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TMI Blog1981 (3) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Rs. 2,500 being about 1/4th of the total expenses on the ground of the personal use of the telephones by the partners of the assessee and their family members. On appeal, the said addition has been reduced to Rs. 1,500 by the AAC of Income-tax, Ajmer Range, Ajmer. 3. We have heard both the representatives for the assessee, Mr. Patni and the Department. We have gone through the details of the telephone expenses at pages 1 2 of the Paper Book. There are three telephones, one each at factory, at the Bombay office and at the residence of the partners. The expenses for the telephone at the residence the partners totalled up Rs. 3,166 including Rs. 579.70 on account of rental and Rs.1,987.20 on account of trunkcalls. As such, on the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and another expenditure of Rs. 661 on account of supplying dresses and uniforms to the labour. Further, we find that there is no evidence or material on the record for the AAC to hold that 50 per cent of the aforesaid expenditure of Rs. 10,140 under the aforesaid head must have been incurred on purposes other than welfare of the employees. The said observations of the AAC, as rightly argued by the representative for the assessee are based on surmises and conjectures. The incurring of the entire said expenditure in the manner stated by the assessee has not been doubted by the ITO. We, therefore, on the facts and in the circumstances of the case, delete the addition of Rs. 5,070 upheld by the AAC. 6. In the year, the assessee incurred an e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs was involved, hence disallowed Rs. 5,000''. The said disallowance has been upheld by the AAC as according to him, the expenditure to that extent was capital in nature. 8. We have heard both the representatives for the assessee and the Department. As is clear from the letter of the Sr. Inspector of Factories Boilers dt. 1st Dec., 1973 addressed to the assessee he (Inspector) pointed out certain deficiencies in the factory premises of the assessee and he directed it to undertake certain repairs etc., including the following:— (1) The staircase leading to the cupola platform is not of sound construction. The same should be provided of sound construction along with the hand rails, and (2) The roof of the working shed was found in ver ..... X X X X Extracts X X X X X X X X Extracts X X X X
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