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TMI Blog2016 (6) TMI 640X X X X Extracts X X X X X X X X Extracts X X X X ..... wever, in some circumstances, loss is also inevitable. This Tribunal is of the considered opinion that it is the initial year of providing services, therefore, as observed earlier, the assessee could not have anticipated the expenditure in providing the services. When the assessee entered into the agreement for providing services at Rs. 1 lakhs/Rs. 2 lakhs per month for these assessment years, it is expected that the assessee has to discharge its obligation as per the agreed terms. If there was any breach of agreement, the assessee has to compensate for the breach of the conditions as agreed between the parties. When the agreement entered into between the parties are not in dispute, merely because one of the trustee Smt. Geetha Muthaia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement and other hospital services to the general hospital run by Rajah Muthiah Chettiar Charitable and Educational Trust. According to the ld. Counsel, there was an agreement between the assessee and Chettinad Academy of Research and Education for providing various services. The consideration for the services provided by the assessee was ₹ 12 lakhs per annum excluding taxes for the assessment year 2008-9 and Rs. 24 lakhs per annum each for assessment years 2009-10 and 2010-11. Referring to the agreement dated 30.7.2008, the copy of which is available at page 338 of the paper book, the ld. Counsel submitted that the assessee-company entered into the agreement on trial basis. The assessee, in fact, entered into the agreement in anticip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer for any tax evasion. It is a loss suffered by the assessee in the course of its business activity, therefore, according to the ld. Counsel, the CIT(A) is not justified in confirming the disallowance made by the Assessing Officer. 3. On the contrary, Dr. B Nischal, ld. Departmental Representative submitted that the assessee, in fact, entered into an agreement with Chettinad Academy of Research and Education for providing services to the general hospital maintained by the Trust. According to the ld. DR, Rajah Muthiah Chettiar Charitable and Educational Trust was maintaining a Medical College and General Hospital. The assessee agreed to provide managerial services for running the general hospital. According to the ld. DR, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee. 4. We have considered the rival submissions on either side and also perused the material available on record. Admittedly, the assessee entered into an agreement for providing managerial and other services to general hospital run by Rajah Muthiah Chettiar Charitable and Educational Trust. It is also an admitted fact that Rajah Muthiah Chettiar Charitable and Educational Trust is running a medical college and general hospital. For the purpose of providing various services in the general hospital, Chettinad Academy of Research and Education entered into an agreement with the assesseecompany. The consideration for providing services was fixed between the parties at Rs. 1 lakhs per month for assessment year 2008-09 and Rs. 2 lakhs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved earlier, the assessee could not have anticipated the expenditure in providing the services. When the assessee entered into the agreement for providing services at Rs. 1 lakhs/Rs. 2 lakhs per month for these assessment years, it is expected that the assessee has to discharge its obligation as per the agreed terms. If there was any breach of agreement, the assessee has to compensate for the breach of the conditions as agreed between the parties. When the agreement entered into between the parties are not in dispute, merely because one of the trustee Smt. Geetha Muthaiah is a director in the assessee-company that cannot be a reason to doubt the genuineness of the transaction between the assessee-company and Rajah Muthiah Chettiar Chari ..... X X X X Extracts X X X X X X X X Extracts X X X X
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