Income Tax Appellate Tribunal - Kolkata
Abhishek Kejriwal, Kolkata vs Acit, Circle-45, Kolkata, Kolkata on 29 May, 2019
IN THE INCOME TAX APPELLATE TRIBUNAL "A", BENCH KOLKATA BEFORE SHRI A.T.VARKEY, JM &DR. A.L.SAINI, AM आयकरअपीलसं./ITA No.1132/Kol/2017 ( नधा रणवष / Assessment Year:2012-13) Abhishekh Kejriwal Vs. ACIT, Circle-45, Kolkata Karnani Mansion, 2nd Floor, Room no. 219, 25A, Park Street, Kolkata-700016 थायीले खासं . /जीआइआरसं . /PAN/GIR No.: AEUPK 1023 K (Assessee) .. (Revenue) Assessee by :Shri S.K. Tulsiyan, AR Respondent by : Shri C.J.Singh, JCIT, Sr. DR सन ु वाईक तार ख/ Date of Hearing : 08/04/2019 घोषणाक तार ख/Date of Pronouncement : 29/05/2019 आदे श / O R D E R Per Dr. A. L. Saini:
The captioned appeal filed by the assessee, pertaining to assessment year 2012-13, is directed against an order passed by the learned Commissioner of Income Tax (Appeals)-13, Kolkata (in short the ld. 'CIT(A)'], which in turn arises out of an assessment order passed by the Assessing Officer u/s 143(3) of the Income Tax Act, 1961 ( in short the 'Act') dated 28.03.2015.
2. Grounds of appeal raised by the assessee are as follows:
1.(a) That on the facts and circumstances of the case the ld. CIT(A) erred on disallowing hoarding construction charges of Rs.17,40,000/- as capital expenditure instead of revenue expenditure and allowing the depreciation on it of Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 15%. The expenses claimed of Rs.17,40,000/- be allowed as revenue expenditure as claimed by the assessee.
(b) That on the facts and circumstances of the case the ld. CIT(A) erred in ignoring the facts that hoardings are temporary structure and expenditure are incurred for facilitating the business operations and not acquisition of capital asset. The same be allowed in full.
(c ) That on the facts and circumstances of the case the ld. CIT(A) erred in relying on the Inspector report without furnishing the same to assessee and fact that the same is supporting the assessee case and not otherwise as interpreted by ld. CIT(A). The same be allowed in full.
(d) That on the facts and circumstances of the case the ld. CIT(A) erred in ignoring the settled law that hoarding charges are revenue expenditure.
2.(a) That on the facts and circumstances of the case the ld. CIT(A) erred in adding/disallowing of Rs.7,76,500/- on Balaji Construction on wrong presumption and applying same analogy as Balaji Ads.
(b) That on the facts and circumstances of the case the ld. CIT(A) erred on disallowing hoarding construction charges of Rs.9,13,529/- as capital expenditure instead of revenue expenditure and allowing the depreciation on it of 15%. The expenses claimed of Rs. 9,13,529/- be allowed as revenue expenditure as claimed by the assessee.
(c ) That on the facts and circumstances of the case the ld. CIT(A) erred in ignoring the settled law that hoarding charges are revenue expenditure.
3. That on the facts and circumstances of the case the ld. CIT(A) erred in disallowing Rs. 50,000/- u/s 40A(2)(b). The same be allowed.
4. That the order is otherwise bad in law and on facts.
5. That the appellantcraves leave to add, alter, delete, amend, include any ground or grounds of appeal before or at the time of hearing.
3. Ground Nos. 1 and 2 raised by the assessee are identical and common and relate to the same issue, that is,whether, hoarding construction expenses are capital in nature or Revenue in nature?Since these two grounds of appeal are interlinked therefore, we adjudicate together.
4. Brief facts qua the issue are that assessee is an individual carrying on business of advertisement in the name and style of Balaji Ads, Balaji Construction. During the assessment proceedings, the assessing officer has gone through the profit and loss account and noted that the profit and loss account, in respect of M/s Balaji Pa g e | 2 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 Ads revealed that a sum of Rs. 25,24,016/- had been debited under the head 'hoarding construction charge'. The details of such charges were called for and it was noticed that these charges were debited in the names of thirteen person / parties. Out of this, a sum of Rs. 17,40,000/- had been paid / payable to one party, Monark Marketing Pvt. Ltd. The assessee was requested to explain that since such huge expenses were made for construction of hoarding, the same should be giving usefulness / utility to the assessee for more than one financial year and hence why the said expenses should not be treated as capital in nature.
