9911796707
TMI Blog2021 (8) TMI 603X X X X Extracts X X X X X X X X Extracts X X X X ..... of Income Tax (Appeals) is contrary to the Law and facts of the case. 2.1 The CIT(A) ought to have appreciated the fact that the AO made the disallowance u/s.68 of the Act for the reason that the assessee could not prove the credit worthiness of the said loan with evidences. 2.2 The ClT(A) failed to call for the remand report from the AO while allowing an amount of Rs. 85,00,000/- based on the submissions of the assessee which was not submitted before the AO during course of scrutiny proceedings, which is in violation of provisions of Rule 46A. 3.1 The CIT(A) erred in deleting the disallowance u/s.37 of Rs. 1,92,00,725/- by holding that there was a direct nexus between the expenditure incurred and the business of the assessee. 3.2 T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RBI. The assessee has filed its return of income for the assessment year 2013-14 on 23.09.2013 declaring income of Rs. 1,85,06,830/-. The case has been taken up for scrutiny and assessment has been completed u/s.143(3) of the Income Tax Act, 1961 (hereinafter the 'Act') on 21.03.2016 and determined total income of Rs. 4,94,67,555/- by inter-alia making addition towards unexplained cash credit u/s.68 of the Act of Rs. 85,00,000/- towards unsecured loan received from Shri R.D. Sukumar Babu, the Director of the company, disallowance of commission expenses u/s.37 of the Act of Rs. 1,92,00,725/-, on the ground that the assessee has failed to furnish required information to establish that said commission expenditure was incurred for the purpose o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the assessee before the lower authorities that identity of the creditor is satisfied and genuineness of the loan is also not in dispute because the loan has been taken from shareholder of the company whose credentials have been furnished to the AO. 4.1 We have heard both the parties, perused materials available on record and gone through orders of the authorities below. We find from the order of the ld.CIT(A) that the loan has been taken from shareholder of the company, that means the identity of the creditor is not disputed by the AO. As regards, genuineness of the transaction, loan has been taken through bank and part of loan has been repaid through cheque. The assessee had also paid interest after deducting applicable TDS. Theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diture and business of the assessee. 5.1 The ld.DR submitted that the ld.CIT(A) has erred in deleting disallowance of commission expenses u/s.37 of the Act by holding that there is a direct nexus between expenditure incurred and the business of the assessee without appreciating the fact that the assessee could not file any evidences to prove business nexus with that company. 5.2 The ld.AR for the assessee on the other hand strongly supporting order of the ld.CIT(A) submitted that there is no doubt in genuineness of payment because the said payment was made through proper banking channel after deducting applicable TDS and hence, the reason given by the AO to disallow said expenses is incorrect. 5.3 We have heard both the parties, perused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO has disallowed 20% of various expenses including printing & stationery, office maintenance and electricity charges, on the ground that the assessee has not filed any evidences to prove that said expenses are normal business expenses which had to be incurred wholly and exclusively for the business of the assessee. It was the claim of the assessee before the lower authorities that all expenses incurred under the head 'miscellaneous expenses' are incurred wholly and exclusively for the business of the assessee and further AO has made adhoc disallowance without any query with regard to said expenditure. The assessee further claimed that it had furnished all evidences before the AO and also proved that out of total expenses deferred revenue e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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