2011 (6) TMI 857 - AT - Income Tax

Summary

Issues involved: Disallowance of consultancy charges payments and restoration of verification of books of accounts for assessment year 2004-05.

Consultancy Charges Payments Disallowance:
The Assessing Officer disallowed consultancy charges payments of Rs. 15,05,178 due to lack of information on the nature of services provided and their relevance to the business. The Ld. Commissioner of Income Tax (Appeals) overturned this disallowance, stating that the Assessing Officer did not properly examine the details and disregarded the claim without sufficient justification. The matter was remitted back to the Assessing Officer for a fresh consideration, with the directive to provide the assessee with a fair hearing.

Verification of Books of Accounts:
The Assessing Officer disallowed expenses amounting to Rs. 96,78,133, citing the non-production of books of accounts and vouchers by the assessee. The Ld. Commissioner of Income Tax (Appeals) noted that the books of accounts were indeed produced for verification and remitted the issue back to the Assessing Officer for limited verification. The Revenue challenged this decision, arguing that the Ld. Commissioner of Income Tax (Appeals) lacked the authority to remit the matter post-1.6.2001. However, the tribunal upheld the decision, emphasizing that the remittance was for the specific purpose of verifying the books of accounts and did not exceed the Ld. Commissioner of Income Tax (Appeals)' jurisdiction.

In conclusion, the appeal by the Revenue was partly allowed for statistical purposes, with the tribunal upholding the decision to remit the issues back to the Assessing Officer for fresh consideration based on the additional evidence and verification of books of accounts provided by the assessee.