1986 (11) TMI 135

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... the tune of Rs. 1,61,00,000 and a gross profit of 5.3. per cent for the year compares will with the gross point of 5.63 per cent for the last year on a turnover of Rs. 1,70,00,000. He submitted that in that earlier year similar trading additions were sought to be made which were deleted in appeal against which the Department did not prefer any appeal. On this issue the plea of the Department was that there was no stock register maintained and therefore, addition was called for On this issue, our considered opinion is that the gross profit rate compares adequately with the gross profit of the earlier year and such small trading addition could have been well avoided. We, therefore, delete the trading addition. 3. The next item is in respe....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... entity and there cannot be any personal expenses of the firm, no disallowance can be made out of the expenses incurred on vehicle. The items cannot be said to be covered under s. 40(b) and, therefore, they cannot be treated as payments to the partner. The plea, therefore, was that the disallowance should be deleted. On this issue that the view that has been consistently followed is that the expenses that are wholly and exclusively laid out for the purpose of business alone is to be allowed and the use of the vehicle of the firm by the partners for their personal purposes cannot be said to be usage of the vehicle for business purposes. So say that the partners should be equated with the employees who are allowed such personal usage would no....