In response to the above, the assessee furnished a written submission dated 16.03.2015 stating the following:
"This is with reference to the above mentioned assessee,that'hoarding Construction charges' amounting to Rs. 17,40,000/- has been paid to Monark Marketing Pvt. Ltd. with respect of 7 sites. These sites have an estimated life of barely one year so instead of considering it as capital expenditure, such amount has been debited in the profit & loss account as revenue expenditure."
The details of constructions at such sites, as furnished by the assessee, are as follows:
The image cannot be display ed. Your computer may not hav e enough memory to open the image, or the image may hav e been corrupted. Restart y our computer, and then open the file again. If the red x still appears, y ou may hav e to delete the image and then insert it again.
Pa g e | 3 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 Assessing Officer noted that the assessee has claimed total expenses of Rs. 17,40,000/- as cost construction for 8700 sq. ft. Thus, the per sq. ft. construction works out to Rs. 200/-.
The assessee's submission was carefully perused by the assessing officer and observed that the cost of construction of hoardings per sq. ft. is as high as Rs. 200/-, that itself contradicts the claim of the assessee that the hoardings have a life of barely one year. The claim that for a construction having barely one year's longevity, the assessee would spend Rs. 200/-, as cost of construction per sq. ft. is not, acceptable. Thus, AO concluded that at this rate of construction, the assessee would get a structure which is fairly durable and capable of giving benefits / use value to the assessee far beyond the relevant financial year. The AO observed that having regard to the huge cost of construction, the only logical conclusion which emerges is that the hoardings have a life of more than one year, quite contrary to the claim of the assessee. With this view of the matter, the hoarding construction charges paid to M/s Monark Marketing Pvt Ltd. to the tune of Rs.17,40,000/-, out of the total hoarding construction charges in respect of Balaji Ads, was treated as capital expenditure and disallowed as deduction claimed in the accounts by the assessee. However, having regard to the nature of business of the assessee, these hoardings were treated by AO as plant & machinery for the assessee and depreciation @ 15% was allowed thereon. Thus, the net addition on this account worked out to the tune of Rs.14,79,000/- [17,40,000 - 2,61,000 (Depreciation)].
5. Assessing Officer also noted that a sum of Rs.3,30,988/- was credited to the profit and loss account of the said concern under the head 'advertising fees'.
Anothersum of Rs.3,27,255/- was credited on account of 'display charges'. Against this income deduction of Rs.9,13,529/- was claimed on account of hoarding construction charges. Since the hoarding construction charges in this case is far more than the receipts under relevant heads, the hoardings in this case are supposed to give enduring benefits of more than one year and by the same analogy, as discussed above, the hoarding construction Charges of Rs.9,13,529/- was treated as capital expenditure and hence disallowed and added to the total Pa g e | 4 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 income of the assessee. However, having regard to the nature of business of the assessee, these hoardings were treated as plant & machinery for the assessee and depreciation @ 15% is allowed thereon. Thus, the net addition on this account works out to Rs.7,76,500/- [9,13,529-1,37,029] (Depreciation)].
6. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the Ld. CIT(A). The ld CIT(A) just reiterated the findings of the assessing officer and confirmed the addition made by assessing officer. Aggrieved by the order of the Ld. CIT(A) the assessee is in appeal before us.
7. Before us, Ld Counsel for the assessee, Shri S.K. Tulsiyan, begins by pointing out that these hoardings were required to be maintained by the assessee and in order to avoid corrosion of the structure and other adverse weathering effects, application of red oxide and painting was regularly required to be done. Similarly, cementing and plastering of foundation was also required to be done regularly in order to maintain the hoarding structures. Keeping in view the nature of business activity carried on by the assessee, the ld Counsel submitted that the expenditure incurred by the assessee to maintain the structures used or hoardings is revenue in nature.
