2022 (1) TMI 38

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.... 2. The learned Appellate Officer has erred in confirming action of the Deputy Commissioner of Income Tax CPC (the AO) in making addition u/s 143(1)(a) (iv) who is not authorised to make such adjustments under the Scheme notified by the Board. 3. The learned CIT-A has not appreciated that the proper opportunity was not afforded to appellant by the A.O. in providing response to the adjustment proposed by him hence proceedings was against the rules of justice and fairplay. 4. The learned CIT-A has erred in upholding the adjustment when no reason given by the A.O for holding appellant's response as not acceptable. 5. The learned CIT-A has failed to appreciate that the intimation now passed without calling....

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....isallowance made by the Ld.AO, by observing as under: "From the perusal of the guidance note above, it is clear that whether the club expenses are incurred in course of business or whether they are of personal nature should be ascertained and if they are personal in nature, then to be shown under clause 21(a). In this case as the club expenses are mentioned under clause 21(a) of Form 3CD by the auditor, it is evidently personal in nature. Hence, the adjustment in order u/s 143(1)(a) is found to be valid and inaccordance with law. Therefore, the contentions of the appellant are not sustainable." Aggrieved by the Ld.CIT(A), the assessee preferred appeal to this Tribunal. 4. It was contended that the assessee had paid only subsc....

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....purposes of business of the assessee in the instant case, the assessee was a company and it was found by the Appellate Tribunal that the expenditure by way of subscription to the clubs was incurred for the. purpose of promoting the business of the company and in view of the finding of the Tribunal, it must be held that the expenditure incurred was an allowable business expenditure. In the case of subscription to clubs, in so far as the assessee was concerned, the expenditure was incurred to promote and foster its business relationship. The object of the assessee was that its directors by remaining as members in some of the city clubs would give them certain social status, and it was obvious that by being members of the club, they would be a....