TaxTMI 
TaxTMI 
2026 (9) TMI 1624
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....al: "1. The learned CIT (A) is erred in law and facts by confirming part of partial disallowance made by learned A.O against Salary & Rent without considering the fact that payment is quite moderate and much below the fair market value. 2. The learned CIT (A) is erred in law and facts by ignoring the lease deeds submitted during assessment proceeding. The appellant trust is using altogether five premises out of which only one premises belongs to specified person. 3. The learned CIT (A) is erred in law and by ignoring the fact that as per provisions of section 13(1) (c), payments made to specified persons against actual use of service shall not be construed benefit unless the payment exceeds the fair market value w....
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.... Details Amount Jahane Abha (Salary) Rs.8,57,528 Hushne Abha (salary) Rs.8,57,528 Danyal Abha (Salary) Rs.7,16,266 Danish (Salary) Rs.5,39,595 Jahne Abha (Rent) Rs.10,80,000 Hushne Abha (Rent) Rs.10,80,000 Danyal Abha (Rent) Rs.10,80,000 Total..... Rs.62,10,917 3. In this regard, the assessee tried to justify the payments made to the specified persons and trusts, enclosed qualifications of the teachers and form-16, issued to the teachers and income tax return filed by them. The assessee further submitted that all payments made to the specified persons through banking channel. On verification of the form No.10B, it was noticed that in the proceeding years, there was no payments to the spe....
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....g the entire facts and documents furnished by the assessee, he held that 50% of the payments are excessive and he allowed to the extent of 50%. Accordingly, a show cause notice was issued to the assessee dated 2nd September, 2022 and time was granted up to 9th September, 2022, but assessee failed to reply of the show cause notice issued by the AO. Accordingly, 50% of the payments made to the specified persons noted (supra) were disallowed of Rs.31,05,458/- and apply tax rate at MMR (at the rate of 30%). 4. Aggrieved from the above order, the assessee filed before the ld. CIT (A). During the course of first appellate proceedings, the assessee furnished the details reply and tried to justify the observations of the AO, submitted that the p....
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....any fair market value of rent and he has arbitrarily disallowed and considered as excessive payment, whereas the rent payment were as per rent agreement between the tenant and land lord. He further submitted that the ld. CIT (A) has also not properly appreciated the submissions made before him. He also filed a paper book containing page 1 to 35. He referred to page no. 1 and submitted that there is an increase in salary payment of specified persons are only 19.18% and then also similar increase on the salary payments to other specified perrons which is 16.5% and he also computed the rent payment per sq.ft. which is 21.43 address Shankar Shopping Centre, No.692, Plot no.-KC-1, Circle No.51A ward 34, Hanuman nagr, patna, Ram Salil Rai market ....
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....the entire materials available on record and order of lower authorities, we noted that here the dispute is only relating payments made to the specified persons that the ld. AO has treated it as excessive payments and he restricted to the payments up to 50% of the expenditure incurred by the assessee. We noted from the orders of the above stated facts that the ld. CIT (A) has considered the entire submissions. He has given further 25% relief on the additions made by the Assessing Officer. We have also gone through the comparative chart produced by the assessee, the average increase in salary to the specified persons is 19.18% and percentage of increase in salaries to other than specified persons is 16.5%. The assessee has increased salary of....