SHRI RANDHIR SINGH BHANWARSINGH BHANDARI, Indore V. THE ACIT-5(1), Indore

ITA 111/IND/2016

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4383 (ITAT-INDORE)
• Duration Of Justice: 5 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 03-08-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 12-02-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: N D PATWA; ASHISH GOEL
• Keywords: Business expenditure; Salary income; Maximum Marginal Rate; Commercial expediency
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI O.P. MEENA, ACCOUNTANT MEMBER SHRI RANDHIR SINGH BHANWARSINGH BHANDARI, 71, M.G.ROAD, INDORE. PAN: ABNPB6646D VS. ACIT, 5(1), INDORE. APPELLANT RESPONDENT APPELLANT BY SHRI ASHISH GOEL AND SHRI N. D. PATWA, ADV. RESPONDENT BY SHRI MOHD. JAVED, SR. DR DATE OF HEARING 03.08.2016 DATE OF PRONOUNCEMENT 03.08.2016 O R D E R PER O.P. MEENA, ACCOUTANT MEMEBR. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-II, INDORE [HEREINAFTER REFERRED TO AS THE CIT(A)] DATED 30.11 .2015 AND PERTAINS TO ASSESSMENT YEAR 2012-13 AS AGAINST APPE AL DECIDED IN ASSESSMENT ORDER DATED 05.02.2015 OF AC IT, CIRCLE 5(1), INDORE [HEREINAFTER REFERRED TO AS THE AO]. I.T.A. NO.111/IND/2016 ASSESSMENT YEAR: 2012-13 ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 2 OF 13 2. GROUNDS NO. 1 TO 3 RELATE TO ADDITION MADE U/S 40A( 2) AT RS. 16,10,893/- TOWARDS PAYMENT OF SALARY TO ASSE SSEES DAUGHTER-IN-LAW WITHOUT CONSIDERING CONTRACTUAL OBLIG ATION, LEGITIMATE NEED FOR THE BUSINESS ETC. 3. FACTS APROPOS OF THESE GROUNDS ARE THAT THE ASSESSE E HAS PAID A SALARY SUM OF RS. 20,70,833/- AS REMUNER ATION TO SMT. SEEMA BHANDARI, DAUGHTER-IN-LAW OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION AS COMPARED TO PRECED ING YEAR AT RS. 4,60,000/- FOR WHICH NO PLAUSIBLE EXPLANATION WAS FILED. THE AO FURTHER NOTED THAT THE ASSESSEE HAS SHOWN LOA N OF RS. 61,10,508/- FROM ESSEN ASSOCIATES, A PROPRIETORY CO NCERN OF SMT. SEEMA BHANDARI AND ALSO RS. 1,04,579/- FROM SM T. SEEMA BHANDARI, ON WHICH INTEREST @ 15% HAS BEEN PAI D. THEREFORE, THE ASSESSEE IS REDUCING PROFIT BY INCRE ASING REMUNERATION AND ALSO BY TAKING UNSECURED LOAN FROM THE SAME FAMILY MEMBERS AND PAYING INTEREST THEREON. ACCORDINGLY, REMUNERATION PAID WAS RESTRICTED TO RS. 4,60,000/- AND BALANCE EXCESS REMUNERATION OF RS. ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 3 OF 13 16,10,833/- ( RS. 20,70,833/- (-) RS. 4,60,000/-)WA S DISALLOWED. 