AO proposing addition to the Income of the assessee by disallowing the genuine business Service Fees expenditure due to reason that notice u/s 133(6) to the receiving party not responded and that company not fillied ITR.
Assessee alreday submitted the proof of transaction by submitting all relevant docs and informations availlabe in normal course of business i.e
1- Service Agreement between the Assessee and the Service provider
2- Bank statement where payments have been made
3. Copy of Tax Invoices
4. GST return copy - paid to party, party deposited, reflected in 2A and input taken.
5. TDS deducted and paid -proof
6- All correspondences between the assessee and the service provider during complete financial year for normal business activity.
7- Contract terminated and the matter now reffereed to Arbitration process i.e Notice from the Service provider received and reply sent by advocates and it is in process
8- All other relevant docs and informations to proof genuinness of the transactions alreday submitted before AO.
Besides the fact as above ,AO wants to disallow the expenditure and add the total expenditure to total income of the Assessee
Please suggest your opinion whether the AO is correct or how to defend this with decided cases
CAclubindia
