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TMI Blog2012 (10) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO initiated reassessment proceedings by issuing notice u/s.148 of the I.T.Act, 1961 for all the assessment years under consideration i.e. A.Ys. 2000-2001 to 2004-05. 4. Firstly, we take up appeal for assessment year 2000-2001 being I.T.A. No.5188/M/2009. 5. The assessee has filed concise grounds of appeal which are as under: "1. On the facts and in the circumstances of the case, ld CIT(A) erred in confirming the following additions: (i) Depreciation Rs.34,26,233 (ii) Admn. Expenses Rs. 1,05,694 (iii) Donation Rs 9,000 6. In respect of Ground No.1(i), the relevant facts are that assessee debited depreciation of Rs.49,68,365. The AO disallowed the claim of depreciation stating that the assessee company closed down the production and, therefore, there is no reason to allow depreciation on the assets of the company. Being aggrieved, assessee filed appeal before ld CIT(A). 7. Ld CIT(A) called for a Remand Report from the Assessing Officer as the assessee contended that as per tax audit report, assessee had been trading only during the year. The AO submitted his Remand Report vide letter dated 23.4.2009, copy placed at pages 26 to 30 of PB. The AO in the Remand Report (par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chineries were used by the assessee during its trading business. 9. Ld D.R. also submitted that no evidence has been placed on record by ld A.R. and therefore, the order of ld CIT(A) be confirmed. 10. We on consideration of submissions of ld representatives of parties and in the absence of any documentary evidence on record, that the assessee used plant and machinery during the course of its trading activities as submitted before us, we do not find any reason to interfere with the order of ld CIT(A). Hence, we reject Ground No.1(i) of appeal taken by assessee. 11. In Ground No.1(ii), the assessee has disputed the order of ld CIT(A) in confirming a sum of Rs.1,05,694 out of Rs.4,76,220 disallowed by the AO under the head "administrative expenses" 12. During the relevant assessment year, assessee debited an amount of Rs.8,52,435 as administrative expenses. The AO stated that the assessee company was closed down during the year 1999 but still debited an amount of Rs.8,52,435 as administrative expenses for which no proof or evidences were produced. Therefore, the AO disallowed 50% of the claim of the assessee which comes to Rs.4,76,220 and added to the taxable income of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orities below. However, ld A.R. submitted that at the time of remand proceedings sought by the CIT(A), the assessee furnished copy of FIR before the AO for theft of Rs.1,60,000 and referred to pages 45 to 51 of PB. He further submitted that assessee had also written of Rs.50,000 as sundry debtor since assessee failed to produce any evidence with regard to theft like FIR etc. To substantiate his submission, he referred copy of remand report placed at pages 32 to 36 of PB. Ld D.R. submitted that the order of ld CIT(A) is silent on this issue and, therefore, the matter could be restored back to his file for his consideration. 20. On consideration of above submissions of ld representatives of parties and also considering para 8 of the remand report placed at pages 32 to 36 of PB r.w. 45 to 51 of PB, we restore the issue to the file of ld CIT(A) to decide the claim of the assessee in respect of Rs.1,60,000 on merits by a speaking order. However, in respect of balance amount of Rs.50,000, no submissions were made by ld A.R. We also observe that the assessee failed to produce any documents at the time of remand proceedings and, accordingly, the AO could not verify the claim of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n to interfere with the order of ld CIT(A). Accordingly, Ground of appeal taken by assessee is rejected. 28. The assessee has filed additional ground as under: "On the facts and in the circumstances of the case, ld CIT(A) erred in not appreciating Explanation 5 to Sub-section 1 of Section 32 of the Income tax Act, 1961. He failed to appreciate that the provisions of sub-section 1 of Section 32 shall apply whether the assessee company has claimed the deduction or not in respect of depreciation in computing its total income for the assessment year 2002-03." 29. During the course of hearing, it was conceded by ld A.R. that above additional ground is not arising out of orders of authorities below. Ld A.R. also conceded that assessee did not make any claim for depreciation before the AO and no details were filed before him. However, ld A.R. submitted that the list of plant and machineries were filed during the course of remand proceedings before the AO. He submitted that a direction could be given to the AO to allow the claim of depreciation to the assessee as applicable to it. However, ld D.R. submitted that the said additional ground should not be admitted as it is not arising out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m is raised by the assessee before the Tribunal for the first time. Considering the facts of the case and the fact that no details were filed before the authorities below to consider the claim of the assessee for depreciation, we are of the considered view that additional ground for claiming depreciation is not maintainable as claim of the assessee for depreciation depends on the factual details which the assessee failed to furnish not only in the return filed but also during the course of assessment proceedings as well as before ld CIT(A). Hence, we reject the additional ground taken by the assessee. 