TMI Blog2018 (12) TMI 1314X X X X Extracts X X X X X X X X Extracts X X X X ..... the source thereof, remain unproved, if not disproved; the assessee, by all available accounts, having been already allowed his claim for the relevant expenditure against his undisclosed receipt, which appears to be arising to him regularly and in the normal course of his business, though kept outside books. The assessee’s case, being wholly unsubstantiated and presumptuous, has thus rightly been not accepted by the Revenue. The matter being otherwise wholly factual, the assessee’s reliance on the decisions supra, including on his own case for AY 2011-12, which stands already met, to no rebuttal and, in fact, a tacit admission of its inapplicability by the ld. counsel, would be of no consequence - no infirmity in the Revenue’s case or reason to interfere and, accordingly, uphold the impugned order - decided against assessee - I.T.A. No. 26/Asr/2018 - - - Dated:- 27-9-2018 - Sh. Sanjay Arora, Accountant Member For the Appellant : Sh. P. N. Arora (Adv.) For the Respondent : Sh. Charan Dass (D.R.) ORDER PER SANJAY ARORA, AM: This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals), Bathinda ('CIT(A)&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Loss account; (b) Depreciation of ₹ 1,57,077/- has been claimed (which means that the truck has been treated as a business asset); (c) The tax deducted at source has been claimed in the return; (d) The Assessing Officer provided opportunity to the appellant to produce the details of expenses which might have been incurred in earning this income: the appellant failed to provide the details and necessary evidences; (e) A specific request was made to furnish details of expenses under the head Diesel, salary of driver and cleaner, the repair and maintenance expenses. This information was not provided. (emphasis, supplied) Thereafter, he observed that the assessee had not brought on record a shred of evidence in support of his claim of having any incurred expenditure toward earning the said undisclosed income. In fact, he continues further to state that it may be that the expenditure claimed to have been incurred had already been claimed per the assessee s operating statement (Profit and Loss Account), so that entertaining any further claim (for expenditure) would amount to a double deduction (para 2.2.1). He, then, proceeded to examine the expenditure claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fer para 3 of the order, read out during hearing). It was on this basis that the tribunal opined that some retention by the Union was inevitable, as for meeting its expenses; the tax deduction at source itself being at 2% of the gross receipt, and estimated the income at 3% thereof in view of the accounts being not correct or complete. The said decision, which stands followed by the tribunal (SMC Bench) in Vijay Roadways (supra), and which in turn stands followed by the first appellate authority in the assessee s case for AY 2011-12, is thus on an entirely different footing. On this being therefore observed by the Bench during hearing, Sh. Arora would fairly state that the estimate of income is left to the best judgment of the tribunal. On a query by the Bench as to whether the admitted gross income of ₹ 15.10 lacs stands received during the relevant year or not, Sh. Arora would, after seeking time to respond which was allowed, submit that the same stands received in cash during the year, and no part of it is outstanding for payment as at the relevant year-end. The ld. Departmental Representative (DR) would, on the other hand, submit that the assessee has no case in v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urther reinforced by the fact of the assessee having claimed expenditure on interest on borrowed capital and depreciation in respect of the relevant vehicle, which admittedly stands reflected in the assessee s books of account. This, ostensibly so, is even otherwise implied as the assessee has not made any claim as to the relevant vehicle being not accounted for, or contradicted the observation of the Revenue on the basis of the claim for depreciation on truck, of the relevant truck as a business asset, or even stated of his claim for the depreciation (and interest on borrowing) thereon as not relevant. Further still, even assuming the incurring of such expenditure, i.e., outside books, would result in the same being deemed as the assessee s income u/s. 69C, read out during hearing and, further, a bar of the same being allowed as a deduction in computing the assessee s income of his freight business. The assessee s claim of the said expenditure being incurred out of the undisclosed freight receipt, received in cash during the relevant year, made before the tribunal for the first time, providing thus the source of the said expenditure, is wholly unevidenced. Expenditure is ordi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uestion is answered in the affirmative. The assessee s argument is valid in principle. This is as it is only the net income from any source, or that embedded in any receipt, i.e., after deducting expenditure incurred in its respect, whether accounted for in the regular books of account or not, is liable to be taxed. Where though the source is not proved, section 69C shall come into play, with proviso thereto barring the claim for such expenditure as deduction. The first thing that therefore the assessee needs to show is the receipt of the income in cash, providing thus the source of the expenditure claimed to be incurred outside books, which it surprisingly does not inasmuch as the payment/s thereto during the year would only be disclosed by the deductor. In fact, even in this regard the date/s of payment are relevant inasmuch as only the payment/s, in cash, prior to the date/s of the expenditure, which may though be assumed to be incurred evenly during the year. The next aspect is the vehicle/s in respect of which the freight receipt arises, and in the manner in which it does, inas- much as the assessee s claim, in effect, is of it being an independent source of income, kept ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s with the fact that the assessee has not led an iota of evidence toward incurring any expenditure, even if outside books, which record the transactions entered into the regular course of business. The assessee s argument, valid in principle, thus, fails completely on facts. It would be, under the circumstances, incorrect to say that the assessee has not been allowed any expenditure against the said receipt, but only that the same to the extent admissible, stands already claimed and allowed as a part of regular business expenditure. There is no need or occasion to, under the circumstances, engage in any estimation exercise. The case law relied upon, even as indicated above, is distinguishable. Why, as observed by the Bench during hearing, the depreciation claim itself works to about 10% of the gross freight. The claim for TDS, deductible at 2%, and not paid to the assessee but to the Central Government, has been already allowed. To conclude, no evidence in support thereof being adduced at any stage, the assessee s claims, both as regards the incurring of expenditure over and above that allowed, as well as the source thereof, remain unproved, if not disproved; the assessee ..... 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