4. AGGRIEVED WITH THE ORDER OF THE AO, THE ASSESSEE PREFERRED THE APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) NOTED THAT THE ASSESSEE HAS TAKEN LOAN OF RS. 61.60 LAKHS FROM ESSEN ASSOCIATES, A PROPRIETORY CONCERN OF SMT. SEE MA BHANDARI AND ALSO PAYING INTEREST @ 15 % THEREON. THE CONTENTION OF THE ASSESSEE THAT DURING THE RELEVANT ASSESSMENT YEAR, THERE HAS BEEN INCREASE IN THE TURNOVER TO 33 %. IF THE SAME IS CONSIDERED THAT DUE TO CONTRIBUTION BY SMT. SEEMA BHANDARI THERE WAS INCREASE IN THE SALE, THE SALE, T HE SAME HAS BEEN JUST AT 33 % AS AGAINST THE INCREASE OF 35 0 % OF REMUNERATION WHICH IS NOT JUSTIFIABLE. ACCORDINGLY, THE LD. CIT(A) HAS UPHELD THE FINDINGS OF THE AO. 5. NOW THE ASSESSEE IS IN APPEAL BEFORE US. 6. LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT SMT. SEEMA BHANDARI IS ALSO PAYING TAX @ 10% ON SALARY INCOME BEING MAXIMUM MARGINAL RATE, THUS, THERE WAS NO EVASION O F TAX BY BOOKING HIGHER EXPENSES IN THE NAME OF DAUGHTER-IN- LAW. THE OBJECTIVE OF SECTION 40A(2) WAS TO DO EVASION OF TAX BY BOOKING ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 4 OF 13 HIGHER EXPENSES IN THE NAME OF FAMILY, WHEREAS NO SU CH TAX EVASION HAS BEEN FOUND. PROVISIONS OF SECTION 40A(2 ) CANNOT BE INVOKED. THE LD. AUTHORIZED REPRESENTATIVE OF TH E ASSESSEE REFERRED TO CBDT CIRCULAR NO.6-P DATED 06.07.1968, WHICH SAYS THAT THE ITO IS EXPECTED TO EXERCISE HIS JUDGM ENT IN A REASONABLE AND FAIR MANNER IN RESPECT OF PAYMENTS T O RELATIVES AND ASSOCIATE CONCERNS AND SHOULD NOT APPLY IN A MA NNER WHICH WILL CAUSE HARDSHIP IN BONA FIDE CASES. IT WAS A LSO SUBMITTED THAT THE ASSESSEE IS MORE THAN 75 YEARS O LD. THUS, TAKING SERVICES OF SMT. SEEMA BHANDARI WAS A PART OF SUCCESSION PLANNING OF THE BUSINESS OF THE ASSESSEE . SMT. SEEMA BHANDARI, IN FACT, TOOK PARTICIPATION IN THE ENTIRE BUSINESS ACTIVITY AS CHIEF EXECUTIVE OFFICER. HER WO RK PROFILE WAS ALSO FILED AT PAPER BOOK PAGE NOS. 87-88. IT WAS ALSO SUBMITTED THAT SHE STARTED WORKING WITH THE ASSESSEE FROM FINANCIAL YEAR 2007-08 ONWARDS AND IN SUBSEQUENT FI NANCIAL YEAR 2012-13, SHE WAS ALSO PAID RS. 36 LAKHS. THE SA ID SALARY WAS ALLOWED U/S 143(3). COPY OF THE SAID ORDER WAS AL SO FILED BEFORE US. ALTHOUGH THE PROFIT HAD DECREASED IN THE CURRENT YEAR DUE TO EXPENSES, HOWEVER, THE TURNOVER INCREAS ED FROM ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 5 OF 13 RS. 5.53 CRORES IN ASSESSMENT YEAR 2010-11, RS. 7.3 6 CROES IN ASSESSMENT YEAR 2011-12, RS. 9.81 CRORES IN ASSESSM ENT YEAR 2012-13 (CURRENT YEAR ) AND RS. 12.58 CRORES IN ASS ESSMENT YEAR 2013-14. THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE FURTHER STATED THAT BASED ON C.B.D.T. CIRC ULAR, VARIOUS JUDGMENTS HAVE BEEN GIVEN WHERE PAYMENTS MAD E TO RELATED PERSONS WAS HELD TO BE ALLOWABLE. THE LD. AUT HORIZED REPRESENTATIVE OF THE ASSESSEE DREW OUR ATTENTION TO WARDS DECISION IN THE CASE OF PRINCIPAL CIT VS. GUJARAT G AS FINANCIAL SERVICES LIMITED, (2015) 60 TAXMANN.COM 483 (GUJ), WHEREIN IT WAS OBSERVED THAT THE ASSESSEE COMPANY AS WELL AS PA RENT COMPANY, BOTH WERE ASSESSED TO TAX AT MAXIMUM MARGIN AL RATE AND, THEREFORE, IT COULD NOT BE SAID THAT SERV ICE CHARGES WAS PAID TO G AT UNREASONABLE RATE TO EVADE TAX. WHE THER SINCE REVENUE COULD NOT POINT OUT THAT THE ASSESSEE EVADED PAYMENT OF TAX, INVOCATION OF SECTION 40A(2) WAS NOT VALID. THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE FURTH ER RELIED ON THE CASE OF CIT VS. INDO SAUDI SERVICES (TRAVEL) (P .) LIMITED, (2008) 219 CTR 562 (BOM), WHEREIN IT WAS HELD THAT WHE RE THE REVENUE WAS NOT IN A POSITION TO POINT OUT HOW THE A SSESSEE ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 6 OF 13 EVADED PAYMENT OF TAX BY ALLEGED PAYMENT OF HIGHER COMMISSION TO ITS SISTER CONCERN SINCE THE SISTER C ONCERN WAS ALSO PAYING TAX AT HIGHER RATE, AND COPIES OF THE A SSESSMENT ORDERS OF THE SISTER CONCERN WERE TAKEN ON RECORD B Y THE TRIBUNAL, DISALLOWANCE OF ALLEGED EXCESS COMMISSION PAID TO THE SISTER CONCERN WAS NOT JUSTIFIED. THE LD. AUTHOR IZED REPRESENTATIVE OF THE ASSESSEE ALSO CITED CIT VS. D EMPO & CO.P.LTD., (2011) 196 TAXMAN 193 (BOM), WHEREIN IT WA S HELD THAT WHERE THE ASSESSEE AS WELL AS ITS SUBSIDIARY WER E IN THE SAME TAX BRACKET AND PAID SAME RATE OF TAX, THERE WA S NO QUESTION OF DIVERSION OF FUNDS BY PAYING HIGHER RAT E TO SUBSIDIARY COMPANY AND, THEREFORE, NO DISALLOWANCE C OULD BE MADE U/S 40A(2) OF THE INCOME-TAX ACT, 1961. 7. THE LD. SR. DEPARTMENTAL REPRESENTATIVE S UPPORTED THE ORDERS OF THE LOWER AUTHORITIES. 8. WE HAVE CONSIDERED THE FACTS AND MATERIALS AVAILABLE ON RECORD. WE FIND THAT SMT. SEEMA BHANDARI, DAUGHTER -IN-LAW OF THE ASSESSEE HAS BEEN WORKING WITH THE ASSESSEE FOR T HE FINANCIAL YEAR 2007-08 ONWARDS. SHE WAS PAID REMUNER ATION AT RS. 4.60 LAKHS IN THE IMMEDIATELY PRECEDING YEAR , BUT DURING THE YEAR UNDER CONSIDERATION THE INCREASE IN REMUNERATION WAS BY 350%, ALTHOUGH IT IS THE CONTENT ION OF ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 7 OF 13 THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE T HAT INCREASE IN REMUNERATION IS DUE TO THE SERVICES OF SMT.BHAND ARI, WHICH WERE UTILIZED AS PART OF SUCCESSION