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TMI Blog2011 (2) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... e CIT(A) in confirming the disallowance of Rs. 96,380/- on account of salary paid to the Director. 4. Facts of the case, in brief, are that the assessee company is engaged in the business of importer and reseller of rubber products and chemicals. During the course of assessment proceedings, the Assessing Officer noted from the tax audit report and the various submissions filed by the assessee that out of the total salary of Rs. 9,12,144/- paid to its employees, a sum of Rs. 1,23,120/- has been paid to the Managing Director Mr Mazhar Vohra and an amount of Rs. 1,92,760/- paid to the Director Mrs Samina M Vohra . The Assessing Officer asked the assessee to explain as to why such substantial amount paid as remuneration should not be tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved from the nature of activity undertaken by the assessee company that there are transactions taking place among the group concerns. Therefore, payment of remuneration to the director in general is excessive and unreasonable. 4.3 After considering the total employees cost shown by the assessee for the year, the Assessing Officer came to the conclusion that services rendered by Mrs Samina Mazhar Vohra does not deserve a much higher salary for signing few correspondence letters and does not convey the legitimate needs of the business or profession. According to him, the company has reduced its net profit by diverting such a substantial and unreasonable amount of remuneration to the lady director. In view of the above, he disallowed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... director (who looks after mere routine work viz-a-vis salary of Rs. 1,23,120/- to the Managing Director is unjustified. Accordingly, under the facts and circumstances of the case, the disallowance made by the Assessing Officer u/s 40A(2)(b) is upheld." 6. Aggrieved with such order of the CIT(A), the assessee is in appeal here before the Tribunal. 7. I have considered the arguments advanced by the ld DR and perused the orders of the authorities below. There is no dispute to the fact that an amount of Rs. 1,92,760/- has been paid as remuneration to the director Smt Samina Vohra. There is also no dispute to the fact that the above salary paid to the lady director is higher than the salary paid to the Managing Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A), which I find has been mentioned at page 3 of the order of the CIT(A), I find the CIT(A) has not considered the same. His findings, in my opinion are on general basis while upholding the action of the Assessing Officer. It is the well settled proposition of law that the Assessing Officer cannot direct the assessee to conduct its business in a particular manner. It is for the assessee how to conduct its business in a particular manner. It has been submitted before the Assessing Officer and the CIT(A) that Mrs Samina Vohra was overall In-charge of the company and looks after all the activities. This aspect has not been proved to be false or untrue. Therefore, merely because the remuneration of the lady director is more than that of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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