8. On the other hand, the ld. DR has primarily reiterated the stand taken by the Assessing Officer which we have already noted in our earlier para and the same is not being repeated for the sake of brevity.
7. We have heard both the parties and perused the material available on record. We note that ld assessing officer made the addition solely on the ground that the cost of construction of hoardings per sq. ft. is as high as Rs. 200/-, which itself contradicts the claim of the assessee that the hoardings have a life of barely one year. The claim that for a construction having barely one year's longevity, the assessee would spend Rs. 200/- as cost of construction per sq. ft. is not, acceptable. AO noticed that because, at this rate of construction, the assessee would get a structure which is fairly durable and capable of giving benefits / use value to the Pa g e | 5 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 assessee far beyond the relevant financial year. On this backdrop of facts, the Departmental Inspector was deputed by the assessing officer to conduct a field enquiry and furnish a report regarding the construction of the hoardings. As appears from the Inspector's report, he covered 2 hoardings out of the seven listed by the assessee. As per the Inspector's report the hoarding at 113, Dilkhusha Street near Park Circus was approximately of 1200 sq. ft, huge structure, made with angles of steel and the hoarding had been there for almost 2 years. The Inspector also made a site visit to 258C, Rash Behari Avenue, Kolkata-19. At this address, the Inspector found that the hoarding was on a four storey building with huge structure of steel angles covering almost the entire roof. He took photographs of the two hoardings, which are made part of the assessment records by AO. Thus, from the above analysis and having regard to the huge cost of construction, the AO was of the view that the only logical conclusion which emerges is that the hoardings have a life of more than one year, quite contrary to the claim of the assessee. With this view of the matter, the hoarding construction charges paid to M/s Monark Marketing Pvt Ltd. to the tune of Rs.17,40,000/-, out of the total hoarding construction charges in respect of Balaji Ads, was treated as capital expenditure and disallowed as deduction claimed in the accounts.
We note that on a perusal of the Profit and Loss account of M/s Balaji Ads, the learned AO noted that a sum of Rs.25,24,016/-, which had been debited by the assessee under the head 'hoarding construction charge',out of this, a sum of Rs.17,40,000/- had been paid to one party, M/sMonark Marketing Pvt Ltd. with respect to construction of 7 different sites in Kolkata. As per assessee, these sites have an estimated life of barely one year so instead of considering it as capital expenditure, such amount had been debited by the assessee in his Profit and Loss account as revenue expenditure.
8. We note that ground No. 2 raised by the assessee, which relates to the disallowance of Rs.7,76,500/- on the ground that the assessee carried on advertising business in the name of another proprietorship concern, 'M/s Balaji construction'. A sum of Rs. 4,30,988/- was credited to the profit & loss account of Pa g e | 6 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 the said concern under the head 'advertising fees'. Another sum of Rs. 3,27,255/- was credited on account of 'display charges'. Against this income, deduction of Rs. 9,13,529/- was claimed on account of hoarding construction charges. Since the hoarding construction charges in this case is far more than the receipts under relevant heads, the hoardings in this case are supposed to give enduring benefits of more than one year and by the same analogy, as discussed above in para seven of this order, the hoarding of construction charges of Rs. 9,13,529/- was treated by assessing officer as capital expenditure and hence the disallowances was made. However, AO noticed that having regard to the nature of business of the assessee, these hoardings are treated as plant and machinery for the assessee and depreciation @ 15% was allowed by AO.
9. We note that the hoardings are subjected to vagaries' of rain, storm, vandalism, weather, theft, miscreants, damages etc., thus, the activities indulged by the assessee are part of its normal activities of advertisements and publicity. The assessee has incurred the hoarding charges for facilitating the business operations and not with the object of acquiring any capital asset. The assessee is in the business of advertising and these expenses with regard to the hoarding structures is a part of the normal and day to day business of the assessee. The hoardings are temporary structures and are made with angles of steel and iron rods to affix them to the ground since these are vulnerable to rain, storm, theft and other damages. As such, affixation of the same using steel angles and iron rods was a necessity else the assessee would have not received any advertising orders. To receive advertising orders, these hoardings were required to be maintained by the assessee in a good quality condition. Further, in order to avoid corrosion of the structure and other adverse weathering effects, replacement of parts and other incidental expenses is regularly required to be done. It is also relevant to note that such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field.
