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2019 (1) TMI 1805 - AT - Income TaxDeduction of service charges paid to the employees - bogus claim as the employees, who were examined by the AO had denied having received any service charges - HELD THAT:- What is paid to the employees is only out of the amount collected from the customers in the form of the service charges but the total service charges paid to the employees far exceeds the amount collected. This fact undoubtedly raises doubts as to the genuineness of the claim made. Perhaps, this would have triggered the AO to enquire into the genuineness of the claim. As a part of inquiry into the claim, the AO had examined certain employees, who had denied having received any such service charges. However, this would not lead to a conclusion that the claim is untenable in view of the fact that the employees, who were examined by the AO may not be working during that relevant time. Onus of proving the claim always lies on the assessee. But, the present case, the assessee-company failed to lead any evidence to prove the claim. CIT(A) had merely based on the presumptions that the assessee-company would have paid to the employees to the extent of the service charges collected and allowed the claim to the extent of service charges collected. Further, the ld. CIT(A) had not even examined whether the service charges are really collected by the assessee-company nor was any evidence was discussed in the order in support of the claim for the expenditure. CIT(A) had proceeded on assumptions and presumptions while granting the partial relief. Order of the ld. CIT(A) is also not supported by any material on record. CIT(A) also failed to note that the facts necessary to prove the claim would be within knowledge of the assessee and it is the duty of the assessee alone to prove that what is claimed is true and correct AO was justified in drawing adverse inference on the claim and the ld. CIT(A) ought not have granted any relief in the absence of any evidence in support of the claim. Therefore, the appeals filed by the assessee are dismissed and the appeals filed the Revenue are allowed.
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