TMI Blog2013 (1) TMI 264X X X X Extracts X X X X X X X X Extracts X X X X ..... ources'. In the decision relied upon by the assessee in Rieta Biscuits Company P. Ltd.,(2007 (8) TMI 311 - PUNJAB AND HARYANA HIGH COURT) keeping in view the principles of consistency once the issue on the merits has been decided against the Revenue on the same issue during the subsequent assessment years, Hon’ble High Court did not take a different view on a technical reason. This decision rather supports the case of Revenue, the assessee having all along accepted that income from royalty for use of Liberty brand by LSL since 1986 is to be assessed under the head ‘Income from Other sources’ - against assessee. Disallowance of advertisement and sales promotion expenses - Held that:- Liberty Footwear Company in the AY 2004-05, the AO made an adhoc disallowance while the CIT(A) called for the relevant bills and vouchers. Since the assessee failed to produce certain bills for the AY 2004-05 mentioned in the name of Liberty Shoes Ltd., CIT(A) upheld the disallowance. The assessee though referred to the details placed in the paper book, did not explain as to why the relevant bills and vouchers were not placed before the lower authorities. Even before us situation is no better. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erved that it is difficult to appreciate as to how a trade mark can be owned by two firms nor the assessee furnished a copy of relevant bills of the advocate in order to ascertain the exact nature of services rendered by the said advocate - against assessee. Disallowance of bonus expenses- Held that:- Exgratia paid to same staff had been allowed by the AO but not the bonus. Considering the facts and circumstances of the case, especially when the AO did not record any findings as to whether or not the amount was claimed on payment basis, we consider it fair and appropriate to vacate the findings of the CIT(A) and restore the matter to the file of the AO with the directions to allow another opportunity to the assessee to establish its claim of bonus on payment basis - in favour of assessee for statistical purposes. Disallowance of depreciation on additions to building - Held that:- Since the new building was not used for the purposes of business of the assessee, CIT(A) rejected the submissions of the assessee. Similar is the position in the AY 2007-08 in Liberty Enterprises and in the AY 2006-07 in the case of Liberty Group Marketing Division. Since the assessee did not dispute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess asset is income from other sources is altogether arbitrary, illegal and void and uncalled for. 3. That in the facts and circumstances of the case of the appellant firm the order of the learned CIT(A) in upholding disallowance of Rs.2,50,000/- out of advertisement and sales promotion expenses is altogether arbitrary, illegal and uncalled for. 4. That the learned CIT(A) has grossly erred in confirming disallowances of Rs.15,334/- in respect of written of assets and Rs.19,254/- in respect of receivables which is arbitrary and uncalled for. 5 That the order of the learned CIT in confirming disallowance of 1/4th car expenses and depreciation at Rs.21,055/- is arbitrary and uncalled for." I.T.A. no.735/Del./2011[AY 2005-06] 1. That the order of the learned CIT(A) is against law and facts. 2. That in the facts and circumstances of the case of the appellant firm the order of the learned CIT(A) in confirming disallowance of Rs.2.01.648/- out of advertisement expenses is altogether arbitrary, illegal and void and uncalled for. 3. That in the facts and circumstances of the case of the appellant firm, the order of the learned CIT(A) in confirming di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isallowances of Rs.75,000/- suffered in respect of sale of vehicles is illegal and uncalled for. Liberty Enterprises I.T.A. no.738/Del./2011 [AY 2004-05] 1. That the order of the learned CIT(A) is against law and facts. 2. That in the facts and circumstances of the case of the appellant, the order of the learned CIT(A) in confirming disallowance of advertisement expenses amounting to Rs.3,39,547/- is altogether arbitrary, illegal and void and uncalled for. 3. That the order of the learned CIT(A) in upholding disallowance of 1/4th car expenses and depreciation is arbitrary and uncalled for. 4. That in the facts and circumstances of the case of the appellant the order of the learned CIT(A) in confirming disallowance of claim of actual bonus expenses paid at Rs.1,72,951/- is altogether arbitrary, illegal, void and uncalled for. 5 That the learned CIT (A) has further erred in confirming disallowance of Rs.18,330/- in respect of written off assets which is arbitrary and uncalled for." I.T.A. no.739/Del./2011[AY 2006-07] 1. That the order of the learned CIT(A) is against law and facts. 2. That in the facts and circumstances of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olding disallowances of Rs.67,790/- out of business promotion expenses which is arbitrary and uncalled for. 5 That the order of the learned CIT(A) in upholding disallowance in respect of written off unrealized securities amounting to Rs.34,740/- is altogether, arbitrary, illegal and uncalled for. I.T.A. Nn.742/Del./2011 [AY 2006-07] 1. That the order of the learned CIT(A) is against law and facts. 