9911796707
TMI Blog2012 (8) TMI 558X X X X Extracts X X X X X X X X Extracts X X X X ..... ock, not for keeping check and control over the stock but also for determining true and correct "profit". 7. The learned CIT (A) erred in restricting the addition on salary expenses to 15% instead of 50% of Rs..1,33,551/- without appreciating the fact that assessee has not kept and maintained salary register, daily attendance register and proper salary vouchers. 8. The learned CIT (A) erred in deleting the BMC property tax of Rs..2,93,015/- paid to the landlords of the premises without appreciating the fact that assessee's submission did not substantiate and conclusively establish that the payment was paid to BMC for property tax. 9. The learned CIT (A) erred in deleting the addition on account of royalty to workers under section 40(a)(i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rade of assessee, he considered that it is not possible to maintain stock of number of books. The CIT (A) deleted the addition. 4. After considering the rival submissions, we do not see any reason to interfere with the order of the CIT (A). AO has simply made an addition of Rs.1,75,000/- to the closing stock valuation without rejecting the books of account. He did not even bother to verify the valuation adopted by assessee for the closing stock. As discussed by the CIT (A), there was increase in the royalty expenditure and also turnover. We are of the opinion that there is no basis for making an addition of Rs.1,75,000/- by AO and accordingly the deletion by the CIT (A) is in order. Ground No.1 raised by the Revenue is rejected. 5. Ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arguments, we are of the view that the order of the CIT (A) is to be upheld. First of all there is no reason to disallow the amount by AO as assessee has claimed property tax as business expenditure on a tenanted property. Requirement of proof of payment to the BMC authorities to allow in the year of payment was required while computing the income from house property but not allowing the expenditure under section 37(1) as business expenditure. Moreover, assessee has already furnished the evidence regarding the dispute with the owner and payment by way of deposit to the Court. In these circumstances, there is no need for any disallowance of the amount. Revenue ground is accordingly rejected. 7. Ground No.4 pertains to disallowance under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case records. The AO has disallowed the royalty payment to author under section 40(a)(ia) r. w.s 194J of the Act. The provisions of Section 194J read as "any person not being an individual or a Hindu undivided family, who is responsible for paying to a resident any sum by way or- (a) Fees for professional services or (b) For technical services 2(or) 2(c) royalty or 2 (d) any sum referred to in clause (va) of section 28 Shall at the time of credit of such sum to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to five per cent (w.e.f. 1.6.2007 ten per cent) of such sum as incometax on income comprised therein". For th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that the rights for the story of the novels for the purpose of use in television or broadcasting on radio are given by the authors directly to the television or radio channels. It is submitted that royalty to authors paid by the appellant is deductible in the hands of the recipient under section 80QQB of the Act. Section 80QQB refers to rights granted in respect of books only whereas in the corresponding definition in section 9 there is no reference to books. It may be pointed out that the definition of royalty for the purpose of Section 9 was brought on the statute in the year 1976 when television was introduced in India. It was introduced in Mumbai in the said year and thereafter in other states. In order to tax the royalty on r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the appellant's reply it is seen that as they have filed all the relevant details before AO and their contention that explanation to clause 6 of sub section (i) of 9 does not apply to them is correct. Because the clause states the "transfer of all or any rights including granting of license in respect of any copy right literary, artistic or scientific work including films or video tapes for use in connection with television or tapes for use in connection with radio broadcast but not including the sale distribution or exhibition of cinematography. 11. The appellant's contention that this clause relates to and restricts itself to transfer of rights for use in connection with TV and radio broadcast. The important wording of the section is f ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
