TMI Blog2023 (11) TMI 731X X X X Extracts X X X X X X X X Extracts X X X X ..... The ld. Assessing Officer ought to have not over emphasized about the conduct of the assessee for not charging the interest. It is just a normal business incident and in the absence of any interest income, according to the assessee, the notional interest income cannot be estimated for making the disallowance out of interest expenditure. We allow this ground of appeal and delete the addition. Disallowance of garden visit expenses - AO has disallowed 10% of such expenditure on the ground that certain payments have been made through self-made vouchers without any addresses of the recipients - HELD THAT:- AO has unnecessarily disbelieved the vouchers of petty expenses for adopting a method of disallowing expenditure on adhoc basis. He has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eared. ORDER PER SHRI RAJPAL YADAV, VICE-PRESIDENT (KZ):- The assessee is in appeal before the Tribunal against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 22 nd December, 2022 passed for A.Y. 2014-15. 2. In the first ground of appeal, the assessee has pleaded that the ld. CIT(Appeals) has erred in confirming the addition of Rs. 10,38,950/-. 3. Brief facts of the case are that the assessee-firm is engaged in the business of finance as a commission agent, trading in shares and investment in Mutual Funds. It has filed its return of income on 30.09.2014 declaring total income of Rs. 32,52,238/-. The case of the assessee was selected for scrutiny assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eque was bounced. Hence, a legal notice was issued under section 138(b) of the Negotiable Instruments Act, 1881. Ultimately no principal amount has been returned nor any interest has been paid. By and large, the facts with regard to other creditors are also similar. The loans were advanced to them prior to 31st March, 2009 or 2010. These concerns were making the payment of interest prior to the accounting year relevant to this assessment year. But in this year, they have not paid the interest nor returned the money. Thus according to the assessee, even its principal was at a stake and, therefore, it did not account for the interest income from these loans. 6. On the other hand, ld. D.R. relied upon the order of the ld. Assessing Officer. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b) General Expense Rs. 67871/- Total Rs. 2,53,056/- But no proper bills/vouchers have been maintained in respect of these expenses. Most of the payments have been made through self made vouchers without any addresses of the recipients. Therefore, the expenses are not fully verifiable. In view of above, 10% such expense i.e. Rs. 25,305/- [i.e 10% of Rs. 2,53,056/-] is disallowed and added to the total income of the assessee for the previous year relevant to A.Y 2014-15. [Addition: Rs. 25,305/-] 3.7. The assessee has claimed following expenditure as business expenditures the Profit Loss Accounts for the A.Y. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee submitted that the ld. Assessing Officer failed to pinpoint errors in the accounts. He just made a sweeping observation that possibility of personal user of car facility and telephone facility cannot be ruled out. The assessee has submitted the complete details. 12. On the other hand, ld. D.R. relied upon the order of the ld. Assessing Officer. 13. We have duly considered the rival contentions and gone through the record carefully. The first item of expenditure claimed by the assessee is expenditure incurred on garden visit etc. We find that the ld. Assessing Officer has disallowed 10% of such expenditure on the ground that certain payments have been made through self-made vouchers without any addresses of the recipients. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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