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TMI Blog2020 (11) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... o M/s. Pal Mohan Electronic Pvt. Ltd. Further, except for single journal entry dated 31/3/2015 no material was furnished by the assessee before the Assessing Officer to substantiate genuineness of the expenditure. No material was placed on record by the assessee either before the CIT(A) or before the Tribunal to controvert the findings of the Assessing Officer. No merit in ground No.1 of the appeal, the same is dismissed, accordingly. Disallowance of claim of deduction u/s 36(1)(iii) - AO observed that the assessee has made borrowings of ₹ 14.21 crores during the period relevant to the assessment year under appeal and has paid interest of ₹ 1.57 cores @ 11.05% - HELD THAT:- AO while making the addition has observed that the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, after factoring for personal use of vehciles, deem it appropriate to restrict disallowance to 10% of the total expenditure claimed for petrol and vehicle maintenance. The ground No.3 of appeal is partly allowed, in the terms aforesaid. Business promotion expenses - HELD THAT:- The expenditure has been made on entertainment of customers, gifts, etc. The payment for the expenditure has been made by credit card. The disallowance has been made primarily for the reason that the assessee has failed to furnish copies of bills, vouchers, etc. Considering entire facts disallowance of 50% is on higher side. Disallowance to the extent of 10% of the expenditure claimed would meet the ends of justice - Shri Vikas Awasthy, Judicial Member For the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pugned order and prayed for dismissing the appeal of assessee. 4. Submission made by ld. Departmental Representative heard and the orders of authorities below examined. The ground No.1 of the appeal is against disallowance of ₹ 8,10,320/- in respect of job work charges paid to M/s. Pal Mohan Electronic Pvt. Ltd., a sister concern of the assessee. The expenditure has been purportedly incurred by the assessee on testing of the meters. The authorities below has observed that in fact the assessee was itself doing testing of the meters from its sister concern M/s. Pal Mohan Electronic Pvt. Ltd. and was receiving job work charges for testing of meters. Since the assessee itself was self equipped for testing of the meters, there was no reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 52.12 VDS Plastic Pvt. Ltd. 24,44,954.00 Vision Enterprises 25,00,000.00 The assessee pointed that out of these advances two parties i.e. Om Sai Enterprises and VDS Plastic Pvt. Ltd. have been wrongly shown under the head sundry debtors. The amount is outstanding from the aforesaid parties on account of sale of goods. The rest of the advances are made to suppliers for smooth supply of material. Hence, these are business advances. The Assessing Officer while making the addition has observed that the assessee has diverted borrowed funds for non-business purposes and has debited huge interest expenditure in the P L Account. The Assessing Officer while holding so has not given his finding on the fact that the list of parties given by the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Delhi. Taking into consideration entire facts on record, personal use of vehicles by the directors and their family cannot be ruled out, hence, after factoring for personal use of vehciles, I deem it appropriate to restrict disallowance to 10% of the total expenditure claimed for petrol and vehicle maintenance. The ground No.3 of appeal is partly allowed, in the terms aforesaid. 7. In ground No.4 of the appeal, the assessee has assailed disallowance of ₹ 3,20,455/- sustained by the CIT(A) in respect of business promotion expenses. The assessee has claimed expenditure of ₹ 6,40,911/- under the head Business Promotions Expenses. The expenditure has been made on entertainment of customers, gifts, etc. The payment for the expenditu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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