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| The Tax Publishers2020 TaxPub(DT) 0924 (Mad-HC) INCOME TAX ACT, 1961
Section 37(1)
Authorities have concurrently held against the assessee that only for want of production of relevant evidence by assessee, Authorities came to conclusion that expenses incurred by assessee on various items were not allowable expenses and additions made on variation in raw materials and production was also justified, therefore, appeal of assessee was dismissed.
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Business expenditure - Disallowance of foreign travel expenses - Allowability -
Assessee was a manufacturer polymerization initiators and cross-linking agent formulations. AO wanted to find out quantity of finished products, quantum of wastage and shortage occurred during manufacturing process as well as quantum of any other kind of losses such as evaporation loss and handling loss. In order to verify the percentage of yield of finished products from major raw materials, AO referred to quantitative information in respect of each class of raw materials consumed and goods manufactured. AO compared the ratio of total production of raw materials consumed in the previous year with current assessment year and held that there was an excess consumption of raw materials. Accordingly disallowed the same. Held: The findings of facts are rendered by Tribunal upholding the findings of two Authorities and thus, all Authorities have concurrently held against the assessee that only for want of production of relevant evidence by assessee, Authorities came to conclusion that expenses incurred by assessee on various items as well as contribution made to Hospital were not allowable expenses and additions made on variation in the raw materials and production was also justified and unless such findings rendered by Tribunal were found to be perverse by this court. Thus, appeal of assessee was dismissed.
REFERRED :
FAVOUR : Against the assessee
A.Y. :
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