The Income Tax Appellate Tribunal (ITAT), Pune bench has allowed the expenses paid through cheques based on the self-made voucher allowable as deduction under the Income Tax Act, 1961 as the same was incurred for business purpose.
An addition of Rs.1,15,872/- was made by way of vouchers submitted in the assessment proceedings and the AO and CIT(A) held the same as self-made vouchers. The assessee contended that the said vouchers consist of expenditure incurred towards car hire charges, small conferences and other petty expenses when the employees travel to different places on behalf of the assessee. The said expenditure also includes on account of picnic for the staff. The said expenditure would be incurred by the staff and the assessee used to pay that amount through cheque on furnishing of details. All these expenses are small in nature but no cash payments were made.
The department was of the view that no supporting necessary bills were submitted and the assessee is not entitled to claim deduction in that regard.
A bench of Shri R.S. Syal, Vice President and Shri S.S. Viswanethra Ravi, Judicial Member has allowed the claim of the assessee and held that “We note that as submitted by the ld. AR that all these expenses were incurred for staff during the course of business and all were paid through cheques. We note that all these petty expenses were paid through cheque and the AO did not point out any of such expenses were incurred for personal gain, therefore, we find force in the arguments of ld. AR that all these expenses under head miscellaneous expenses as confirmed by the CIT(A) incurred for the purpose of business and therefore, the assessee is entitled to claim as a deduction. Thus, the order of CIT(A) is not justified and the grounds raised by the assessee are allowed.”
Shri D.Y. Pandit & Smt. Deepa Khare appeared for the assessee.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to TaxscanAdFree. Follow us on Telegram for quick updates.
