TaxTMI 
TaxTMI 
2014 (7) TMI 7
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....d by him on 23-09-2009 declaring total income of Rs. 3,80,56,452/-. In the P&L account filed along with the said return, a sum of Rs. 20 lacs was debited by the assessee on account of contract charges. During the course of assessment proceedings, the assesse was called upon by the A.O. to explain the nature of this expenditure. In reply, the following explanation was offered by the assessee:- "The said contract charges was paid by our clients to his father and was mainly paid to look and take care, follow up, do necessary paper work, coordinate and manage on his behalf for all his brand endorsement and IPL related work. TDS was deducted on payments made to him and the sum was paid in cheque. Since this was first year of private contract wi....
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....and there are certain agencies who are charging fees ranging from 10 to 15% of gross collection. Our client found a better alternative in his own father and hence the amount was paid. Our clients humbly pleads the amount is reasonable, keeping in mind the facts and circumstances of the case". 4. The above submission made by the assessee was not found acceptable by the A.O. on the following grounds: "(i) Shri Gurunath Sharma father of the assessee is not in possession of any expertise knowledge about the job for which he is assigned by the assessee. (ii) It is mere a transfer of fund from son to his father. (iii) The bond of relationship between father and son is so strong that (a) The assessee has given Rs. 53,11,000/- as gift to his ....
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....Act, appeal was preferred by the assessee before the ld. CIT(A) disputing the disallowance made by the A.O. on account of various expenses. As regards the disallowance made on account of contract charges, the submissions made before the A.O. were reiterated on behalf of the assessee before the ld. CIT(A). The ld. CIT(A), however, did not find merit in the said submissions and confirmed the disallowance made by the A.O. on account of contract charges observing that there was failure on the part of the assessee to prove that the expenditure incurred on payment of contract charges to his father was for any business consideration. As regards the disallowance made by the A.O. on account of depreciation on BMW car, it was brought to the notice of....
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.... CIT (A) has erred in confirming the disallowance of Rs. 2,64,041/- made by the Assessing Officer by disallowing entire depreciation on Skoda motor car claimed by the appellant. 4. In the facts and circumstances of the case and in law, the Ld. CIT (A) has erred in confirming the disallowance of Rs. 89,480/- made by the Assessing Officer by disallowing 75% of the gross expenses on motor car and fuel expenses as claimed by the appellant." 7. We have heard the arguments of both the sides and also perused the relevant material available on record. As regards the issue raised in ground No. 1, it is observed that the contract charges of Rs. 20 lacs claimed to be paid by the assessee to his father were disallowed by the A.O. on the ground that t....
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.... to the disallowance of depreciation on BMW car made by the A.O. to the extent of 50% and confirmed by the ld. CIT(A), it is observed that a specific plea was raised by the assessee before the ld. CIT(A) that the BMW car having been given on rent during the year under consideration, he was entitled for full depreciation on the said car at the specified rate. The ld. CIT(A), however, did not accept this plea of the assessee on the ground that there was no evidence adduced by the assessee to establish that the BMW car was put to commercial use. He, however, appears to have overlooked the vital fact that the car rental income of Rs. 3,16,700/- received during the year under consideration was duly offered by the assessee to tax in his return of....