2022 (6) TMI 1100

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.... circumstances of the case, the Ld. CIT(A) erred in deleting the addition of Rs. 2,42,04,706/- made on account of treating entertainment tax subsidy as revenue receipt by relying on the decision of the Hon'ble Bombay High Court in the case of M/s. Chaphalkar Brothers (ITA No. 1036 of 2010 & ITAT No. 1147 of 2010 dated 08.06.2011), without appreciating the fact that this decision has not been accepted by the Department and SLP has been preferred against the same before the Hon'ble Supreme Court. 2. On the facts and circumstances of the case, the Ld. CIT(A) erred in not appreciating the fact that the entertainment tax subsidy received by the assessee is a receipt in lieu of its income. It is a receipt generated because a part of the....

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....ravelling and conveyance expenses when no single items was pointed out by the AO as of non-business nature or non-genuine. 5. The reasons adduced by the learned CIT(A) for confirming the additions of Rs. 22,06,000/- and of Rs. 2,07,620/- are wrong, insufficient and contrary to the provisions of law and facts on record. 6. The appellant craves leave to add, alter amend, modify and/or delete any of the grounds of appeal." 2. Brief facts of the case are that the Appellant assessee is in the business of film exhibition at Mangala Multiplex Pune, it runs the multiplex. The assessee has treated the Entertainment tax subsidy as capital receipt. The Assessing Officer in the assessment order hold it as revenue receipt. The ld. CIT(A) held it as....

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.... the assessment order because the AO has added entire entertainment subsidy as capital receipt. This is an ad hoc disallowance. AO has not pointed out any specific expenditure which was in the nature of revenue expenditure. AO cannot presume it. Therefore, the AO is directed to delete the said disallowance. Accordingly, the assessee's Ground No. 1, 2 and 3 are allowed. 6. Ground No. 4 is related to disallowance of Rs. 2,07,620/-. The AO has made ad hoc disallowance of 10% of expenditure out of Travelling, Conveyance, repairs and maintenance on the ground that these expenditures were in cash, no evidence filed to prove it. The Ld. DR relied on the order of the AO and ld. CIT(A). 6.1. Heard ld. DR and perused the material available on r....