Chatterjee Management Servives Pvt Ltd Kolkata v. The Dcit Cir 8 Kolkata Kolkata

A In The Income Tax Appellate Tribunal Kolkata Bench A Kolkata Before Shri Veeravalli Durga Rao Judicial Member And Shri Waseem Ahmed Accountant Member Ita No 1333 Kol 2016 Assessment Year 2005 06 Chatterjee Management Services Pvt Ltd 9 B Wood Street 3 Rd Floor Kolkata 700016 Pan No Aabcc 4005 D V S Dcit Circ E 8 Kolkata Appellant Respondent By Appellant Shri A K Tibrewl Fca By Respondent Shri R P Nag Addl Cit Dr Date Of Hearing 14 12 2017 Date Of Pronouncement 15 12 2017 O R D E R Per Veravalli Durga Rao Judicial Member This Appeal Filed By The Assessee Is Directed Agai Nst The Order Passed By Of Commissioner Of Income Tax Appeals 15 Kolk Ata In Appeal No 179 Cit A 15 15 16 Cir 8 R T Kol Dated 21 03 20 16 2 Facts In Brief Are That Assessee Is In The Busin Ess Of Consultancy Services Filed Return Of Income Declaring Total Loss At 2 35 95 212 The Return Of Income Filed By Assessee Was Processed U S 143 1 O F The Income Tax Act 1961 Hereinafter Referred To As The Act After F Ollowing Due Procedure Assessment Is Completed U S 143 3 Of The Act Ita No 1333 Kol 2016 A Y 2005 06 C M S P Ltd Vs Dcit Cir 8 Kol Page 2 3 During The Course Of Assessment Proceedings The Assessing Officer Has Observed That Assessee Has Claimed Travel And C Onveyance Expenses Of 20 59 268 Includes A Sum Of 7 23 054 Is Expense Incurred For The Director The Assessee Has Not Filed Any Bill Vou Chers Etc The Ao Of The Opinion That Above Expenses Are Personal In Nature In The Absence Of Details 20 Of 7 23 054 I E 1 44 620 Being Disallowed 4 On Appeal Before Ld Cit A The Ld Cit A Has C Onfirmed The Order Of Ao 5 Before Us Ld Counsel For The Assessee Has Submi Tted That All The Bills And Vouchers File Before Ao Without Examining The S Imply The Ao Has Disallowed 20 Of The Expense Incurred By The Asses See Which Are For The Purpose Of Business And Same Is Confirmed By Ld Ci T A Without Any Basis Ld Dr Has Submitted That No Details Were Filed Bef Ore The Ao Even Before Ld Cit A He Strongly Supported The Order Passed By A Uthorities Below 6 We Have Heard Both The Parties And Perused The R Ecord And Gone Through The Order Of Authorities Below We Find Tha T Assessee Has Incurred Conveyance Expense Of 7 23 054 And Before Ao Assessee Is Not Able To Substantiate That These Expenses Are Incurred Fully For The Purpose Of Business Therefore The Ao Has Disallowed 20 Of T He Expense Incurred By Assessee By Considering It As Personal Expense Ld Cit A Confirmed The Order Of Ao Subsequently We Find That By Taking In To Consideration Of Entire Facts And Circumstance Of The Case And In The Inter Est Of Justice The Disallowance Made By Ao Is Higher Side Under The Sa Me Is Scaled Down To 10 Accordingly We Set Aside The Order Passed By Ld Cit A The Ground Of Appeal Is Allowed Partly Ao Is Directed Accordingl Y 7 Next Ground Relates To Office Expense Ita No 1333 Kol 2016 A Y 2005 06 C M S P Ltd Vs Dcit Cir 8 Kol Page 3 8 In The Assessment Order The Ao Has Observed Tha T Assessee Has Incurred A Sum Of 17 00 719 Towards Office Management As Against Th E Expense Of 6 00 105 Incurred In Preceding Previous Year Whic H Is Approximately Three Times Where The Consultancy Fee Received Has Been Increased Only 60 From The Preceding Year The Ass Essee Has Not Submitted Any Details Or Cogent Bills In The Absence Of Deta Ils The Ao Of The Opinion That The Entire Expense Incurred By Assessee Cannot Be C Onsidered For The Purpose Of Assessees Business Therefore He Is Di Sallowed 10 Of Total Expense Of 17 00 719 Is Being Disallowed I E 1 70 172 Being In Personal Nature 9 An Appeal Before Ld Cit A Confirmed The Order Of Ao 10 Before Us Ld Counsel For Assessee Has Submitte D That So Far As The Order To Consider The Assessee Has Received A Fee W Hich Is 60 More Than The Earlier Year Therefore The Assessee Has To Incur M Ore Expense To Increase The Business Of Assessee This Fact Is Not Disputed By The Ao The Case Of Assessee Before Ao Is That Some Of The Expense Must Have Incurred For Personal Purpose And Therefore He Has Disallowed 10 Of The Expense Incurred Submitted That Entire Expense By The Asses See Are Related To Only Business Of Assessee And Same May Be Allowed On The Other Hand Ld Dr Has Submitted That Has No T Filed Any Details Before Ao Even Before Ld Cit A Therefore He Confirmed The Order Of Ao 11 We Have Heard Both The Sides And Gone Through F Acts And Circumstances Of The Case We Find That Assessee Ha D Incurred An Expense For The Purpose Of Office Expense Which Is Connected Wi Th The Business Of Assessee And There Is Increase Of Consultancy Fee R Eceived Is More Than 60 In This Year Under Consideration Comparatively Earl Ier Year The Case Of The Assessing Officer Is That Assessee Has Not Filed An Y Details In Respect Of Expense Incurred By The Assessee Therefore He Is Of The Opinion That There Is Ita No 1333 Kol 2016 A Y 2005 06 C M S P Ltd Vs Dcit Cir 8 Kol Page 4 Possibility Of Incurring Personal Expense Therefor E It Is Disallowe 10 Of The Total Expense Incurred By The Assessee And Same Is Confirmed By Ld Cit A We Have Considered The Facts And Circumstances And We Are Of The Opinion That Disallowance Made By The Ao Is Higher Side Th Erefore We Scale Down The Disallowance Made By Ao From 10 To 5 In View Of The Above We Set Aside The Order Passed By Ld Cit A The Ground Ra Ised By Assessee Is Partly Allowed Ao Is Directed Accordingly 12 In The Result Assessees Appeal Stands Allowed Par Tly Order Pronounced In The Open Court 15 12 2017 Sd Sd Waseem Ahmed Veeravalli Durga Rao Accountant Member Judicial Member Kolkata Dkp Sr P S 15 12 201 7 Copy Of Order Forwarded To 1 Appellant Chatterjee Management Services Pvt Ltd 9 B Wood St 3 Rd Fl Kol 16 2 Respondent Dcit Cir 8 Kolkata 3 0 Concerned Cit Kolkata 4 0 Cit A Kolkata 5 3 66 Dr Itat Kolkata 6 9 Guard File By Order True Copy Sr Private Secretary Head Of Office Ddo