Appeal partly allowed: godown rent issue remanded, staff bonus claim fully granted

The Tribunal partially allowed the appeal, remanding the issue of godown rent disallowance for further verification and allowing the full claim of bonus to staff, setting aside the restriction imposed by the CIT(A).

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Issues:
1. Disallowance of godown rent
2. Disallowance of bonus to staff

Disallowance of Godown Rent:
The assessee claimed &8377;1,80,000/- as godown rent, but the AO disallowed it due to lack of supporting evidence like a rent agreement or confirmation. The CIT(A) upheld the disallowance citing incomplete details in the confirmation provided by the landlord. However, before the Tribunal, the AR argued that the confirmation contained full details of the landlord, including the address. The Tribunal noted that the rent was paid to the assessee's father, and since the father is not an income tax assessee, details like PAN were not necessary. The Tribunal emphasized that the relationship between the tenant and landlord being son and father does not justify denying the rent claim. Therefore, the issue was remanded to the AO for further verification and a proper enquiry to determine the validity of the claim.

Disallowance of Bonus to Staff:
The assessee claimed &8377;90,326/- as bonus to staff, but the AO disallowed it as the identity of the workers could not be verified from the ledger produced. The CIT(A) partially allowed the claim, restricting it to &8377;60,000/-. Before the Tribunal, the AR argued that the claim had been accepted in the previous year, and the restriction by the CIT(A) was not justified. The Tribunal agreed, noting that if the bonus was accepted in the earlier year, it should not be restricted based on the previous amount. Consequently, the disallowance of &8377;30,326/- was set aside, and the full claim was allowed.

In conclusion, the Tribunal partially allowed the appeal, remanding the issue of godown rent disallowance for further verification and allowing the full claim of bonus to staff, setting aside the restriction imposed by the CIT(A).

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