TMI Blog2014 (2) TMI 845X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proceedings as well as in the penalty proceedings to substantiate its claim that the travelling expenses of Mr. Jayanti mehta was incurred for business purposes - the disallowance was related to the interest genuinely incurred for the purposes of business and the disallowance was made u/s 14A of the Act - the assessee has failed to prove that the travel expenses of Shri Janti Mehta for the purposes of its business, i.e., the assessee has failed to address the view of the AO that the expenses were inflated, which has resulted in concealment of income – thus, there is no reason to interfere with the order of the CIT(A) – Decided against Assessee. - ITA No. 841/Mum/2012 - - - Dated:- 19-2-2014 - Shri B. R. Baskaran, AM And Amit Shukla, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm. The assessee also did not furnish any reason as to why the travel expense of Mr. Jayanti Metha was incurred by the assessee firm. Hence the AO disallowed the portion of travelling expenditure relatable to Mr Jayanthi Mehta, which was worked out at Rs.5,79,509/-. The AO also initiated penalty proceedings. Before the AO, during the course of penalty proceedings, the assessee submitted that it did not furnish any inaccurate particulars with regard to travel expenses. However, the AO noticed that the assessee did not produce any evidence to substantiate the necessity of incurring expenses for Mr. Jayanti Mehta; even during the course of penalty proceedings. Hence, the AO took the view that the assessee, by debiting the expenses relating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On the contrary, the ld DR submitted that the assessee did not offer any convincing explanation during the course of assessment proceedings as to why he had incurred travel expenses of Mr Jayanti Mehta, even though he has not connected to the assessee firm. The assessee did not offer any explanation even during the course of penalty proceedings. Further the assessee did not substantiate that these expenses were genuinely incurred for business purposes. Accordingly, he submitted that the ld CIT(A) was justified in confirming the penalty levied by the AO u/s 271(1)( c) of the Act. 8. We have heard the rival contention and carefully perused the record. We also carefully gone through the order passed by the ld CIT(A). For the sake of convenie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the appellant firm. Merely having vast experience in the line of the business of the firm, is not a sufficient criteria to a!low an expense incurred on a person, who is otherwise not connected in any way with the business operations of the appellant firm. No such evidence has been provided by the appellant either during the course of assessment proceedings or the appellate proceedings before me. 4.3. There is no substance in the argument of the appellant that AO has not provided them opportunity of personal hearing. The AO had issued show cause notices and in response to that the appellant had filed a letter dated 11/05/2009 contending that the penalty is not imposable. Therefore, it is not correct argument of the appellant that oppor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice that the assessee has failed to discharge the said onus. Thus, it is noticed that the travelling expenses incurred for Mr. Jayanti Mehta was not proved to be for business considerations. 10. In the case of Reliance Petroproducts Pvt Ltd (supra), the disallowance was related to the interest genuinely incurred for the purposes of business and the disallowance was made u/s 14A of the Act. The Hon'ble Apex Court noticed that the assessee therein had furnished all the details of its expenditure as well as income in its return, which details, in themselves, were not found to be inaccurate not could be viewed as concealment of income on its part. Further, the Hon'ble Apex Court gave a specific finding that the department did not find any fau ..... X X X X Extracts X X X X X X X X Extracts X X X X
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