TMI Blog2018 (1) TMI 447X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of the motor cars, as a result whereof the lower authorities had rightly concluded that the element of personal usage of the motor cars cannot be ruled out. We find that the CIT(A) after recording the aforesaid observations had relied on the order passed by his predecessor in the assesses own case for the earlier assessment years, wherein under similar facts a disallowance to the said extent was made in the hands of the assessee. We further find that as observed by the CIT(A), the orders of his predecessor for the earlier assessment years had been upheld in respect of the issue under consideration by the Tribunal. We are of the considered view that as neither any material had been brought to our notice which would persuade us to observe that the observations of the CIT(A) are perverse or incorrect, therefore, find no reason to dislodge the same. We thus in the terms of our aforesaid observations uphold the sustaining of the disallowance of expenses pertaining to motor car usage of ₹ 5,30,432/- by the CIT(A). The Ground of Appeal No. 2 raised by the assessee is dismissed. - ITA No. 709/Mum/2016 - - - Dated:- 20-12-2017 - SHRI P.K. BANSAL, VICE PRESIDENT AND SHRI RAVISH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he return of income filed by the assessee was processed as such under Sec.143(1) of the Act. The case of the assessee was thereafter selected for scrutiny assessment through CASS under Sec. 143(2). 3. That during the course of the assessment proceedings the A.O observed that the assessee had claimed a sum of ₹ 92,69,949/- as deduction on account of foreign travelling expenses. The A.O deliberating on the claim of the assessee pertaining to the foreign travelling expenses observed that the same was similar by placed as in comparison to her claim towards the said expenses in the preceding years, viz. A.Y(s). 2007-08, 2008-09, 2009-10 and 2010-11, wherein his predecessor had disallowed 1/3rd of the expenses on the ground that the same were not related to the business of the assessee. The assessee in order to fortify his claim of foreign travelling expenses therein furnished with the A.O details of foreign travelling expenses incurred by him during the year under consideration along with the details of places visited, the period of travel, number of days of stay and fare and other expenses incurred during his stay. The assessee submitted before the A.O that the foreign travell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essed the income of the assessee at ₹ 1,24,80,919/-. 4. Aggrieved, the assessee carried the matter before the CIT(A). The assessee assailing the disallowance of ₹ 30,89,983/- made by the A.O out of the foreign travelling expenses, therein submitted before the CIT(A) that keeping in view the very fact that he was carrying on the business of export of high end designer ladies dresses which required him to display and present the garments to the foreign buyers abroad on a regular basis, therefore, to facilitate interaction with foreign buyers extensive foreign travelling was involved in his business. The assessee further submitted that as the foreign travelling expenditure was incurred by him wholly and exclusively for the purposes of his business, which was neither in the nature of a capital expenditure nor involved any personal element, therefore, no part of the foreign travelling expenses incurred by him during the year under consideration was liable to be disallowed. The assessee in order to drive home his contention that the foreign travelling expenses were allowable in his hands, therein submitted that the additions made by the A.O under the head foreign travellin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses booked by the assessee under the head Hotel and other expenses of ₹ 39,79,935/- were not fully supported with bills and invoices and certain expenses, viz. samples, gifts and other such expenses were certainly not directly related and incurred in respect of the business of the assessee. Thus, the CIT(A) going by the ratio adopted by the Tribunal in the assesses own case for A.Y. 2006-07, therein disallowed 20% of the Hotel and other expenses of ₹ 39,79,935/- and restricted the addition/disallowance in the hands of the assessee to the extent of ₹ 7,95,987/-. 5. That as regards the disallowance aggregating to ₹ 5,30,432/- pertaining to motor car usage, viz. 20% of motor car expenses of ₹ 1,48,542/-; proportionate disallowance of depreciation of ₹ 2,89,017/-; and interest on car loan of ₹ 92,873/-, the CIT(A) observed that as the assessee was not maintaining any log book, therefore, the element of personal usage of the motor cars could not be ruled out. The CIT(A) observed that a disallowance to the said extent made by his predecessor in the case of the assessee for the earlier assessment years was affirmed by the Tribunal, therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts involved in the case of the assessee for A.Y(s) 2007-08 to 2009-10 were in parity with those for the year under consideration. We find that the assessee in the backdrop of his aforesaid ground had averred that as the Tribunal while disposing of the appeals of the assessee for A.Y(s) 2007-08 to 2009-10 had upheld the order of the CIT(A) and confirmed the disallowance out of foreign travelling expenses only to extent of 10% of Other expenses out of the entire foreign travelling expenses, therefore, on a similar footing the A.O be directed to restrict the disallowance out of foreign travelling expenses to the extent of 10% of Other expenses . We have deliberated on the aforesaid claim of the assessee that in the backdrop of the observations of Tribunal in the assesses own case for A.Y(s). 2007-08 to 2009-10, the disallowance out of foreign travelling expenses for the year under consideration may also be restricted to 10% of Other expenses . We are of the considered view that in the backdrop of the very fact that the disallowance out of foreign travelling expenses in the preceding years, AY s 2007-08 to 2009-10, as claimed by the assessee, was restricted by the CIT(A) to 10% ..... X X X X Extracts X X X X X X X X Extracts X X X X
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