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2016 (3) TMI 858 - AT - Income TaxAddition U/s 40A(2)(b) - interest in excess of 3.25% more than the bank rate - expenses had increased substantially compared to preceding year - Held that:- The assessee had explained the reasons for increase in the expenses under all the heads and also produced the relevant bill vouchers at the time of assessment proceedings. The ld Assessing Officer had not found any non-genuine payment under these heads, no specific discrepancy has pointed out in the bills and vouchers maintained by the assessee. It is not necessary that increase in expenses automatically raised the sales/production. The assessee has explained the increase in the expenses on the basis of evidence, which has not been controverted by the ld DR. The assessee's manufacturing activities comes under the excise item and also had sales tax registration. The assessee's case is auditable in the income tax law and no qualifying remark had been made by the auditor on expenses claimed by it. The ld Assessing Officer has not brought out on record any material to substantiate his addition. - Decided in favour of assessee
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