9911796707
TMI Blog2016 (4) TMI 1009X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee was excessive. We, therefore, delete the addition sustained by the ld. CIT(A) and direct the AO to allow the claim of the assessee. - Decided in favour of assessee. Disallowance of various expenses - Held that:- In the present case, it is noticed that the assessee suo motu disallowed ₹ 24,200/- being 1/5th of vehicle running and maintenance expenses amounting to ₹ 1,21,200/-. However, the AO disallowed 1/5th of car insurance, car depreciation, telephone expenses, interest on car loan also. In the instant case, it is not in dispute that car insurance, car depreciation and interest on car loan was to be borne by the assessee even when the vehicles were not used for the personal purposes or remained idle. In the present c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has failed to bring any evidence on record that the assessee has not paid the interest claimed by him. The CIT(A) has also failed to appreciate that bank gives money against security and interest is always payable to the bank of day to day basis whereas assessee has been paying interest on yearly basis. 2. That the Order of the Learned CIT(A) in confirming sum of ₹ 53,558/- out of expenses claimed by the assessee on account of various expenses such as Car Insurance, Car Depreciation, Telephone Expenses, Vehicle Maintenance and interest on Car Loan is totally wrong, bad in law and needs to be quashed. 3. That the assessee prays permission to add, delete or amend one or more grounds of appeal. 3. The grievance of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee firm has arrange loan from outsider parties other than banks to promote the more sales and Arhat Income and to get better profits. Assessee Firm has not so much Goodwill to get the cheaper loans below 15% p.a. That the Assessee Firm is earning much more than interest paid. The Assessee Firm declare Net Income of ₹ 4,60,085/- after allowing remuneration of ₹ 9,15,000/- and interest of ₹ 1,20,038/- to partners as compare to last year Net Income of ₹ 3,02,541/- after allowing remuneration of ₹ 6,77,500/- and Interest of ₹ 1,18,695/- to partners. That interest is not the burden on the firm. Firm is earning more even after paying the interest. All Interest payment are made by Account Payee Chequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been made view the decision of Sh. G.D. Aggarwal, VP of ITAT Ld. In the case of Vipul Y. Mehta. Further please note that AO has not brought any evidence on record regarding the reasonableness of interest @ 12%. We you will agree and appreciate that the assessee hasn t paid excess interest at all and therefore the addition made by the AO has no merit and must be deleted. 7. The ld. CIT(A) after considering the submissions of the assessee observed that the contention of the assessee was partially correct. He further observed that the assessee agreed that even in the banks money lending rate is about 13%. The ld. CIT(A) restricted the payment of interest to the lenders @ 13%. 8. Now the assessee is in appeal. The ld. Coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowance of ₹ 53,558/- out of various expenses. The facts related to this issue in brief are that the AO during the course of assessment proceedings noticed that the assessee had incurred the following expenses: i) Car Insurance ₹ 15,232/- ii) Car Depreciation ₹ 1,19,574/- iii) Telephone Expenses ₹ 1,07,983/- iv) Vehicle Running Maintenance ₹ 1,21,200/- v) Interest on car loan ₹ 25,001/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee suo motu disallowed ₹ 24,200/- being 1/5th of vehicle running and maintenance expenses amounting to ₹ 1,21,200/-. However, the AO disallowed 1/5th of car insurance, car depreciation, telephone expenses, interest on car loan also. In the instant case, it is not in dispute that car insurance, car depreciation and interest on car loan was to be borne by the assessee even when the vehicles were not used for the personal purposes or remained idle. In the present case, nothing is brought on record that those vehicles were not used for the business purposes and were not the asset of the assessee. Therefore, disallowance of car insurance, car depreciation and interest on car loan was not justified. At the same time, ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
