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TMI Blog2022 (2) TMI 109X X X X Extracts X X X X X X X X Extracts X X X X ..... oring the submissions of the appellant. 2. On the facts and circumstances of the case, the Commissioner of (Appeals) is wrong in sustaining the disallowance of Rs. 11,01,445/- made by the A.O. on account of entertainment expenses by ignoring the submissions of the appellant. 3. On the facts and under the circumstances of the case, the Commissioner of income Tax (Appeals) is wrong in confirming the addition of Rs. 1,80,653/- u/s. 40(a)(ia) out of the total additions of Rs. 3,54,703/- by ignoring the submissions of the appellant. 4. The disallowances are against the law and facts of the case." 2. The brief facts of the case are that the assessee is a firm having income from business/profession, house property and other sources. The ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as per Clause 3 of the partnership deed of the firm which has already been placed on record, all the partners are working partners of the firm for carrying out the business activities of the firm and thus, these expenses were incurred wholly and exclusively for the purpose of business of the assessee firm and are entitled to deduction U/s 37(1) of the Act. We also verified the fact that the department had not made any disallowance in preceding year i.e. A.Y. 2012-13 wherein the assessment was completed U/s 143(1) of the Act. The department has also not made any disallowance for the subsequent year i.e. A.Y. 2015-16 wherein the assessment was passed U/s 143(3) of the Act. Copies of all the orders of the precedings years as well as subsequen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o run the business activities of the assessee firm smoothly. 8. We observed from perusal of the record that with regard to entertainment expenses, no disallowances had been made by the A.O. in the preceding years as well as in the subsequent year. Copy of the assessments order for the A.Y. 2012-13, 2013-14 and 2015-16 alongwith profit and loss account are placed on record at page Nos. 27 to 39 of the paper book. With regard to club subscription/expenses, we observed that the club subscriptions and expenses were incurred for the business purposes as much as it facilitated interaction with business associations etc. The club expenses were incurred with a view to promote to soliciting the customers in export of garments business. The A.O. not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied the nature of payments are as under: 1(i) Membership Fee paid to Apparel Export Promotion Council (Page No. 106 of paper book) Rs. 27,792/- (ii) Application fee for getting the export performance certificate (Page No. 107-108 of paper book) Rs. 31,850/- (iii) Balance amount of Rs. 8,154/- (i.e. 67,796 - 59642= 8154) paid for the certificate issued of origin for China (Page No. 104-105 of the paper book. 2. Payment made to Export Inspection Agency (Page No. 106 of paper book) 10,409/- We further noticed that the payments of Rs. 1,01,448/- were made on account of Membership and subscription charges as under: Date Particulars Amount 25/04/2013 Federation of Indian Export Organization 10534 30/04/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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