TaxTMI 
TaxTMI 
2025 (10) TMI 1229
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....over and the same amounted to business promotion to improve the business as well as collection from customers. In this regard, the assessee also furnished the list of the eligible dealers/ customers and the related passengers travelling on behalf of the said dealers/ customers alongwith the bills of the travel agent M/s. Dewan Travels Pvt. Ltd. who had booked the said tickets. However, the same was not accepted by the AO and the main reason for the disallowance given by the AO in para-3.6 of his order which is reproduced as under :- 3.6 The list merely mentions the names of the passengers. However, it is not substantiated by the assessee how the individuals mentioned in the list above have exceeded the sales turnover target set by the assessee. The assessee has not provided any copy of agreement or any correspondence with the above mentioned companies which states that they would be entitled to foreign travel in case of achievement of certain target. The assessee has not explained or clarified how was it possible for the assessee to ascertain who was eligible for foreign travel and who was not. The assessee has not furnished any Board's resol....
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....er in this order were furnished by the assessee in Annexure-6 to Annexure-19 before the Ld. CIT(A). Further, it was submitted inter-alia by the assessee before the Ld. CIT(A) that the Holding Company created a Brochure by the name of Austrian Trip 2016-17, GP Pipes Purchase Reward detailing the terms and conditions of availing the reward of fully paid foreign trip. It was further submitted that the scheme, per Brochure was also sponsored by the assessee and copy of the Brochure was placed as Annexure-9 before the Ld. CIT(A). Further, it was submitted that assessee company had adopted the same scheme and had passed a resolution in the Board Meeting held on 30-05-2016 and the copy of the Board Resolution was placed as Annexure-10 before the Ld. CIT(A)0. It was submitted that as per scheme, for every 600 tons of purchases of GP pipe the dealer was entitled for one ticket per 600 ton and for purchases more than 2500 ton, additional two tickets and the entitlement of dealers was explained by an example below: Dealer purchases 599 tons of GP pipe during FY 2016- 17-Not Ticket Dealer purchases 1600 tons of GP pipe during FY 2016-17- Two tickets (one ticket for every 600 ....
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....pared to Rs. 1165.8 crore in the A.Υ. 2012-13. To achieve the target, the assessee floated different schemes to incentivize the dealers. As per the scheme, any dealer achieving sales target of 150 metric tonne, will be entitled for 1 air ticket to and fro to Malaysia and if achieves a sales target of 500 metric tonne of steel tubes, such dealer would be entitled for one ticket to Paris. In case, a dealer achieves target of 750 metric tonne such dealer is entitled for one ticket to Australia and two tickets in case of 1500 M.T. of the steel tubes. As per the scheme, three groups consisting of 272 persons, 251 persons and 157 persons were taken to Malaysia and 20 persons who have been taken to Australia. The assessee has incurred an expenditure of Rs. 6,54,32,452/-. 6. The Id. CIT (A) examined the bills raised by the assessee of Dewan Travels Pvt. Ltd. which are as under: Sl. No. Date Amount 1. 17.09.2011 Rs. 20,48,705/- 2. 04.04.2012 Rs.2,53,17,202/- 3. 26.05.2012 Rs.1,46,54,700/- 4. 19.07.2012 Rs. 2,34,11,845/- 7. The Id. CIT (A) found that the bill dated 17.09.2011 for an amount of Rs. 20,48,705/- pertain to th....
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....t attested either by any auditor or any Chartered Accountant. The AO also questioned the fact that it was not clear as to why the assessee had started claiming the said expenses from the present financial year and observed that it had not claimed such expenses in any of the earlier year. The AO also noted that a perusal of the allocation shows that main expenses was towards employees cost but the assessee had not furnished the list of the employees who had worked for more than one group concerns because of which their expenses was among all the concerns to whom he / she had rendered services. The AO also noted that the assessee had not furnished Form -16 of all such employees in absence of such details it was not possible for her to ascertain whether the allocation of employee cost was made correctly or not. Similar observation was also made by the AO with respect to allocation of operational expense as according to the AO the basis for allocation of the said expenses among various concerns was not provided. Accordingly, the AO disallowed the sum of Rs. 2,53,43,451/- and added to same to the total income of the assessee. 9. Aggrieved with the said order of the AO the assessee fi....