PLANNING IN THE BUSINESS DUE TO OLD AGE OF THE ASSESSEE AND SHE WAS ALSO ACTI VELY WORKING AS CHIEF EXECUTIVE OFFICER FOR THE BUSINESS. WE HAVE ALSO NOTED THAT SHE IS ALSO PAYING TAX @ 30%. THERE FORE, THERE APPEARS NO EVASION OF TAX BY PAYING HIGHER AMOUNT O F REMUNERATION. THE CASE LAWS IN THE CASE OF PRINCIPAL CIT VS. GUJARAT GAS FINANCIAL SERVICES LIMITED, (2015) 60 TAXMANN.COM 483, AS RELIED UPON BY THE LD. AUTHORI ZED REPRESENTATIVE OF THE ASSESSEE ALSO SUPPORTS HIS CA SE, WHEREIN IT WAS HELD THAT WHERE THE RECIPIENT COMPANY AS WELL AS PARENT COMPANY, BOTH ARE ASSESSED TO INCOME TAX AT MAXIMUM MARGINAL RATE AND, THEREFORE, IT CANNOT BE SAID THA T THE SERVICE CHARGES IS PAID TO THE RECIPIENT COMPANY AT UNREASO NABLE RATE TO EVADE INCOME TAX. IT WAS ALSO NOTED THEREIN THAT SO FAR AS THE CIRCULAR DATED 06.07.1968 IS CONCERNED, IT MAKE S CLEAR THAT THE PROVISIONS OF SECTION 40A(2) AND PARTICULA RLY WITH REGARD TO THE TRANSACTION BETWEEN THE RELATIVES AND ASSOCIATES IS CONCERNED, THE SAME SHALL BE TREATED AS BONA FID E CASE UNLESS THE OFFICER FINDS IT THAT ONE OF THEM IS TRY ING TO EVADE PAYMENT OF TAX. IN THE LIGHT OF THESE DECISIONS, WE FIND THAT THE ASSESSEE AS WELL AS HIS DAUGHTER IN LAW ARE BEING A SSESSED AT THE MAXIMUM MARGINAL RATE AND, THEREFORE, THERE APP EARS NO GROUND FOR TAX EVASION. HOWEVER, WE ARE ALSO AWARE O F THE FACT THAT INCREASE IN THE TURNOVER AT 30% WAS SAME AS IN THE ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 8 OF 13 INCREASE OF TURNOVER OF 30% DURING THE PRECEDING YE AR. THEREFORE, INCREASE IN THE REMUNERATION @ 350% APPE ARS TO BE ON HIGHER SIDE. CONSIDERING THE NATURE OF SERVICES RENDERED BY SMT. SEEMA BHANDARI AND INCREASE IN TURNOVER DUE TO HER EFFORTS, IT WOULD BE REASONABLE TO CONSIDER A SUM OF RS. 1 LAC PER MONTH AS REASONABLE. THEREFORE, DISALLOWANCE OF RS. 20,70,833/- (-) 12,00,000/- = RS. 8,70,833/- IS CON FIRMED AND BALANCE IS DELETED. 9. GROUND NO. 4 RELATES TO DISALLOWANCE OF THE ENTIRE AMOUNT SPENT ON FOC (FREE OF COST ) AT RS. 16,29,22 9/-. 10. THE FACTS APROPOS, OF THIS GROUND ARE THA T THE AO NOTED THAT THE NET PROFIT OF THE ASSESSEE IS DECREA SED BY RS. 67,92,357/- WITH THE INCREASE OF GROSS PROFIT AT RS. 10,13,318/-. THE ASSESSEE HAS GIVEN FOC TO MANY CUS TOMERS AT RS. 16,26,229/-. THEREFORE, THE ASSESSEE WAS ASKE D TO FURNISH THE DETAILS OF FOC OF LAST THREE YEARS ALON GWITH SCHEME DETAILS FOR WHICH THE ITEMS ARE SOLD ON FOC BASIS TO DIFFERENT PARTIES, FOR WHICH NO PLAUSIBLE JUSTIFICATION WAS FOR THCOMING. THE AO ALSO NOTED THAT THE ASSESSEE DEBITED RS. 16, 26,229/- AS FOC, WHICH WAS NIL DURING THE PRECEDING YEAR WHERE AS THE ASSESSEE WAS WORKING ON SAME MODUS OPERANDI FROM LAS T ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 9 OF 13 SEVERAL YEARS. THEREFORE, THE CLAIM ,OF ASSESSEE RE GARDING FOC OF RS. 16,26,229/- WAS DISALLOWED. 