2013 (11) TMI 1691

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..... veyance expenses and (c) ₹ 1,42,600/- out of Staff Welfare expenses. 2. Qua the grounds raised it is further agitated that in regard to the disallowance made no specific show cause notice was issued by the AO and the past history on the said issue has not been considered by the CIT(A). 2.1. The relevant facts of the case are that the AO in the course of the assessment proceedings made the following additions :- 3. The income is computed subject to the below mentioned : Business Promotion Expenses ₹ 1,86,25,177/- A sum of ₹ 1,86,25,177/- has been claimed on account of Business Promotion by the assessee under the head Selling and Distribution expenses. In these background facts the books of acco .....

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..... ions made no specific show cause notice was issued and the adhoc disallowances have been made ignoring the past history and facts on record. It was submitted that for a company having a turn over of ₹ 207.40 crores the addition on account of expenditure on business promotion of only 0.90% of the turn over was not warranted. It was further contended that the AO has merely observed that these expenses are not verifiable without caring to point out as to what was the specific deficiency. A perusal of the record also shows that a complete break up of staff welfare expenses was given which has been reproduced in page 5 of the impugned order so as to contend that the AO has not pointed out what was not verifiable. However not convinced by .....

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..... ncluding books of accounts, bills and vouchers, bank statements which were put to test checks. 2. The assessee company is an authorized dealer of M/s Dalmler Chrysler (India) Pvt. Ltd. for sale service of Mercedes Benz Cars in Delhi, UP Haryana. During the year under consideration the assessee derived income from trading, servicing and repairing of these vehicles. During the test checks of the books of accounts no material discrepancy was found. Therefore, the trading results are accepted as such. 5.2. It is further seen that the AO has made the additions for Business Promotion expenses , Traveling and conveyance expenses and Staff welfare expenses holding that the expenses were not fully verifiable. No attempt was consid .....

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