9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (12) TMI 406 - AT - Income TaxAddition of telephone expenses Held that - Personal use of the telephone being very common cannot be totally ruled out The assessee has not produced any evidence to show that the entire telecommunication was used for the business purpose The disallowance was restricted to Rs. 50,000/- out of Rs. 1,00,000 - The appeal is partly allowed. Addition of Vehicle expenses and depreciation on vehicle Held that - The AO has not justified the personal usage of vehicle with evidence or material on record Decided in favour of assessee. Addition of Conveyance expenses - Held that - The assessing officer failed to prove the element of personal expenses included in conveyance bill or vouchers The adhoc disallowance was not properly justified by him Decided in favour of assessee. Addition of office expenses Held that - The self-made vouchers should also be accepted It is not possible to obtain the receipt and vouchers of each and every expenditure - Once the expenditure is incurred for the purpose of the business, the same is allowable - Decided in favour of assessee. Addition of business promotion expenses Held that - The assessing officer did not offered any proper justification regarding adhoc disallowance of expenses - Decided in favour of assessee.
Issues Involved:
1. Adhoc additions to various expense claims challenged by the assessee for the assessment year 2004-05. Analysis: 1. Telephone Expenses Disallowance: The AO disallowed a portion of the telephone expenses claimed by the assessee due to lack of proof that the expenses were incurred wholly and exclusively for business purposes. The CIT(A) upheld a reduced disallowance. The ITAT sustained a partial disallowance of Rs.50,000, as the assessee failed to demonstrate that the entire telecommunication was used for business purposes. Ground no.1 was partly allowed. 2. Vehicle Expenses Disallowance: The AO disallowed a portion of vehicle expenses due to the absence of vehicle log books, presuming personal use. The CIT(A) confirmed this disallowance. However, the ITAT found no concrete evidence to support the disallowance and deleted the addition of Rs.45,572. Ground no.2 was allowed. 3. Depreciation on Vehicle Disallowance: Given the deletion of vehicle expense disallowance, the ITAT allowed the ground related to depreciation on vehicles by deleting the addition of Rs.13,304. Ground no.3 was allowed. 4. Conveyance Expenses Disallowance: The AO disallowed a portion of conveyance expenses citing lack of specific details in self-made vouchers. The ITAT found the disallowance to be based on mere suspicion and cryptic reasoning, deleting the addition of Rs.86,143. Ground no.4 was allowed. 5. Office Expenses Disallowance: The AO disallowed a portion of office expenses supported by self-made vouchers. The ITAT emphasized that self-made vouchers should be acceptable if expenses were incurred for business purposes, deleting the addition of Rs.21,921. Ground no.5 was allowed. 6. Business Promotion Expenses Disallowance: The AO disallowed business promotion expenses alleging them to be entertainment expenses with a personal element. The ITAT found the reasoning cryptic and unjustified, deleting the disallowance of Rs.1,92,382. Ground no.6 was allowed. In conclusion, the ITAT partly allowed the assessee's appeal by deleting various adhoc additions made by the AO and upheld by the CIT(A), emphasizing the need for concrete evidence and justifications for disallowances.
|
