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TMI Blog2023 (9) TMI 160X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. The following substantial questions of law are proposed : a. Whether on the facts and in the circumstances of the case an in Law, the Hon'ble ITAI was correct in holding that expenses in respect of Sales Support Services and Management Fee had no direct nexus with the project and was not subject to proportionate disallowance as per Accounting Standards AS-7? b. Whether on the facts and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (East), Mumbai. Respondent had debited a sum of Rs. 2,75,87,391/- and Rs. 26,40,390/- on account of Sales Support Services and Management Expenses, respectively. The Assessing Officer ("AO") allowed 26.32% of these debited amounts because in the opinion of AO, Respondent followed Project Completion Method of accounting and the project was completed only upto 26.32%. Accordingly 73.68% of Rs. 3,02 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce of 25% of the travelling expenses debited by Respondent in its Profit and Loss Account. 4. The dissatisfied Revenue preferred an Appeal before the Income Tax Appellate Tribunal ("ITAT"). ITAT dismissed the Appeal and upheld the view expressed by the CIT(A). It is this order of ITAT which is impugned in this Appeal. 5. Respondent though served, is absent. The substantial questions of law prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, viz., 2011-2012 and 2012-2013. The CIT(A) came to the conclusion that it was not a one-time expenditure incurred in Assessment Year 2010-2011, which is the year in question or that the expenditure incurred would provide Respondent any benefit of enduring nature. 7. On facts, a conclusion has been arrived at that it was incurred towards day to day expenditure incurred on project staff and sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure. Mr. Sharma submitted that there was no justification in deleting the additions made by AO, who had rightly included the balance expenditure as part of work in progress. 10. In our view the CIT(A) and ITAT having come to factual finding that the expenses incurred by the Respondent-Assessee on salary of the office employees/management fees do not have any direct nexus with the project ..... X X X X Extracts X X X X X X X X Extracts X X X X
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