2. That in the facts and circumstances of the case of the appellant the order of the learned CIT(A) in confirming disallowance of depreciation on car amounting to Rs.60,054/- is highly arbitrary, illegal and void and uncalled for. 3. That the order of learned CIT(A) in confirming disallowance of car expenses amounting to Rs.12,626/- is altogether, arbitrary, illegal, void and uncalled for. 4. That learned CIT(A) has further erred in confirming disallowance of Rs.13,000/- out of business promotion expenses which is arbitrary and called for. 5. That in the facts and circumstances of the case of the appellant the order of the learned CIT(A) in confirming disallowance of depreciation of Rs.77,084/- in respect of building additions is arbitrary, illega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e it till perpetuity irrespective of this agreement. The agreement dated 31.3.2003, stated to be valid for a period of 7 years, granted exclusive licence for a period of 7 years to use the trademark globally on and in connection with the goods manufactured or sold by or for the L.S.L. in accordance with the LFC s minimum quality standard and manufacturing specifications. In lieu of granting the exclusive licence, LSL. during the term of this agreement agreed to pay licence fees as per terms referred to in clause 4 of the agreement and extracted by the AO as under:- The LSL shall, during the term of this agreement, make payment to LFC as licence fees @1.5% of the total annual sales of the L.S.L. or Rs.300 lacs per annum whichever is higher. The amount of Rs.300 lacs per annum whichever is higher. The amount of Rs.300 lacs shall be considered as Minimum Annual Guarantee Amount. Further as per clause 3(f) of the agreement dated 31.3.2003, it has been agreed that the LFC shall have the right of reimbursement from the L.S.L. of all reasonable expenses incurred by the LFC on behalf of the LSL during the term of this agreement or any renewal thereof in connection with the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of the department and held royalty income is to be assessed under the head Income from other Sources'. Relevant extracts there from is extracted below:- "The next ground of appeal is regarding Royalty Income for Trade Brand. The Learned Counsel has submitted that the income was generated during the course of business only and hence be allowed. The Assessing Officer has, however, noted in the assessment order that this income as treated as income from Other Sources' in the earlier years. Therefore, there was no reason to deviate from that stand. I have examined this matter carefully. Since the income was being shown as income from other sources in the earlier years,therefore,I see no reason to depart from that accepted stand.This action of the Assessing Officer is, therefore, confirmed." In view of the facts discussed above, action of the AO is confirmed and ground of appeal no.4 is rejected. 1.06 The appellant tried to distinguish the facts, on the ground that in the year under consideration exclusive right of use of brand 'Liberty' was allowed to Liberty Shoes Ltd. whereas' in the earlier years exclusive right of use of brand 'Liberty' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his fact can change the nature of income. Accordingly, following the past history of the case and orders of his predecessors, the ld. CIT(A) held that fees received in lieu of allowing the use of brand 'Liberty' is to be assessed under the head 'Income from other sources'. In nutshell right since 1986, the income from Liberty brand has been assessed under the head Income from Other Sources . The plea of the ld. AR that income on account of royalty has been assessed by the AO in subsequent years under the head business is not established because in the AY 2005-06, the AO specifically recorded the findings that since the assessee has given all the rights to Liberty Shoes Ltd., the assessee did not carry on any business in the period relevant to AY 2005-06 and accordingly, disallowed various expenses. Similar is the situation in subsequent two years. On appeal before the ld. CIT(A), the assessee did not question of the findings of the AO that it did not carry on any business during the year. Apparently, the assessee accepted the said findings of the AO. Even otherwise, despite request made by us, the ld. AR did not demonstrate as to how trade mark was business asset for the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is to be assessed under the head Income from Other sources . In view of the foregoing, especially when the ld. AR did not place before us any material, controverting the aforesaid findings of the ld. CIT(A) so as to enable us to take a different view in the matter, we are not inclined to interfere. Therefore, ground no.2 in the appeal of the assessee in Liberty Footwear Company for the AY 2004-05 is dismissed. 