11. THE LD. CIT(A) HAS ALSO OBSERVED THAT THE A SSESSEE HAS FAILED TO JUSTIFY THE EXPENDITURE ON ACCOUNT OF FOC DURING THE COURSE OF ASSESSMENT AS WELL AS APPELLATE PROCEEDING S. THEREFORE, THE DISALLOWANCE MADE BY THE AO WAS FOUND TO BE JUSTIFIED. 12. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF TRA DING IN MACHINERY & SPARE PARTS AND IMPLEMENTS IN THE NAME OF HIS PROPRIETORY BUSINESS CONCERNS M/S. NAVEEN TECH SOLU TION. IT WAS SUBMITTED THAT WHILE SELLING THE MACHINERY, THE C USTOMERS INSIST ON GETTING CERTAIN ACCESSORIES FOR FREE. LOO KING TO THE COMPETITIVE ENVIRONMENT, THE ASSESSEE HAD TO OFFER CERTAIN ACCESSORIES FOR FREE ALONGWITH THE MACHINERY. WHILE SETTING THE PRODUCT, A DETAILED DEAL SHEET WAS MADE ON THAT BA SIS, THE DEAL WAS DONE. THE ASSESSEE HAS FILED THE DETAILS O F PRODUCT BILLED, THE ACCESSORIES PROVIDED WAS ALSO GIVEN; INV OICE WAS ALSO PREPARED FOR ACCESSORIES, AS THE SAME WAS LIABL E FOR VAT. S.NO. NAME BILLED AMOUNT FOC EVIDENCES ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 10 OF 13 13. THE LD. AUTHORIZED REPRESENTATIVE OF THE AS SESSEE FURTHER CONTENDED THAT THE ASSESSEE HAD EFFECTED TU RNOVER OF RS. 2.65 CRORES JUST BY GIVING ACCESSORIES FREE OF COST OF RS. 14,82,344/- AND THE BALANCE AMOUNT OF DISCOUNT WAS GIVEN ON MISCELLANEOUS CONTRACT OF SMALL VALUES. IT WAS ALSO CONTENDED THAT THESE TRANSACTIONS WERE WITH NON-RELATED PARTIE S. IT WAS AMOUNT PB NOS. JAIN BOREWELLS & DRILLINGS 18,90,000 82,991 90-95 2. C. R. MITTAL & CO. 17,30,000 1,24,111 96-105 3. JAY AMBEY DRILLING CO. 17,00,000 98,435 106-112 4. TOMAR BUILDERS & CONTRACTORS 17,45,000 94,656 113-119 5. PATIDAR EXPLOSIVES 17,35,000 1,80,668 120-128 6. VINAYAK MINING CO. 18,78,850 93,882 129-134 7. CIPIL ANACPL JOINT VENTRUES 17,35,000 1,01,350 135-141 8. PARTH DEVELOPERS 17,11,000 95,499 142-149 9. RAJAT STONE CRUSHER 17,00,000 79,044 150-154 10. TEJKARAN GIRDHARILAL CHAWDA 18,34,665 88,513 155-160 11. SOLANKI CONSTRUCTION 17,00,000 92,705 161-167 12. KHAJURAHO BUILDERS & CONSTRUCTION 18,65,000 97,022 168-175 13. BANSAL CONSTRCUTION WORKS 17,00,000 86,786 176-181 14. PRAHLAD KUMAR TANK 18,44,000 88,937 182-187 15. SURENDRA SINGH KACHHAWA 18,11,000 77,845 188-193 TOTAL 2,65,79,515 