TMI Blog2016 (11) TMI 890X X X X Extracts X X X X X X X X Extracts X X X X ..... he order of the Assessing Officer. On this issue also, the Tribunal has held that the findings in respect of the disallowance of the car expenditure equally applied. Here also, the Tribunal has found that the assessee has not maintained proper data base to verify whether all the phones were used for the purpose of his business. The aforesaid conclusions of the Tribunal regarding the cars and the telephone bills show that these are factual conclusions and do not give rise to any question of law for the consideration of this court. Disallowance of salary paid to the assessee’s wife - Held that:- If the income earned by the wife of the assessee was on account of her technical or professional knowledge or experience, such income cannot be r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), we answer the 4th question of law raised in favour of the assessee and against the Revenue. - I.T.A. No. 55 of 2010 - - - Dated:- 26-9-2016 - ANTONY DOMINIC AND P.V.ASHA, JJ. FOR THE APPELLANT : ADVS.SRI.ANIL D. NAIR, SMT.NIVEDITA A.KAMATH FOR THE RESPONDENT : SRI.JOSE JOSEPH, SC, FOR INCOME TAX JUDGMENT Antony Dominic, J. This appeal is filed by the assessee impugning the order passed by the Income Tax Appellate Tribunal, Cochin Bench, in I.T.A.No.624/2007 pertaining to the assessment year 2004-2005. 2. On facts, it is relevant to state that for the assessment year 2004-2005, the assessee had returned loss of ₹ 10,12,980/-. The Assessing Officer, after making additions and disallowances, determin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar and on going through the orders impugned, we feel that the four questions of law framed in the appeal memorandum deserve to be considered. 5. Insofar as the first question regarding the expenditure claimed on the use of cars and telephone bills are concerned, reading of Annexure A assessment order shows that the assessee, who is the manufacturer of Anoop Hair Oil , on the basis of a secret formula developed by the assessee himself had entrusted the marketing of the product to M/S Godrej. Assessee had a fleet of cars comprising of one Mercedez Benz van, four Mercedez Benz cars, one Maruti Wagon R and 2 Fiat Palio. In respect of these cars, he had incurred a total expenditure of ₹ 22,15,189/-. The Assessing Officer disallowed 50% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s wife. The findings of the Assessing Officer in paragraph 6 of the assessment order is that the assessee had paid an amount of ₹ 81,000/- to his wife. This was sought to be justified by the assessee s Authorized Representative by contending that the assessee had imparted the secret formula of his medicines to her and hence the salary was paid. The Assessing Officer found that such payment of salary cannot be regarded as one covered by the proviso to Section 64(1)(ii) of the Income Tax Act and disallowed the same. However, this finding was vacated by the 1st Appellate Authority and the Tribunal has set aside the order of the 1st Appellate Authority and restored the order of the Assessing Officer. 9. The learned counsel appearing fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or professional knowledge or experience. In such a case, the payment made by the assessee to his wife would not qualify for the benefit of proviso to Section 64 (1)(ii). 12. Insofar as the judgment of the Andhra Pradesh High Court in Batta Kalyani v. Commissioner of Income Tax [154 ITR 59] is concerned, findings therein turned on the conclusion of the Assessing Officer that the assessee s husband was employed to manage the business of his wife. Insofar as this case is concerned, there is no such finding and, therefore, this judgment is of no assistance to the assessee. In the light of the above, the second question of law has to be answered against the assessee and in favour of the revenue. 13. Insofar as the third question regardi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w Ravindra Laboratories (India) Ltd. [132 ITR 401]. 15. Insofar as this finding of the Tribunal is concerned, the learned counsel for the assessee has placed reliance on the judgment of this court in Commissioner of Income Tax v. Aluminium Industries Ltd. [214 ITR 541] wherein Division Bench of this court had occasion to consider whether the advertisement charges incurred by a company is capital expenditure or revenue expenditure. That was a case where the assessee had incurred advertisement expenditure in connection with the inauguration of its 'relay' project. In that factual background, referring to several precedents on the subject it was held that if expenses are incurred for advertisements for the expansion of the busin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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