement of retaining heavy cash balance. The entire books of account along with cash books and ledger were indeed produced by the assessee before the AO for its verification. The entire cash deposits were sourced out of available cash balance. The learned NFAC, Delhi, however, did not give any finding with regard to the availability of cash balance with the assessee as per the cash book submitted. However, very strangely, he proceeded to delete the addition by observing that the cash deposits were sourced out of opening cash balance in hand of Rs. 12.61 lacs and certain disallowance of expenses were also made by the learned AO on adhoc basis which also would act as a cash source for the assessee to explain the cash deposits. In other words, the learned NFAC, Delhi used the adhoc disallowance of expenses made by the learned AO as a cash source available with assessee to explain the cash deposits made. Against this observation, the assessee is in appeal before us even though the addition towards cash deposit has been deleted by the learned CIT(A). It is pertinent to note that Revenue had not preferred any appeal against the deletion of the addition by the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
