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2018 (1) TMI 1367 - AT - Income TaxAddition on account of under-reported income - Held that:- AO has considered only receipt of ₹ 11,89,074/- in Profit & Loss Account whereas as per Profit & Loss Account filed by the assessee it shows that the assessee has shown receipt of ₹ 14,37,002/-. It is not understood as from where he brought the receipt of ₹ 11,89,074/-. Even the ld. DR could not explain from where the Assessing Officer has picked the figure. I find the ld. CIT(A) without applying his mind as mechanically upheld the order of the Assessing Officer.Thus restore the issue to the file of the Assessing Officer for fresh adjudication. Disallowance of bad debts due to non-furnishing of any explanation or details in this regard - Held that:- CIT(A) has not adjudicated the issue. Since the assessee has debited an amount of ₹ 77,774/- in the Profit & Loss Account, he is entitled to such bad debt in view of the decision of the Hon’ble Supreme Court in the case of TRF Ltd.[2010 (2) TMI 211 - SUPREME COURT ]. Therefore, this ground by the assessee is allowed. Disallowance of telephone expenses - Assessing Officer has made disallowance of ₹ 38,534/- being 1/5th of the telephone expenses being probable personal use which has been restricted by the ld. CIT(A) to 50% of such expenses - Held that:- Considering the facts that certain free calls are allowed by the Telephone Department, lump sum disallowance of ₹ 10,000/- under the facts and circumstances of the case will meet the ends of justice. I hold and direct accordingly. The issue relating to the telephone expenses is accordingly partly allowed. Levy of interest u/s 234B and 234D is concerned, the same is mandatory and consequential in nature. However, direct the Assessing Officer to verify the computation and rectify the arithmetical in accuracy, if any. This ground raised by the assessee is dismissed.
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