14,82,344 ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 11 OF 13 FURTHER SUBMITTED THAT THIS WAS THE PART OF THE ADOP TING THE SALES PROMOTION TACTICS AND SUCH FOC WERE ALSO GIVE N DURING SUBSEQUENT ASSESSMENT YEAR 2014-15 AT RS. 9,27,804/ -, WHICH WERE ACCEPTED IN THE ASSESSMENT MADE U/S 143(3) AFTER DUE INQUIRY. THEREFORE, IT IS A SETTLED LAW THAT AO CANNOT GO INTO THE COMMERCIAL EXPEDIENCY OF THE TRANSACTION A S IT IS TO BE DECIDED BY THE BUSINESSMEN AND NOT BY THE AO. IN S UPPORT OF THIS CONTENTION, THE LD. AUTHORIZED REPRESENTATIVE OF THE ASSESSEE ALSO RELIED ON THE DECISION IN THE CASE OF H.B.ESTATE DEVELOPERS, 192 TAXATION 278 (DEL). THE LD. AUTHOR IZED REPRESENTATIVE OF THE ASSESSEE ALSO DREW OUR ATTENTI ON THAT THE AO/CIT(A) DID NOT DOUBT THE TRANSACTION, BUT THEY S IMPLY BRUSHED ASIDE THE TRANSACTION HOLDING THAT THE FOC WAS DONE FOR THE FIRST TIME, WHEREAS A PRUDENT BUSINESS-MAN I T HAD TO BE DONE TO INCREASE THE GROWTH IN THE TURNOVER. 14. THE LD. SR.DEPARTMENTAL REPRESENTATIVE HAS SUPPORTED THE FINDINGS OF LOWER AUTHORITIES AND ALSO POINTED O UT WHETHER SUCH EVIDENCES FILED BEFORE THE AO, IN RESPONSE TO WHICH THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THESE WER E GIVEN BEFORE THE LD. CIT(A). ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 12 OF 13 15. WE HAVE CONSIDERED THE FACTS AND MATERIALS AVAILABLE ON RECORD. WE FIND THAT THE FOC WERE GIVEN TO THE NON -RELATED PARTY ON ACCOUNT OF ACCESSORIES SUPPLIED FREE OF CO ST ALONGWITH THE MACHINERY ITEMS FOR WHICH DETAILS WERE FILED BEF ORE THE CIT(A) AS MENTIONED ABOVE. WE ALSO OBSERVE THAT IN SUBSEQUENT ASSESSMENT YEAR 2013-14 OF WHICH ASSESSME NT WAS MADE U/S 143(3) ON 16.11.2015. THE PAYMENT OF SU CH FOC AMOUNTING TO RS. 9,04,307/-WAS ACCEPTED AND NO DISALLOWANCE ON THE SAME SCORE HAS BEEN MADE. THIS I S THE BUSINESS EXPENDITURE, WHICH HAS BEEN INCURRED BY THE ASSESSEE BY WAY OF ADOPTING SALES PROMOTION INCREASE TACTICS, THE GENUINENESS OF WHICH HAS NOT BEEN DOUBTED BY THE LOWER AUTHORITIES. THEREFORE, IN ALL FAIRNESS, WE ARE OF THE CONSIDERED OPINION THAT DISALLOWANCE OF SUCH EXPENSES IS NOT DE SIRABLE. ACCORDINGLY, THE DISALLOWANCE OF RS. 16,29,229/- IS DELETED. THIS GROUND OF APPEAL IS ALLOWED. 16. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. THE ORDER HAS BEEN PRONOUNCED IN OPEN COURT ON 3 RD AUGUST, 2016. SD/- SD/- (D. T. GARASIA) ( O.P.MEENA) JUDICIALMEMBER ACCOUNTANT MEMBE R DATED: 3 RD AUGUST, 2016. CPU* ITA NO.111/IND/2016 AY 12-13 SHRI RANDHIR SINGH BHA NWAR SINGH, BHANDARI PAGE 13 OF 13