TaxTMI 
TaxTMI 
TaxTMI 
2010 (2) TMI 741
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....004 that the asessee has purchased fresh flowers for daily decoration to display in various locations such as main entrance, reception and various cabins considering the nature of business and dealing with foreign clients which is necessary for the maintenance and survival of business. The bills for the said expenses were produced and submitted that the expenses incurred are only for the purpose of business. The Assessing Officer did not accept the explanation of the assessee and observed that such huge amount on the purchase of plants definitely act in a long way to enhance the assessee's image and is of enduring nature and therefore, treated the same as capital expenditure and allowed depreciation @ 10% and accordingly added Rs.1,68,861/- to the income of the assessee. The learned CIT(A) accepted the explanation of the assessee and relying upon the decision of the Hon'ble Supreme Court in the case of Empire Jute Co. Ltd. vs. CIT (1980) 124 ITR 1, held that the expenditure incurred by the assessee on purchase of flowers and ornamental plants is an allowable business expenditure and not as a capital expenditure. 4. We have heard the rival contentions and perused the facts o....
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....CIT (2000) 245 ITR 428 of Hon'ble Supreme Court. It was held that if a business liability has definitely arisen in the accounting year, the deduction should be allowed although the liability may have to be quantified and discharged at a future date. However, sub clause (f) of Section 43B of the Income Tax Act was inserted with effect from 1.4.2002 (by Finance Act 2001) stating that any sum payable by the assessee as an employer in lieu of any leave at the credit of his employee shall be allowed only in computing the income referred to in Section 28 of the previous year in which such sum is actually paid by him. Therefore, provision of section 43B(f) is not applicable to the assessee company during the year under consideration as the same is inserted from 1st April, 2002. Accordingly, provision for amount payable to employee in lieu of leave is allowable expenditure in the year the liability has arisen as per the provision applicable prior to the amendment of section 43B." The above explanation has been perused and I tend to disagree with the view points expressed by the assessee. The assessee ahs not given any basis on which provision of Rs.7,09,136/- is made on account of ....
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....y the assessee that the said expenses had been incurred for repair, refurnishing, temporary partition etc. Copies of the bills were also produced along with the letter dated 16.2.2004. The AO observed such expenditure is of capital in nature and therefore, considered Rs.2,07,148/- out of the said expenditure being of capital in nature and after allowing depreciation made an addition of Rs.1,97,047/-. The learned CIT(A) after considering the explanation of the assessee and relying upon the decision of various Courts of Law allowed the claim of the assessee by observing that the assessee has not derived any enduring benefit by incurring such expenditure. 10. We have heard the rival contentions and perused the facts of the case. It was submitted before the learned CIT(A) that temporary alteration and partition of the office space was done to make the office presentable to foreign clients and also to increase efficiency of the workers. The rented premises for which the permission from the lessor was taken and the same was placed on record. Reliance has been placed on the decision of the Hon'ble jurisdictional High Court in the case of Instalment Supply Pvt. Ltd. vs. CIT, 149 IT....
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....set and therefore, allowed the claim of the assessee. 13. We have heard the rival contentions and perused the facts of the case. We concur with the views of the learned CIT(A) that by incurring such expenditure in the rented premises the assessee has not created any new capital asset and therefore, the learned CIT(A) has rightly deleted the addition made by the AO relying upon the decision of Hon'ble Delhi High Court in the case of Installment Supply Pvt. Ltd. (supra). Therefore, we find no infirmity in the order of the learned CIT(A). Thus ground No.4 of the revenue is dismissed. 14. Ground No.5 of the appeal of the revenue reads as under:- "On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs.19,43,477/- made by the Assessing Officer out of professional charges." 15. Brief facts of the case are that the assessee had paid professional charges of Rs.34,62,474/- to various parties. The assessee was required to file the confirmation letters and the assessee had submitted the confirmation letters of various parties amounting to Rs.15,19,000/- but could not submit the confirmation letters for the prof....
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....e details filed Shri Ajay Mutreja and Ajay Yograj, MD visited countries like Germany, USA, Australia, Sweden, Belgium France, Switzerland, Hong Kong for the purpose of marketing. During the course of proceedings, the assessee has been specifically asked to furnish the air tickets in original along with datewise schedule in the foreign country. The persons assessee met abroad and any correspondence made by the assessee with the foreign parties before the spent of the foreign visit and/or after the finish of the foreign visit. The assessee failed to furnish any explanation for the same which mean that the assessee failed to justify the nature of expenditure on foreign tours. In view of this, expenditure of Rs.24,80,054/- stated to have been incurred on foreign visit is disallowed being personal in nature. Penalty proceedings u/s 271(1)(c) shall be initiated accordingly. Addition: Rs.24,84,054/-)." Before the learned CIT(A) the assessee submitted copy of correspondence with foreign parties and copy of visiting cards of foreign parties. The said additional evidences were sent to the AO for the report. The AO submitted that such additional evidences may be admitted and t....