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2018 (11) TMI 1324 - ITAT VISAKHAPATNAMDisallowance of stamp duty charges collected by the assessee and incurred as expenditure - survey under section 133A - AO recorded the statements of some employees and the directors at the time of survey and found some inconsistencies in the statements recorded from the concerned persons under section 131 & 133A - Held that:- The assessee has purchased the stamps in cash from the stamp vendors and liasioning agents and through the Government. The said sum was paid by cheque for purchases from Government and whatever stamps purchased from the vendors across the country, the same is paid in cash. Assessee also accounted the stamps in detail settlement-wise in the ledger account. AO did not find any defect in the account of the stamp duty having conducted the survey in the business premises of the assessee. Though the details are available settlement wise, no enquiry was conducted to verify whether the assessee has affixed the requisite stamps or not? The Assessing Officer also did not have any evidence to establish that the purchase of stamps was bogus Merely on the basis of non-furnishing of the details of the vendors, the addition cannot be made especially in the case of purchase of stamps. The consumption of stamps required to be considered on the basis of volume of business and the consumption account. AO did not dispute the fact that there is requirement of affixing the stamps on every contract note, there was no evidence brought on record to show that affixing of stamps in settlement wise as accounted in the ledger account copy is false or overstated. In the earlier years also, the assessee has followed the same practice but the department has not brought on record any evidence to show that department has suspected the payment. Once the department accepts the settlements and mandatory requirement of affixing the stamps there is no reason to suspect the expenses incurred by the assessee towards stamp duty merely on the basis of surmises and conjunctures of the Assessing Officer without bringing any evidence to show that the stamps account is incorrect. The Assessing Officer should have verified the daily transactions on simple basis settlement-wise and given a finding whether assessee is really incurred such expenditure for affixing of stamps. This exercise was not done by the Assessing Officer. Therefore, we hold that disallowance of expenditure claimed by the assessee on account of stamp duty is unsustainable and the same is deleted - Decided in favour of assessee.
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