Pa g e | 7 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13
10. We note that the report of the Inspector, on which the learned AO has relied in the assessment order, was never furnished to the assessee to controvert the same. As such, this is denial of natural justice to the assessee. It is a settled position, that if an Authority is relying on the testimony of a witness/document, the assessee is required to be afforded an opportunity to cross-examine the witness/document failing which the testimony cannot be utilized against the assessee. If this procedure is not followed, then there would be a case of denial of natural justice to the assessee. To buttress this view, we rely on the recent judgment of the Apex Court in the case of Andaman Timber Industries vs Commissioner of Central Excise (2015) 281 CTR 241 (SC) wherein it was held as follows:
"Not allowing the assessee to cross-examine the witnesses by the Adjudicating Authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order nullity inasmuch as it amounted to violation of principles of natural justice because of which the assessee was adversely affected. It is to be borne in mind that the order of the Commissioner was based upon the statements given by the aforesaid two witnesses. Even when the assessee disputed the correctness of the statements and wanted to cross-examine, the Adjudicating Authority did not grant this opportunity to the assessee. It would be pertinent to note that in the impugned order passed by the Adjudicating Authority he has specifically mentioned that such an opportunity was sought by the assessee. However, no such opportunity was granted and the aforesaid plea is not even dealt with by the Adjudicating Authority. As far as the Tribunal is concerned, we find that rejection of this plea is totally untenable. The Tribunal has simply stated that cross-examination of the said dealers could not have brought out any material which would not be in possession of the appellant themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the appellant wanted to cross-examine those dealers and what extraction the appellant wanted from them."
We note that the financial year involved in the current appeal is FY 2011-12 and the Inspector's report was given in the month of Feb - March 2015 (approx.)i.e after almost three years. The Inspector has based his findings in the impugned report by watching a hoarding after a time gap of three years. The said hoardings had underwent changes in this long time span of three years. Repair works and replacement of parts had taken place in the last few years as per the demand of the advertising business. As such, the structure existing on the date the Inspector visited the site can in no circumstances be compared with the structure which existing in the relevant AY, being AY 2012-13.
Pa g e | 8 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 Hence, the said report should not have been considered by assessing officer in the current assessment year 2012-13.
11. We note that the assessee has been following this practice of claiming the hoarding expenses as revenue expenses in all the earlier years also and the same was not disturbed by the learned AO in any of the preceding years. There is no change in the accounting policies of the assessee in the current year vis a vis the earlier years, hence consistency should be maintained by the assessing officer. Apart from this, on identical facts, our view is fortified by the judgment of the Coordinate Bench of Mumbai ITAT in the case ofM/s Empress Advertising in IT.A. No.4184/Muml20l2, order dated 31.07.2014, wherein it was held as follows:
"We have heard the arguments of both the sides and also perused the relevant material available on record. As submitted by the Id. Counsel for the assessee, the assessee was having 15 hoardings installed in the city during the course of its business of outdoor advertisement and total income of about Rs. 88 lacs was generated from this activity giving a net profit of about Rs. 18 lacs as shown by the assessee in the P&L account. These hoardings were required to be maintained by the assessee and in order to avoid corrosion of the structure and other adverse weathering effects, application of red oxide and painting was regularly required to be done. Similarly, cementing and plastering of foundation was also required to be done regularly in order to maintain the hoarding structures. Keeping in view the nature of business activity carried on by the assessee, we are of the view that the expenditure incurred by the assessee to maintain the structures used (or hoardings is revenue in nature especially when the Quantum of expenditure incurred is considered in the light of the fact that there were 15 hoardings which were exposed to climate. It is also relevant to note that such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field. Moreover, even if the hoarding expenditure claimed by the assessee is inclusive of replacement of M.S. Angles etc., as noted by the A.O., the same is in the nature of replacement of parts of the hoarding structure which cannot be treated as capital expenditure. As such, considering all the facts of the case, we are of the view that the assesse is entitled to deduction on account of hoarding expenditure being in the nature of revenue expenditure. In that view of the matter, we delete the disallowance made by the A.O. and confirmed by the Id. CIT(A) on this issue and allow the appeal of the assessee. "
Therefore, applying the ratio of the above notedjudicial precedents, to the facts of the assessee`s case, it is abundantly clear that hoarding expenses incurred by the assessee are revenue in nature and are not capital in nature. The assesse is entitled to deduction on account of hoarding expenditure being in the nature of revenue expenditure. Therefore, we delete the addition made by AO of Rs. 14,79,000/-, Pa g e | 9 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 and Rs.7,76,500/- respectively, and allow the ground No.1 and 2 raised by assessee.
