TaxTMI 
TaxTMI 
2005 (5) TMI 272
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....earned CIT(A) restricted the addition to Rs. 1,464 being the amount of travelling expenses relating to Smt. Urmila Jain. The remaining amount of Rs. 14,798 was deleted. 4. After considering the rival submissions and relevant material on record, it is found that the travelling expense of Rs. 10,814 related to customers of the assessee and that of Rs. 3,984 pertaining to the inspectors of the customers who visited the assessee's project. It is nothing but expenditure incurred in the carrying on (of) the business. We, therefore, uphold the impugned order on this score. Other amount of Rs. 1,464 being the travelling expense of Smt. Urmila Jain, wife of one of the partner's, was rightly held to be disallowable. 5. Next ground is with regard to deletion of addition of Rs. 2,70,017 on account of expenditure on foreign travelling. The assessee had claimed foreign travelling expenses at Rs. 4,66,789 which were found to be far in excess of the amount spent in the preceding year. The details of such foreign travelling expenses were called for. On the perusal of such details, the learned AO held that the visits made by the partner's to certain countries were not directly or indirectly co....
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....oncern of Shri M.K. Jain, whose wife was partner in the assessee-firm. It was noted that the vehicle was taken on hire as per agreement of dt. 28th May, 1992. It was noted by him that during the last year, a sum of Rs. 3,000 per, month was disallowed out of fixed hire charges under s. 40A(2) of the Act. However, by holding it to be a colourable device, he made an addition of Rs. 84,000 in this year. It was also noted that as per the agreement dt. 28th May, 1992, by which Maruti van was taken on hire, all the costs, namely, of driver, of maintaining vehicle and incidental charges were to be borne by the hirer only. On the perusal of details, it was seen that a sum of Rs. 16,994 was claimed by the assessee towards repair charges in respect of this van. He, therefore, made the above addition. In the first appeal, the learned CIT(A) observed that since some of the expenses were borne by the appellant in violation of the agreement with the owner of the vehicle, the same were to be deducted out of hire charges. He, however, held that the disallowance of Rs. 84,000, being total hire charges, at Rs. 7,000 per month, was not called for. He, therefore, reduced the repair cost of this vehicle....
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....s on pp. 9 and 10 of the assessment order) was not for business purposes as it included the expenses of family members of the partner's as well. It was, therefore, held that a sum of Rs. 1,01,774 was not relatable to the assessee's business and hence he disallowed the same. In the first appeal, the learned CIT(A) reduced the disallowance to Rs. 10,000 by observing that some of the expenses were relatable to the family members of the partner's of the assessee-firm. The remaining addition of Rs. 91,774 was deleted by the learned CIT(A) as expenditure incurred for the purpose of business. It was contended by the learned Departmental Representative that the first appellate authority had ignored the fact that the expenditure was not related to the business of the assessee-firm as it included the expenses of family members of the partner's as well. In the opposition, the learned Authorised Representative invited our attention to page Nos. 38 and 39 of the paper book being bifurcation of total expenditure incurred under this head. It was argued that a major chunk of such expenditure was on the partner's and employees of the assessee-firm who had undertaken tours to promote the business. T....
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.... Rs. 91,431 on account of sale promotion expenses. 15. Briefly stated, the facts of the ground that the assessee had claimed a deduction of Rs. 91,431 as sale and business promotion expenses. The AO called upon the assessee to give details to whom the gift items were presented. In the absence of any documentary proof, the AO made disallowance for the whole of the amount. However, in the first appeal, the learned CIT(A) held that the expenditure was incurred in connection with the business only. He, therefore, restricted the addition to Rs. 10,000. Before us, the learned Departmental Representative contended that the details of items noted in the assessment order such as, plastic trays, sarees, wrist watches, garments, dry fruits, buckets, etc. clearly showed that these were given for non-business purposes. Per contra, the learned Authorised Representative took as through pp. 45 and 46 of the paper book showing complete details of the expenses incurred along with the person to whom such gifts were made. It was stated that the AO erred in making wrong mention in the assessment order about the fact that details were not produced. 16. Having heard the rival submissions and peruse....
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....of the assessee that these were written off after all the efforts of recovery fell down. It was observed by the learned AO that the assessee had claimed deduction for bad debt in the name of M/s Batra Walls, Faridabad, at Rs. 34,688 despite the fact that it had transactions with the said concern, thereafter. In the first appeal, the learned CIT(A) deleted the addition on the ground that the assessee had written off such amount as bad debts during the accounting year. It was contented by the learned Departmental Representative that the addition was wrongly deleted simply on the score that the amount was written off as bad debt in the books of account. In the opposition, the learned Authorised Representative while relying on the impugned order, made a statement at the Bar that all the amounts had in fact become bad and no recovery from any of such accounts is made even till date. It was further submitted that the amount of M/s Batra Walls was written off as the goods supplied were of the defective quality and the business continued with them. by foregoing the claim against such defective goods. Our attention was invited towards a copy of account of this party and all other parties, w....
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....king huge payment of the commission, the assessee justified the payment by giving seven reasons incorporated on p. 16 of the assessment order. It was noted by the AO that the payment to this party in this year was much more than that of the preceding year in which it was only to the tune of Rs. 1,86,322. The AO noted that a sum of Rs. 5,42,524 was standing as payable in the account of this party at the year end. He, therefore, made a disallowance to this extent by allowing deduction of Rs. 4,50,000. In the first appeal, it was contended on behalf of the assessee that the AO had also, by written inquiry letter, inquired the services rendered by agent directly from him, who explained the rendering of services vide his letter. The learned CIT(A) got convinced with the assessee's submission and deleted the addition. 22. Before us, the learned Departmental Representative strongly relied on the assessment order. On the contrary, the learned Authorised Representative reiterated the submissions as advanced before the first appellate authority and on the basis of his reasoning urged that his order be maintained. Our attention was invited towards p. 102, onwards of the paper book, namely,....