IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 70 of 2009 (O&M) Date of decision: 4.8.2009 Commissioner of Income Tax, Faridabad ......Appellant Vs. M/s Puneet Udyog, Plot NO. 37E, Sector 6, Faridabad. ...Respondent CORAM:- HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MRS.JUSTICE DAYA CHAUDHARY PRESENT: Mr.Rajesh Katoch, Sr. Standing Counsel for revenue. Mr.Rajiv Sharma, Advocate, for the respondent. **** ADARSH KUMAR GOEL, J. (Oral) 1. The revenue has preferred this appeal under Section 260A of the Income Tax Act, 1961 (for short, “the Act”) against the order dated 8.8.2008 passed by the Income Tax Appellate Tribunal, Delhi Bench “F” New Delhi in ITA No. 3410/D/2006 for the Assessment Year 2001-02, proposing to raise the following substantial questions of law: (i)“Whether, on the facts and in the circumstances of the case, the Ld.ITAT is right in law in upholding the order of the Ld.CIT(AS) in deleting the addition of Rs. 6,12,430/- made by Assessing Officer out of total fuel and firewood expenses by holding that Assessing Officer was not able to bring on record any additional circumstances different from the earlier years ITA No. 70 of 2009 -2- where such expenditure has been accepted and allowed disregarding the fact that the assessee has failed to establish the genuiness and identity of the concerned suppliers?” (ii) “ Without prejudice to question No.1, whether on the facts and in the circumstances of the case, the Ld. ITAT is right in law in confirming the order of the Ld.CIT(A) in deleting the addition of Rs..6,12, 430/- without considering the fact that expenditure of each year has to be established by the assessee and such establishment is to be based on facts relevant to that year only. (iii)“ Whether on the facts and in the circumstances of the case, the Ld.ITAT is right in law in upholding the order of the Ld.CIT(A) in deleting the addition of Rs.12,84,515/- made as a disallowance from inward and outward freight expenses solely relying on the GRN's (Goods Return Notes) issued by the transporters, whereas the Assessing Officer made the addition on the basis that no bills were produced for such expenses.?” 2. The assessee is a soap manufacturer. The Assessing Officer ITA No. 70 of 2009 -3- disallowed claim of the assessee on account of fuel and firewood expenses and also on account of inward and outward freight expenses. On appeal, the addition made by the Assessing Officer was ordered to be deleted and the said view was upheld by the Tribunal. On issue of fuel and firewood expenses, it was observed: “ However, the claim of the assessee for purchase of firewood was duly supported by documentary evidence in the form of weighment slips and on verification of such slips produced by the assessee before him, it was found by the Ld. CIT(A) that the assessee has maintained a comprehensive and proper record regarding purchase of firewood. At the time of hearing before us, the Ld.DR has not been able to rebut/controvert this finding of fact as well as the other findings recorded by the Ld.CIT (A) while deleting the disallowance made by the AO out of firewood expenses and this being so as well as keeping in view all the facts of the case, we do not find any infirmity in the impugned order of the Ld. CIT(A) giving relief to the assessee on this issue.” ITA No. 70 of 2009 -4- On issue of inward and outward freight expenses, it was observed: “ As clearly noted by the ld CIT(A) in his impugned order, this entire documentary evidence filed by the assessee before him was verified by the ld. CIT(A) and it was found by him on such verification that comprehensive and systematic record was maintained by the assessee to show that the freight expenses were incurred wholly and exclusively for the purpose of its business. At the time of hearing before us, the ld. DR has not been able to rebut/controvert this finding of fact recorded by the ld.CIT(A) in his impugned order and this being so as well as having regard to all the facts ofd the case, we are of the view that the adhoc disallowance made by the AO out of freight expenses was not sustainable. In that view of the matter, we uphold the impugned order of the ld.CIT(A) deleting the said disallowance and dismiss ground No.3 of the revenue's appeal.” 3. We have heard learned counsel for the parties. ITA No. 70 of 2009 -5- 4. The concurrent findings recorded by the CIT(A) as well as the Tribunal are based on appreciation of evidence. 5. No substantial question of law arises. 6. The appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE (DAYA CHAUDHARY) August 4, 2009 JUDGE raghav Note: Whether this case is to be referred to the Reporter? ........Yes/No