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2015 (9) TMI 1230 - ITAT CHENNAI

2015 (9) TMI 1230 - ITAT CHENNAI - TMI - Addition towards disallowance of expenses for earning the commission receipts - Held that:- The assessee has not placed necessary evidence for support of the claim. Whenever the assessee incurs any expenditure, it is the duty of the assessee to prove that expenditure was incurred wholly and exclusively for the purpose of business and also the assessee shall produce relevant evidence for the same. Since, the assessee has not produced required evidence, the .....

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tted back to the file of the Assessing Officer for fresh consideration with a direction to the assessee to file the balance sheet as on 31.03.2007 before the Assessing Officer explaining the investment and the Assessing Officer would decide the issue afresh. - Decided in favour of assessee for statistical purposes. - I.T.A. No.1313/Mds/2015 - Dated:- 2-9-2015 - SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER For The Appellant : Shri. V. Rajasekaran, C.A. For The Respondent : Shri. A.B. Koli, IRS, JCIT. .....

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earning the commission receipts C1,29,450/-. (2) The Respectable Commissioner of Income Tax (Appeals)-19, Chennai was not justified while passing the order confirming addition towards investment in Spny Stones Pvt. Ltd C3,00,000/- made out of income and savings . 3. The facts of the case are that there was a search u/s.132 of the Act in the case of Shri K. Vigneshkumar, son of Shri P. Karvannan, Managing Director of M/s. Sony Fireworks Private Limited. Books of accounts, documents and other mat .....

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l the assessment years under appeal, the assessee had admitted Adayam income, commission and interest receipts as his income, but claimed expenses towards salaries, foreign travel expenses and others. These expenses, as per the Assessing Officer could not be attributed to have been incurred for earning the above income. As the assessee could not provide proper explanation, the Assessing Officer completed the assessment by making an addition on account of expenses claimed by the assessee towards .....

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not explain the sources for the investment and hence the Assessing Officer added the same as unexplained investment to the total income of the assessee. The details of assessment order passed u/s.143(3) rws 153A are given below: Asst. Year Date of asst.order Income assessed 2005-06 06.12.2010 Rs.118850/- 2006-07 06.12.2010 Rs.130850/- 2007-08 06.12.2010 Rs.461124/- 2008-09 06.12.2010 Rs.363310/- Aggrieved, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals). 4. Regar .....

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at Sivakasi and that the assessee himself or through a part-time employee books fireworks orders to other fireworks factories & for the purpose he goes along with the customers to other fireworks factories advise them to select varieties and bargaining them with price etc. The customers may not be regular or fixed, however, the places or the fireworks factories at Sivakasi would certainly be known to the assessee as the assessee himself belongs to a family owning a big brand fireworks factor .....

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s furnished by the appellant, the submissions cannot be accepted as there is no detail or evidence brought on record by the assessee to show that the income has been earned by the assessee by carrying on the business the assessee claimed to have been doing. It is also pertinent to mention here that originally, before the search i.e., 21.10.2008, the assessee had not file any return of income for any of the assessment years under appeal, though the same were due before the date of search. No evid .....

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would be incurring travelling expenses, including foreign travel expenses. No bills or vouchers, with regard to any expenditure has been brought on record by the assessee even during the course of appeal proceedings. It was a settled law that for making a claim of expenditure to be allowable as business expenditure under section 37 of the Act, the onus is on the claimant assessee to prove that the expenditure had been incurred wholly and exclusively for the purpose of its business. It is consid .....

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wholly and it's usually for the business of the assessee. The assessee therefore, has failed to discharge the onus cast on it by law. Therefore the claim of assessee with regard to the aforesaid expenses debited towards salaries, foreign travel & others etc., cannot be allowed. Accordingly, the Commissioner of Income Tax (Appeals) upheld the order of the Assessing Officer. Against this, the assessee is in appeal before us. 5. Heard both parties and perused the material on record. The ass .....

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