Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (3) TMI 1223 - AT - Income TaxComputer Gift Expenses and other gift expenses - Allowable business expenditure under section 37(1) or not? - expenditure prohibited by MCI Guidelines - expenses debited in the assessee’s P & L A/s under the head sales promotion expenses - assessee is mainly engaged in the business of pharmaceuticals goods and sells the same through the dealer distribution network and the stockiest at the ground level - as submitted none of the payee or beneficiaries are in the list of parties to whom the freebees in violation of the provisions of Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 is provided or proved by the assessing officer - HELD THAT:- CIT(A) has not erred in law and on facts while considering the claim of the assessee. The bench further noted from the report of the AO before us also while commenting on expenditure has accepted that the fact that the assessee has submitted the name of the party to whom the gold coins were given. AO has given his comments on each expenditure but nowhere in the assessment order in the report before us that the benefit directly or indirectly given as freebees (freebies) to medical practitioners and their professional associations in violation of the regulations issued by Medical Council of India (the 'Council') which is a regulatory body constituted under the Medical Council Act, 1956. Once, the basis on which the addition made is not substantiated by the ld. AO in the assessment proceeding by any evidence contrary to the claim which is supported by bills and vouchers and that too of a manufacturing company where their books are subjected to audit. The ld. CIT(A) after evaluating the submission of the assessee considered the various aspect of the claim of the assessee and has given a reasoned finding that why the claim of the assessee is allowable. The revenue has not controverted finding of the ld. CIT(A) by filling contrary submission or evidence. Thus, we see not fault in the detailed finding of the ld. CIT(A) while allowing the claim of the assessee for an amount as the revenue has not established that there is violation of board circular as relied upon by the AO. Merely on presumption and assumption that circular will not be made applicable to the facts of the case when nothing contrary placed on record. In the light of these finding the ground no. 2 raised by the revenue fails and thus the same is dismissed. Addition u/s. 69C - reasoning given by AO while making the disallowance was that the assessee could not produce any ledger account, bills/vouchers of purchase of gifts and could not state that to whom the computer gifted - HELD THAT:- As per assessment order the assessee did not provide any ledger account, bills and vouchers of purchase of these gifts and details of persons to whom these gifts were given. Whereas assessee on this issue submitted that these expenses are claimed in profit and loss account and the provisions of section 69C is not applicable in the present case. The payment for these expenditure has been made by crossed account payee cheque and this fact is not disputed by the revenue. Thus, merely based on assumption and presumption no addition can be made. Even based on these facts ld. CIT(A) also considered the claim of the assessee accordingly. Thus, we see not fault in the detailed finding of the ld. CIT(A) while allowing the claim of the assessee for an amount and revenue has not placed on contrary evidence or facts expressly demonstrating that why the claim is disallowable.Appeal of the revenue stands dismissed.
|