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TMI Blog2018 (1) TMI 447X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2006-07. The Appellant submits that the facts for the assessment year 2006-07 were different as compared to the facts for the assessment years 2007-08 to 2009-10 and the CIT(A) ought to have followed the ITAT decision in the Appellants own case for the assessment years 2007-08 to 2009-10 wherein in Order of the CIT(A) was upheld confirming the disallowance of 10% of only "Other Expenses" out of the entire foreign travel expenses. The Appellant therefore prays that the ACIT be directed to restrict the disallowance to 10% of "Other expenses". 2. The CIT(A) erred in confirming the disallowance of Rs. 5,30,432/- made by the ACIT out of motor car expenses. The Appellant submits that the entire expenses of motor car has been incurred wholly and exclusively for the purpose of the business and that the ACIT be directed to delete the disallowance of Rs. 5,30,432/- made by him on this account. The Appellants crave leave to, add to, alter or amend the above grounds of appeal or to add a new ground of appeal at any time before hearing of the appeal." 2. Briefly stated, the facts of the case are that the assessee who is engaged in the business of manufacture, trading and export o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee could not be ruled out, therefore, observing that 1/3rd of the foreign travelling expenses were disallowed by his predecessor while framing the assessment in the hands of the assessee for A.Y(s). 2007- 08, 2008-09, 2009-10 and 2010-11, therein disallowed 1/3rd of the foreign travelling expenses for the year under consideration and made a consequential addition of Rs. 30,89,983/-. The A.O further deliberating on the motor car expenses of Rs. 7,42,710/- claimed by the assessee, observed that as no log book/journey details were maintained by him, therefore, the fact as to whether the cars were exclusively being used by the assessee for his business purposes could not be ascertained. The A.O on the basis of his aforesaid observations, holding a conviction that the usage of the cars for personal purposes could not be ruled out, therefore, disallowed 20% of the claimed expenses and made an addition of Rs. 1,48,542/- in the hands of the assessee. That on the basis of his aforesaid observations the A.O further made two proportionate disallowances, viz. depreciation on motor car of Rs. 2,89,017/- and interest on car loan of Rs. 92,873/-. Thus, on the basis of the aforesaid observatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 to 2010-11. The CIT(A) took cognizance of the fact that during the year under consideration the assessee had furnished details of foreign travelling expenses incurred by him during the year under consideration along with the details of places visited, the period of travel, number of days of stay and fare and other expenses incurred during his stay, and had averred that the expenses for the year under consideration despite increase in the export turnover had witnessed a decline as in comparison to the immediately preceding year, viz. A.Y. 2010-11. The CIT(A) observed that the ITAT, 'D' Bench, Mumbai, in the assesses own case, viz. ITA No. 4912/Mum/2011, dated 28.10.2015 had confirmed the orders of the CIT(A) for the A.Y(s) 2007-08 to 2009-10, and for A.Y. 2006-07 restricted the disallowance to 20% of the expenses. The CIT(A) in the backdrop of the aforesaid facts observed that out of the total foreign travelling expenses of Rs. 92,69,950/- an amount of Rs. 7,84,315/- and Rs. 21,87,641/- was spent by the assessee for purchase of foreign currency and Rs. 23,18,059/- was incurred towards air fare, visa charges and insurance. The CIT(A) further observed that the balance amount of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er authorities. We have deliberated on the facts of the case and find that while for the A.O had made an adhoc disallowance of 1/3rd of the foreign travelling expenses of Rs. 92,69,950/- claimed by the assessee, therein leading to a consequential addition/disallowance of Rs. 30,89,983/-, however, the CIT(A) after perusing the fact that the assessee had placed on record details of foreign travelling expenses incurred by him during the year under consideration along with the details of places visited, the period of travel, number of days of stay and fare and other expenses incurred during his stay, therefore, keeping in view the aforesaid facts and going by the ratio adopted by the Tribunal in the case of the assessee for A.Y. 2006-07, restricted the disallowance of 20% only in respect of the expenses which were booked under the head 'Hotel and other expenses', for the reason that the same were not backed by supporting bills and invoices. We find that the assessee had assailed the order of the CIT(A) for the reason that while for the facts involved in the case of the assessee for the year under consideration, viz. A.Y. 2011-12 were distinguishable as in comparison to those involved i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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