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TMI Blog2019 (4) TMI 1667X X X X Extracts X X X X X X X X Extracts X X X X ..... ooja expenses as compared to the total returned income of ₹ 12,94,52,310/-, we do not find any justification on the part of the lower authorities in making the aforesaid disallowance, as admittedly, the said Pooja expenses have been incurred in the premises of the unit for the need of the workers and to maintain peace and harmony among them. Disallowance of foreign travelling expenses - HELD THAT:- CIT(A) has allowed the expenditure relating to the foreign travel of the wife as well as has restricted the disallowance relating to the boarding lodging of the children to the extent of 25% of the total boarding lodging expenditure as against 50% made by the AO. As noted above, the assessee has disputed the calculation made by the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DICIAL MEMBER: The captioned appeal preferred by the Revenue and Cross Objections by the assessee are against the order dated 01.08.2016 of Commissioner of Income Tax (Appeals)-2, Ludhiana [hereinafter referred to as CIT(A) ]. 2. First we shall take up appeal of the Revenue in ITA No. 1167/Chd/2016. ITA No. 1167/Chd/2016: 3. At the outset, both the Ld. representatives of the parties have submitted that the tax effect in the present case is less than ₹ 20 lacs and, therefore, the appeal filed by the Revenue is liable to be dismissed. 4. It may be noted that CBDT vide Circular No. 3/2018 dated 11.07.2018 has revised the monetary limit upto ₹ 20 lacs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1,47,886/-. 2. That the learned AO, has erred in confirming the disallowance of ₹ 5,52,897/- out of foreign travelling expenses of ₹ 48,23,473/- 3. That the learned AO, has erred confirming the disallowance of interest u/s 36(l)(iii) amounting to ₹ 12,25,292/- ignoring the fact that the investment in the fixed assets and capitalwork-in-progress was made out of own funds. 4. That the assessee craves permission to add, amend or alter any cross-objection at the time of hearing. 5. Ground No.1: Vide ground No.1, the assessee has agitated the action of the CIT(A) in restricting the disallowance of Pooja Expenses of ₹ 75,000/- out of the total ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that out of the total Pooja Expenses of ₹ 1,47,886/-, an amount of ₹ 83,316/- was relatable to Haridwar Unit, the total income of which was eligible for deduction u/s 80IC of the Act. Further, considering the small amount of ₹ 64,570/- incurred by the assessee for normal day to day Pooja expenses as compared to the total returned income of ₹ 12,94,52,310/-, we do not find any justification on the part of the lower authorities in making the aforesaid disallowance, as admittedly, the said Pooja expenses have been incurred in the premises of the unit for the need of the workers and to maintain peace and harmony among them. Ground No.1 of the Cross objections is, therefore, allowed and the disallowance m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses of the children @ 50% of the total boarding lodging of the visit. The Ld. CIT(A) observed that both the children of the director were minor and that the expenditure attributable to boarding lodging cannot be equated to the expenditure incurred as boarding lodging of the director and his spouse. He, therefore, directed the Assessing officer to take 25% of the total boarding lodging expenditure attributable to the children. He, thereafter made the calculation and confirmed the disallowance of ₹ 5,52,897/-. The Ld. Counsel for the assessee, however, has disputed only the calculation of the aforesaid disallowance in terms of the relief granted by the CIT(A). Further, the Ld. Counsel has submitted that the Assessing officer aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee during the year had share capital of ₹ 20 corers, reserves and surpluses of ₹ 63.32 cores totalling ₹ 83.32 cores. Apart from that, the income of the assessee during the year was ₹ 39.97 cores, whereas, the investment made in the fixed assets were ₹ 22.19 crores and the addition in building was amounting to ₹ 4.66 crores. That the investment of the year was much less than the reserves and surplus available with the assessee. 11. The issue is now squarely covered by the recent decision of the Hon'ble Supreme court in the case of CIT (LTU) Vs. Reliance Industries Ltd. [2010] 410 ITR 466 (SC), wherein, the Hon'ble Supreme Court has affirmed the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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