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TMI Blog2018 (3) TMI 1077X X X X Extracts X X X X X X X X Extracts X X X X ..... pitalization of the above interest on the ground that the machinery was not put to use during the year - Held that:- As the assessee has submitted that the machinery was put to use as a trial run was done prior to first April, 2012 but the above contention of the assessee is not supported with any cogent and convincing evidence. - Decided against assessee Deprecation on building disallowed - building was not completed at the end of the financial year i.e. by 31st March, 2012 - Held that:- Admittedly, the bricks and cement was purchased in the month of March itself, which was used for the construct ion of the aforesaid building. In view of this, in our view, lower authorities have rightly held that the building was not competed at the close ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to various circumstances as explained by the assessee. The above disallowance has been made by the lower authorities only on a presumption basis which, in our view, is not sustainable - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. The Ld. CIT(A) after considering the overall facts and circumstances of the case observed that merely because the assessee had shown during the year less yield that itself cannot be a ground for addition. That even otherwise, there was no evidence available of suppression of sales. He therefore, deleted the additions so made by the Assessing officer on this issue. Being aggrieved by the above order, the Revenue has come up in appeal before us. 6. We have considered the rival submissions. In our view, the Ld. CIT(A) has rightly deleted the addition in the absence of any cogent or convincing evidence that the assessee has surpassed i ts sales. The assessee has explained about var ious factors contributing for the low yield. Even otherwis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e month of March the assessee purchased machineries and there are no erection charges qua those machineries whereas, as per the assessee the employees of the assessee are competent enough to install the said machineries, therefore, the disallowance of depreciation is being prayed to be set-aside. 4. That the Ld CIT(A) has erred in confirming the disallowance of expenditure amounting to ₹ 58,840/- on the ground that the said expenditure relates to service tax penalty and therefore under sect ion 37(1) the said expenditure is not al lowable, whereas, as per the assessee these expenses paid towards meeting Statutory obligation, therefore the disallowance made may kindly be set aside. 5. That the Ld. CIT(A) has erred in partially co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al instructions of his client, he has withdrawn ground Nos. 3 & 4. Therefore, ground Nos. 3 & 4 are dismissed as 'withdrawn'. 9. Ground No.1 is regarding the capitalization of interest of ₹ 53,157/-. The Assessing officer disallowed the capitalization of the above interest on the ground that the machinery was not put to use during the year. The assessee contested this issue unsuccessfully before Ld. CIT(A) also. Before us, Ld. Counsel for the assessee has submit ted that the machinery was put to use as a tr ial run was done pr ior to f irst Apr il, 2012. We f ind that the above content ion of the assessee is not supported with any cogent and convincing evidence. We, therefore, do not f ind any merit in this ground and accordingly di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contributed in procuring business for the assessee company. Hence, in our view, the lower authorities have rightly disallowed the expenses relating to the foreign trip of the family of director of the assessee. This ground is accordingly dismissed. 12. Ground No.6 is regarding disallowance of 50% of sales promotion expenses claimed to have been incurred on purchase of costly gifts. The Ld. Assessing officer asked the assessee to give the details of the persons to whom the costly gifts were given and how the gif ts to those persons were beneficial to the business of the assessee. However, the assessee could not give any satisfactory explanation in this regard. Before us, Ld. Counsel for the assessee could not explain about the justificat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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