8. Ground no.3 in the appeal in the case of Liberty Footwear Company for the AYs 2004-05 ground nos.2 3 in their appeal for the AY 2005-06 as also ground no. 3 in their appeal for the AY 2006-07 relates to disallowance out of advertisement and business promotion expenses. The AO noticed during the course of assessment proceedings in the AY 2004-05 that the advertisement and business promotion expenses included an amount of Rs.20,23,478/-[17,14,800+3,08,678] in connection with golden jubilee celebrations. To a query by the AO, the assessee replied that the expenditure related to Liberty brand and is allowable. However, the assessee did not furnish details of these expenses. Accordingly, the AO made an adhoc disallowance of Rs.2,50,000/- out of the expenditure in the AY ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowable fully and A. O. had no reason or base to make it an adhoc disallowance. Your honour will kindly appreciate that without any reason of assigning adhoc disallowance as has been done by A.O. On the basis of past history of the assessee never disallowance was ever made out of advertisement and publicity in such a manner. " 4.03 The appellant vide para (iii) of this office letter dated 18.10.2010 was asked to produce the following :- that the AO made an adhoc disallowance of Rs.2.5 lacs out of claim of advertisement expenses amounting to Rs.18,07,023/ - on the ground that no details of these expenses were furnished to justify the claim made. You are requested to furnish the details and to produce the relevant vouchers/ bills in support of your claim that the entire expenses were incurred for business only specifically in view of the fact that main income of the firm is from Royalty received. 4.04 The relevant extracts from the letter dated 09.11.2010 of the appellant is reproduced below:- that appellant's claim before your honour is against adhoc disallowance made by AD. Details of expenses with vouchers and a certificate from M/ s Liberty Shoe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2004 To bill No.2591/01-03 expenses for fashion show at the Grand Vasant Kunj in the name of Liberty Group 24940 4.07 In view of the facts discussed above, it is held that appellant has not been able to establish with the help of the relevant documents that the entire expenses were incurred for the purpose of its business and hence adhoc disallowance out of these expenses made by the A.O. is confirmed. 9.1 In the case of Liberty Footwear Company in the AY 2005-06, the ld. CIT(A) upheld disallowance of advertisement expenses since the expenditure of Rs.1,25,000/- claimed through internal voucher related to payments to Shri Rajindra Jain, Mumbai on account of fee for golden jubilee devotional programme, without producing the relevant bill while bill dated 11.6.2004 for an amount of Rs.50,000/- of Shri Sunil Babbar of Chandigarh did not contain any bill number or name of the client. Description in this bill was mentioned as part payment of production of documentary film of Karnal namely Karna Bhoomi Karma Bhomi . Since the assessee failed to establish that the expenditure was incurred for the purpose of business, if any, of the assessee, the ld. CIT(A) up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Liberty Shoes Ltd..The appellant further enclosed a copy of its letter dated 24.3.2008 filed before the AO during assessment proceedings, wherein nature of expenses specified as; expenditure relates to cost of liberty folded, leaflets with envelops . 3.04 As discussed above, that the appellant has granted the exclusive use of brand Liberty to its sister concern, w.e.f 1.4.2003 and hence cost of Liberty Folded leaflets and envelops etc. cannot be said for the business of the appellant and hence disallowance thereof made by the AO is hereby confirmed. 9.3 In the case of Liberty Enterprises in the AY 2004-05 , the ld. CIT(A) found that none of the bills referred to in para 3.09 of the impugned order related to the assessee firm nor the assessee addressed or rebutted the findings of the AO that as per clause 6(vi) of the agreement, all the expenses viz. administrative and selling expenses including advertisement and sales promotion, discounts, claims, commission and branch overheads were to be met by Liberty Shoes Ltd. Accordingly, the ld. CIT(A) upheld the findings of the AO. 9.4 Likewise in the case Liberty Group Marketing Division in the AYs 2004- 05 the ld. CITA) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the paper book, did not explain as to why the relevant bills and vouchers were not placed before the lower authorities. Even before us situation is no better. In the absence of relevant bills , we are not inclined to interfere with the findings of the ld. CIT(A) in the AY 2004-05.In the AY 2005-06, the assessee did not dispute the findings of the AO that since the assessee has given all the rights to Liberty Shoes Ltd., it did not carry on any business in the period relevant to AY 2005-06, before the ld. CIT(A) and even before us. Even bills for these expenses were not placed before the ld. CIT(A) nor nature of these expenses is known and nor even it is established as to how these expenses relate to the business, if any, of the assessee in the year under consideration. Similar is the position in the AY 2006-07.In these circumstances, in the absence of any material so as to enable us to take a different view in the matter, we have no hesitation in upholding the disallowance confirmed by the ld. CIT(A) to the extent of Rs.11,61,401/- out of golden Jubliee Celebration expenses Rs.2,01,648/- out of advertisement expenses in the AY 2005-06 Rs.44,770/- in the AY 2006-07. This vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.15,334/- in respect of written of assets and Rs.19,254/- in respect of receivables. The AO disallowed these amounts in the absence of any proof relating to these amounts. 