9911796707
TMI Blog2022 (10) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... ll to the Assesseeat the address mentioned in Form no. 36, the Assessee neither appeared nor filed any adjournment application, therefore, in the constrained circumstances, we deem it appropriate to decide the appealsunder consideration as ex-parte after hearing the learned DR and on the basis of the material available on record and. ITA no. 1117/Del/2018 (quantum appeal): 3. In the instant case the AO vide assessment order dated 29.12.2016 passed u/s 143(3) of the Act, made three additions i.e. (i) disallowance of service tax claimed in the P&L a/c at Rs. 40,45,470/-; (ii) addition on account of rejection of consumption of foods & beverages claimed at Rs. 4,07,09,028/-; and (iii) disallowance on account of certain expenses claimed as revenue at Rs. 22,27,702/-. The Assessee being aggrieved preferred first appeal before the Ld. Commissioner, who vide impugned order partly affirmed the additions, against which the Assessee has preferred the instant appeal. 4. The Assessee has raised following grounds of appeal: 1. The CIT (A) has erred in confirming the disallowance of Rs.2,03,54,514/-. 2. The CIT (A) has erred in disallowance of Rs.2,03,54,514/- on estimation basis. 3. Bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Corporation. The ledger account and postal addresses of these two parties were also filed and the AO was also requested to issue notice u/s 131 of the Act to collect the relevant information. Though the Assessee submitted the details, however, the Assessee could not furnish the details in the manner required by the AO as the Assessee maintains complete excise record in the format prescribed under the law for each location in respect of liquor. However, AO has not pointed out any defects in the books of account. Mere absence of stock records or quantitative details is not a sufficient ground to reject the books of account." 7. The Ld. Commissioner by considering the above submissions and the observation of the AO observed "that the tax auditors in Item no. 35 of form no. 3CD which relates to quantitative details of goods traded and raw material etc.,has not provided any details but has mentioned that this is not applicable. This does not appear to be justified particularly in view of the fact that some of the items like liquor, soft-drinks, tobacco etc. are sold in terms of the quantity. The Ld. Commissioner also held that the quantitative details could have been provided in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the AO on the ground that the Assessee had not been able to state as to how the repairs so done extensively are only current repairs and not renovation, the details sought as per point no. 26 of the detailed questionnaire have also not been furnished. The expenditure claimed was admittedly on renovation, 'capital in nature' and would, therefore stand to be capitalized. 10. The Ld. Commissioner affirmed the said disallowance, by concluding as under: "15.1 The Assessing Officer held that the expenditure is on installation of SS Tiles, Renovation work, supply of kitchen equipments and installation charges of five line units in respect of Restaurant at Bangalore, where fire broke out and the Restaurant was renovated and, therefore, the expenditure was for enduring benefit and hence capital expenditure in nature. The Appellant has pleaded that the expenditure was in nature of repair & maintenance and is not I respect of new unit and, therefore, is allowable expenditure. The Appellant also submitted that alternatively, without being prejudice to the main submission, the depreciation should be allowed on the expenditure. 15.2 I have carefully considered the observation of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2020 (penalty appeal): 15. Coming to ITA no. 1335/Del/2020, we observe that the AO vide assessment order dated 29.12.2016 passed u/s 143(3) of the Act also made the addition of Rs. 4,07,09,028/- on account of rejection of consumption on foods and beverages claimed and Rs. 22,27,702/- on account of disallowance qua capital expenses. The ld. Commissioner in appeal vide order dated 20.12.2017 in quantum appeal sustained the addition of Rs. 2,03,54,514/- out of Rs. 4,07,09,028/- and disallowance on account of capital expenses of Rs. 22,27,702/-. Thereafter the AO vide penalty order dated 31.3.2019 passed u/s 271(1)(c) of the Act levied a penalty of Rs. 7,26,800/- in respect of affirmation of the addition of Rs. 2,03,54,514/- on account of disallowance (rejection of consumption claimed) and Rs. 22,27,702/- on account of disallowance (capital expenses), for concealment of income/furnishing of inaccurate particulars of income, on the ground that the Assessee has failed to justify the 'revenue nature' of the expenses and it is prima facie evident that the expenditure claimed are of enduring nature. 16. On appeal, the ld. Commissioner deleted the said penalty by observing that the penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (SC) the Hon'ble Supreme Court, it is held that "that glance at this provision would suggest that in order to be covered, there has to be concealment of the particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of his income. Making an incorrect claim in law is not tantamount to furnishing inaccurate particulars. Further, the Court has also held that mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the return cannot amount to inaccurate particulars." 6.1 It is an admitted position that in the present case no information given in the return was found to be inaccurate. It is not as if any statement made or any detail supplied was found to be factually incorrect. Hence, the assessee cannot be held guilty of furnishing inaccurate particulars. A claim was advanced regarding classifying a particular expenditure as revenue. The action of the Assessing Officer can be justified at the assessment stage. But, penalty proceedings, the principle of law are on a different footing. 7. Accordingly, the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
