TMI Blog2014 (9) TMI 928X X X X Extracts X X X X X X X X Extracts X X X X ..... . For the sake of reference, we extract the grounds raised in appeal No.112/LKW/2014 as under:- 1. The CIT(A) has erred in law and on facts in deleting the disallowance of ₹ 12,91,500/- made by the AO on property tax paid at USA without appreciating the fact that the assessee has admitted that its office at USA was treated as a Permanent establishment as per American Tax laws and taxes-were paid on its profit there and thus carrying of expenses relating thereto to India for computing profit as per Indian Income Tax Law was not correct. 2. The CIT(A) has erred in law and on facts in restricting the disallowance up to 50% of the total electricity expenses of ₹ 3,98,735/- without appreciating the fact that such expenditure wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose. Before the CIT(A), it was contended that the assessee company had its office at 8/2B, Arya Nagar, Kanpur, which is two storey building and the assessee company has registered administrative office on the entire ground floor and also occupied about 40% space on the first floor for the purpose of office and storage. Thus, more than 70% of the whole premises is used for the business office etc. Therefore, the entire disallowance of the electricity charges cannot be made. The CIT(A) re-examined the entire issue in the light of above facts and came to the conclusion that the entire premises were used by the registered office of the assessee company and as residence of the Directors. He accordingly restricted the disallowance to 50% of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of property tax is done from Head Office and proof of payment is submitted to the Bank as the same was one of the conditions for sanction of Term Loan for purchase of property. The CIT(A) re-examined the issue in the light of relevant evidence and judicial pronouncements and came to the conclusion that there is no dispute to the ownership, user and payment of tax relating to the warehouse in question. It is also an admitted fact that the consolidated books of account were prepared and no separate books were maintained for the activities carried on in U.S.A. If the income from operations in abroad is included in the profit and loss accounts, the expenditure has to be allowed as per matching principle. Accordingly the CIT(A) has allowed th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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