TMI Blog2019 (1) TMI 993X X X X Extracts X X X X X X X X Extracts X X X X ..... d vehicle expenses - allowable busniss expenses - personal use of asset - Held that:- We are of the considered opinion that such depreciation are allowed as it is not disputed that funds for purchases of the car were provided by the assessee company which is also reflected in the accounts of the assessee company. In our opinion, when the car is actually used for the purpose of business of the company depreciation thereon cannot be denied. Regarding the vehicle expenses and insurance expenses, we find that the cars were used by the body corporate and these were also shown as fixed assets in the balance sheet in the year under consideration. As we have allowed the depreciation in respect of such vehicles, we are inclined to allow the amount of vehicle and insurance expenses to the extent deleted by the CIT(A). We also note that the assessee was a limited company and, hence, it could act through its directors only. Thus, if cars were used by the directors for their personal use also, the same could be added to the income of the directors as perquisite but insofar as, the assessee-company was concerned the entire expenditure was for its business as the directors were appointed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hort DSIR) which was mandatory for claiming such deduction. Therefore, the same was disallowed and added to the total income of the assessee. 5. The aggrieved assessee preferred an appeal to Ld. CIT(A) who has deleted the addition made by the Assessing Officer after having the reliance on the order of his predecessor in the own case of the assessee. 6. Being aggrieved by the order of the Ld. CIT(A), the Revenue is in appeal before us. 7. Both the parties before us relied on the orders of the authorities below as favorable to them. 8. We have heard the rival parties and perused the materials available on record. At the outset, we find that the issue is covered in favor of the assessee by the order of this Tribunal in assessee s case in ITA No.1130/Ahd/2015 pertaining to AY 2011-12 vide order dated 28/03/2018. The relevant extract of the order is reproduced as under: 9. We have gone through the relevant record and impugned order. So far as ground no.1 related to disallowance of ₹ 76,43,540/- made u/s.35(2AB) of the Act is concerned. Assessee would be entitled to deduction u/s.35(2AB) in the year under consideration, even thought the registration/recognition is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not form part of total income 0 Total 953326 11.1. Accordingly, the Assessing Officer disallowed the sum of ₹ 9,53,326/- and added to the total income of the assessee. 12. The aggrieved assessee preferred an appeal to the Ld. CIT(A) who has partly confirmed the order of the Assessing Officer after having reliance in the order of his predecessor pertaining to the AY 2011-12. Accordingly, the Ld. CIT(A) deleted the addition made by the Assessing Officer in part. 13. Being aggrieved by the order of the Ld. CIT(A), the Revenue is in appeal before us. 14. Both the parties before us relied on the orders of the authorities below as favorable to them. 15. We have heard both the parties and perused the materials available on record. At the outset, we find that the issue is covered in favor of the assessee by the order of this Tribunal in assessee s case in ITA No.1130/Ahd/2015 pertaining to AY 2011-12 vide order dated 28/03/2018. The relevant extract of the order is reproduced as under: 10. So far as ground related to deleting the addition to the extent of ₹ 10,50,282/- is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the vehicles after, having a reliance on the order of his predecessor for the AY 2011-12. However, the Ld. CIT(A) in respect of vehicle expenses and insurance expenses deleted the addition in part by observing as under: Regarding the expenses of ₹ 4,37,351/- and Rs.insurance expenses ₹ 1,22,479/- claimed on the running of the vehicle, the appellant has submitted that as the cars were used wholly and exclusively for the purpose of business, no part of expenses was required to be disallowed. The company is artificial person and there cannot be any personal expenses or non business expenses in the hands of the company. The appellant was not able to demonstrate that the whole expenses on running of the vehicle were made for the purpose of business. The partial use of cars by the directors for personal purpose cannot be ruled out. In view of the above, out of expenses of ₹ 4,37,351/- and insurance expenses of ₹ 1,22,479/- claimed on the running of the vehicle, a sum of ₹ 1,50,000/- disallowed by the A.O. is being confirmed. The ground of appeal is partly allowed. 21. Being aggrieved by the order of the Ld. CIT(A), now the Revenue is in appeal be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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