9911796707
TMI Blog2015 (9) TMI 168X X X X Extracts X X X X X X X X Extracts X X X X ..... any expenditure on account of Guest Complimentary and Guest Supplies for the assessment year 2005-06. 2. That the appellant craves leave to add, modify, alter or rescind any of the ground of appeal at the time of hearing of the case." 3. In this case AO made disallowances of expenses under the head Guest Complimentary and Guest Supplies by observing as under : "As per the Profit & Loss A/c. the assessee had debited Rs. 73,10,746/- on account of expenses on apartment and board. During the course of assessment proceedings the assessee has furnished details from wherein it is noticed that sum of Rs. 22,14,839/- was claimed on account of Guest Complimentary and further Rs. 8,03,909/- was claimed on account of Guest Supplies. The assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness executives of different companies like Coal India, Glen Mark Pharmaceuticals etc., who are regular customers, are also offered rooms with complimentary breakfast and complimentary one major meal either lunch or dinner. In such cases, room rent are credited in the accounts at gross rate with corresponding debit in Guest Complimentary on account of complimentary breakfast and one major meal. 05. The fact of Complimentary breakfast and one major meal is apparent from details submitted in the form of ledger print outs. Further more room rents being credited in the accounts on gross basis and reflected as such in the Profit and Loss Accounts has been offered for taxation. The gross room rent includes cost of complimentary breakfast and one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of assessment proceedings the assessee was asked to give details of guest complimentary and guest supplies. However, assessee did not give detailed breakup of these expenses instead ledgers were submitted. Even during the course of Remand Report proceedings, the assesee has only submitted ledgers. No inference can be drawn from ledger because the narration does not contain anything in detail. Narration of expenses is very general in nature. So, the undersigned is of the view that assessee failed to give detailed break up of expenses on 'apartment and board' of Rs. 30,18,748/- which was disallowed by the Assessing Officer." 3.2. Considering the above the ld. CIT(A) observed that guest complimentary were mainly in the nature of foo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich is inclusive of complimentary break fast and or meal. Now in this regard we find from the paper book submitted by the assessee that there is a guest complimentary ledger. A sample entry in the said ledger account is as under :- "Particulars Debit Guest Complimentary 1,53,285.50 Business Promotion 55,119.33 Dr Staff Welfare 27,154.53 Dr F&B Cost Adjustment 2,35,559.36 Cr AMOUNT ADJD AGST. COST OF MAP, BREAKFAST, COMPLIMENTARY AND EDM." 4.1. We note that this aspect has neither been explained by the assessee nor appreciated by the ld. CIT(A). The scheme of entry shown as above showed that it is not a simple matter as debiting guest complimentary on account of food and beverages and crediting room rent. It cannot be said that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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