DR DEEPAK M. UGRA, MUMBAI V. ACIT 11(2), MUMBAI

ITA 6391/MUM/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 71935 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2009-2010
• Appeal Filed On: 18-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHOK SURI
• Assessee Lawyers: PRASAD RAO
• Section: 37

Judgement Text

- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL E BEN CH, MUMBAI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER ITA NO.6391/MUM/2012 ASSESSMENT YEAR:- 2009-10 DR. DEEPAK M. UGRA A-402/403, SAUSALITO, KIAPARK, PRATHAMESH COMPLEX, VEERA DESAI ROAD, ANDHERI (W), MUMBAI 400 053. VS. ACIT (11) (2), AAYAKAR BHAWAN, M.K. MARG, NEW MARINE LINES, MUMBAI. PAN:- AAAPU3323L APPELLANT RESPONDENT APPELLANT BY SHRI PRASAD RAO RESPONDENT BY SHRI ASHOK SURI ORDER PER I.P. BANSAL, JM THIS APPEAL IS FILED BY THE ASSESSEE. IT IS DIRECTE D AGAINST THE ORDER PASSED BY CIT(A) DATED 7 TH AUGUST 2012 FOR ASSESSMENT YEAR 2009-10. GROUNDS O F APPEAL READS AS UNDER:- 1. THE HONBLE CIT(A)-3, ERRED IN LAW AND ON THE FA CTS AND IN THE CIRCUMSTANCES OF THE CASE IN CONFIRMING ALLEGED DISALLOWANCE OF R S. 1,26,853/- DEBITED UNDER THE HEAD PATIENTS EDUCATION EXPENSES. THESE EXPENSES ARE STAMP AND FRANKING CHARGES PAID TO POSTAL AUTHORITIES FOR MAILERS SENT TO PARE NTS OF CHILDREN (PATIENTS) AND INDIAN ACADEMY OF PEDIATRICIANS (IAP) ON PEDIATRICS AND CHILDCARE. THESE EXPENSES HAVING BEEN INCURRED IN THE ORDINARY COURSE OF CARR YING ON PROFESSION BE ALLOWED AS FULL AS CLAIMED. LQUOKBZ DH RKJH[K@ DATE OF HEARING 19-12-2013 ?KKS'K.KK DH RKJH[K@ DATE OF PRONOUNCEMENT 19-12-2013 - 2 - 2. THE HONBLE CIT(A)-3, MUMBAI, ERRED IN LAW AND O N THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE IS NOT CONSIDERING AND AL LOWING CLAIM OF EXPENSES OF RS. 22,500/- BEING ACCOUNTING CHARGES RS. 19,663/- BEIN G AUDIT FEE AND RS. 2,050/- BEING PROFESSIONAL FEES PAID, DEBITED TO CAPITAL AC COUNT INSTEAD OF INCOME & EXPENDITURE ACCOUNT, THOUGH A SPECIFIC CLAIM WAS MA DE IN THE ASSESSMENT PROCEEDINGS. THESE EXPENSES HAVING BEEN INCURRED IN THE ORDINARY COURSE OF CARRYING ON PROFESSION BE ALLOWED IN FULL AS CLAIMED. YOUR APPELLANT CRAVES TO LEAVE, TO ADD TO, AMEND, MODIFY OR ALTER, THE AFORESAID GROUNDS AND/OR ADDUCE FURTHER EVIDENCE, B EFORE OR AT THE TIME OF HEARING. 2. THE ASSESSEE IS A DOCTOR AND HAS DECLARED HIS IN COME UNDER THE HEAD INCOME FROM PROFESSION. FROM THE DETAILS OF EXPENDITURE M AINTAINED BY THE ASSESSEE, IT WAS FOUND BY THE AO THAT THE ASSESSEE HAS CLAIMED A SUM OF RS. 1,26,853/- UNDER THE HEAD PATIENT EDUCATION EXPENSES. IT WAS CLAI MED THAT THESE EXPESES ARE COST OF SENDING MAILERS TO PEDIATRICIAN WHO WERE THE MEM BERS OF IAP( INDIAN ACADEMY OF PEDIATRICIAN) AND CLIENTS AND OTHER DOCTORS. THE DRAFT MAILER WAS ALSO SUBMITTED FOR REFERENCE. ACCORDING TO AO THESE EXPENSES COULD NOT BE CLAIMED U/S 37 AS THOSE HAVE NOT BEEN INCURRED WHOLLY AND EXCLUSIVELY FOR T HE PURPOSE OF BUSINESS. ACCORDING TO AO THESE EXPENSES ARE MERELY FOR ALTRU ISTIC CONSIDERATION AND MAINLY TO SATISFY HIS PHILANTHROPIC URGES AND ALSO FOR MAI NLY IN ORDER TO WIN APPLAUSE OR EARN GARLANDS OR PUBLIC APPRECIATION. LD. CIT(A) HA S ALSO UPHELD THE DISALLOWANCE. 3. WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE. TH E ASSESSEE IS A DOCTOR BY PROFESSION. DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAS EARNED PROFESSIONAL INCOME OF MORE THAN 14,00,000/- WHICH HAS BEEN DESCRIBED AT PAGE 2 OF THE ASSESSMENT ORDER. THE ASSESSEE HAS SENT SOME LETTERS TO THE DOCTORS WHO ARE ENGAGED WITH THIS ACTIVITY OF PEDIATRICS AND CHILDC ARE WHICH WERE CLAIMED BY THE ASSESSEE AS PATIENT EDUCATION EXPENSES. SUCH EXPENS ES CANNOT BE SAID TO BE NOT - 3 - INCURRED BY THE ASSESSEE FOR THE PURPOSE OF HIS PRO FESSION. THIS CANNOT BE DESCRIBED AS EXPENSES INCURRED BY THE ASSESSEE AS CHARITY. TH EREFORE, THE DISALLOWANCE IS DELETED AND GROUND NO. 1 IS ALLOWED. 4. GROUND NO. 2; THE ASSESSEE HAS CLAIMED THESE EXP ENSES BEING ACCOUNTING CHARGES AND AUDIT FEES. THE VOUCHERS FOR THESE EXPE NSES ARE ALSO ENCLOSED IN THE PAPER BOOK AT PAGES 27, 28 AND 29. AT PAGE 27 THE V OUCHER FOR ACCOUNTING CHARGES PLACED WHICH IS A SUM OF RS. 22,500/- AND AT PAGE 2 8 RS. 2,050/- IS CHARGED ON ACCOUNT OF PREPARING AND FILING TDS RETURNS BY A.S. GUJRAL & CO. CHARTERED ACCOUNTANTS. AT PAGE 29 FURTHER A SUM OF RS. 19,663 /- IS CHARGED BY THE A.S. GUJRAL & CO. ON ACCOUNT OF AUDIT FEES FOR ASSESSMEN T YEAR 2008-09. 5. IN THIS VIEW OF THE SITUATION, AFTER HEARING BOT H THE PARTIES, AS THESE EXPENSES HAVE BEEN INCURRED FOR THE PURPOSE OF PROFESSION OF THE ASSESSEE WE DELETE THE DISALLOWANCE AND ALLOW GROUND NO. 2. 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 -12-2 013. SD/- SD/- (N.K. BILLAIYA) (I.P. BANSAL) ACCOUNTANT MEMBER JUDICIAL MEMBER SKS SR. P.S, MUMBAI DATED 19-12-2013 - 4 - COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, E BENCH, ITAT, MUMBAI //TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI