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TMI Blog2017 (5) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... under: ITA No.894/Ahd/2014 1. On the facts and circumstances of the case as well as law on the subject, the Id. CIT(A) has erred in confirming the action of Assessing officer in reopening of assessment by issuing notice u/s sec 148 of Act and thereby framing assessment u/s 143(3) r.w.s 147 of the Act. 2. On the facts and circumstances of the case as well as law on the subject, the Id CIT (A) has erred in confirming the action of Assessing Officer in rejecting assessee's contention of its case being covered u/s 44AE of the Act. 3. Without prejudice to Ground No. 2,on the facts and circumstances of the case as well as law on the subject, the Id CIT (A) has erred in partly confirming the action of Assessing Officer and in making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer. It is, therefore, prayed that the order of the Ld.CIT(A)-1, Surat may be set-aside and the Assessing Officer's order may be restored." 3. Ground no.3 in the appeal of the Revenue and ground no.5 in the appeal of the assessee are general grounds of appeal. They do not call for recording of any specific finding, hence rejected. 4. Ground no.1 and 2 in the Revenue's appeal and ground no.3 and 4 of assessee's are inter-connected with each other. The ld.AO has made a disallowance of Rs. 3,30,858/- out of truck expenses at the rate of 25%. The ld.CIT(A) has restricted this disallowance to 10%. Therefore, the assessee is aggrieved with the confirmation of disallowance at 10%, on the other hand, the Revenue is aggrieved with part delet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of the Hon'ble Delhi High Court in the case of Madhukar Khosla Vs. ACIT, Writ Petition No.(C) 1320/2014. He placed on record copy of this decision. On the other hand, the ld.DR relied upon the order of the AO. 9. We have duly considered rival contentions and gone through the record carefully. In the present case, there was no scrutiny assessment. The return was processed only under section 143(1) of the Act. There is nothing with the assessee to say that the AO was not possessed any fresh information. The observation of the AO in the reasons to the effect is that on verification of record he found certain discrepancies. Now this record would contain all the information possessed by him. In other words, he has not made reference to a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,32,343/- which is impugned by the assessee in its ground no.3. Deletion made by the ld.CIT(A) has been impugned by the Revenue in ground no.1. 12. Before we embark upon an inquiry on the facts of this issue, we deem it appropriate to take note of the facts relating to ground no.4 of the assessee's appeal, and ground no.2 of the Revenue's appeal. The facts with regard to this issue are that the assessee has gross receipts of Rs. 3,02,66,798/-. It has debited a sum of Rs. 2,73,66,599/- towards cartage and labour expenses. According to the AO the assessee failed to supply requisite information, and therefore, he disallowed 25% of the total cartage and labour expenses. He made an addition of Rs. 68,41,650/-. On appeal, the ld.CIT(A) has rest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee, because the assessee has maintained the books of accounts and AO has made an ad hoc disallowance out of the expenditure, which are debited in the books. 16. We have duly considered rival contentions and gone through the record carefully. No doubt, the assessee has been maintaining books of accounts. It has filed audit report also. On page no.23 of the paper book, the assessee has placed on record details of fixed assets and how it calculated depreciation. In these details, the assessee has given registration number of 11 trucks. Out of which, one truck was not available in the first half of the year i.e. on 1.4.2006. Thus, the assessee was having 10 trucks in the beginning, but on closing of the account, it was having 11 truc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king various disallowance out of the expenses claimed by the assessee. He also enhanced the receipt shown by the assessee. The estimated disallowance made by the AO was partly reduced by the CIT(A). Therefore, undisputedly, in the assessee's case, the actual dispute is only with regard to estimation of the income from trucks plying business. In our opinion, when the legislature has provided some formula for estimation of income in the case of a transporter, who owns less than ten goods carnages, there would not be any justification for not estimating the income of the assessee as per the formula prescribed in s. 44AE. It is irrelevant whether the revised return furnished by the assessee is valid or not. When the question of estimation o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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