2015 (5) TMI 1059

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....or the assessee, submitted that the first issue arises for consideration is with regard to disallowance of business promotion expenses to the extent of Rs. 15,77,819/-. According to the Ld. representative, the assessee had to incur certain expenditure in entertaining the customers in the hotel. The payments were made through credit card. According to the Ld. representative, the Assessing Officer disallowed 30% of the expenditure on estimate basis. The CIT(Appeals) confirmed the same. On a query from Bench, how the expenditure incurred in payments to Spa, Hotels at Mecca & Medina relate to business purpose? The Ld. representative submitted that the assessee had to necessarily entertain its customers in Spa, Hotels, etc. Therefore, these a....

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.... Therefore, the Assessing Officer disallowed a sum of Rs. 13,90,620/-. On appeal by the assessee, the CIT(Appeals) confirmed the addition made by the Assessing Officer. According to the Ld. representative, the fact that the directors of the assessee-company undertook foreign travel is not disputed. Therefore, the entire claim of the assessee has to be allowed. 7. On the contrary, Shri S. Das Gupta, the Ld. D.R. submitted that inspite of repeated requests, the assessee could not file any bills and vouchers except only to the extent of Rs. 8,24,256/-. In the absence of material to prove the expenditure, according to the Ld. D.R., the Assessing Officer restricted the claim only to the extent the assessee filed the bills and vouchers. ....

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....d the sum of Rs. 15,53,226/-. However, on appeal by the assessee, the CIT(Appeals) found that the expenditure disallowed by the Assessing Officer is in the nature of capital, therefore, the Assessing Officer should allow depreciation. According to the Ld. representative, these expenses are revenue in nature. Therefore, the entire expenditure ought to have been allowed.   11. On the contrary, Shri S. Das Gupta, the Ld. D.R. submitted that the construction of dining hall for the workers, construction of connecting roads and walls are capital in nature. Therefore, the Assessing Officer has rightly treated the same as capital expenditure. The Ld. D.R. further submitted that the assessee did not file any proof with regard to repairs a....