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2019 (12) TMI 1251 - AT - Income TaxDisallowance of Event Management Expenses - eligible for deduction u/s 37 - HELD THAT:- From the preceding discussion, there is no ambiguity in the genuineness of the expenses incurred by the assessee. As such, there was no evidence brought on record suggesting that the impugned expenses were in the nature of bogus expenses. Onus lies on the assessee to justify the expenses incurred by it by furnishing the details as desired by the authorities below. CIT (A) we note that the learned CIT (A) agreed that such expenses were incurred in connection with the business of the assessee. Assessee failed to furnish the following detail - Details of the invitees,The procedure adopted for selecting invitees, There is no evidence on record suggesting that there was no personal guest of the directors in such event/gathering. CIT (A) made the disallowance to the tune of 50% of the total event management expenses. To our mind, it was the onus of the assessee to furnish at list of the invitees but the learned AR before us has not brought anything on record. In fact, in such kind of business gathering the companies keep a database of the parties who attended the function. This database is crucial for the company which can be utilized in connection with the activity carried on by it. Assessee failed to furnish such details which creates suspicion in the mind so as to whether the impugned expenditure was incurred in connection with the business. Indeed, it appears that the assessee has earned handsome/attractive margin on the sale of shop/office but that is not the criteria laid down under the provisions of section 37 of the Act for the deductibility of the expenses. Thus in the absence of sufficient documentary evidence as discussed above, we are not inclined to reduce the disallowances to the extent of hundred percent but in the interest of justice and fair play, we limit the disallowance to the extent of 25% of the total expenses. Thus the assessee gets the relief in part. Hence the ground of appeal of the assessee is partly allowed.
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