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2016 (6) TMI 696 - HC - Income TaxDisallowance of long-term capital loss on sale of the capital asset, being silver utensils - Held that:- The silver utensils, according to the assessee, were purchased in the year 1966-67. The occasion to use the silver utensils for the purpose of business of the assessee arose at least 30 years after the silver utensils were allegedly purchased. Therefore, the silver utensils can by no stretch of imagination be said to have been purchased for the business of the assessee. - Decided in favour of revenue Disallowance of business expenditure under different heads incurred by the appellant wholly and exclusively for the purposes of his business - Held that:- It is not the case of the Assessing Officer that the assessee was unable to adduce satisfactory evidence that the expenditure was incurred for the purpose of his business. When appropriate evidence has been adduced, it is not in the power of the Assessing Officer to arbitrarily disallow any item of expenditure on the ground that the sums are not verifiable. There is no indication as to what step was taken by the Assessing Officer to have those expenses verified. If the Assessing Officer takes no pains to have the expenses verified he cannot resort to disallowing any portion of the expenditure on the ground that they are not verifiable. This was a sheer act of arbitrariness which the Assessing Officer could not have done. The learned Tribunal did not realise the aforesaid position. They chose to bring down the amount of disallowance without any reasons. The question always shall be whether the assessee has been able to prove the expenditure alleged to have been incurred by him for the purpose of his business. If the answer is in the affirmative, no part of the expenditure can be disallowed. But if the answer is in the negative, the entire expenditure may be disallowed. - Decided in favour of assessee
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