12. Grounds No. 3 raised by the assessee relates to disallowance of Rs. 50,000/- u/s 40A(2)(b) of the Act.
13. Brief facts qua the issue are that during the scrutiny proceedings the ld AO noticed that assessee had employed 24 employees in his business organization. The total payment on account of salary and bonus was Rs.11,94,974/-. The detailed break- up of salaries paid to all employees were called for and it was noticed that total salary of Rs.1,92,000/- had been made to Smt. Nidhi Kejriwal, who happens to be the wife of the assessee. The next highest salary paid to one employee for the year was Rs.1,00,932/- only. None of the other employees had received salary exceeding Rs.1 lakh. The assessee was requested to furnish the detailed nature of job performed by Smt. Nidhi Kejriwal, her personal qualification expertise/experience in the job, etc. In response to the above, the assessee filed a written submission dated 23.03.2015 stating the following:
"This is with reference to the above mentioned assessee, has paid total salary amounting to Rs.11,94,974/- during the A. Y. 2012-13, to the different employees. Out of the total salary paid, Rs.1,92,000/- has been paid to his wife which has been properly disclosed in the Tax Audit Report. Smt. Nidhi Kejriwal is an educated lady and handling all the day to day administration of the Assessee's business. As regard of her qualification, salary of Rs.16,000/- p.m. is inadequate. So as per her education and responsibilities the amount of salary paid to her should not be disallowed u/s 40A(2)."
The AO perused the submission of the assessee and noted that the assessee did not have any details regarding the work allocated to Smt. Nidhi Kejriwal. Further, the details regarding her educational qualification, work experience, the expertise in the assessee's line of business. etc. were also not furnished. Hence the comparability with and material difference from other employees were not adequately established. Thus, in absence of aforementioned specific details regarding Smt. Nidhi Kejriwal, wife of the assessee, and heaving regard to the Pa g e | 1 0 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 business of the assessee, it was held by AO that the salary paid to Smt. Kejriwal is excessive and unreasonable, therefore, a sum of Rs. 50,000/- out of total salary of Rs. 1,92,000/- paid to Smt. Nidhi Kejriwal, was disallowed u/s 40A(2)(b) of the Act on estimate and added to the total income of the assessee.
14. Aggrieved by the order of the Assessing Officer the assessee carried the matter in appeal before the Ld. CIT(A) who has dismissed the appeal of the assessee. Aggrieved by the order of the Ld. CIT(A) the assessee is in appeal before us.
15. Before us, ld Counsel for the assessee reiterated the submissions made before the lower authorities. Whereas,the ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer which we have already noted in our earlier para and the same is not being repeated for the sake of brevity.
16. We have heard both the parties and perused the material available on record. Before we deliver our opinion on this issue, let us go through the provisions of section 40A (2) of the Act, which is reproduced below for ready reference.
"40A Expenses or payments not deductible in certain circumstances.
(1) .. ...
(2) (a) Where the assessee incurs any expenditure in respect of which payment has been or is to be made to any person referred to in clause (b) of this sub-section, and the Assessing Officer is of opinion that such expenditure is excessive or unreasonable having regard to the fair market value of the goods, services or facilities for which the payment is made or the legitimate needs of the business or profession of the assessee or the benefit derived by or accruing to him therefrom, so much of the expenditure as is so considered by him to be excessive or unreasonable shall not be allowed as a deduction."
From the provisions of section 40A(2) of the Act, as noted above, it is abundantly clear that this section provides power to the Income Tax Officer that in case any expenditure has been incurred and the payment has been made or is to be made to certain specified persons and he is of the opinion that such expenditure is excessive or unreasonable with regard to the fair market value of the goods, services or facilities provided, he may disallow such expense as he considers to be excessive.
