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TMI Blog2014 (9) TMI 722X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal is upheld – Decided against revenue. - ITA 593/2014 - - - Dated:- 12-9-2014 - Sanjiv Khanna And V. Kameswar Rao,JJ. For the Appellant : Ms. Suruchi Aggarwal, Sr. Standing Counsel For the Respondent : Through ORDER Sanjiv Khanna, J (Oral) 1. The assessment year in question is 2009-10 and the respondent assessee, a company, for the year had filed a return declaring income of ₹ 4,46,22,010/-. This was the net taxable profit declared. 2. The Assessing Officer disallowed payment of ₹ 48,30,000/- out of ₹ 60,00,000/- made to the Director by invoking Section 40A(2)(b) of the Income Tax Act, 1961 (Act, for short). He held that reasonable salary payable would be ₹ 1 lac per month. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n view of the facts mentioned in assessment orders for earlier years. The assessee submitted its reply vide letter dated 28/11/2011. On reconsideration of facts it is found that the salary paid to Mr. Patanjali Keswani is unreasonable and highly excessive and is hit by provisions of Section 40A(2)(b) of the Act also. The quantum of salary is highly excessive and manifestly disproportionate to the relative quantum and nature of business of the company. Considering the reply of the assessee and increasing inflation in the economy the salary to the Director is held to be reasonable at ₹ 1,00,000/- per month and balance amount is disallowed. Accordingly, a salary of ₹ 12,00,000/- @ ₹ 1,00,000/- per month for the period April, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oup of Hotels as Chief Operating Officer of Taj Business Hotels, and Sr. Vice President of a special project. Later, he also worked as Director of A.T.Kearney Inc. s India Office. 7. Thereafter, the Commissioner of Income Tax (Appeals) observed that the respondent assessee was engaged in financing business. Their business and profits had increased substantially over a period of time. A chart giving details of interest income earned, noticed in the first appellate order is reproduced below:- The comparative chart of interest income and net profit for year ended 31.03.2007, and 31.03.2008, 31.03.2009 and 31.03.2010 is as under:- Particulars 31.03.2007 (Rs.) 31.03.2008 (Rs.) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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