13. On appeal, the ld. CIT(A) upheld the disallowance in the following manner:- 5.00 Ground of appeal No.6 is as under:- That addition of Rs..34,588/- for assets written off and receivable written off is uncalled for. 5.01 Relevant para 6 from the order of A.O. is reproduced as under:- The assessee firm has claimed assets written off at Rs..15334/- and receivable written off at Rs..19254/-. These are not allowed as no proof in regard to the claim has been furnished by the assessee". 5.02 The relevant extracts from the written submissions of the appellant is reproduced below:- "In the magnitude of assessee's business small amount written off in a sum of Rs..15334/ - and Rs.19254/- was so meager amount where disallowances made by the A. O. was unfair and uncalled for. Appellant prayeth for its deletion. 5.03 The issue is considered. The appellant has not made submissions on merits' to justify the allowability of its claim and hence disallowance made by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otwear Company in the AY 2006- 07, the ld. CIT(A) upheld the disallowance in the following terms:- 2.03 The issue is considered. The facts as discussed above are that the appellant hired out its entire business to M/s Liberty Shoes Ltd. with the stipulation that during the term of agreement, no business would be carried out by the appellate firm. It is, therefore, difficult to appreciate the justification of purchase of a car of Rs.36,01,627/- for business purposes. Nothing has been brought on record such as log book etc. to establish that the car was used for the purposes of business, specifically in view of the fact that the entire business was let out. Disallowance of depreciation made by the Assessing Officer is, therefore, confirmed. 17.02 Likewise in AY 2007-08 in the case of Liberty Footwear Company, the ld. CIT(A) upheld the disallowance, following his findings in the AY 2006-07. 17.1 In the case of Liberty Enterprises in the AY 2004-05, the ld. CIT(A) concluded as under:- 3.12 The issue is considered. The plea of the appellant is not tenable since facts in the year under consideration are different with the facts of the case in the earlier years in as fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cars were used by the Directors of the Liberty Shoes Ltd. and also by its partners to carry out administrative, manufacturing and sales activities. The appellant has, however, not brought on record any evidence such as log book etc. in support its claim of use of cars for its business purposes. Otherwise also, plea of the appellant is difficult to appreciate in view of the fact that entire business was let out as a going concern to Liberty Shoes Ltd. with the stipulation that the appellant firm will not engage itself in the business (clause 4(a) of the Agreement). In view of these facts, plea of the appellant is not tenable. The depreciation on car disallowed by the Assessing Officer is, therefore, confirmed. 3.06 As far as claim of car expenses is concerned, the appellant submitted that the same was on account of short receipt of insurance claim against damage of car. In view of the fact that car itself was held not for business, expenses incurred thereon cannot be allowed. Disallowance thereof made by the Assessing Officer is, therefore, confirmed.Ground of appeal No.2 and 3 is as such rejected. 17.22 In the AY 2007-08, the ld. CIT(A), following his decision in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eciation of Rs.38,946/- in respect of Central House and Saharanpur Office .The AO disallowed the depreciation, the assessee having transferred all its assets to Liberty Shoes Ltd. 21. On appeal, the ld. CIT(A) upheld the findings of the AO in the following terms:- 5.01 The AO disallowed claim of depreciation amounting to Rs.38,946/- of Central House and Saharanpur office. The appellant in the written submissions relied on the submissions made for the assessment year 2004-05. The written submissions made by the appellant in the last year has been perused and it is noted that there was no such issue under consideration in the last year. In view of these facts, no interference is called for in the order of the Assessing Officer in this regard and depreciation disallowed by him is hereby confirmed. 