ITO WD 19(3)(4), MUMBAI vs. SHIRISH MANOHAR NADKARNI, MUMBAI

Aforesaid appeal of the Department is directed against the order dated 28th October 2011, passed by the learned Commissioner (Appeals)–30, Mumbai, for the assessment year 2003–04.

“1. On the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in deleting the addition of Rs.9,56,944/- in respect of expenditure incurred for purchase of Foreign Exchange without appreciating the fact that the 2 Shri Shirish Manohar Nadkarni assessee has failed to establish that the said expenses were incurred wholly and exclusive for the purpose of business by submitting the supporting documentary evidences during the course of assessment proceedings as well as appellate proceedings.

2. On the facts and in the circumstances of the case and in law, the Ld CIT(A) has erred in deleting the addition of Rs.9,56,944/- by presuming that the expenditure was incurred for earning income neglecting the finding by the A.O that the assessee had failed to establish that the said expenses were incurred wholly and exclusively for the purpose of business without appreciating that the assessee specializing in India- Centric business writing, there cannot be a legitimate presumption regarding expenditure in foreign currency being business expenditure.”