M/s. East West Rescue Private Ltd., New Delhi V. DCIT, New Delhi

ITA 3880/DEL/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5277 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 26-07-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 04-07-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: P N MONGA SHRI MANU MONGA
• Keywords: Depreciation; Earning of tax free income; Revised return
• Section: 14A; 12; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI D BEN CH, NEW DELHI BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER AND SHRI K.N. CHARY, JUDICIAL MEMBER. ITA NO. 3880/DEL/2014 [ASSESSMENT YEAR: 2010-11] EAST WEST RESCUE PRIVATE LIMITED VS. DCIT 38, GOLF LINKS, CIRCLE 3(1) NEW DELHI NEW DELHI PAN : AAACE 0482 H [APPELLANT] [RESPONDENT] DATE OF HEARING : 03.08.2017 DATE OF PRONOUNCEMENT : 03.08.2017 ASSESSEE BY : SHRI P.N. MONGA, SHRI MANU MONGA, AR REVENUE BY : SHRI ANSHU PRAKASH , CIT-DR ORDER PER B.P. JAIN, ACCOUNTANT MEMBER, THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE LD. CIT(A)-XXVIII, NEW DELHI VIDE ORDER DATED 23.05.201 4 FOR ASSESSMENT YEAR 2010-11. 2 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL; 1.THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEAL) HAS ERRED IN FACT & IN LAW WHILE CONFIRMING DISALLOWAN CE OF RS. 8,31,908/- APPLYING SECTION 14A OF THE INCOME TAX A CT, 1961 AND RULE 8D OF THE INCOME TAX RULES. 2.THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEAL) HAS ERRED IN FACT & IN LAW WHILE CONFIRMING THE DISAL LOWANCE OF RS.1,185/- OUT OF THE CLAIM OF DEPRECIATION. 3.THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EAL) HAS ERRED IN FACT & IN LAW WHILE CONFIRMING DISALLOWANCE OF RS.62,403/- BEING PAYABLE TO SUNDRY CREDITOR AS NO N-PAYABLE. 4.THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EAL) HAS ERRED IN FACT & IN LAW WHILE CONFIRMING DISALLOWANC E OF RS.22,000/- PAID AS FEE FOR ARBITRATION TO JUSTICE R. L. KHURANA, FOR NON-DEDUCTION OF TDS; WHERE THE SAID FEE IS NOT COVERED IN THE DEFINITION OF PROFESSIONAL FEE. 5.THAT THE LEARNED COMMISSIONER OF INCOME TAX (APP EAL) HAS ERRED IN FACT & IN LAW WHILE CONFIRMING DISALLOWANC E OF RS.2,20,924/- TOWARDS PERSONAL USE OUT OF / TRAVELL ING EXPENSE (RS. 53,181/-), TELEPHONE EXPENSES (RS. 67743/-) & BUSINESS. PROMOTION (RS. 1,00,000/-) 3 6. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEAL) HAS ERRED IN FACT & IN LAW WHILE DISALLOWING THE CLAIM OF THE ASSESSEE IN RESPECT OF CARRY FORWARD OF LOSS OF RS 4,11,895/ -, AND INSTEAD TREATING IT AS LONG TERM CAPITAL GAIN OF RS. 23,83, 252/- AND INCLUDING THE SAME IN THE TAXABLE INCOME OF THE ASS ESSEE. 