9911796707
TMI Blog1980 (1) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... ver the provisions made in the earlier years. The same being spent for the business of the Company. 3. For that the Ld. AAC is not justified in confirming the addition of Rs. 3,926 from subscription donation account which was solely for business." 2. Facts briefly stated are, that the ITO, while computing the total income of the assessee-company for the assessment year under appeal disallowed, as excessive and un-reasonable, a sum of Rs. 1,800 and treated the same as income of the assessee-company for the assessment year under appeal, out of Managing Director's conveyance allowance. The ITO reasoned that the assessee has claimed Rs. 22,800 on account of Managing Director's conveyance allowance as against Rs. 19,461 claimed by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany contended that all the expenses i.e. the disallowances, the subject-matter of appeal were for the business expediency and were incidental to the business of the assessee-company and as such merited to be allowed. Shri Barjatiya, place on our file, a copy of the order of the Tribunal, Gauhati Bench, Gauhati, made in ITA No. 872 (Gau) of 1975-76, relating to the asst. yr. 1974-75 in the case of the assessee, also details of miscellaneous expenses and copy of agreement for bonus between the management of the assessee-company and the Employees Union. He further relied upon the order of this Bench, which are dt. 5th Feb., 1979 and made in the case of the assessee for the asst. yr. 1976-77 and 1977-78 in ITA Nos. 230 and 231 (Gau) of 1978- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have also perused the orders of the lower authorities. 7. As regards the disallowance out of Managing Director's conveyance allowance, the disallowance would be made either because the said allowance was not paid, in fact, or else the expenditure was not incurred solely and exclusively for the purposes of the business. But once there is an enquiry into the excessiveness or unreasonableness of an allowance resulting in any benefit to a Director or a person who has a substantial interest in the company, the onus is always in the assessee to establish that the particular allowance was justifiable; more so the burden of proving a claim for deduction is always on the assessee, since the assessee has to prove that the claim made was justifiable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee may like to. We make it clear that to prove the justification as to this disallowance being not called of rests on the assessee. 8. As regards disallowance made out of bonus paid to employees, the learned counsel for the assessee has relied upon a said to be true copy of an agreement, claimed to be an agreement for bonus in between the assessee-company and its employees. For the purposes the learned counsel for the assessee has placed on our file as Annexure-III a true copy said to be copy of the original agreement. The said copy has not even been verified to be true one, accordingly the veracity of the facts contained therein cannot be taken and verified and at the face value as also the said paper has little evidential value, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total income of the assessee for the said assessment year; also as to what was the allocable surplus i.e. the amount which could be subjected to payment of bonus by the assessee-company to its employees and allied particulars as to the justification for entering into the agreement vis-a-vis the net earnings of the assessee-company. In view of these vital facts not coming forth, we are not in a position to adjudicate upon this aspect of the case too, as such on the facts and in the peculiar circumstances of the assessee's case, we deem it fit to restore this aspect of the case also to the file of the ITO with the direction that the claim of the assessee-company for deduction be decided afresh in accordance with law and after providing the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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