Allow ability of expenditure for Income tax assessment

Last updated: 31 October 2012

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
The facts of the case of the appellant are very simple in the sense that the assessee firm has debited a total of Rs.8,21,885/- to its Profit & Loss a/c which are routine expenses like expenditure for income tax assessments, trade marks, and other legal cases etc. The maximum that Assessing Officer could have disallowed is Rs.8,21,855/- and that too after giving a finding of fact that the expenditure so disallowed was incurred for earning the exempt income. However, the ld.AO proceeded to apply Rue 8D and arrived at an arithmetical figure of Rs.33,05,662/-, which to my mind is travesty of justice. It is illogically to make disallowance on weighted basis. The observation of my ld.Predecessor in assessee’s own case for preceding Assessment Year that there is no equity in tax laws is respectfully disagreed. Therefore, the addition made by the Assessing Officer to the tune of Rs.33,05,662/- is deleted

Citation :
ACIT, Circle 24(1) New Delhi (Appellant) Vs.M/s Bharti Enterprises H 5/12, Qutab Ambience Mehrauli road, New Delhi PAN: AAAFB 2416 M (Respondent)