3. AS REGARDS GROUND NO. 1, THE BRIEF FACTS OF THE CASE ARE THAT THE LD. CIT(A), AFTER CAREFUL CONSIDERATION OF THE ASSE SSMENT ORDER AND SUBMISSIONS THEREOF, OBSERVED THAT THE ASSESSEE REC EIVED DIVIDEND INCOME OF RS. 71,89,451/- WHICH HAS BEEN CLAIMED AS EXEMPT U/S 10(34) OF THE INCOME-TAX ACT, 1961 [HEREINAFTER REF ERRED TO AS 'THE ACT' FOR SHORT]. THE LD. CIT(A) FURTHER OBSERVED THAT T HE ASSESSEE HAS ALSO MADE INVESTMENT IN SHARES, MUTUAL FUNDS AND BONDS E TC. THE ASSESSING OFFICER THUS INVOKED THE PROVISIONS OF SECTION 14A BY PROVIDING THE ASSESSEE DUE OPPORTUNITY. ON THE BASIS OF DETAILED REASONS GIVEN ON PAGES 2 TO 5 OF THE ASSESSMENT ORDER THE ASSESSING OFFICER EXPRESSED HIS SATISFACTION THAT THE ASSESSEE COMPANY HAD INVE STED IN SHARES AND WOULD GENERATE INCOME WHICH DOES NOT OR SHALL NOT F ORM PART OF TOTAL INCOME OF THE ASSESSEE COMPANY AND INDIRECT COST IN THE FORM OF ADMINISTRATIVE EXPENDITURE AND INTEREST IS INVOLVED IN THIS PROCESS. HE ACCORDINGLY MADE A DISALLOWANCE OF RS.8,31,908/- UN DER CLAUSE (III) OF RULE 8D(2) OF THE ACT. THE LD. CIT(A) FURTHER OBSE RVED THAT DURING THE APPELLATE PROCEEDINGS, THE APPELLANT REITERATED ITS SUBMISSIONS AND 4 CLAIMED THAT NO DISALLOWANCE WAS CALLED FOR UNDER C LAUSE (III) AS THE ASSESSEE DOES NOT HAVE TO INCUR ANY EFFORT TO RECEI VE OR RECOVER THE INCOME. THE ASSESSEE HAS NOT TAKEN ANY LOAN OR PAID ANY INTEREST IN RESPECT OF ANY INVESTMENT AND NO DECISION OR ADMINI STRATIVE EXPENSE HAS BEEN INCURRED ON THE MANNER OF INVESTMENTS. AC CORDINGLY, THE LD. CIT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICE R. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. AT THE OUTSET, WE DO NOT FIND ANY INFIRMITY I N THE ORDER OF THE LD. CIT(A). THE ASSESSING OFFICER HAS EXPRESSED HIS SA TISFACTION BEFORE TAKING RECOURSE TO RULE 8D. FURTHER, IT WAS OBSERVE D BY THE LD. CIT(A) THAT ANY INCOME, WHETHER EXEMPT OR NOT, CAN ONLY BE EARNED AFTER INCURRING SOME EXPENDITURE. IN THE CASE OF THE ASSE SSEE, SUCH EXPENDITURE CANNOT BE SEGREGATED IN THE ACCOUNTS OF THE ASSESSEE AND IS CLUBBED WITH OVERALL ADMINISTRATIVE/FINANCIAL AN D OTHER EXPENSES OF THE BUSINESS AS A WHOLE. IF ANY INCOME IS EXEMPT FR OM TAX BECAUSE IT IS NOT INCLUDED IN THE TOTAL INCOME BY VIRTUE OF SECTI ON 10 OF THE INCOME- TAX ACT, 1961, SECTION 14A OF THE ACT PROHIBITS ALL OWANCE OF ANY EXPENDITURE INCURRED IN RELATION THERETO. INCOME FR OM DEPLOYMENT OF FUNDS IN SHARES EARNED BY WAY OF DIVIDEND IS NOT IN CLUDED IN TOTAL INCOME BY VIRTUE OF THE PROVISIONS CONTAINED IN SEC TION 10(34) OF THE 5 ACT, WHETHER THE SHARES ARE HELD AS STOCK-IN-TRADE OR AS INVESTMENT. AS DIVIDEND INCOME DOES NOT FORM PART OF TOTAL INCOME UNDER THE ACT, THE PROVISIONS OF SECTION 14A ARE APPLICABLE. THE ALLOW ANCE OF EXPENDITURE IN RELATION TO DIVIDEND INCOME IS THUS NOT ADMISSIB LE IN COMPUTING THE INCOME OF AN ASSESSEE WHETHER THE SHARES ARE HELD A S INVESTMENT OR THEY ARE HELD ON TRADING ACCOUNT AS STOCK-IN-TRADE. THE PROVISIONS OF SECTION 14A, CONTROLS THE COMPUTATION OF INCOME UND ER THE PROVISIONS OF THE ACT AND HAS OVERRIDING EFFECT