Pa g e | 1 1 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 We note that in the assessee`s case under consideration, the learned AO has compared the salary of Smt Nidhi Kejriwal who is a B.Sc Preliminary (Home Science) graduate with an employee doing manual works. Smt Nidhi Kejriwal was the only graduated employee of the assessee firm and all the rest of the employees were manual workers, working on the site. A copy of her graduation certificate is furnished by the ld Counsel. She was in-charge of handling the day to day administration of the assessee's business and coordinating with the clients.Ld Counsel claimed that even the salary of Rs.l,92,000/- paid to her is inadequate taking into consideration the nature of the assessee's business vis-à-vis her education & experience.
17. We note that CBDT Circular dated 06.07.1968, clarifies the definition of "reasonable expenditure" in the context of the AO's discretion under Section 40A of the Act. The CBDT had clarified that whenever an AO proposes disallowance, he has to examine the matter in a fair and reasonable manner and what should be borne in mind is that the provision is intended to check evasion of tax through excessive or unreasonable payments to relatives and associateconcerns, and should not be so applied as to "cause hardship in bona fide cases".
We note that in assessee`s case, the learned AO has not recorded any finding as to how the payment made to Smt Nidhi Kejriwal is excessive under Section 40A(2) of the Act. The AO ought to have determined what constitutes the fair market value of the services rendered and disallow the difference between what is claimed by the assessee in the books and what is fair market value of such services. However, as evident from the facts of the case, no such exercise was undertaken by the AO during assessment, therefore, addition made by the assessing officer is based of guess work and needs to be deleted.For that we rely on the judgment of the Delhi High Court in the case of CIT vs. Modi Revlon Pvt. Ltd. (2012) 78 DTR 0342 (Del- HC) wherein it was held as follows:
"In order to determine whether the payment is not sustainable, the AO has to first return a finding that the payment made is excessive, under Section 40-A (2) of the Income Tax Act. If it is found to be so, then the AO has to determine what constitutes the fair market value of the services rendered and disallow the difference between what is claimed and what is such value determined (as fair market value). Apart from the fact that no such Pa g e | 1 2 Abhishekh Kejriwal ITA No.1132/Kol/2017 Assessment Year:2012-13 exercise was undertaken by the AO, the Court sees that the assessment order went off into a tangent, in following a method that was clearly inapplicable. The annual cap of 30 lakh payable to managerial personnel applied to public limited companies, and not those such as the assessee. This aspect was noticed by the CIT(A) who set aside the disallowance. The Tribunal upheld that finding. Such view (of admissibility of similar consultancy charges) is supported by several decisions. This Court finds no valid grounds to interfere with those findings, which are both sound and reasonable."
18. We note that Nidhi Kejriwal, being a BSC. Graduate, has benefitted the company in a number of ways as already discussed in the preceding paras and hence, the salary of Rs. 16,000/- per month was commensurate with the type of services provided by her to the assessee firm and was not unreasonable. The ld . Assessing Officer made addition purely on surmises and conjectures without bringing comparable persons having same education and experience on record to judge fair market value of Nidhi Kejriwal services. No finding was recorded by the Assessing Officer that the sum of Rs. 50,000/- is unreasonable u/s 40A(2)(b) of the Act. In view of the above, we delete the addition of Rs.50,000/-.
19. In the result, the appeal of the assessee is allowed.
Order pronounced in the Court on 29.05.2019
Sd/- Sd/-
(A.T.VARKEY) (A.L.SAINI)
या यकसद य / JUDICIAL MEMBER लेखासद य / ACCOUNTANT MEMBER
दनांक/ Date: 29/05/2019
(SB, Sr.PS)
Copy of the order forwarded to:
1. Abhishekh Kejriwal
2. ACIT, Circle-45, Kolkata
3. C.I.T(A)- 4. C.I.T.- Kolkata.
5. CIT(DR), Kolkata Benches, Kolkata.
6. Guard File.
True copy
By Order
Assistant Registrar
ITAT, Kolkata Benches
Pa g e | 1 3
Abhishekh Kejriwal
ITA No.1132/Kol/2017
Assessment Year:2012-13
Pa g e | 1 4