2016 (1) TMI 374

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....on the following substantial question of law. (A) "Whether the Tribunal was justified in deleting the disallowance made in the "consumable stores" ? (B) Whether the Tribunal was justified in holding that the expenses attributable on the conveyance and telephone of the Directors of the assessee-company should be included in the expenses of the assessee-company?" The facts relating to this appeal for the assessment year 2004-05 is that the company under the "profit and loss account" had claimed a sum of Rs. 22,06,84,916/- under the head "manufacturing expenses" indicating it as consumable stores.  During the course of assessment proceedings, the assessee was directed to file details in respect of the expenses claimed....

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.... of the revenue was dismissed and the appeal of the assessee was allowed. The Tribunal held that the disallowance under the head "consumable stores/manufacturing expenses" to the extent of 5% was not justified and deleted the same on the strength that there was increase in the turnover by 5% and the expenses under this head had gone down considerably. On the issue of telephone and conveyance allowance, the Tribunal held that the assessee's case was covered by a decision of the Gujarat High Court in Sayaji Iron And Engg. Co. Vs. Commissioner of Income Tax, (253) 2002 ITR 749. Having heard the learned counsel for the parties, we find that there is an express finding given by the Assessing Authority as well as by the Ist Appellate Autho....