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Income Tax Appellate Tribunal, HYDERABAD ‘ B ‘ BENCH, HYDERABAD.
O R D E R Per Shri S.S. Godara, J.M. : This assessee’s appeal for Asst. Year 2015-16 arises from the Commissioner of Income Tax (Appeals)-1, Hyderabad’s order dt.3.10.2018 passed in case No.0253/CIT(A)-1, Hyd/2017-18/2018-19 in proceedings under Section 143(3) of Income Tax Act, 1961 (‘the Act’). Case called twice. None appeared at assessee's behest. It is accordingly proceeded exparte.
The assessee's sole substantive grievance raised in the instant challenges the correctness of both the lower
authorities' action disallowing its business promotion expenses including advertisements, print media, digital media activities, google search space and conference(s) in educational universities involving a sum of Rs.31,08,610 in the course of assessment dt.29.12.2017 and upheld in the CIT(A)’s order as under :
Learned department representative fail to dispute that the CIT(A) has mainly gone by the fact that there was no justification on assessee's part to incur the impugned business promotion expenses. Such a course of action on the learned lower authorities’ part amounts to sitting on judgement as an assessee's business expediency not sustainable as per the decision S.A. Builders Vs. CIT 288 ITR 1 (SC). The fact also remains that the assessee has not been able to file its cogent supporting evidence to the effect that the impugned expenses had been incurred wholly and exclusively for the purpose of business so as to be allowable under section 37 of the Act. Faced with this situation, we deem it appropriate that a lump sum disallowance of 30% of the impugned expenditure amounting to Rs.31,08,610 would be just and proper with a rider that same shall not be treated as precedent in any other assessment year. We order accordingly. Necessary computation shall follow as per law.
This assessee's appeal is partly allowed in above terms. Order pronounced in the open court on 16th Aug., 2021.