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TMI Blog2019 (12) TMI 1234X X X X Extracts X X X X X X X X Extracts X X X X ..... ts at this belated stage. Ground of the assessee s appeal is disposed of in the terms indicated herein above. Disallowance of electricity expenses - HELD THAT:- As perused the materials available on record and gone through the orders of the authorities below. There is no dispute with regard to the fact that the property was given on rent from October, 2012 at a monthly rent of ₹ 13,15,000/- and a rent of ₹ 81 lakhs has been credited in the profit loss account. It is pointed out by the CIT(A) that the assessee could not furnish any evidence regarding occupation of the property in December, 2012. The assessee has admittedly received rent for the relevant period. Therefore, it cannot be inferred that the property in question was used wholly and exclusively for business purpose. Hence, the expenditure has rightly been disallowed. This ground of the assessee s appeal is dismissed. Deduction u/s 24(a) - HELD THAT:- Admittedly, the assessee has offered rental income and claimed deduction u/s 24 of the Act. Therefore, since the expenditure is related to the property, which has been let out by the assessee, this expenditure cannot be treated as business expenditur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Ld. A.O. in the assessment order. 2. Briefly stated facts are that case of the assessee was picked up for scrutiny assessment and the assessment u/s 143(3) of the Income Tax Act, 1961 (hereinafter called as the Act ) was framed vide order dated 23.3.2016. While framing the assessment, the A.O. assessed income at ₹ 46,77,270/- against the returned loss of ₹ 6,64,346/-, thereby the A.O. made addition in respect of disallowance of claim of deduction of amount under VRS scheme amount pertaining to the assessment year 2011-12. Disallowance of leave encashment of ₹ 10,74,150/- prior period expenses of ₹ 3 lakhs. The A.O. observed that a sum of ₹ 10,03,629/- has been credited in the profit loss account under the head other income . Details of sales tax refund along with sales tax assessment orders were called. As per the assessment order dated 16.1.2012, the amount of refund is ₹ 11,20,563, hence difference amount of ₹ 1,26,934/- was added to the total income of the assessee. Further, the A.O. observed that the assessee had rented out building to Netlink Software Pvt. Ltd. from October, 2012 with mont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, expenditure was crystalised in the year when Board approved such expenditure. 5. On the contrary, Ld. D.R. opposed the submissions and submitted that the assessee is a private limited company. It is not pointed out whether there was any dispute with regard to the approval of such expenditure. Merely because tax has been deducted would not sufficient to demonstrate that the expenditure is crystalised in the year under appeal. 6. I have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. The Ld. CIT(A) has given its finding in para 7.2 as under: 7.2 The main contention of the appellant is that the Board meeting approving these expenditure has taken place on 21.3.2012 and therefore, the liability for the expenditure has crystalised in the F.Y. 2012-13 only. In this regard, it is noted that the said furnishings and furniture have been put up in the residence of the MD. The expenditure has been incurred during the earlier period. The approval of the expenditure in the Board meeting was only a formality that too in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he vacancy period, the electricity expenditure was paid by the assessee. Since the property was for the business purposes, this expenditure is allowable. 10. On the contrary, Ld. D.R. opposed these submissions and supported the orders of the Ld. CIT(A). 11. I have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. There is no dispute with regard to the fact that the property was given on rent from October, 2012 at a monthly rent of ₹ 13,15,000/- and a rent of ₹ 81 lakhs has been credited in the profit loss account. It is pointed out by the Ld. CIT(A) that the assessee could not furnish any evidence regarding occupation of the property in December, 2012. The assessee has admittedly received rent for the relevant period. Therefore, it cannot be inferred that the property in question was used wholly and exclusively for business purpose. Hence, in my view, the expenditure has rightly been disallowed. This ground of the assessee s appeal is dismissed. 12. Ground No.3 is against sustaining of addition of ₹ 3,07,636/-. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of travelling expenses along with ledger account were filed. Details of bills, vouchers were produced before the A.O. for verification. He submitted that the entire expenditure was incurred for the business purposes. Ld. Counsel submitted that from the expenses as incurred, it is clear that those were for the official purposes. The assessee has visited Japan. Since the Japanese company Fujitsu is the major share holder, the assessee was required to attend meetings in Japan. 19. On the contrary, Ld. D.R. opposed these submissions and supported the orders of the authorities below. 20. I have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. The Ld. CIT(A) has decided this issue in para 13.2 of his order as under: 13.2 I have examined the arguments of the appellant. No evidence whatsoever has been given by the appellant of holding the board meeting in Japan. The nature of business being carried out in the relevant year did not warrant any board meeting, as claimed, to be held in Japan. No agenda papers or minutes of the board meeting has been submitted by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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