Allowability of expenditure

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

21 October 2016 Dear Experts,
Pls clarify weather following
Expenses are allowed in income tax
Or not.
(1) salary paid to gardner for maintaining garder.
(2) Pooja Exp. & payment made
to pujaari toward pooja,

Thanks,
Vivek Gupta

Amol S Joglekar

Amol S Joglekar (Expert)

21 October 2016 Prima facie YES...they are very much allowed.....subject to TDS provisions AND reasonableness of the expenditure.

Querist : Anonymous

Querist : Anonymous (Querist)

21 October 2016 Dear sir.
R u 100% sure in respect of allowability of these expenditure. Actually our statutory auditor has denied to claim the deduction of these expenses however according to him these are not business expenses

Amol S Joglekar

Amol S Joglekar (Expert)

24 October 2016 Commerce has always proved to be a mid point between SCIENCE and ARTS.
This language of 100% signifies the SCIENCE background......anyway.....let me try to line out the mid point.....
So long as you are able to convince yourself, in first place and then to your auditors, in the next place that the expenditure as mentioned in your query are business expenses and NOT the personal expenses.....
I will try to give you a case of a Company which built a temple in the premises of that company.....the expenditure was allowed as business expenditure where the counsell argued that building the temple and doing the worship etc is necessary to keep the MORALE of the employees high as well as intact, year on year basis......This view was upheld by the Courts.....
Now please think of finding the real reason as to why you are paying the gardner as well as pooja expenses......
I think if properly argued, both these expenses should be allowed....(Keeping the amount/magnitude to its reasonable level)
Your views please

Querist : Anonymous

Querist : Anonymous (Querist)

24 October 2016 Sir.
It is not the matter that what we do think in respect of allowability of these expenses. According to my statutory auditor both these expenses does not have any relation with business transaction & even all the business activities can be performed without doing worship and maintaining garden. Therefore pls provide me any case law pertain to such expenses.

Amol S Joglekar

Amol S Joglekar (Expert)

25 October 2016 https://indiankanoon.org/doc/1455821/

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