The Tribunal held that the remuneration received by the ...

Tribunal Classifies Director's Income as Salary, Allows Deductions for 2010-11, Requires Expense Review for 2011-12.

December 10, 2024

Case Laws     Income Tax     AT

The Tribunal held that the remuneration received by the assessee, who was a whole-time director holding 13.8% shares in D-Art Furniture System Pvt. Ltd. and supervising sales, should be assessed under the head 'Salary' and not as 'Income from Other Sources'. The ITAT ruled that the company, being a juristic person governed by the Board of Directors, could be an employer while appointing the assessee as a whole-time director on a particular remuneration. The ITAT directed the Assessing Officer (AO) to allow deductions for conveyance allowance and HRA for the assessment year (AY) 2010-11. For AY 2011-12, the ITAT deleted the addition made under 'Income from Other Sources'. Regarding the bank deposit, the ITAT accepted the assessee's explanation that it was the sale consideration received from the sale of a property. However, for the disallowance of business expenditure, the ITAT restored the matter to the AO for fresh adjudication, as the assessee failed to produce bills, vouchers, or establish the genuineness of the expenditure.

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