TaxTMI 
TaxTMI 
2023 (2) TMI 253
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....es for doing studies abroad by Shri Harshvardhan Barech who happened to be the son of director Rajkumar Barech. The assessee company during the year sponsored for his education for graduation abroad at University of Sussex, UK. The AO noted that Harshvardhan Barech was not the employee of the assessee company at the relevant point of time and therefore the expenses were not incurred for wholly and exclusively for the purpose of business. Shri Harshvardhan Barech after completion Higher Secondary Examination in 2011 was sponsored by the assesse company by the board of director in its meeting held on 26.07.2011 deciding to bear the expenses on foreign studies on the condition that Mr. Harshvardhan Barech would join the company after completion of graduation in future and to corroborate the facts the Ld. A.R filed agreement dated 21.08.2022 and copy of extracts of board meeting dated 26.07.2011 before the AO. However the AO rejected the contention of the assessee and added the same to the income of the assessee by holding that this has not been wholly and exclusively incurred for the purpose of business of the assessee. 4. In the appellant proceedings, the Ld. CIT(A) simply dismissed....
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....raining of one of its director's son who was sent to USA for completing course in business administration. In this case the director's son had committed to serve the assessee company for at least ten years. A.O. was not convinced with the explanation of the assessee and he disallowed the expenses in this regard. The Hon'ble Court in this case held that the course in business administration was general in nature and had no direct nexus with the business activities of the appellant assessee. Court observed that the appellant failed to place particulars on record like basic education, subject knowledge, and how such subject had nexus to business activities of the appellant and so on. Though the director's son had enteredirito a contract to render his services after completing his education but it was not sufficient to hold that appellant assessee had proved nexus between expenditure and its'business activities. The Hon'ble court upheld the action of the A.O. and in the process also distinguished the case of Sakai Papers Pvt. Ltd. Vs. CIT (1978) 114 ITR 256 (Bombay H.C.). This is one of the judgements on which the assessee has relied in support of its claim. (c) In the case of W....
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....t ensure that the person has requisite skillssuited to the needs of the company. Now coming to the assessee's submissions regarding the decision given by Ld. CIT(A)-17, Kolkata for A.Y. 2012-13 and AY: 2015-16, with due respect I differ from the views of the Ld. CIT(A). Facts of assessee's case are similar to those discussed in JBM Industries Ltd, vs. CIT (Supra) and Indian Galvanics Cyrium Foils Ltd. (Supra). The judgements cited by the appellant, in support of its contentions, are distinguishable on facts. In all the cases, relied upon by the assessee, the persons contrned had been working with company and they all were at least graduates. A person's specialization in any field decides his utility for a particular job. Specialization comes by experience or through education/training. If only educational background is considered, then the person should be at least graduate in a particular stream to assess his suitability for a particular job. But in the present case, the person has just finished his basic schooling only. Hence, the facts of assessee's case are distinguishable from the cases relied upon by the assessee. On the other hand it is similar to the cases of JBM Industries....
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....investments are required to be taken into accounts for calculating disallowance under Rule 8D(2)(iii). Accordingly we restore this issue to the file of AO to calculate the disallowance only by taking those investments which yielded exempt income during the year. The case of the assessee finds support from the decision of REI Agro Ltd. in ITA No. 1331/Kol/2011 dated 19.06.2013 and the decision of Hon'ble Calcutta High Court in the case of CIT vs. Ashika Global Securities Ltd. in ITAT 100 of 2014 dated 11.6.2018. Accordingly the ground no. 2 raised by the assessee is allowed for statistical purposes. 8. Now we shall adjudicate in ITA No. 542/Kol/2022 for AY 2014-15. Issue raised in ground no. 1 and 5 are similar to ground no. 1 and 2 in ITA No. 541/Kol/2022 for AY 2013-14 therefore our finding would ,mutatis mutandis, apply to these grounds as well. Consequently issue raised in ground no. 1 is allowed and issue raised in ground no. 5 is allowed for statistical purposes. 9. Issue raised in ground no. 2 is against the confirmation of addition of Rs. 5,29,472/- by the Ld. CIT(A) as made by the AO on account of prior period expenses on repairs to building. 10. After hearing both the p....