9911796707
TMI Blog2014 (11) TMI 1223X X X X Extracts X X X X X X X X Extracts X X X X ..... t was in this background the Tribunal had deleted the said addition. The learned counsel was unable to furnish the details or point out that on similar reasons disallowance was made in the earlier years. Thus looking to the facts of the case, we are of the opinion that this matter should go back to the file of the AO to examine this issue afresh - Decided in favour of assessee for statistical purpose. Disallowance of business promotion expenses being 20% - AO disallowed said expenses on ad hoc basis on the ground that these expenses pertain to expenditure incurred on hotels and clubs and similar disallowance in the pased were made - Assessee submitted a very important fact and distinguishing feature in this year is that, assessee has p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO to examine the issue of interest and indirect expenses as per directions given above. - Decided partly in favour of assessee for statistical purposes. - ITA No. 2732/Mum/2012 - - - Dated:- 12-11-2014 - SHRI SANJAY ARORA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER For the Assessee : Shri H.N. Motiwala For the Revenue : Shri Akhilendr P. Yadav ORDER PER AMIT SHUKLA, JM: This appeal has been preferred by the Assessee against order dated 09.02.2012, passed by the Ld.CIT(A) -24, for the quantum of assessment passed u/s 143(3), for the A.Y. 2008-09, mainly on the following grounds: On the facts and in the circumstances of the case, the learned Commissioner of Income-tax (Appeal) 24, Mumbai, e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is a partnership firm, engaged in the business of civil repairs, and painting contracts. In ground no.1, assessee has challenged the disallowance of ₹ 89,911/-, being 20% of telephone expenses our of total telephone expenses of ₹ 4,49,555/- debited in the Profit Loss Account. The assessing officer required the assessee to furnish telephone wise amount of claim and the places where telephones were installed. Since no details were filed, AO made the disallowance @ 20%. The Ld.CIT(A) following the order of the A.Y. 2005-06, confirmed the said disallowance. 3. Before us learned counsel submitted that, firstly, this is purely ad hoc disallowance and the only reason for disallowance is that the assessee could not give de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round no. 2, the assessee has challenged the disallowance of business promotion expenses of ₹ 97,640/- being 20% of ₹ 4,88,201/- The assessing officer has disallowed said expenses on ad hoc basis on the ground that these expenses pertain to expenditure incurred on hotels and clubs and similar disallowance in the pased were made. This has been sustain by the Ld.CIT(A), on the ground that personal element could not ruled out. 7. Before us learned counsel submitted that the Tribunal has dismissed the said ground in A.Y. 2004-05, however, a very important fact and distinguishing feature in this year is that, assessee has paid Fringe Benefit Tax on payments relating to business promotion. Therefore to the proportion of FBT paid, n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the Ld.CIT(A). 11. After considering the rival submissions, we find that, so far as assessee s contention that no interest should be disallowed as the investments have been made from surplus and were made prior to the loan taken from the bank, have not been examined either by the AO or by the Ld.CIT(A). Therefore, we feel that this contention of the assessee should be examined by the AO. Further we agree with the contention of the learned counsel that, so far as investment in debentures and mutual funds which are debt oriented, the same should be excluded while taking the average investment for the purpose of disallowance under clause (iii) of rule 8D (2). Only average investment made in the shares should be taken into account. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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