TMI Blog2020 (3) TMI 553X X X X Extracts X X X X X X X X Extracts X X X X ..... olly and exclusively for the purposes of the business or profession shall be allowed in computing the income chargeable under the head Profits and gains of business or profession . It was observed that the expression wholly and exclusively appearing in the said section does not mean necessarily . Ordinarily, it is for the assessee to decide whether any expenditure should be incurred in the course of his or its business. Such expenditure may be incurred voluntarily and without any necessity. If it is incurred for promoting the business and to earn profits, the assessee can claim deduction under Section 10(2)(xv) even though there was no compelling necessity to incur such expenditure. The fact that somebody other than the assessee is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wal a/w. Mr. Upendra Lokegaonkar i/b. Mint Confreres for Respondent. P.C. : Heard Mr. Saxena, learned standing counsel, Revenue for the appellant and Mr. Agarwal, learned counsel for the respondent - assessee. 2. This appeal under Section 260-A of the Income Tax Act, 1961 (briefly the Act hereinafter) has been preferred by the Revenue assailing the order dated 31.08.2016 passed by the Income Tax Appellate Tribunal, Mumbai Bench F , Mumbai (for short the Tribunal hereinafter) in I.T.A.No.9030/Mum/2010 for the assessment year 2007- 08. 3. The following questions have been proposed by the Revenue as substantial questions of law: 1. Whether on the facts and in the circumstances of the case and in law, the Tribunal is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ultation? 4. Whether on the facts and in the circumstances of the case and in law, the Tribunal was correct in allowing the Director s remuneration by holding that he was rendering consultation and advisory services even though no evidence in support of consultation was brought on record by the assessee? 5. Whether on the facts and in the circumstances of the case and in law, the Tribunal is justified in deleting the addition made in pursuant to the report of the DRI after recording that the report has been quashed by Customs, Excise Service Tax Appellate Tribunal (CESTAT) without appreciating that the decision of CESTAT has not been accepted by the Customs Department and appeal is pending before Hon ble High Court of Gujarat? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rectors of the respondent - assessee. Statement of Shri Faraz Joshi was recorded under Section 132(4) of the Act. According to the assessing officer, Shri Joshi was not attending the office of the respondent - assessee for the last six years and no duties were assigned to him except some consultation. Moreover, respondent - assessee failed to provide any details regarding the nature and character of consultation. Accordingly, assessing officer held that payments made to Shri Joshi in the form of salary / perquisites was not expended wholly and exclusively for the purpose of business of the respondent - assessee. Accordingly, an amount of ₹ 3,00,00,000.00 claimed as paid to Shri Joshi as salary / perquisites was disallowed being not ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the words in the answer given by Shri Joshi. Tribunal noted that Shri Joshi was a whole time Director, rather a promoter - Director of the respondent - assessee, since 1972. In response to the specific query as to who looked after the respondent - assessee on day-to-day basis, Shri Joshi had answered that he was not aware about who actually looked after the day-to-day business activity since for the last 6 years, he was not attending office but rather involved in consultation. The answer given by Shri Joshi was quite reasonable and no adverse inference could be drawn therefrom. 10. Besides, Tribunal also found that in all the assessments made upto the date of the search, salary payment to Shri Joshi was allowed. Even post-search from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee is also benefited by the expenditure should not come in the way of an expenditure being allowed by way of deduction under Section 10(2)(xv) of the Act. 12. In the light of the above, we do not find that question Nos.1 to 4 as proposed by the Revenue raise any substantial question for consideration of the Court. Consequently, the said questions are not admitted for adjudication. 13. In so far question Nos.5 and 6 are concerned, we find that Tribunal relied upon the order of the Customs, Excise Service Tax Appellate Tribunal (CESTAT) dated 04.12.2014 in the assessee s own case and deleted the additions made by the assessing officer. We have been informed that Commissioner of Customs has assailed the finding returned by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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