TaxTMI 
TaxTMI 
2022 (10) TMI 594
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....Ltd. as a Director since 2006. The return of income was filed declaring total income of Rs. 63,10,470/-, which included income from salary, income from house property and income from other sources. The assessee's case was selected for scrutiny under the CASS guidelines and during the course of assessment proceedings, the Assessing Officer (AO) noted that the assessee had given his car on lease to the employer company and had received a lease rent of Rs. 4,08,000/- as 'income from other sources'. The AO further noted that the assessee had shown a net loss on account of lease to the tune of Rs. 4,33,020/after claiming depreciation of Rs. 4,39,662/-, interest on loan amounting to Rs. 3,19,572/- repairs and maintenance amounting to ....
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....he disallowance of balance expenditure of Rs. 4,33,020/- 2.3. Now, the assessee has approached this Tribunal challenging the order of the Ld. CIT(A) by raising the following grounds of appeal: 1. The order of the Ld. CIT(A) is bad in law and on facts. 2. The Ld. CIT(A) has erred in restricting the expenses, to lease income of assessee from vehicles of Rs. 4,08,000/- and disallowing balance expenses of Rs. 4,33,020/- claimed u/s. 57 of Income Tax Act, 1961. 3. When the appeal was called out for hearing, none was present on behalf of the assessee. However, an application from Shri Sunil Kumar Bhasin, Chartered Accountant, the Ld. AR for the assessee was placed before us requesting adjournment on the ground that due to heavy rush of Tax ....
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....lowance to the tune of Lease Rental earned by the assessee. It was submitted by the Ld. Sr. DR that the assessee had given his vehicle on hire to the employer company and was using the same and the entire usage was being shown as official, whereas, the assessee was using the vehicle both for official as well as personal purposes and, therefore, the Ld. CIT(A) had rightly upheld a disallowance of Rs. 4,33,020/-. It was prayed that the appeal of the assessee be dismissed and the order of the Ld. CIT(A) be upheld. 5. We have heard the Ld. Sr. DR and have also perused the material on record. It is seen that the facts are not in dispute. The assessee had leased out his vehicle to his employer company and had shown lease rent of Rs. 4,08,000/- u....
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....e of registration of the vehicle had also been produced before the AO along with the insurance related documents. It was also the contention of the assessee before the AO that as far as the AO's observation that the vehicle was not registered as taxi was concerned, the same was irrelevant in as much as the vehicle was given on lease to the employer company for official use and not for the use by public at large. 5.1. A perusal of the impugned order shows that the Ld. CIT(A) did not consider any of these submissions made before him but simply proceeded to restrict the disallowance tune of to the income received from lease i.e. Rs. 4,08,000/- by holding that the assessee was using the vehicle both for official as well as personal use. Th....
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....ich in general (subject to its Explanation) makes available deduction of any expenditure, not being expenditure of the nature described in sections 30 to 37 of the Act and not being in the nature of capital expenditure or personal expenses of the assessee, expended wholly and exclusively for the purposes of the business or profession while computing the income chargeable under the head 'profit and gains of business or profession'. Thus, as per the mandate of section 57 (iii) of the Act, it is necessary that the primary motive of incurring such expenditure should be directly relatable to the earning of income falling under the head 'income from other sources'. In the present case it is beyond doubt that depreciation, interest....