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2016 (6) TMI 330 - AT - Income TaxAd-hoc disallowance of conveyance expenses - Held that:- The assessee has paid the entire amount of expenses related to conveyance and collection in cash. The assessee before the Assessing Officer made written submissions that the disallowance of this expenses were made on estimated basis but the same are incurred for business purpose by the assessee. The assessee submitted that the supporting evidence towards incurring expenditure was produced before the Assessing Officer. It is seen from the paper book that the evidence to the extent of expenses incurred on conveyance and collection was before the adjudicating and appellate authorities but the same was not taken into account by both the authorities. The disallowance was on ad-hoc basis. This is in our view arbitrary. Hence we delete the disallowance - Decided in favour of assessee Disallowance of interest for utilizing bank loan for making interest free advance - Held that:- As per assessee's submission the loan was taken for business purpose and thus the interest was paid / incurred for business. The relevant documents before the authorities, but the same was not taken cognizance. The Assessing Officer and the CIT (A) proceeded on the premise that the assessee has failed to produce any evidence in support of his claim. This is not a correct position as the paper book submitted by the assessee along with the loans statement for the period 1/4/2008 to 31/3/2009 was produced before the Assessing Officer as well as CIT (A). Both the authorities failed to take cognizance of the said loan statement. It is not in dispute that the loan was taken for business purpose. The money was also advanced for business purpose. Hence the disallowance is bad in law - Decided in favour of assessee Disallowance of interest on account of not utilizing cash available in hand for business purposes and resorting to payment from bank cash credit limit - Held that:- CIT (A) has simply stated that there was no evidence produced by the assessee. We find that there is no merit in the disallowance. The said statement is incorrect. It is not for the Assessing Officer to decide how an assessee can use a cash credit limit with the Bank. - Decided in favour of assessee Addition of house hold expenses - Held that:- We find that ₹ 90,000/- is not a reasonable amount for monthly expenses of any person and his family. The addition in our view is not warranted. - Decided in favour of assessee TDS u/s 194C - Non deduction of tds on payment made to transporters - Held that:- Before us the assessee demonstrated that the payments are covered under the exceptions specified under Rule 6DD. A chart is filed. We are convinced with the same. Hence we delete the disallowance - Decided in favour of assessee Addition on account of variation in the value of closing stock between the value declared in the accounts and the value declared to the Bank - Held that:- The Assessee has given the books at the relevant time to the Assessing Officer to verify the same and the books were also subjected to the audit under Section 44AB of the Act to support the value of closing stock. The finding of the CIT(A) that the assessee has not produced complete sale vouchers and also quantity wise details of opening and closing stock, is not factually correct. It was clear from the records that the same was produced before the Assessing Officer at the relevant time. The assessee submitted month wise purchase and sale details before the Assessing Officer. It was clear from the records that the same all quantitative details were produced before the Assessing Officer. The rejection of books is bad in law as no defects are pointed out. The assessee demonstrated with evidence that the closing stock declared in the books of account is correct. Hence no addition can be made on this account. - Decided in favour of assessee
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