Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (11) TMI 935 - AT - Income TaxDisallowance of expenditure u/s 37(1) - Expenditure for erection of scaffolding - Nature of expenditure - business expediency or otherwise - Assessee was given rights to display advertisement by means of mounting a banner on the scaffolding erected for carrying out the repairs of the building - Held that:- As seen from the documents placed on record the Municipal Corporation of Greater Mumbai has permitted to display the temporary advertisement on the outer direct wall of Heera Panna Coop.Housing Society vide approval dated 27.04.2005 for which the advertising fee was to be paid of more than Rs.3,75,360. So, it cannot be accepted that assessee has permitted the said Deesha only for an amount of Rs.1.00 lakh when the fee paid/ payble to BMC was much more. As seen from the documents if such amount was towards contributing for maintenance of the building/scaffolding advertisement as contended, the actual payment of the amount spent goes beyond the period of permitted advertisement period. The said services so charged are general in nature, which does not require such receipt/ reimbursement - it cannot be stated that maintenance or cleaning of walls by application of primer coat was the responsibility of M/s Deesha for advertisement so displayed. The affairs are so arranged that the cost to be incurred by the society for their regular maintenance was borne by the said company and receipts were bifurcated into two agreements - scaffolding and the painting expenditure is part of the maintenance of the building and no way connected with the advertisement provided to M/s Deesha. The security watch and ward etc, as claimed by assessee is part of its regular activity of the society and just because an agreement was entered into by arranging the affairs in such a manner, the claim of expenditure which has no relevance for earning the advertisement amounts. This cannot be allowed under section 37(1) or section 57. Moreover as seen from the above, painting expenditure itself was spent over a period of two years, whereas the advertisement was only for a period of two months - Decided against assessee.
|