22. The assessee is now in appeal before us against the aforesaid findings of the ld. CIT(A).The ld. AR on behalf of the assessee merely reiterated their submissions before the lower authorities while the ld. DR supported the findings in the impugned order of the ld. CIT(A). 23. We have heard both the parties and gone through the facts of the case. Indisputably, the assessee cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt from the LSL of all reasonable expenses incurred by the LFC on behalf of LSL during the terms of this Agreement of any renewal thereof in connection with the maintenance of the Trade Mark in the Territory and the records,if necessary, of this license in the Territory. 5.05. As per clause 4(f) of the agreement, the expenses should have been reimbursed by Liberty Shoes Ltd., as has also been noted by the AO in the order. In view of these facts, disallowance made by the AO is hereby confirmed. 25.1 Following his aforesaid findings, the ld. CIT(A) upheld the disallowance in the AY 2007-08. 25.2 Similarly in the appeal in the case of Liberty Group Marketing Division in the AY 2007-08, the ld. CIT(A) concluded as under: 4.07 The issue is considered. It is noted in the case of M/s Liberty footwear that the brand 'Liberty' was claimed to be owned by M/s Liberty Footwear who allowed the use thereof from 1.4.2003 to Liberty Shoes Limited in lieu of franchise fee of 1.5% of the turnover. In the case under consideration, it is, however, claimed that fees of Rs.82,000/- was paid to M/s Anand and Anand, Advocates for renewal of registration of Trade Mark 'Liberty'. It is diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imed to have paid property tax to the MC Delhi for the buildings situated at 4/42 11/51,Punjabi Bagh, New Delhi. The appellant as per letter dated 29.10.2010 /9.11.2010 filed during appeal proceedings for the AY 2004-05 submitted that it stopped manufacturing selling footwear and hired out its assets as commercial assets to Liberty Shoes Ltd. Nothing has been brought on record to establish that the properties situated at 4/42 11/51,Punjabi Bagh, New Delhi were not hired out to M/s Liberty Shoes Ltd., but used for its business. The claim of the appellant can, therefore, not be allowed and hence disallowance thereof made by the AO is hereby confirmed. 30. The assessee is now in appeal before us against the aforesaid findings of the ld. CIT(A). The ld. AR on behalf of the assessee merely reiterated their submissions before the ld. CIT(A) while the ld. DR supported the findings of the ld. CIT(A). 31. We have heard both the parties and gone through the facts of the case. Indisputably and as pointed out by the ld. CIT(A), no evidence was filed before the AO or the ld. CIT(A) that the aforesaid properties were used for the purpose of the business of the assessee. There is no mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lower authorities that the amount was claimed on payment basis. The ld. AR claimed that exgratia paid to same staff had been allowed by the AO but not the bonus. Considering the facts and circumstances of the case, especially when the AO did not record any findings as to whether or not the amount was claimed on payment basis, we consider it fair and appropriate to vacate the findings of the ld. CIT(A) and restore the matter to the file of the AO with the directions to allow another opportunity to the assessee to establish its claim of bonus on payment basis ,bringing out clearly as to whether or not the bonus related to employees of the assessee for the year under consideration and thereafter, pass appropriate orders in accordance with law. With these observations, ground no 4 in the appeal in the appeal in the case of Liberty Enterprises for the AY 2004-05 is disposed of. 37. Ground no.5 in the appeal in the case of Liberty Enterprises for the AY 2004- 05 relates to disallowance of assets of Rs.18,330/- written off. The AO disallowed the claim in the absence of details and reasons for writing off. 38. On appeal, the ld. CIT(A) upheld the findings of the AO for want of details ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year on the ground that the same was not said to be used for purpose of business of the appellant besides the fact of no increase in the franchise fee. In the written submissions the appellant referred to its letter dated 24.3.2008which was filed on 26.3.2008. The same is perused and it is noted that no justification has been given for constructing the new building/ making additions to the existing buildings. There is no such clause in the agreement putting an obligation on the appellant for constructing any new budding for the lessee. In view of these facts it is difficult to appreciate that how construction of new building could be said for the purposes of business of the appellant and hence disallowance of depreciation on that building made by the AO is hereby confirmed. 42.1 Following his aforesaid order, the ld. CIT(A) upheld the disallowance of depreciation in the AY 2007-08 also in Liberty Enterprises. 42.2 In appeal in the case of Liberty Group Marketing Division in the AY 2006- 07, the ld. CIT(A),followed his aforesaid findings in the case of Liberty Enterprises in the AY 2006-07 and upheld the disallowance. 