SUNNY WASSAN, KORBA(CG) v. ITO-I, KORBA(CG)

ITA 20/BIL/2011 | 2007-2008
Pronouncement Date: 08-02-2012 | Result: Partly Allowed

Appeal Details

RSA Number 2024714 RSA 2011
Assessee PAN AAAAL1964F
Bench Raipur
Appeal Number ITA 20/BIL/2011
Duration Of Justice 1 year(s) 27 day(s)
Appellant SUNNY WASSAN, KORBA(CG)
Respondent ITO-I, KORBA(CG)
Appeal Type Income Tax Appeal
Pronouncement Date 08-02-2012
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 08-02-2012
Assessment Year 2007-2008
Appeal Filed On 12-01-2011
Judgment Text
1 ITA NO. 20/BLPR/2011 SUNNY WASSAN IN THE INCOME TAX APPELLATE TRIBUNAL BILASPUR BENCH BILASPUR BEFORE SHRI SHAILENDRA KUMAR YADAV J.M. AND SHRI R.K. PANDA A.M. ITA NO. 20/BLPR/2011 ASSESSMENT YEAR 2007-08 SUNNY WASSAN PROP. SUN CONSTRUCTION 88-1CC T.P. NAGAR KORBA. VS INCOME TAX OFFICER -1 NIHARIKA TALKIES ROAD KORBA (C.G. (APPELLANT) (RESPONDENT) PAN NO. AAAAL 1964F APPELLANT BY SHRI RAJESHWAR RAO RESPONDENT BY SHRI P.W. ATHAYLE DATE OF HEARING 01.02.2012 DATE OF PRONOUNCEMENT 08.02.2012 ORDER PER R K PANDA AM THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DTD. 17.09.2010 OF THE LD. CIT(A) BILASPUR RELATING TO A.Y. 2007-08. 2. THE ASSESSEE IN HIS GROUNDS OF APPEAL HAS CHALLE NGED THE PART RELIEF GIVEN BY THE LD. CIT(A) OUT OF THE DISALLOWANCES OF VARIOUS EXPENSE MADE BY THE A.O. 2.1 FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE IS A CONTRACTOR RUNNING HIS PROPRIETARY BUSINESS UNDER THE NAME AND STYLE O F M/S SUN 2 ITA NO. 20/BLPR/2011 SUNNY WASSAN CONSTRUCTIONS AT KORBA. AS AGAINST THE GROSS RECEI PTS OF RS. 3 35 99 841/- THE ASSESSEE HAS DISCLOSED A NET PROFIT OF 0.84% AS AGAINST 5% DURING A.Y. 2006-07 AND 8% IN A.Y. 2005-06. THE A.O. OBSERVED T HAT MOST OF THE VOUCHERS FOR EXPENDITURE ARE VAGUE AND SELF MADE WH ICH IS NOT SUSCEPTIBLE OF VERIFICATION. MOST OF THE VOUCHERS ARE MADE INT ERNALLY. THE LABOUR PAYMENTS TOTALLING RS. 27 67 800/- ARE NOT PROPERLY MAINTAINED AND THE ASSESSEE COULD NOT PRODUCE ORIGINAL BILLS AND VOUCH ERS OF THE ABOVE EXPENSES. THE A.O. THEREFORE WAS OF THE OPINION T HAT INFLATION OF EXPENSES CANNOT BE RULED OUT. HE THEREFORE DISALLOWED THE F OLLOWING AMOUNTS ON ADHOC BASIS:- PARTICULAR HEAD EXPENSES CLAIMED(RS.) EXPENSES DISA LLOWED(RS) (I) TRAVELLING EXP. 1 82 451 36 490 (II) CONVEYANCE EXP. 1 65 324 33 065 (III) STATIONERY EXP. 36 852 7370 (IV) LABOUR HUTMENT 86 542 17 308 (V) OFFICE EXP. 1 30 663 26 133 (VI) SITE EXP. 1 26 370 25 274 (VII) REPAIRING & MAINTENANCE EXP. 18 28 340 3 65 668 (VIII) EXCAVATION EXP. 22 70 688 4 54 138 (IX) LABOUR EXP. 27 67 800/ 5 53 560 2.2 IN APPEAL THE LD. CIT(A) RESTRICTED SUCH DISALL OWANCE TO 10% OF THE TOTAL EXPENSES. AGGRIEVED WITH SUCH ORDER OF THE L D. CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS MADE BY BOTH THE SIDES PERUSED THE ORDERS OF THE A.O. AND THE LD. CIT(A) A ND THE PAPER BOOK FILED ON 3 ITA NO. 20/BLPR/2011 SUNNY WASSAN BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS RELIED ON BY BOTH THE SIDES. THERE IS NO DISPUTE TO THE FA CT THAT THE ASSESSEE FAILED TO FILE THE COMPLETE BILLS AND VOUCHERS BEFORE THE A.O. TO SUBSTANTIATE THE HUGE EXPENSES CLAIMED BY HIM. IT IS THE SETTLED PR OPOSITION OF LAW THAT FOR CLAIMING ANY EXPENDITURE AS GENUINE BUSINESS EXPEND ITURE THE ONUS IS ALWAYS ON THE ASSESSEE TO SUBSTANTIATE WITH EVIDENC E TO THE SATISFACTION OF THE A.O. THAT THE EXPENDITURE HAS BEEN INCURRED WHO LLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS. IN THE INSTANT CASE IT IS AN ADMITTED FACT THAT THE ASSESSEE COULD NOT PRODUCE THE ORIGINAL BILLS AND V OUCHERS IN MOST OF THE CASES. FURTHER THE FINDINGS GIVEN BY THE A.O. THAT MOST OF THE EXPENSES ARE MADE THROUGH INTERNAL VOUCHERS ALSO COULD NOT BE CO NTROVERTED BY THE LD. COUNSEL FOR THE ASSESSEE. THE VARIOUS DECISIONS REL IED ON BY THE LD. COUNSEL FOR THE ASSESSEE ARE DISTINGUISHABLE AND NOT APPLIC ABLE TO THE FACTS OF THE PRESENT CASE. THEREFORE FULL RELIEF CANNOT BE GIVE N TO THE ASSESSEE AND SOME DISALLOWANCE HAS TO BE MADE. HOWEVER CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE ORDER OF THE LD. CIT(A) SUSTAINING 10% OF THE VARIOUS EXPENSES APPEARS TO BE ON THE HIGHER SI DE. WE THEREFORE DIRECT THE A.O. TO RESTRICT THE DISALLOWANCE TO 7.5% OF TH E VARIOUS EXPENSES. THE GROUND RAISED BY THE ASSESSEE IS ACCORDINGLY PARTLY ALLOWED. 4 ITA NO. 20/BLPR/2011 SUNNY WASSAN 4. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON 08.02.2012. SD/- (SHAILENDRA KUMAR YADAV) JUDICIAL MEMBER SD/- ( R K PANDA ) ACCOUNTANT MEMBER PLACE: BILASPUR : DATED: 08.02.2012 RK COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT A) BILASPUR 4 CIT BILASPUR 5 DR BENCH BILASPUR 6 MASTER FILE /TRUE COPY/ BY ORDER SR. PRIVATE SECRETARY ITAT BILASPUR BILASPUR.