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Roshan Motors Versus ITO, Ward-2 (2) , Muzaffarnagar

2016 (1) TMI 313 - ITAT DELHI

Power of the CIT(A) to enhance the assessment u/s 251 - disallowances as well as enhancement of income done by CIT(A) - DR stated that the assessee has agreed before the learned Commissioner of Income-tax (Appeals) for enhancement there is no reason in the appeal now to be filed before ITAT - Held that:- According to provisions of sub-section 2 of section 251 of the Income Tax Act, the learned Commissioner of Income-tax (Appeals) shall not enhance the assessment unless the appellant had a reason .....

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d report and learned Commissioner of Income-tax (Appeals) has passed the order on the same day. Therefore it is apparent that on 25.03.2015 the assessee was shown remand report and on the same day the appellate order was passed by the learned Commissioner of Income-tax (Appeals) enhancing the income of the assessee by ₹ 2 lacs. We also could not gather from the order of the learned Commissioner of Income-tax (Appeals) that how the sum of ₹ 2 lac was arrived at. We are not at all conc .....

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disallowance . We are not in a position to sustain the order of CIT (A) confirming other additions as well as the amount of enhancement of ₹ 2 lac. Therefore, in the interest of justice we set aside the matter back to the file of Commissioner of Income-tax (Appeals) with a direction to pass a speaking order on each of the grounds raised following the procedure prescribed u/s 251 of the Act - Decided in favour of assessee for statistical purposes. - ITA No. 4180/Del/2015 - Dated:- 2-12-2015 .....

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r is illegal, bad in law and without jurisdiction and the CIT(A) has also erred in upholding the same. 2. The addition/ disallowances made by the assessing officer are illegal, unjust, highly excessive and are not based on any material on record by the assessing officer. The total income of the assessee appellant has been wrongly and illegally computed by the assessing officer at ₹ 6,78,780/- as against declared income of ₹ 4,77,890/- 3. That, in view of the facts and circumstances, .....

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to the income that under which source he is proposing and making the enhancement, which is illegal, bad in law and without jurisdiction. 6. That, without prejudice to the above, in view of the facts and circumstances, the CIT(A) has erred in law and on facts in making the addition of ₹ 2,00,000/- on account of enhancement by the estimation, which is unjust, arbitrary, unlawful, highly excessive, based on surmises and conjectures and cannot be justified by any material on record. 7. That, i .....

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lawful, highly excessive, based on surmises and conjectures and cannot be justified by any material on record. 9. That the Assessing Officer, in view of the facts and circumstances of the case erred on facts and in law in making the addition/ disallowance of ₹ 6,988/- on account of misc. expenses and the C1T(A) has also erred in upholding the same. 10. That the Assessing Officer, in view of the facts and circumstances of the case erred on facts and in law in making the ad-hoc addition/ dis .....

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on facts and in law in making the ad-hoc addition/ disallowance on estimated basis, which is unjust, arbitrary, unlawful, highly excessive, based on surmises and conjectures and cannot be justified by any material on record. 13. The additions made and the observations made are unjust, unlawful and based on mere surmises and conjunctures. The additions made cannot be justified by any material on record. 14. That the explanation given evidence produced, material placed and available on record has .....

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es/additions made and could not have included the same in current income for payment of Advance tax. The interest charged under various sections is also wrongly worked out. 2. The facts in brief of the case are that the assessee is engaged in the trading of Honda Scooters, Moto Cycle, its parts and accessories. The assessee e-filed return of income declaring total income of ₹ 4,77,890/- on 22.09.2010. The return of income was processed u/s 143(1) of the Income tax Act, 1961. The case was s .....

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s made in cash. Though this facility may be provided to enhance the sale of the firm as per company s scheme however in absence of proper bills and vouchers the actual amount of this expenditure cannot ascertained. Therefore to cover up any discrepancy one fourth of this expenditure is disallowed and added in assessee s total income which comes to ₹ 49,504/-. The assessee had debited an amount of ₹ 61,373/- on account of car and scooter running expenses. The personal use of car and s .....

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de. Therefore, the Assessing Officer disallowance the expenses and added ₹ 20,101/- on the total income of the assessee. Further the Assessing Officer asked the assessee to furnished the justification of advertisement expenses of ₹ 8,36,991/-, but the assessee failed to furnish any justification in this regard. So, the Assessing Officer disallowed and added ₹ 83,699/- to the total income of the assessee. The assessing officer completed the assessment on total income of ₹ .....

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issuing any notice and without providing adequate opportunity of hearing. He further submitted that CIT (A) has merely on the part of remand report obtained by him in appellate proceeding has enhanced the income of the assessee to the tune of ₹ 2 lac. He further submitted that in fact the AO has asked for the further time for submitting the remand report. He further submitted that CIT (A) has not decided the grounds of appeal on merit and not granted an opportunity of rebutting the remand .....

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and stationery expenses, miscellaneous expenses, miscellaneous deduction against cash less policy, scooter repair and maintenance in remand report also could not be met with by assessee as no opportunity was granted by CIT (A). He submitted that there is no difference. He submitted that the ledger account submitted by the assessee are duly supported by vouchers and bill. Further looking into the circumstances of the case it can be possible that during the remand report it could not be produced. .....

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ITAT. Therefore same may be dismissed. 6. We have carefully considered the rival contention, the power of the Commissioner of Income-tax (Appeals) are enshrined in section 251 of The Income Tax Act which are as under :- Powers of the [Principal Commissioner or Commissioner] (Appeals)]. (1) In disposing of an appeal, the Commissioner] (Appeals)] shall have the following powers- …….. (2) The [Principal Commissioner or Commissioner] (Appeals)] shall not enhance an assessment or a pena .....

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mention about the show cause notice issued by him giving the reasons for enhancement and the manner of determining the amount of enhancement. There is no opportunity granted to the assessee at all. According to the order of the learned Commissioner of Income-tax (Appeals), on 25.03.2015 the appellant was confronted with the remand report and learned Commissioner of Income-tax (Appeals) has passed the order on the same day. Therefore it is apparent that on 25.03.2015 the assessee was shown remand .....

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