9911796707
TMI Blog2011 (1) TMI 1436X X X X Extracts X X X X X X X X Extracts X X X X ..... hs for A.Yrs. 1999-2000 and 2001-02. 2. In the grounds of appeal for A.Y 1999-2000 the amount of penalty has been shown at ₹ 6,20,064/- but the Ld.counsel of the assessee pointed out that this amount was actually ₹ 4,84,167/- because penalty in respect of depreciation on vehicle was deleted by the CIT(A) himself, whereas the total amount was mentioned in the ground is ₹ 6,20,064/-. In this regard he has also filed a letter that this amount should be taken at ₹ 4,84,167/- and, therefore, for adjudication of the appeal for A.Y 1999-2000 we are considering the amount of ₹ 4,84,167/- only. 3. In both these cases during assessment proceedings the salary paid to the Managing Director was disallowed mainly o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the Managing Director, assessee also verbally agreed to pay the remuneration which was in excess of the limits prescribed under sections 198/349 of the Companies Act and in this regard he referred to page-21 of the paper book, which is a copy of notes to the financial statement showing the calculation of the remuneration. As the remuneration was in excess of the limits prescribed under the Companies Act, assessee company further applied to the Government of India for approval of remuneration and the Government of India approved the same on 8-6-2001 and in this regard he filed the copy of the approval letter. He argued that mere disallowance of expenditure cannot lead to automatic levy of penalty. In the case before us genuineness of rem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of appointment of Mr. Tarun Pasricha has not been doubted. Further, we find that remuneration paid to Mr. Tarun Pasricha came to ₹ 13,83,3336/-, whereas he could have been paid only a sum of ₹ 10,14,343/- [see page 21 of the calculation of the managerial remuneration] in terms of sec.349 of Companies Act and, accordingly, even approval of the Government of India for such excess payment was sought and the same was approved vide letter dated 8-6-2001 by Ministry of Law Justice and Company Affairs, Department of Company Affairs, Government of India. Therefore, it is clear that salary was definitely paid to Mr. Tarun Pasricha which was duly approved by the government and even his services have not been doubted. Merely, because ..... X X X X Extracts X X X X X X X X Extracts X X X X
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