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TMI Blog2018 (11) TMI 1239X X X X Extracts X X X X X X X X Extracts X X X X ..... 2015 passed by learned Assessing Officer (hereinafter called "the AO") u/s 143(3) of the Income-tax Act, 1961 (hereinafter called "the Act") for AY 2013-14. 2. The grounds of appeal raised by the assessee in the memo of appeal filed with the Income-Tax Appellate Tribunal, Mumbai (hereinafter called "the tribunal") read as under:- "1. The learned CIT (A) has erred in up holding the disallowance of expenditure incurred of Rs. 9,15,043/- paid to M/s K.G.N. Enterprises. The expenditure incurred is genuine and appellants had produced the necessary evidence available with them. 2. The appellants crave leave to add, to alter to amend or delete any of the grounds of appeal. If any, on or before the date of hearing." 3. The brief facts of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payee cheques and income-tax was also deducted at source(TDS) as provided under the provisions of the 1961 Act from the payments made to this party. The details of Income-tax PAN of the said party, TDS certificates, ledger account of this party and bank statement was duly submitted but the AO was not satisfied and the additions were made by the AO to the income of the assessee by disallowing these expenses to the tune of Rs. 9,15,043/- vide assessment order dated 29.12.2015 passed by the AO u/s 143(3) of the 1961 Act. 4. Aggrieved by the assessment order dated 29.12.2015 passed by the AO u/s 143(3) of the 1961 Act, the assessee filed first appeal before the learned CIT(A) but without success as learned CIT(A) rejected the contentions of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cord. It is submitted by learned counsel for the assessee that the said party namely M/s K G N Enterprises left the painting work in between and the party is not traceable. Ledger accounts of the said party in the books of the assessee are enclosed along with bank statements and TDS certificates . It was submitted that the Income Tax Permanent Account number and addresses of the said party as per records with the assessee was duly supplied before the authorities below and the AO/learned CIT(A ) could have traced the said party by mining their IT data base as the said party is assessee with the IT Department. The reliance was placed on the decision of Hon'ble Supreme Court in the case of CIT v. Orissa Corporation Private Limited reported in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wherein ad-hoc disallowance have been made of expenses aggregating to Rs. Rs. 99,680/- towards Telephone charges, Conveyance and Travelling expenses, Mess charges and Miscellaneous Site Expenses. The assessee has not challenged this addition of Rs. 99,680/- as was made by the AO in appellate proceedings , which has now attained finality. The dispute between rival parties is with respect to disallowance of expenses of Rs. 9,15,043/- made by the AO which was later confirmed by learned CIT(A) with respect to payments made by the assessee to K.G.N. Enterprises claimed to be towards plaster expenses on the grounds that the said party is not traceable and notices issued u/s. 133(6) of the 1961 Act by the AO to the said party has returned un-serve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt from the return of notices u/s 133(6) sent by the AO to the said party as well non production of the said party by the assessee before the authorities below. Apart from sending notices u/s 133(6), the authorities below have made no efforts to trace/locate the parties as no efforts to mine existing database with IT department was made by the AO/learned CIT(A), as the Income-tax PAN of the said party was duly furnished by the assessee and the said party is an existing assessee with IT department. The said party K G N Enterprises (Prop. Mansoorali Habeeb Ansari-PAN AOYPA4809D) is an income tax assessee with IT department as he is holding PAN allotted by Revenue. No such report of the AO/learned CIT(A) is on record showing the result of data ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents were made to said party for plaster work which is directly related to business of the assessee and similar payments made to the said party in preceding year stood allowed by the AO itself in scrutiny assessment framed u/s 143(3) of the 1961 Act. Suspicion howsoever strong cannot take the place of proof is cardinal rule of jurisprudence. Thus, based on our above detailed discussions and reasoning, we are ordering for deletion of aforesaid additions to the tune of Rs. 9,15,043/- as was made by the AO and later confirmed by learned CIT(A). The assessee succeeds in this appeal. We order accordingly.
8. In the result , appeal filed by the assessee is allowed. .
order pronounced in the open court on 23.07.2018 X X X X Extracts X X X X X X X X Extracts X X X X
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