TMI Blog2021 (3) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... her and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year. In the instant case also, in assessment year 2013-14, the assessee has shown net profit @ 3.08%, which was assessed u/s.143(3) of the Act. Further, in assessment year 2015-16, the profit was shown @ 2.99%, and accepted u/s.143(1) of the Act by the department, which is less than the net profit shown by the assessee in the present year under consideration i.e. 3.75%. Therefore, we find that the ld CIT(A) is justified in restricting the disallowance to 2% of the total expenses claimed by the assessee considering the quantum and nature of expenses and also the claim of earlier years. Decided against revenue. - ITA No. 278/CTK/2018 C.O.No.18/CTK/2019 - - - Dated:- 28-1-2021 - S/SHRI P. M. JAGTAP , VICE PRESIDENT AND C. M. GARG , JUDICIAL MEMBER Assessee by : Shri P. K. Mishra , AR Revenue by : Shri M. K. Gautam , CIT, DR ORDER Per Bench This is an appeal filed by the revenue against the order of the CIT(A), Sambalpur dated 24.4.2018 for the assessment year 2014-15. The assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... These payments were received by Drivers after putting their signature on hand made Vouchers maintained at the work site. The learned A.O. without having any contrary evidence in hand, should not have disbelieved it and should not have asked the Assessee to produced printed Bills and Vouchers. It may be further submitted here that, it is not the fact that the Assessee Firm has not maintained any bills or vouchers, rather all payments were made to Truck drivers at the spot after obtaining their signature on cash voucher where, the details of trips and total expenses vehicle wise were mentioned. Since, it were handmade vouchers, the learned A. O. did not accept it, for which he came to a conclusion that, the Assessee could not produce bills and vouchers. Further, during the year under consideration, the total turnover of the Assessee was of ₹ 10,63,17,938.00, if the gross transportation receipts is compared with the hire charges expenses of ₹ 8,25,28,757.00, then it will be found that, the impugned expenditure was of only 77.62% which is too low in comparison with the hire charges expenses claimed by any other Assessee. That apart, before holding that, the impugned expendi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in restricting the disallowance without giving any reasons. He submitted that the assessee has failed to furnish the books and account and bills and vouchers in support of the claim of expenditure. Hence, the AO was correct in making the disallowance. 7. Replying to above, ld AR supported the order of the ld CIT(A) and reiterated the submissions made before the ld CIT(A) (supra). He also submitted that the ld CIT(A) considering the nature and quantum of business vis- -vis expenses of the earlier years, restricted the disallowance to 2% which is correct and justified. He submitted that the assessee s total turnover was ₹ 10,63,17,938/- and the claim of expenditure was ₹ 8,25,28,757/- which is too low in comparison to other similar business operators. That apart, before holding that, the impugned expenditure is abnormally high, the learned A.O. should have brought on record other comparable cases, where any other Assessee has claimed less transportation expenses in comparison to the assessee, but in the instant case, without having any contrary evidence and any comparable cases, the learned A.O. framed an opinion that, the impugned expenditure is abnormally high, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not disallowed 100% expenditure and he had considered the maximum expenditure as genuine and having been incurred for the purpose of business, which means that the expenditure claimed by the assessee has been considered as excessive. Nowhere in the order of the AO, there is a whisper as to how the expenditure is excessive and how the expenditure is not incurred for the purpose of transport business or there is personal expenditure. No working or factual basis has been stated in the assessment order to substantiate disallowance @ 20% of the work. The ld CIT(A) rightly considered the sole issue as to whether the disallowance made by the AO @ 20% of total expenses claimed is very high or excessive. First of all, we also agree with the action of the AO that in absence of books of account and bills and vouchers, he was right and quite justified in making part disallowance of hire charges expenses. At the same time, we also find that the disallowance of 20% of total claim that too without basis is also not justified and reasonable. The ld CIT(A) keeping in view the nature of business of assessee, nature and quantum of the expenses claimed and quantum of expenses claimed under the same he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earlier years on the same matter are relevant where all fundamental facts permitting through different assessment years have been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year. We find that in the instant case also, in assessment year 2013-14, the assessee has shown net profit @ 3.08%, which was assessed u/s.143(3) of the Act. Further, in assessment year 2015-16, the profit was shown @ 2.99%, and accepted u/s./143(1) of the Act by the department, which is less than the net profit shown by the assessee in the present year under consideration i.e. 3.75%. Therefore, in view of the foregoing discussion and considering the totality of the facts and circumstances of the case, we find that the ld CIT(A) is justified in restricting the disallowance to 2% of the total expenses claimed by the assessee considering the quantum and nature of expenses and also the claim of earlier years. We uphold the same. This ground is dismissed. 13. Ground No.2 is as under: On the facts and in the circumstances of the case and in law, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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