2023 (6) TMI 263

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..... order dated 20-01-2023 passed by the CIT(A) in National Faceless Appeal Centre, Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter also called 'the Act') in relation to the assessment year 2017-18. 2. The only issue assailed in this appeal is against the confirmation of disallowance of car expenses incurred by the assessee, a Private Limited company, towards personal use by the two Directors. .....

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..... or which the purchase price was paid by the company to the extent it did not exceed the fixed benchmark. The major reason given by the AO for disallowing the expenses incurred on cars is the personal use of vehicles by the directors-employees of the company. The Delhi Bench of the Tribunal in DCIT vs. Haryana Oxygen Ltd. (2001) 76 ITD 32 (Del) has held that the use of cars by directors-employees o .....

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..... eating it as personal user or non-business user of the company. I fail to see any rationale in disallowing the expenses incurred on cars as for personal use, when admittedly these have been provided to director-employees. A company is a separate legal entity distinct from its directors or employees. As such, there can be no question of treating the use of vehicles by the directors/employees as a p .....

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