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TMI Blog2022 (7) TMI 735X X X X Extracts X X X X X X X X Extracts X X X X ..... e order dated 22.12.2018 passed by the Assistant Commissioner of Income Tax(Appeals), Circle-12(1), Kolkata (hereinafter referred to as the Assessing Officer). The grounds raised by the assessee are as under: "1. For that on the facts and circumstances of the case, the CIT(A) grossly erred on facts and in law in confirming the ad hoc disallowance of Rs.1,88,000/- made by the AO out of foreign travel expenses incurred by the company. 2. For that on the facts and circumstances of the case, the CIT(A) failed to appreciate that the foreign travel expenses pertained to director/employee which was incurred in the course of business and therefore the disallowance made by the AO out of such expenditure was unwarranted on facts and in law 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n expenditure of Rs.3,76,000/- on foreign travel and the assessee was called upon to furnish details for travel. The assessee filed the necessary details of the foreign expenditure and submitted that the said expenditure was incurred in connection of travel of managing director of the company for attending business conference abroad. The reply did not find favoured with the Assessing Officer and after rejecting the reply of the assessee and contention made in correction therewith. The Assessing Officer disallowed 50% of the foreign expenditure thereby making an addition of 1,88,000/- by holding that since the assessee in the business of trade of shares and there is no need of getting quantified with foreign financial development and systems ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld. CIT(A) has confirmed the order of the Assessing Officer without giving a valid reason as to how the ad hoc disallowance of 50% could be sustained. In view of these facts, we are not in agreement with the conclusion drawn by the CIT(A) and consequently the order of the CIT(A) cannot be sustained. The ld. Assessing Officer is directed to delete the disallowance. Ground No.1 and 2 are allowed. 5. The issue raised in Ground No.3 & 4 is against the confirmation of addition of Rs.27,98,868/- as made by the Assessing Officer on account of dividend earned from business and held by the assessee as stock-in-trade. The facts in brief are that the Assessing Officer noted during the assessment proceedings that the assessee has made some investmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act u/s 10(34) and 115 of the Act, we note that the impugned premise of the Assessing Officer is that the dividend income earned on the assessee on shares and securities held as stock-in-trade is business income, therefore, deduction 10(34) of the Act is not available and similarly the ld. CIT(A) has upheld the view taken by the Assessing Officer. Having persued the provisions of the Act u/s 10(34) and 115 of the Act, we are of the opinion that the dividend received by the assessee is exempt u/s 10(34) of the Act irrespective of the fact that the whether the same is derived from investment in shares or the shares and securities held as stockin- trade. We find merit in the contentions of the ld. AR that the dividend income is exempt u/s 10( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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