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TMI Blog2015 (1) TMI 1070X X X X Extracts X X X X X X X X Extracts X X X X ..... . 27,63,920/- made by the Assessing Officer under section 37(1) of the Act from out of the Assessee's claim towards Keyman Insurance Premium. 3] The second ground was that a sum of Rs. 42,48,052/- on account of under valuation of closing stock of shares and bonds was rightly added. 4] Mr. Vimal Gupta, learned Senior Counsel, appearing in support of this Appeal submits that all four questions and formulated by the Revenue are substantial questions of law. 5] He submits that the Keyman Insurance Policy has been taken in the case of the present Assessee, a partnership firm. It is on the life of two partners. The partnership firm cannot have existence in law independent that of the partners. Therefore, the Assessing Officer was justified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceeded to hold that the Keyman Insurance Premium could be treated as personal expenses of the partners. He disallowed 20% of the Keyman Insurance Premium on the basis that this expenditure was personal in nature of the partners and it was not incurred wholly and solely for the purpose of business of the Assessee firm. 7] The Commissioner deleted such adhoc disallowance and the Tribunal has upheld that order of the Commissioner. 8] We have, in the light of this admitted factual position perused the findings. The findings of the Tribunal in para 5 are that the adhoc deduction could not have been effected. More so, when the department itself has clarified that premium paid on the Keyman Insurance Premium is allowable as business expenditure. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not raise any substantial question of law. 9] Even in relation to other two questions, we have perused para 9 of the Tribunal's order. We find that when the cost actually paid is considered, there is no concept of any notional valuation. The average cost is worked out by considering the total cost actually paid for purchasing the shares and the dividend by the number of shares. The Tribunal held that the Assessee's perception that the value taken on the basis of "weighted average method" is notional, is incorrect. Why it has to be termed as such, has been reasoned by the Tribunal in para 9. It has been held that the Assessee has been following this method of valuation of closing stock for the last 16 years. In these circumstance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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