TMI Blog2012 (8) TMI 241X X X X Extracts X X X X X X X X Extracts X X X X ..... the payment made could not be treated as one of commercial expediency & was purely a personal one - against assessee. - TC(A). No. 307 of 2006 - - - Dated:- 20-7-2012 - Mrs.Justice CHITRA VENKATARAMAN, Mr.Justice K.RAVICHANDRABAABU, JJ. For Appellant : Mr.K.Suresh Kumar For Respondent : Mr.V.S.Jayakumar JUDGMENT CHITRA VENKATARAMAN, J. The Revenue has preferred the appeal as against the order of the Income Tax Appellate Tribunal relating to assessment year 1997-98. The above Tax Case (Appeal) was admitted on the following substantial question of law:- "Whether the Tribunal erred in holding that the expenditure incurred on foreign travel and medical treatment of the Managing Director and his wife is allowabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief was granted to the assessee. Aggrieved by the same, the Revenue went on appeal before the Income Tax Appellate Tribunal. The Tribunal followed the decision of Madhya Pradesh High Court reported in 220 ITR 552 COMMISSIONER OF INCOME TAX v. STEEL INGOTS PRIVATE LIMITED as well as the decision of the Bombay High Court reported in 106 ITR 758 MEHBOOB PRODUCTIONS PVT. LTD v. COMMISSIONER OF INCOME TAX, BOMBAY CITY and submitted that Balasubramaniam, who was the Managing Director, thereafterwards became Managing Editor, had nurtured and developed the weekly Tamil Magazine and taking note of the services, the decision was taken by the Board of Directors in its General Body Meeting to finance his medical treatment. The Tribunal called this deci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... necessity, it was incurred on the ground of commercial expediency. 5. Heard learned standing counsel for the Revenue and learned counsel for the assessee and perused the materials available on record. 6. We agree with the contention of the Revenue. It is a matter of record that Balasubramaniam was the Managing Director of the assessee company, from which he resigned on 3.11.96. The Assessing Officer pointed out that expenditure was reimbursed only due to the fact that the said person was main person in the family controlling the business of the assessee company. His wife, who accompanied him was a Director in the company. Thus, he viewed that the expenditure was purely a personal one and not incurred out of a commercial expediency ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was not made to facilitate the business of the assessee. Thus, applying the decision of this Court reported in 263 ITR 115 CIT v. SAMBANDAM SPG. MILLS, to the facts on hand, we have no hesitation in accepting the plea of the Revenue, thereby, setting aside the order of the Tribunal. 8. As far as the decision of the Apex Court reported in 288 ITR 1 S.A.BUILDERS LTD v. COMMISSIONER OF INCOME (TAX) APPEALS ANR. is concerned, it is no doubt true that the Revenue cannot put itself in the armchair of the businessman or in the position of Board of Directors to decide the commercial expediency character, but as already pointed out when the very fact of commercial expediency remained unsubstantiated, we hold that commercially viable decision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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