OVER OTHER PRO VISIONS. THEREFORE, EVEN IF THE EXPENDITURE IS ALLOWABLE UNDER ANY OTHE R PROVISION OF THE ACT, DISALLOWANCE IS MADE BECAUSE OF THE OVERRIDING EFFECT OF SECTION 14A OF THE ACT. 5. WE FURTHER OBSERVE THAT THE LEGISLATURE, BY USIN G THE EXPRESSION 'EXPENDITURE IN RELATION TO INCOME WHICH DOES NOT F ORM PART OF THE TOTAL INCOME' IN SECTION 14A OF THE ACT, IN NO WAY INDICATES THAT IT DOES NOT ENCOMPASS DISALLOWANCE OF EXPENDITURE INCURRED IN RELATION TO THE INCOME IN THE ABSENCE OF ACTUAL RECEIPT OF INCOME D URING THE RELEVANT PREVIOUS YEAR. ON THE CONTRARY, THE TERM 'IN RELATI ON TO' IS WIDE ENOUGH TO INCLUDE IN ITS SWEEP EXPENDITURE BOTH 'FOR MAKIN G OR EARNING INCOME' AND 'INCURRED WHOLLY AND EXCLUSIVELY FOR TH E PURPOSES OF BUSINESS CARRIED ON BY THE ASSESSEE'. WHEN THERE IS NO INCOME, IT 6 CANNOT FORM PART OF ANYTHING AND CERTAINLY IT DOES NOT, IN ANY CASE FORM PART OF TOTAL INCOME. WHEN DIVIDEND IS NOT TAX ABLE AT ALL, THE EXPENSES PERTAINING TO THAT WOULD ALSO NOT BE ALLOW ABLE BECAUSE THERE IS NO TAXABLE INCOME OF THE ASSESSEE AGAINST WHICH SUCH EXPENSES CAN BE ALLOWED. 6. FURTHER, SUB-SECTION (2) OF SECTION 14A EMPOWERS THE AO TO DETERMINE THE AMOUNT OF EXPENDITURE INCURRED IN REL ATION TO EXEMPT INCOME IN ACCORDANCE WITH THE METHOD AS MAY BE PRES CRIBED. THE METHOD HAS SINCE BEEN PRESCRIBED BY INSERTION OF RU LE 8D OF THE I.T. RULES, 1962 W.E.F. 24.03.2008. SUB-SECTION (3) OF S ECTION 14A MANDATES THAT THE ABOVE PROVISIONS OF SUB-SECTION (2) SHALL ALSO APPLY TO A CASE WHERE AN ASSESSEE CLAIMS THAT NO EXPENDITURE HAS BE EN INCURRED BY HIM IN RELATION TO EXEMPT INCOME. THE CONSTITUTIONA L VALIDITY OF SECTION 14A READ WITH SUB-SECTIONS (1), (2) AND (3) THEREOF HAS SINCE BEEN UPHELD BY THE HONBLE BOMBAY HIGH COURT VIDE ITS ORDER DATED 12.08.2010 IN THE CASE OF GODREJ & BOYCE MFG. CO. LTD. VS. DCIT IN ITA NO. 626 OF 2010 AND WRIT PETITION NO. 758 OF 20 10 AFTER DWELLING ON THE ABOVE ISSUE IN GREAT DETAILS AND CONSIDERING DECISIONS OF VARIOUS COURTS AND TRIBUNALS ON THE MATTER INCLUDING THAT OF ITAT, MUMBAI (SPECIAL BENCH) IN THE CASE OF ITO VS. DAGA CAPITAL 7 MANAGEMENT PVT. LTD. (2009) 117 ITD 169. THE HONBL E HIGH COURT HAS ALSO UPHELD THE VALIDITY OF RULE 8D, W.E.F. AY 2008 -09. THE RELEVANT PORTION OF THE AFORESAID ORDER OF THE HONBLE HIGH COURT IS REPRODUCED HEREUNDER: OUR CONCLUSION IN THIS JUDGMENT ARE AS FOLLOWS: I. DIVIDEND INCOME AND INCOME FROM MUTUAL FUNDS FA LLING WITHIN THE AMBIT OF SECTION 10(33) OF THE INCOME TA X ACT 1961, AS WAS APPLICABLE FOR ASSESSMENT YEAR 2002-03 IS NOT INCLUDIBLE IN COMPUTING THE TOTAL INCOME OF THE ASS ESSEE. CONSEQUENTLY, NO DEDUCTION SHALL BE ALLOWED IN RESP ECT OF EXPENDITURE INCURRED BY THE ASSESSEE IN RELATION TO SUCH INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT, BY VIRTUE OF THE PROVISIONS OF SECTION 14A (1); II) THE PAYMENT BY A