Appeal filed to justify the disallowance of Rs. 2,00,000/- made by the A.O. on account of discount given by the assessee

IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH
(VIRTUAL COURT) 

BEFORE: SHRI. N.K.SAINI, VP & SHRI , R.L. NEGI, JM

ITA NO.990/Chd/2019
Assessment Year : 2013-14

M/s Acme Builders,
GH-10, JLPL, Sector-91
Mohali
PAN NO: AAQFA9330F
Appellant

Vs.

The DCIT
Circle-3(1),Chandigarh
Respondent

Assessee by : Shri Tejmohan Singh, Advocate
Revenue by : Smt. Meenakshi Vohra, Addl. CIT

Date of Hearing : 03/06/2021
Date of Pronouncement : 03/06/2021

Order

PER N.K. SAINI, VICE PRESIDENT

This is an appeal by the Assessee against the order dt. 24/04/2019 of the Ld. CIT(A)-1, Chandigarh.

2. The only grievance of the assessee in this appeal relates to the sustenance of disallowance of Rs. 2,00,000/- made by the A.O. on account of discount given and paid to Ms. Surinderjit Kaur and Mr. Pritam Singh.

3. Facts of the case in brief are that the search and seizure operation under section 132(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘Act’) was conducted on the assessee on 02/05/2012. During the course of search certain agreement relating to sale of plot between different -2 persons and the assessee were found. The assessee furnished the return of income on 27/09/2013 declaring an income of Rs. 82,98,790/-. The A.O. made disallowance of Rs. 2,00,000/- by observing in para 3.1 and 3.2 of the assessment order as under: 

3.1 During the course of examination of the profit and loss account, it was noticed that the assessee claimed expenditure on account of discount paid to the tune of Rs. 200000/-. Vide order sheet entry dated 09.02.2016, the counsel of the assessee was asked to file the details of discount given and the property for which it was given . In response vide reply dated 14.03.2016 it was submitted that the discount was given on account of sale of industrial plot of 500 sq yard to Ms. Surinderjit Kaur and Mr. Pritam Singh.

3.2 On perusal of various details filed by the assessee it was noticed that during the year under the consideration the assessee didn't have any income from sale of plots at yellow stone. Accordingly vide noting sheet entry dated 15.03.2016 the assessee was asked to file reply to justify its claim for the discount claimed in the profit and loss account. In response the assessee didn't file any reply. Therefore the expenditure of Rs. 200000 on discount given is treated as bogus expenditure and added to the returned income. Further penalty proceedings 271(l)(c) are being initiated for concealment of income and furnishing of inaccurate particulars of income.

To know more in details find the attachment file