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| The Tax Publishers2020 TaxPub(DT) 4703 (Del-Trib) INCOME TAX ACT, 1961
Section 37(1)
When in Annexure to Tax Audit Report Item No. 17D(1), it has been intimated that amount of Rs. 8,462 was debited to P & L account being expenditure incurred at club entrance fee and subscription, causal observation made by AO that same was not wholly and exclusively spent for business purpose, was not sustainable.
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Business expenditure - Expenditure incuured at Club as entrance fees and subscriptions - Business nexus -
Assessee claimed deduction of club as entrance fees and subscriptions. AO disallowed deduction on the ground that such expenses were not wholly and, exclusively spent for the purposes of the business. Held: When in Annexure to Tax Audit Report Item No. 17D(1), it has been intimated that amount of Rs. 8,462 was debited to P & L account being expenditure incurred at club entrance fee and subscription, causal observation made by AO that same was not wholly and exclusively spent for business purpose, was not sustainable. So, keeping in view the meager amount and the fact that the same has been incurred as entrance fee and subscription for club disallowance, could not be sustained.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2010-11
INCOME TAX ACT, 1961
Section 92C
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