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2020 (11) TMI 176
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....ing the disallowance towards environmental expenses to the extent of 50% of the total expenditure amounting to Rs. 18,02,292. (ii) whether the CIT(A) has erred in confirming the disallowance towards travelling and office maintenance expenditure to the extent of 50% out of the total expenditure of Rs. 30,10,272 (19,45,509 towards travelling expenses and Rs. 10,64,763 towards office maintenance expenses). We shall adjudicate the above issues as under: I. ENVIRONMENTAL EXPENSES 3. The assessee had debited a sum of Rs. 18,02,292 towards environmental expenses. The Assessing Officer had disallowed the same for the reason that the assessee was categorized in C Category, and there was stoppage of assessee's business and hence the....
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....erred this appeal before the Tribunal. The assessee has filed a paper book comprising of 40 pages inter alia enclosing therein copy of written submissions filed before the CIT(A), reply to the notice received from the Assessing Officer, financial statement for the assessment year 2013-2014 and the judicial pronouncements relied on. The learned AR reiterated the submissions made before the Income Tax Authorities. 3.4 The learned Departmental Representative, on the other hand, submitted that the CIT(A) is justified in restricting the claim of deduction to 50% of the total expenditure because the assessee did not furnish any evidence to prove that it had incurred such expenses. It was contended by the learned DR that the CIT(A) was generous....
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....diture incurred under the head environmental expenses. The A.O. shall afford reasonable opportunity of hearing to the assessee and shall take a decision in accordance with law. 3.6 In the result, ground No.4 is allowed for statistical purposes. II. TRAVELLING EXPENSES AND OFFICE MAINTENANCE EXPENSES 4. The assessee had debited a sum of Rs. 19,45,509 towards travelling expenses and Rs. 10,64,763 towards office maintenance expenses in the books of account. The A.O. for the reasons mentioned in para 4.3 of the assessment order, had allowed the expenditure to the extent it was allowed in the assessment of the previous year (i.e., assessment year 2013- 2014) and disallowed balance being Rs. 13,87,986 towards travelling expenses and Rs. ....
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....ppellate authority. The CIT(A) restricted the disallowance to 50% of the total expenditure. The relevant finding of the CIT(A) reads as follow: "4.4 I have gone through the facts of the case and the submissions of the appellant. As the AO himself has restricted the expenditure similar to AY 2013-14, there is a need to look at the expenditure claimed in the earlier A.Y. and present A.Y. which is as under: Nature of expenses Expenditure claimed and allowed by the AO for the A.Y. 2013-14 (Rs.) Expenditure claimed by the assessee for the present A.Y. 2014-15 (Rs.) % of increase claimed by the assessee compared to A.Y.2013-14 Excess expenditure disallowed by the AO in the A.Y. 2014-15 (Rs.) Travelling expenses 55....
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....rtmental Representative supported the order of the CIT(A). It was submitted that the restriction of disallowance to 50% of the total expenditure is justified in the facts and circumstances of the case as there was no reason for the assessee for incurring such huge expenses when the assessee's business had been temporarily stopped. 4.4 We have heard the rival submissions and perused the material on record. Both the Assessing Officer and the CIT(A) have not examined in detail how the assessee had incurred these expenses. The A.O. was of the view that the assessee had earned only interest income and there was no reason for such a huge expenditure being incurred by the assessee. However, the A.O. allowed the deduction, which is allowed in th....