TMI Blog2024 (3) TMI 884X X X X Extracts X X X X X X X X Extracts X X X X ..... ability of the allotment is licence cannot be denied to the assessee when the assessee has demonstrated the payment from the bank statement, filed an affidavit confirming the fact and most important amongst all the allotment of licence is not disputed by the revenue. Thus, the money paid for making 20 applications for the allotment of liquor licence cannot be disallowed as the same is in respect of the business of the assessee and he has been allotted liquor licence shop in Jaipur as clearly confirmed by the ld. AO in the order. Considering these specific fact and confirmation of the assessee by way of an affidavit that even the amount paid for applying licence in 20 numbers for his business and therefore denial of claim of expenditure u/s 37(1) of the Act is not correct and therefore, the same is directed to be allowed and addition made by the ld. AO confirmed by the ld. CIT(A) is directed to be deleted. In terms of these observations, the appeal of the assessee is allowed. - Dr. S. Seethalakshmi, Judicial Member And Shri Rathod Kamlesh Jayantbhai, Accountant Member For the Appellant : Sh. G.S. Mehta, C.A. For the Respondent : Sh. Prem Prakash Meena, Sr.-DR ORDER PER: RATHOD KAM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tails of payments and has given a categorical finding that it is not pertaining to the financial year 2016-17 which is under consideration. Further the assessee has not submitted any details regarding corresponding 20 Application forms for the allotment of new liquor shops. During the appellate proceedings the assessee states that the said payments were made through proper banking channel as Excise department in Rajasthan only accepts online payment through banking channel. Further the assessee states that the allotment of Wine shop is based on lottery system and desirous applicants filed many application forms in order to participate in the lottery and this is a business practice of the assessee was very much looked into by the Assessing Officer but the very basic question of details of 20 applications/applicants were not provided by the assessee in order to enable the Assessing Officer to examine whether these applications are on behalf of the assessee. Further the assessee has deprived the scope of examining the purpose of these payments and to ascertain whether it is wholly and exclusively incurred for the purpose of business or not. In this background when the assessee has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s or maintaining the business. 3. If the AO's version as stated in the assessment order (Para no. 6.2 of the Assessment order) is accepted than only Rs. 15000 can be carry forward to next year which was related to the lottery selected for the allotment of wine shop for the next financial year. Whereas the AO has treated the complete amount of 20 applications related to the next financial year, which is factually incorrect and wrong. 4. Secondly CIT(A) has not sustained the addition on the reasons given by AO in his assessment order. He has even not considered the submission of the assessee which was related to the reasons given in the assessment order for making the addition. He rejected the submission of the assessee summarily and without passing the speaking order or reasoning order. 5. Sir, the AO has not made addition on this basis detail of forms . He observed only this aspect but later on he used 'HOWEVER' (with Bold high-lighted words) as bifurcation of the sentence. The later part of the sentence as written by the AO is so specific for making the proposed addition. This the word however Means 'But' and not 'and'. 6. In nutshell, the assessee subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany Limited, A government Agency. e. I deposited Rs. 300000/- through my bank account along with these applications forms and duly recorded in my books of account. These entries are tallied with the Bank Statement. f. I state and submit that all the applications forms submitted by me for obtaining the liquor shops/business for he FY 2016-17 as per excise policy norms. These forms were submitted by me for participation in lottery system for allotment of liquor shop. g. I state that the deposited form fee was non-Refundable and that it is my business expenses. h. That the statement made by me above is true and no part of it is untrue and false. 6. Per contra, the ld. DR relied on the order of the ld. AO and ld.CIT(A). He vehemently argued that what is need for filing 20 applications since the assessee could not advance any reasons therefore, the denial of deduction for claim of expenditure u/s 37(1) of the Act is in accordance with the provision of law. 7. We have heard the rival contentions and perused material available on record. The Bench noted that the apple of discord in the present appeal is that whether the money paid for making 20 applications by the assessee by way of appl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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