SHOMA G ANAND, MUMBAI V. ITO WD 11(1)2, MUMBAI

ITA 8634/MUM/2011

• Counselvise Citation: 863419914 RSA 2011
• Duration Of Justice: 3 year(s) 5 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2015
• Appeal Filed By: Assessee
• Bench Allotted: E
• Next Hearing Date: 17-06-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 22-12-2011
• Court: TRIBUNAL
• Department Lawyers: ADGIRI
• Assessee Lawyers: J P PUROHIT
• Keywords: Depreciation
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E , BENCH MUMBAI . . , , BEFORE SHRI R.C.SHARMA , A M & SHRI SANJAY GARG , J M ./ ITA NO . 8634 / MUM/20 1 1 ( / ASSESSMENT YEAR : 200 7 - 08 ) MRS. SHOMA G.ANAND, 401, REGENT CHS LTD., PARVATI NAGAR - 2, SAI GANESH LANE, OFF:YARI ROAD, VERSOVA, ANDHERI(WEST), MUMBAI - 61 VS. ITO, WARD - 11(1)(2), MUMBAI - 20 ./ ./ PAN/GIR NO. : A BBPS 3569 E ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI J.P.PUROHIT /REVENUE BY : SHRI B.YADGIRI / DATE OF HEARING : 1 7 /0 6 / 2015 / DATE OF PRONOUNCEMENT 17/06 /2015 / O R D E R PER R.C.SHARMA (A.M) : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 3 , MUMBAI , DATED 1 - 11 - 2011 FOR THE ASSESSMENT YEAR 200 7 - 08 IN THE MATTER OF ORDER PASSED U/S. 143(3) OF THE I. T. ACT . 2. IN THIS CASE, THE ASSESSEE IS AGGRIEVED FOR DISALLOWANCE OF 50% ON CASH EXPENSES OF RS.22,66,186/ - AND 50% OF EXPENDITURE CLAIMED ON DEPRECIATION ON CAR, INTEREST ON CAR LOAN, HAIR DRESSERS CHARGES. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECOR D PERUSED. FACTS IN BRIEF ARE THAT T HE ASSESSEE IS A FILM ARTISTS. THE ASSESSEE SHOWN NET INCOME ,AT RS. 11.94 LAKHS AGAINST PROFESSIONAL RECEIPTS OF RS. 52.52 ITA NO. 8634 /1 1 2 LAKHS. THE AO EXAMINED THE BILL/VOUCHERS PRODUCED BY THE ASSESSEE AND NOTED THAT EXPENSES AMOUN TING TO RS. 22,66,186 UNDER THE VARIOUS HEADS LIKE CONVEYANCE , PROFESSIONAL CHARGES, PRINTING SALARY, SUNDRY EXPENSES, TELEPHONE EXPENSES TRAVELLING EXPENSES VEHICLE EXPENSES WAGES MAKEUP MAN, SPOT BO Y ETC WERE INCURRED IN CASH AND EX P ENSES OF R S. 12.92,06 9 WERE INCURRED BY CHEQUE OUT OF TOTAL EXPENSES OF RS.35,58,25. THE AO OBSERVED THAT THE ASSESSEE HAS SHOWN PROFESSIONAL RECEIPTS OF RS. 52.52 LAK HS AGAINST WHICH EXPENSES ARE CLAIMED AT RS. 40.61 LAKHS WHICH GIVES 70.27% EXPENSES WHICH ARE TOO EXCESSIVE. THE AO WAS OF THE VIEW THAT EXPENSES OF FILM ACTRESS IS FULLY MET BY FILM PRODUCERS . THEREFORE THE AO DISALLOWED RS. 11,33,093 BEING 50% OF CASH EXPENSES OF RS. 22,66,186 AND RS. 2,58.414 BEING 20% OF EXPENSES CHEQUE OF RS . 12,92,069 / - . SIMILARLY, THE AO NO TED THAT THE ASSESSEE HAS CLAIMED DEPRECIATION ON CAR OF RS.63,043, INTEREST ON CAR LOAN OF RS. 30,403 AND HAIR DRESSER CHARGES OF RS. 3,46,000. THE AO WAS OF THE VIEW THAT PERSONAL ELEMENT IN THESE EXPENSES IS NOT DENIED. THE AO THEREFORE DISALLOWED RS. 2, 19,723 BEING 50% OF SUCH EXPENSES. 4. BY THE IMPUGNED ORDER, THE CIT(A) CONFIRMED THE DISALLOWANCE, AGAINST WHICH THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 5. WE HAVE CONSIDERED RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BEL OW AND FOUND FROM THE RECORD THAT ASSESSEE IS A FILM ARTIST. DURING THE COURSE OF SCRUTINY ASSESSMENT THE AO DISALLOWED 50% OF CASH EXPENDITURE INCURRED ON PROFESSIONAL CHARGES, PRINTING, STATIONERY, SUNDRY EXPENSES, TRAVELLING EXPENSES, ETC. HOWEVER, THE AO ITA NO. 8634 /1 1 3 HAS NOT PIN - POINTED ANY OF THE EXPENDITURE WHICH WAS EITHER NOT INCURRED FOR THE PURPOSE OF ASSESSEES PROFESSION NOR IT WAS THE CASE OF AO THAT TDS WAS REQUIRED TO BE DEDUCTED BEFORE PAYMENT. IT WAS ALSO NOT THE CASE OF AO THAT EXPENSES WERE NOT VERIFI ABLE. GENUINENESS OF THE EXPENDITURE WAS ALSO NOT IN DOUBT, MERELY BECAUSE EXPENSES WERE PAID IN CASH, THE SAME WAS DISALLOWED. SIMILARLY, THE AO DISALLOWED 20% OF THE EXPENDITURE INCURRED BY CHEQUE ON ACCOUNT OF INTEREST ON CAR LOAN, DEPRECIATION ON CAR, DRESS CHARGES ETC. IN RESPECT OF THESE EXPENDITURE ALSO THE AO HAS NOT POINTED OUT ANY EXPENDITURE INCURRED FOR PURPOSE OTHER THAN THE PROFESSION. KEEPING IN VIEW THE NATURE OF ASSESSEES PROFESSION AND TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE RESTRICT THE DISALLOWANCE TO THE EXTENT OF 10% OUT OF THE TOTAL EXPENDITURE SO INCURRED. 6 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 17 /06 / 201 5 . SD/ - SD/ - ( ) ( SANJAY GARG ) ( . . ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 26 /06 /201 5 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//