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TMI Blog2025 (3) TMI 1016X X X X Extracts X X X X X X X X Extracts X X X X ..... icable to the facts of the present case.
We have not been shown any decision regulation or rules which required Petitioner-Assessee to disclose during the assessment proceedings that the sales promotion expenses were incurred on the doctors.
Therefore, even on this count, in the absence of any obligation, there cannot be any failure to disclose fully and truly all material facts necessary for the assessment. Therefore, the decision of Kap Scan and Diagnostic Centre (P.) Ltd.[2012 (6) TMI 620 - PUNJAB AND HARYANA HIGH COURT] would not assist the Revenue. Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment and the reliance placed on the Central Board of Direct Taxes (CBDT) vide Circular No. 5 of 2012 was not available at the time of the assessment. The Petitioner also made submissions on the applicability of Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 and Explanation 1 to Section 37 (1) of the Act and prayed for dropping the impugned proceedings. However, the Assessing Officer (AO) rejected the objections vide order dated 28 January 2016, which is also impugned in the present proceedings. 4. It is on the above backdrop that the present petition is filed. 5. Mr. Rastogi, learned senior counsel for the Petitioner, submitted that there is no failure to disclose fully and truly all material fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions, 2002. He submitted that this decision has been affirmed by the Supreme Court in the case of Apex Laboratories (P) Ltd. (supra) and, therefore, defended the impugned proceedings. Mr. Suresh Kumar also relied upon the Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 and the amendment made in the said regulation on 14 November 2009. He, therefore, prayed that the present petition be dismissed. 7. We have heard learned counsel for the Petitioner and the Respondent and have perused the records with their assistance. 8. Admittedly, there is no dispute that the present proceedings are initiated after a period of four years from the end of the relevant assessment year and, therefore, the pre-condition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny revenue expenditure (other than those falling under Sec. 30 to 36) from the business income if such expense is laid out/expended wholly or exclusively for the purpose of business or profession. However, the explanation appended to this sub-section denies claim of any such expense, if the same has been incurred for a purpose which is either an offence or prohibited by law. The assessee, during the course of assessment proceedings, has failed to disclose these facts before the Assessing Officer. Accordingly, the assessee has claimed expenditure to the tune of Rs.2, 13, 72, 000/- which are not allowable as per Board's Circular coupled with law. Therefore, I have reason to believe that the assessee has debited the inadmissible expense ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel for the Respondent that the reassessment proceedings are initiated because the Petitioner has not disclosed to whom the payment was made is not borne out from the reasons recorded. On the contrary, the reason states that the expenses claim on account of technical literature and books, gift articles and conference expenses includes expenses related to gift, travel, hospitality, etc. are paid to doctors. Therefore, in our view, since the contention of Mr. Suresh Kumar is not borne out from the reasons recorded and it is a settled position that jurisdictional conditions have to be tested on the touchstone of reasons recorded and nothing can be improved, the contention raised on this count that there was a failure on the part of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircular No. 5 of 2012 and the decision of the Supreme Court, wherein it is stated that the amendment to Medical Council Regulation with effect from 14 December 2009 would be prospective, i.e. would apply only to those expenses incurred after 14 December 2009 which would be relevant for AY 2010-2011. We are concerned with the assessment year 2008-2009. Therefore, in our view, the decision of the Coordinate Bench in the case of Abbott India Ltd. (supra) also supports the case of the Petitioner and, therefore, following the same, the impugned notice dated 30 March 2015 is required to be quashed and set aside. 13. Mr. Suresh Kumar, learned counsel for the revenue, heavily relied on the Punjab and Haryana High Court's decision in Kap Scan a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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