COMMISSIONER OF INCOME TAX Vs. LUBTEC INDIA LTD.

JUDGEMENT

(1.) OPERATIONS in the premises of the assessee, the Revenue recovered two sheets of paper marked as Annex. A72 in which certain items were jotted down in pencil such as dinner, gift, projector, slide projector, etc., and some figures were noted against of each item. Some of the items in those two sheets related to advertisements in newspapers, magazines and hoardings, etc.

(2.) ACCORDING to the Revenue, the assessee had incurred expenditure, as mentioned in those two pages, and was thereafter asked to explain the source of the amount. In response, the assessee denied having incurred the expenditure. It was submitted by the assessee that it did not have the amount of money reflected in those two sheets and was incapable of spending the amount, that is, Rs. 29,51,278 which was mentioned in the documents. The AO was not satisfied with the Explanation and therefore added back the amount to the income of the assessee.

(3.) FEELING aggrieved, the assessee preferred an appeal before the CIT(A) who allowed the appeal and deleted the addition. It was held that there was nothing to show that the assessee had incurred the expenditure.