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| The Tax Publishers2023 TaxPub(DT) 1117 (Ahd-Trib) INCOME TAX ACT, 1961
Section 37(1)
Assessee company hired aircraft from time to time mainly for the purpose of commutation of employees and directors from Ahmedabad to Mundra and vice versa as the power plant of assesses was located in Mundra. Further, Air craft was used by executives and company official travelling from Ahmedabad to Bombay and Delhi for the purposes of business meetings with vendors, customers, Banks and Financial Institutions for business of assessee . Accordingly when complete details were made available, AO was not justified in making disallowance treating 10% of expenditure as personal in nature.
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Business expenditure - Travelling expense - 10% disallowance on the ground that personal element could not be ruled out -
Assessee's directors and employees travelled by Karnavati Aviation Ltd. and assessee incurred total expenses of 6,30,29,603 and AO disallowed 10% of the above travelling expenses on the ground that personal element could not be ruled out.Held: Assessee company hired aircraft from time to time mainly for the purpose of commutation of employees and directors from Ahmedabad to Mundra and vice versa as the power plant of assesses was located in Mundra. Further, Air craft was used by executives and company official travelling from Ahmedabad to Bombay and Delhi for the purposes of business meetings with vendors, customers, Banks and Financial Institutions for business of assessee . Accordingly when complete details were made available, AO was not justified in making disallowance treating 10% of expenditure as personal in nature.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2010-11 & 2012-13
INCOME TAX ACT, 1961
Section 92C
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