DOMESTIC COMPANY UNDER SECTION 115(1) OF ADDITIONAL INCOME TAX ON PROFITS DECLARED, DISTR IBUTED OR PAID IS A CHARGE ON A COMPONENT OF THE PROFITS OF T HE COMPANY. THE COMPANY IS CHARGEABLE TO TAX ON ITS PR OFITS AS A DISTINCT TAXABLE ENTITY AND IT PAYS TAX IN DISCHA RGE OF ITS OWN LIABILITY AND NOT ON BEHALF OF OR AS AN AGENT F OR ITS SHAREHOLDERS. IN THE HANDS OF THE SHAREHOLDER AS TH E RECIPIENT OF DIVIDEND, INCOME BY WAY OF DIVIDEND DO ES NOT FORM PART OF THE TOTAL INCOME BY VIRTUE OF THE PROV ISIONS OF SECTION 10(33). INCOME FROM MUTUAL FUNDS STANDS ON THE SAME BASIS; 8 III) THE PROVISIONS OF SUB SECTION (2) AND (3) OF S ECTION 14A OF THE INCOME TAX ACT 1961 ARE CONSTITUTIONALLY VALID; IV) THE PROVISIONS OF RULE 8D OF THE INCOME TAX RULES AS INSERTED BY THE INCOME TAX (FIFTH AMENDMENT) RULES 2008 ARE NOT ULTRA VIRES THE PROVISIONS OF SECTION 14A, MORE PARTICULARLY SUB SECTION (2) AND DO NOT OFFEND ARTICLE 14 OF THE CONSTITUTION; V) THE PROVISIONS OF RULE 8D OF THE INCOME TAX RULES WHICH HAVE BEEN NOTIFIED WITH EFFECT FROM 24 MARCH 2008 S HALL APPLY WITH EFFECT FROM ASSESSMENT YEAR 2008- 09;' 7. IN ACIT V CITICORP FINANCE (INDIA) LIMITED [300 ITR 398(AT MUM)] IT WAS HELD THAT THE PROVISIONS OF SUB SECTIONS (2) & (3) ARE PROCEDURAL IN NATURE AND THEREFORE SECTION 14A WILL APPLY TO A LL PENDING MATTERS. THE HON'BLE CALCUTTA HIGH COURT IN DHANUKA & SONS V S. CIT 12 TAXMANN.COM 227 (CAL.) HELD THAT: ' IN OUR OPINION, THE MERE FACT THAT THOSE SHARES WER E OLD ONES AND NOT ACQUIRED RECENTLY IS IMMATERIAL. IT IS FOR THE ASSESSEE TO SHOW THE SOURCE OF ACQUISITION OF THOSE SHARES BY PRODUC TION OF MATERIALS THAT THOSE WERE ACQUIRED FROM THE FUNDS A VAILABLE IN THE HANDS OF THE ASSESSEE AT THE RELEVANT POINT OF TIME WITHOUT TAKING BENEFIT OF ANY LOAN. IF THOSE SHARES WERE PU RCHASED FROM THE AMOUNT TAKEN IN LOAN, EVEN FOR INSTANCE, FIVE O R TEN YEARS AGO, IT IS FOR THE ASSESSEE TO SHOW BY THE PRODUCTI ON OF DOCUMENTARY EVIDENCE THAT SUCH LOANED AMOUNT HAD AL READY BEEN PAID BACK AND FOR THE RELEVANT ASSESSMENT YEAR, NO INTEREST IS 9 PAYABLE BY THE ASSESSEE FOR ACQUIRING THOSE OLD SHA RES. IN THE ABSENCE OF ANY SUCH MATERIALS PLACED BY THE ASSESSE E, IN OUR OPINION, THE AUTHORITIES BELOW RIGHTLY HELD THAT PR OPORTIONATE AMOUNT SHOULD BE DISALLOWED HAVING REGARD TO THE TO TAL INCOME AND THE INCOME FROM THE EXEMPT SOURCE. IN THE ABSEN CE OF ANY MATERIAL DISCLOSING THE SOURCE OF ACQUISITION OF SH ARES WHICH IS WITHIN THE SPECIAL KNOWLEDGE OF THE ASSESSEE, THE A SSESSING AUTHORITY TOOK A MOST REASONABLE APPROACH IN ASSESS MENT.' 8. CONSIDERING THE ABOVE, THE IMPUGNED ADDITION OF RS. 8,31,908/- MADE BY THE AO BY APPLYING RULE 8D READ WITH SECTIO N 14A OF THE ACT HAS RIGHTLY BEEN CONFIRMED BY THE LD. CIT(A). IN V IEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER OF T HE LD. CIT(A) ON THE ISSUE IS CONFIRMED AND GROUND RAISED BY THE ASSESSE E IS DISMISSED. 