31. Now we take up the appeal for assessment year 2003-04 being I.T.A. No.4600/M/2011. 32. In Ground No.1 of appeal, assessee has disputed the order of ld CIT(A) in confirming the addition of Rs.5,09,955 on account of cash in hand. 33. The AO has stated that as per return of income in the balance sheet schedule-8 under the head 'cash and bank balance', cash balance is shown at Rs.5,09,555. The AO has stated that in the absence of any proof/details, the said amount is added to the income of the assessee. In the first appeal, ld CIT(A) confirmed the action of AO by observing that ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom A.Y. 1999-2000 to 2002-03 and stated that the percentage of expenses allowed were 79.79%, 87.68%, 76.44& and 69.59% respectively from A.Ys. 1999-2000 to 2002-03 and, therefore, the disallowance, if any, is to be made in the assessment year under consideration i.e. A.Y. 2003-04, proportionately following the preceding assessment year. Ld D.R. supported the orders of authorities below and stated that assessee failed to produce proof or books of account for the claim of expenses and, therefore, order of ld CIT(A) be confirmed. 40. We have carefully considered the orders of authorities below and submissions of ld representatives of parties. We have also perused page 61 of PB to which our attention was drawn by ld A.R. Ld A.R. has not disputed the fact as stated by ld CIT(A) that assessee produced copy of bills only for Rs.1,28,945. Further, expense of Rs.11,99,205 was incurred in cash which was supported by internal vouchers and for the balance amount of Rs.13,28,150, assessee failed to produce any particulars or books of account. The Hon'ble AP High Court in the case of Commissioner of Income-tax v. Transport Corporation of India Ltd., 256 ITR 701 (AP) held that unsupported payme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of PB which is a copy of banks statement and submitted that the sum of Rs.20 lakhs was paid by cheque to M/s. Gurudev Chemox Industries, Bangare. Ld A.R. further referred to page 130 of PB which is a copy of certificate dated 29.3.2005 of the recipient of the alleged commission. Save and except the above document, assessee could not furnish any other evidence. Further, assessee sought permission to file additional evidence alongwith affidavit. The same were found to be copy of ledger copies for the period 1.4.2002 to 31.3.2003 running into pages 1 to 97 of PB. During the course of hearing, a query was raised to the assessee whether the TDS was deducted on the alleged payment of commission to M/s. Gurudev Chemox Industries, Bangare. Ld A.R. could not reply anything to establish as to whether any TDS was deducted on the payment of alleged commission. On the other hand, ld D.R. supported the orders of authorities below and submitted that even during the remand proceedings, assessee has not placed any evidence on record to justify the alleged claim of payment of commission. 45. We have considered the orders of authorities below and submissions of ld representatives of parties. Consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edings, assessee has shown inability to produce books of account and supporting documents stating that the books of account are still in the custody of various law enforcement agencies. Ld CIT(A) confirmed the action of AO as no new evidence was produced by the assessee before the AO during the remand proceedings. Hence, the assessee is in appeal before the Tribunal. 49. During the course of hearing, ld A.R. reiterated the facts as stated before the authorities below. He further submitted that in the preceding assessment year such claim made by the assessee on account of sale of the returned goods was allowed by ld CIT(A) and, therefore, there is no justification not to accept the claim for the assessment year under consideration. 50. Ld D.R. supported the order of ld CIT(A) and submitted that in the absence of any document of the said cash deposit aggregating to Rs.19 lakhs, in the bank of the assessee out of sale of returned goods, ld CIT(A) is justified to confirm the action of AO. He submitted that even in the remand proceedings, assessee could not produce any evidence to substantiate his submission. 51. We have considered the orders of authorities below and submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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