9911796707
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Issues:
1. Disallowance of license and production fees for earlier years. 2. Disallowance of telephone expenses for personal calls by directors. 3. Disallowance of fabrication charges due to differences with another party. Analysis: 1. The Revenue's appeal challenged the deletion of disallowance of Rs. 4,292 for license and production fees from earlier years. The Assessing Officer disallowed the expenses, but the CIT(A) reversed it, stating that the liability was settled in the relevant year. The Revenue argued that as the assessee maintained accounts on a mercantile basis, expenses from previous years shouldn't affect the current year's profits. The Tribunal upheld the CIT(A)'s decision, emphasizing the settlement of the liability in the current year, leading to the appeal's dismissal. 2. The assessee's appeal contested the disallowance of Rs. 3,000 from telephone expenses. The Assessing Officer disallowed part of the claim due to potential personal calls by directors. The CIT(A) reduced the disallowance, but the assessee sought complete relief, arguing that in a public limited company with public interest, there would be no personal use of telephones by directors. Citing a precedent, the Tribunal agreed with the assessee, deleting the disallowance based on the nature of the company and the absence of personal use elements. 3. The final issue involved the disallowance of fabrication charges amounting to Rs. 9,158 due to discrepancies with Sadhoushi Woollen Mills. The assessee claimed the amount as a liability for the year, but lacking evidence, the Assessing Officer rejected the claim. The Tribunal noted the disputes between the parties and the absence of confirmation from the other party. Considering the settlement of the matter in the current year, the Tribunal directed the Assessing Officer to allow the revised claim of Rs. 6,194, based on the sale of waste material and the settlement within the relevant year, partially allowing the appeal.
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