TaxTMI 
TaxTMI 
2016 (4) TMI 869
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....nce of Rs. 2 lacs out of adhoc disallowance of Rs. 10 lacs made by the Assessing Officer, out of "advertisement and circulation expenses". 2. BECAUSE the "CIT(A)-H" after having himself found that "......the Assessing Officer has mentioned that some of the expenses claimed were found to be not allowable or were person in nature. Further the AO has not mentioned instance of any such expense" was not justified either on facts or in law to sustain the disallowance out of "advertisement and circulation expenses", to the extent of Rs. 2 lacs. 3. BECAUSE the authorities below have erred in law and on facts in disallowing/upholding the disallowance of expenses claimed under the heads; (Rs.) i) ....
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.... in law and on facts in disallowing /upholding the disallowance of expenditure aggregating Rs. 23,55,190/- as had been incurred on education and training of Sri Rahul Gupta for his education (MBA course in UK). 9. BECAUSE the expenditure had been incurred on commercial considerations/expediency, which is to be judged from the point of view of the businessman only and the disallowance as has been made/sustained by the authorities below is wholly erroneous. 10. BECAUSE the disallowance of Rs. 23,55,190/- is based on a wholly wrong premise and the same is not sustainable. 11. BECAUSE the order appealed against is contrary t>9 facts law and principles of natural justice." 3. Regarding Ground Nos. 1 and 2, Ld. AR of....
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....sessing Officer, the Assessing Officer has not mentioned even a single instance of the expenses which are personal in nature. Ld. CIT(A) has deleted the disallowance made by the Assessing Officer to the extent of Rs. 8.00 lakh out of Rs. 10.00 lakh but he confirmed the disallowance of Rs. 2.00 lakh on this basis that Assessing Officer has mentioned that some of the expenses claimed were found to be not allowable or were personal in nature. Ld. CIT(A) has also not pointed out even a single instance of expenses which is not allowable or which is personal in nature. Under these facts, in our considered opinion, adhoc disallowance confirmed by the Ld. CIT(A) is not justified. We, therefore, delete the same, Accordingly, Ground No.1 and 2 are al....
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....t of the Hon'ble Gujarat High Court rendered in the case of Sayaji Iron and Engg. Co. Vs. CIT (Supra), this amount also cannot be disallowed in the hands of the assessee company although the same may be considered for taxation in the case of concerned Directors as per law and therefore, this disallowance of Rs. 1,62,591/- is also deleted. Accordingly, Ground Nos. 3 to 7 are allowed. 8. Regarding Ground Nos. 8 to 10 involving disallowance of expenditure aggregating of Rs. 23,55,190/- being the expenses incurred on education and training of Shri Rahul Gupta for his education of MBA course in UK, it was submitted before the Assessing Officer as has been noted by the Assessing Officer in Para 13 of the assessment order that on his return to ....
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....irector in July, 2001. In that case, after coming back from USA , Mr. Tayal joined the company as Director on 23rd June, 2004. The assessment year involved in that case was Assessment Year 2001-02 and 2004-05 i.e. before joining of the assessee company by Mr. Tayal after returning back from USA. It was held by Hon'ble High Court that the public Ltd. Company is a legal entity or the legal person and has got right to manage its affairs in accordance with its memorandum of association or related rules. It was held by legal entity the company can take a decision to secure its interest by sending anyone on contract basis for higher education and training to abroad and after completion of training return back to the country and the person may joi....