TMI Blog2016 (5) TMI 1185X X X X Extracts X X X X X X X X Extracts X X X X ..... for statistical purposes only. - ITA Nos. 505 & 506/JP/2013 - - - Dated:- 22-4-2016 - SHRI R.P. TOLANI, JM SHRI T.R. MEENA, AM For The Assessee by : Shri P.C. Parwal (CA) For The Respondent : Shri P.C. Parwal (CA) ORDER PER: T.R. MEENA, A.M. Both the appeals filed by the assessee arise against the order dated 22/03/2013 passed by the learned Commissioner of Income Tax (Appeals), Ajmer for A.Y. 2007-08 and 2008-09. The effective ground of appeal for A.Y.2007-08 is as under:- 1. The ld Commissioner of Income Tax (Appeals) has erred on facts and in law in disallowing the claim of expenses of ₹ 7,94,673/- incurred by the assessee against the professional receipts received from Resonance Institute , Kot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and profession at ₹ 9,68,316/- after claiming various expenses like salary at ₹ 3,30,000/-, bonus at ₹ 22,500/-, workman/staff welfare expenses at ₹ 21,717/-, travelling at ₹ 24,134/-, telephone expenses at ₹ 16,520/-, rent ₹ 75,600/- and other expenses at ₹ 1,46,023/-. The ld Assessing Officer found that the expenses claimed in both the years are not allowable in case of salary of person. Therefore, he resorted a colourful device to treat the salary income as professional income which cannot be allowed to be a part of tax planning. He has given comparable case of other professional in the light of profession of Allen career Institute where this income has been shown under the head salary on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appellant as well as assessment order. It is seen that assessee has shown the professional receipts of ₹ 12,06,000 and salary income of ₹ 90,000 which has been treated as other income by the assessee. Accordingly, assessee claimed that expenses of ₹ 7,94,673 should be allowed against above income. The AO has rejected the above claim of the assessee and has disallowed the claim of expenses holding that assessee is deriving salary income from Resonance , a coaching institute at Kota. It is seen that AO has disallowed the claim of the assessee on two accounts. i. The AO has treated above receipts as income from salary' and not professional receipts. ii. The expenses claimed have been disallowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ethodology, schedules and sequence . It may be mentioned that assessee has also explained that the word used in the contract is consultancy agreement between the institute and the consultant. The remunerations have been stated as annual consultancy fees of ₹ 12,06,000 and not the monthly salary payments. It has been explained that there is no fixed timing and attendance record and no conditions for transfer or superannuation benefits in the said agreement. It is noted that similar issue has been considered and decided in favour of the assessee by Hon ble IT AT Jaipur in the case of ACIT vs Kamlesh Soni 107 TTJ JP 836 where the similar receipts have been held to be professional receipts. In view of above discussion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of the assessee in respect of above remunerations and expenses claimed. Following the same, the above remunerations are held to be professional receipts. However, the claim of the expenses is rejected as discussed as per Para 4.3(ii) of this order. This ground of appeal is partly allowed. 4. Now the assessee is in appeals before us. The ld AR of the assessee has reiterated the arguments made before the ld CIT(A) and further submitted that all these expenses claimed by the assessee are claimed as per law U/s 37 of the Act as incurred wholly and exclusively for business purposes, which is allowable. 5. At the outset, the DR has vehemently supported the order of the ld CIT(A). 6. We have heard the rival contentions of both the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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