43. The assesses are now in appeal before us against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmissions in this ground of appeal while appreciating the facts, franchise agreement and moreover no intention of reducing tax burden except meeting the statutory liability being the owner of vehicles 4.03 The issue is considered. The plea of the appellant is not tenable in view of the fact that entire business has been let out including the personnel and hence all the expenses relating to manufacturing and carrying of business were to be met by the lessee. Further as per clause 6(i) (iii) of the agreement, reimbursement of employee costs which includes wages and other statutory payments would be made by the LSL. Reliance is placed on clause 4(4) and 4(i) is of no help since the same does not cover payment of passenger tax on the buses. In view of these facts disallowance out of fees and taxes made by the AO is hereby confirmed. 47. The assessee is now in appeal before us against the aforesaid findings of the ld. CIT(A).The ld. AR reiterated their submissions before the lower authorities while the ld. DR supported the findings in the impugned order of the ld. CIT(A). 48 We have heard both the parties and gone through the facts of the case. Indisputably. the entire bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prises for the AY 2006-07, is dismissed. 53. Ground no. 6 in the appeal in Liberty Enterprises for the AY 2006-07 relates to loss of Rs.3331/- in respect of transfer of duty entitlement. The AO disallowed the claim, liability being not of the year under consideration. 54. On appeal, the ld. CIT(A) upheld the disallowance, the assessee having not rebutted the findings of the AO that the liability did not pertain to the year under consideration. 55. The assessee is now in appeal before us against the aforesaid findings of the ld. CIT(A).The ld. AR reiterated their submissions before the lower authorities while the ld. DR supported the findings in the impugned order of the ld. CIT(A). 56. We have heard both the parties and gone through the facts of the case. Indisputably. the assessee did not rebut the findings of the AO that the liability did not relate to the year under consideration before the ld. CIT(A) and nor even before us. In these circumstances, especially when the ld. AR on behalf of the assessee did not place before us any material, controverting the aforesaid findings of the ld. CIT(A), so as to enable us to take different view in the matter, we are not inclined to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter, we are not inclined to interfere . Accordingly, .ground no.4 in the appeal in Liberty Enterprises for the AY 2007-08 is dismissed. 61. Next ground no.5 in the appeal in the case of Liberty Group Marketing Division for the AY 2004-05 relates to an amount of Rs.34,740 on account of unrealized securities written off. The AO disallowed the claim in the absence of any details. 62. On appeal, the assessee submitted merely a copy of account of unrealized security written off ,without even adducing any reason or details for such writing off. In these circumstances, the ld. CIT(A) upheld the disallowance. 63. The assessee is now in appeal before us against the aforesaid findings of the ld. CIT(A).The ld. AR on behalf of the assessee merely reiterated their submissions before the lower authorities while the ld. DR supported the findings in the impugned order of the ld. CIT(A). 64. We have heard both the parties and gone through the facts of the case. As is apparent from the aforesaid facts, the assessee did not adduce any justification for writing off the amount either before the AO or the ld. CIT(A). No material has even been placed before us nor the ld. AR on behalf of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving been claimed from Liberty Shoes Ltd., in the absence of any justification. 70. On appeal, the ld. CIT(A) upheld the findings of the AO, as under: 4.10 Relevant extracts from the written submissions of the appellant are extracted below: The establishment staff is being maintained serving for last many years. Never in past any disallowance was made. A chart is being attached for past history along with the detail of their salaries for the year under appeal. The appellant couldn't disputed with the services of this minimum staff kept with the appellant on these services are essentially required by the appellant. Further it is no body's case that this expenses are borne by appellant to reduce incidence of taxation because M/ s. Liberty Shoes Ltd. (a Public Ltd.) is being assessed in highest bracket of tax. The assessee firm as also the group has to adhere to norms of Accountancy, Tax Laws and also the respective responsibilities. The disallowance made is absolutely out of mark and uncalled for. 4.11 The issue is considered. The appellant enclosed a copy of profit loss account for the period ending on 31.03.2007. On examination thereof, it is noted th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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