2011 (10) TMI 457

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..... Admit.   2. The following substantial question of law which arises for consideration:   "Whether the Income Tax Appellate Tribunal was correct in law and on facts in deleting the addition/disallowance made by the AO in respect of business promotion expenses amounting to Rs.27,19,769?"   3. The issue, thus, relates to the business promotion expenses purportedly incurred by the as .....

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..... motion expenses as the assessee was not able to substantiate the same. On being enquired by the AO as to the genuineness of the huge amount which is expended on the so-called business promotion, the assessee stated that the expenses relate to the gift items for presentation. No details or explanation were provided as to what was the nature of gifts and how they related wholly and exclusively to bu .....

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..... me up in further appeal, it is only the Revenue, who has filed the appeal challenging the order of the Tribunal. The reason given by the Tribunal is summarized in Para 3 of the impugned order, which is as follows:   "We have considered the rival contentions and found from the record that in view of the assessee‟s business of leasing, financing and trading of shares, it used to give pre .....

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..... nion that the Tribunal has not addressed the issue in a proper perspective. Only reason which has influenced the Tribunal is the high turnover of Rs.16.13 Crores achieved by the assessee, who was also having interest income of Rs.5.35 Crores, that, according to us, cannot be the ground to allow whatever expenditure is claimed by the assessee as business promotion expenses. It is the genuineness of .....

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..... thus, set aside the impugned order and remit the case back to the AO, who shall give an opportunity to the assessee to prove that the gifts which were purchased by the Director of the company in her name were, in fact, purchased for the assessee‟s business and were utilized by the assessee alone.   9. This appeal is disposed of in the aforesaid terms.  
Case laws, Decisions, .....

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