9. AS REGARDS GROUND NO. 2, THE BRIEF FACTS PERTAIN ING TO THIS GROUND ARE THAT THE ASSESSING OFFICER NOTICED THAT THE BIL LS WERE NOT IN THE NAME OF THE COMPANY BUT IN THE NAME OF THE DIRECTOR OF THE ASSESSEE COMPANY AND THE PAYMENT HAS BEEN MADE BY THE COMPAN Y AND BELONG TO THE COMPANY, THEREFORE, THE ASSETS PURCHASED WER E CAPABLE OF PERSONAL USE. ACCORDINGLY, THE ASSESSING OFFICER M ADE THE DISALLOWANCE WHICH WAS CONFIRMED BY THE LD. CIT(A). 10 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. WE FIND THAT NO PLAUSIBLE EXPLANATION HAS BE EN GIVEN EITHER BEFORE THE AUTHORITIES BELOW OR EVEN BEFORE US. TH EREFORE, THE ASSETS PURCHASED BY THE ASSESSEE, LIKE FURNITURE AND MOBIL E SET ARE CAPABLE OF PERSONAL USE. ACCORDINGLY, IN THE ABSENCE OF ANY S ATISFACTORY EXPLANATION, WE DO NOT FIND ANY INFIRMITY IN THE OR DER OF THE LD. CIT(A) WHO HAS RIGHTLY CONFIRMED THE ACTION OF THE ASSESSI NG OFFICER. THUS, GROUND NO. 2 OF THE ASSESSEE IS DISMISSED. 11. AS REGARDS GROUND NO. 3, THE ASSESSING OFFICER MADE DISALLOWANCE OF RS. 62,403/- ON ACCOUNT OF UNCONFIRMED CREDITORS , WHICH ACTION OF THE ASSESSING OFFICER WAS CONFIRMED BY THE LD. CIT( A). 12. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. AS A MATTER OF FACT, IT WAS PLEADED BEFORE TH E LD. CIT(A) AS WELL AS BEFORE US THAT THE PARTY IS DEMANDING MONEY AND COPY OF DEMAND LETTER HAS BEEN PLACED ON RECORD. BUT THE LD. CIT( A) HAS NOT COMMENTED UPON SUCH DEMAND LETTER AND HAS NOT MADE ANY ENQUIRY IN THIS REGARD. IN THE INTEREST OF JUSTICE, THE MATTE R IS SET ASIDE TO THE FILE OF THE LD. CIT(A) WHO WILL CONDUCT PROPER ENQU IRY AND FIND OUT WHETHER THE CREDITORS ARE STILL OUTSTANDING AND GEN UINENESS OF THE 11 DEMAND LETTER SO PLACED ON RECORD. ACCORDINGLY, GR OUND NO. 3 IS ALLOWED FOR STATISTICAL PURPOSES. 13. AS REGARDS GROUND NO.4 OF THE ASSESSEE, WE FIND THAT THE ASSESSING OFFICER DISALLOWED NON DEDUCTION OF TDS O N FEES PAID TO ARBITRATORS WHICH WAS CONFIRMED BY THE LD. CIT(A). 14. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. WE FIND THAT THE LD. COUNSEL FOR THE ASSESSE E HAS MADE THE FOLLOWING SUBMISSIONS BEFORE THE LD. CIT(A) : IN RESPECT OF PAYMENT MADE TO SH. JUSTICE R.L. KH URANA, ARBITRATOR, THE SAME DOES NOT FALL IN THE CATEGORY OF PROFESSIONAL FEE AND AS SUCH NO TDS IS APPLICABLE. IN SECTION 19 4J IN THE EXPLANATION IT IS EXPLAINED THAT 'PROFESSIONAL SERVICES' MEANS SERVICES RENDERED BY A PERSON IN THE COURSE OF CARRYING ON LEGAL, MEDICAL, ENGINEERI NG OR ARCHITECTURAL PROFESSION OR THE PROFESSION OF ACCOU NTANCY OR TECHNICAL CONSULTANCY OR INTERIOR DECORATION OR ADV ERTISING OR SUCH OTHER PROFESSION AS IS NOTIFIED BY THE BOARD F OR THE PURPOSES OF SECTION 44A A OR OF THIS SECTION' 12 IT IS VERY CLEAR FROM THE ABOVE THAT ARBITRATION FE E IS NOT COVERED BY THE DEFINITION OF PROFESSIONAL SERVICES AS MENTIONED ABOVE ALSO DOES NOT FALL IN ANY OF THE CATEGORIES M ENTIONED THEREIN. THE ARBITRATION PROCEEDINGS DO NOT FALL IN ANY OF THE CATEGORIES MENTIONED ABOVE. IN RESPECT OF THE PROFESSIONS NOTIFIED UNDER SECTIO N 44AA OF THE INCOME TAX ACT, 1961, AS PER CIRCULAR NO. 205 DATED 27-07- 1976, AS WELL AS THE ARBITRATION IS NOT A PROFESSIO N COVERED BY THE CIRCULAR. COPY OF THE CIRCULAR IS ATTACHED. 15. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE WE DO NOT AGREE WITH THE SUBMISSIONS OF THE ASSESSEE SINC E THE TDS IS DEDUCTED ON SERVICES RENDERED WHETHER LEGAL, TECHNI CAL OR AS MENTIONED IN SECTION 194J OF THE ACT. THEREFORE, T AX REQUIRED TO BE DEDUCTED. WE FIND NO INFIRMITY IN THE ORDER OF T HE LD. CIT(A) AND THUS GROUND NO. 4 OF THE ASSESSEE IS DISMISSED. 16. AS REGARDS GROUND NO. 5, THE ASSESSING OFFICER MADE DISALLOWANCE OF RS. 220924/- FOR PERSONAL USE ON ACCOUNT OF TRAV ELLING EXPENSES AND TELEPHONE EXPENSES @ 10% OF THE CLAIM AND RS. 1 LAK HS ON ACCOUNT OF BUSINESS PROMOTION FOR PERSONAL USE WHICH ACTION OF THE ASSESSING OFFICER WAS CONFIRMED BY THE LD. CIT(A). 13 17. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THE ASSESSEE IS NOT MAINTAINED ANY RECORD FO R USE OF VEHICLE AND TELEPHONE AND THEREFORE, PERSONAL USE CANNOT BE RUL ED OUT AND ALSO NO ACCOUNT FOR BUSINESS PROMOTION HAS BEEN MAINTAINED AND, THEREFORE, PERSONAL USE AT THIS JUNCTURE, CAN ALSO NOT BE RULE D OUT. EXPENSES APPEAR TO BE QUITE REASONABLE. THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) WHO HAS RIGHTLY CONFIRMED T HE ACTION OF THE ASSESSING OFFICER IN THIS REGARD. ACCORDINGLY, GRO UND NO. 5 IS DISMISSED. 18. AS REGARDS GROUND NO. 6, THE BRIEF FACTS ARE TH AT THE ASSESSING OFFICER MADE DISALLOWANCE OF LOSS FOR LONG TERM CAP ITAL GAIN AS PER REVISED COMPUTATION, WHICH ACTION WAS CONFIRMED BY THE LD. CIT(A). 19. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. AS A MATTER OF FACTS, THE ASSESSEE FILED REVI SED COMPUTATION DURING THE COURSE OF ASSESSMENT PROCEEDINGS WHICH W AS NOT ACCEPTED BY THE AUTHORITIES BELOW FOR THE REASON THAT THE AS SESSEE SHOULD HAVE MADE THE CLAIM THROUGH REVISED RETURN. IT IS SETTL ED LAW THAT THE CLAIM WHICH IS LEGALLY PERMISSIBLE SHOULD OTHERWISE BE AL LOWED BY THE ASSESSING OFFICER WHICH, IN FACT, HAS NOT BEEN ALLO WED IN THE PRESENT CASE AND, THEREFORE, THE MATTER IS SET ASIDE TO THE FILE OF THE ASSESSING 14 OFFICER WHO WILL ALLOW THE CLAIM AFTER VERIFYING TH E GENUINENESS OF THE COMPUTATION OF LOSS AS PER REVISED COMPUTATION FILE D DURING THE ASSESSMENT PROCEEDINGS. THUS, GROUND NO. 6 OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 20. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 03.0 8.2017. SD/- SD/- [K.N. CHARY] [B.P. JAIN] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 03 RD AUGUST, 2017 VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI