TMI Blog2011 (10) TMI 611X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 7 in Assessment Year 2004-05 are general in nature and hence, need no adjudication as so contended by the learned counsel for the assessee. Therefore, these grounds are rejected. 3. Ground Nos. 2 4 in Assessment Year 2000-01 and ground No. 2 in Assessment Year 2004-05 are with regard to the common issue as to whether the Assessing Officer was justified in not allowing deduction under sec. 80HHC of the Act in respect of Duty Entitlement Pass Book (DEPB) receipts/income. In the Assessment Year 2001-02, the assessee had shown net export profit at ₹ 4,46,23,409/-out of which, a sum of ₹ 4,46,20,490/was claimed as deduction under sec. 80HHC of the Act. However, the AO reduced the deduction u/s 80HHC to ₹ 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Topman Exports, 318 ITR (AT) 87, was reversed. The authorities below have given a categorical finding of the fact that the assessee s turnover is more than ₹ 10 crores and the assessee had an option to choose either duty draw back or DEPB Scheme and the rate of duty draw back credit was not higher than the rate under DEPB Scheme. Therefore, the assessee s case is squarely covered by the Third and Fourth Proviso to sec. 80HHC(3) of the Act, which have been inserted by the Taxation Laws (Amendment) Act, 2005 with retrospective effect from 1.04.1998 and in the light of the provisions contained in the said Provisos, the assessee is not entitled to a deduction in respect of DEPB receipts and Duty Draw Back. We, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd a further provision of ₹ 33,18,179/-was made in the month of March, 2004 on the basis of calculation and estimates given by the LIC of India. It was further pointed out that out of the provision of Rs.33,18,179/-made in the month of March, 2004, the assessee deposited the sum of ₹ 4,79,694/-in LIC of India s Group Gratuity Cash Accumulation Scheme. It was, thus, argued that the payment actually made by the assessee during the financial year and before the due date of filing the return of income, is to be allowed as a deduction. 13. The learned DR on the other hand, submitted that all those details were not filed by the assessee either before the AO or before the learned CIT(A) and therefore, the order of the lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng all these years, and since the concerned party has not initiated any legal proceedings against the assessee, the said amounts may be written off as a liability no longer required to be paid. The AO therefore, treated the same to be an income of the assessee which has been confirmed by the learned CIT(A). 19. In this case, it is not in dispute that the liability of ₹ 1,93,407/-was credited in earlier years and the same has been shown as outstanding in the balance-sheet of the assessee. The said liability has not been written off in the books of accounts of the assessee. There is no material or evidence on record to show and establish that this liability has actually been ceased in the year under consideration. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, disallowed a lump sum amount of ₹ 5,00,000/-out of the foreign travelling expenses by treating the same as not relating to business and are unvouched and personal in nature. 22. On an appeal, the learned CIT(A) taken a view that 5% of the total expenses could be fairly attributed to the personal expenditure of the assessee. The learned CIT(A) therefore, sustained the disallowance to the extent of ₹ 4,15,051/-being 5% of total expenses of ₹ 83,01,029/-, and granted a relief of ₹ 84,950/-. 23. The assessee is in appeal against disallowance of ₹ 4,15,051/sustained by the learned CIT(A) out of foreign travelling expenses. 24. We have heard both the parties and have gone through the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to 2%. In the immediately preceding year, the foreign travelling expenses incurred by the assessee were to the extent of 1.7% of total turnover. However, in the previous year of immediately preceding year the expenses were to the extent of 2% to 2.15% of the total turnover. From that point of view the expenses incurred by the assessee during this year are not on higher side. But the fact remains that the assessee has failed to submit the supporting bills in respect of the foreign travelling expenses incurred during the year. Therefore, in the absence of details, an ad hoc disallowance may be called for. Having regard to the total turnover of the assessee and extent of foreign travelling expenses incurred during the year as compar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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