Sri B.V. Prabhu, Sira v. ITO, Tumkur

ITA 968/BANG/2009 | 2006-2007
Pronouncement Date: 29-01-2010 | Result: Partly Allowed

Appeal Details

RSA Number 96821114 RSA 2009
Bench Bangalore
Appeal Number ITA 968/BANG/2009
Duration Of Justice 3 month(s) 15 day(s)
Appellant Sri B.V. Prabhu, Sira
Respondent ITO, Tumkur
Appeal Type Income Tax Appeal
Pronouncement Date 29-01-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted A
Tribunal Order Date 29-01-2010
Date Of Final Hearing 21-01-2010
Next Hearing Date 21-01-2010
Assessment Year 2006-2007
Appeal Filed On 14-10-2009
Judgment Text
PAGE 1 OF 12 ITA NO.968/BANG/09 1 THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH A BEFORE SHRI N L KALRA A.M. AND SHRI GEORGE GEORGE K J.M. ITA NO.968/BANG/2009 (ASST. YEAR 2006-07) SHRI B V PRABHU PROP. PRABHU ENTERPRISES MAIN ROAD SIRA. - APPELLANT VS THE INCOME TAX OFFICER WARD-2 TUMKUR. - RESPONDENT APPELLANT BY : SHRI RAMASUBRAMANIYAN RESPONDENT BY : SMT. JACINTA ZIMIK VASHAI O R D E R PER N L KALRA : THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDE R OF LEARNED CIT(A)-II BANGALORE DATED 31ST JULY 200 9. 2. THE FIRST GRIEVANCE OF THE APPELLANT IS THAT TH E LEARNED ASSESSING OFFICER HAS ERRED IN DISALLOWING RS.11 26 500/- U/S 40(A)(IA). ALTERNATIVELY IT HAS BEEN CONTENDED THAT THE ASSESSEE HAS MADE PAYMENT TO THE EXTENT OF RS.5 14 7 25/- AFTER CONSIDERING THE DEDUCTION MADE BY INDIAN OIL CORPORA TION LTD. AND THEREFORE DISALLOWANCE U/S 40(A)(IA) COULD NOT HAVE BEEN MADE BEYOND RS.5 14 725/-. PAGE 2 OF 12 ITA NO.968/BANG/09 2 2.1 THE ASSESSING OFFICER NOTICED THAT THE ASSESSE E HAS SHOWN INCOME FROM TRANSPORT BUSINESS SEPARATELY AT A FIXED PERCENTAGE OF THE GROSS RECEIPTS AND WORKING SHEET FOR THE SAME WAS ENCLOSED TO THE RETURN. THE ASSESSING OFFICER FURTHER NOTICED THAT THE ASSESSEE WAS SHOWING RECEIVABLE FR OM INDIAN OIL CORPORATION LTD. IN THE BALANCE SHEET AND WAS ALSO SHOWING THE AMOUNT PAYABLE TO THE TRANSPORT CONTRACTOR. THE ASS ESSEE OBTAINED A CONTRACT FROM INDIAN OIL CORPORATION LTD . FOR THE TRANSPORTATION OF LPG CYLINDERS AND IN TURN SUCH TR ANSPORTATION WAS BEING DONE THROUGH ANOTHER CONTRACTOR. THE ASS ESSEE HAS CLAIMED TDS WITH RESPECT TO TDS MADE BY THE INDIAN O IL CORPORATION LTD. ON THE TRANSPORTATION RECEIPTS. N O PROFIT AND LOSS ACCOUNT HAS BEEN DRAWN UP FOR THE TRANSPORT IN COME AND THE ASSESSEE HAS TAKEN ONLY FIXED PERCENTAGE OF GROSS RE CEIPTS AS INCOME. THE AO WAS OF THE VIEW THAT THE ASSESSEE H AS OBTAINED TRANSPORT CONTRACT FROM IOC BUT HAS GIVEN THE SAME AS SUB- CONTRACT TO SOME OF THE TRUCK OWNERS. THE ASSESSEE WAS RETAINING A PERCENTAGE OF RECEIPTS AND THE BALANCE AMOUNT WAS BEING PAID TO THE TRUCK OWNERS WITH WHOM THE ASSESS EE WAS HAVING AGREEMENTS. THE AO CONCLUDED THAT THE ASSES SEE WAS HAVING SUB-CONTRACT AND THEREFORE THE ASSESSEE WAS REQUIRED TO DEDUCT TAX AT SOURCE IN RESPECT OF PAYMENTS MADE TO THE SUB- CONTRACTORS. SINCE THE ASSESSEE HAS NOT DEDUCTED T AX AT SOURCE THEREFORE THE EXPENDITURE IS NOT ALLOWABLE IN VIEW OF SECTION 40(A)(IA). BEFORE THE ASSESSING OFFICER IT WAS SU BMITTED THAT PROVISIONS OF SECTION 44AE ARE APPLICABLE AND THERE FORE THE PAGE 3 OF 12 ITA NO.968/BANG/09 3 PROVISIONS OF SECTION 40(A)(IA) ARE NOT APPLICABLE. THE AO IN PARA 3.8 OF THE ORDER HELD THAT THE EXPENDITURE OF RS.11 26 500/- IS NOT ALLOWABLE U/S 40(A)(IA) AND THE PARA FROM THAT ORDER IS REPRODUCED AS UNDER:- 'ACCORDINGLY ON THE BASIS OF THE EVALUATION MADE AS PER PARAS 3.5 3.6 AND 3.7 IT IS HEREBY HELD THAT THE TRANSPORT BUSINESS OF THE ASSESSEE IS NOTHING BUT A CONTRACT WITH IOC AND SUB CONTRACT WITH TRUCK OWNERS AND THE TDS PROVISIONS AS PER SEC.194(C)(2) PROVISO ARE APPLICABLE. THIS IS SUBJECT MATTER FOR THE APPLICABILITY OF PROVISIONS OF SEC.40(A)(IA) AS PER WHICH THE PAYMENTS MADE TO SUB CONTRACTOR WITHOUT MAKING TDS WHERE TDS IS APPLICABLE IS DISALLOWED AS AN EXPENDITURE FROM THE INCOME FROM BUSINESS AS PER THE AMENDED SECTION WEF 1.4.2005. THE ASSESSEE DURING THE YEAR 2005-06 HAS RECEIVED RS.11 52 685/- AS PAYMENT TOWARDS TRANSPORT BUSINESS FROM IOC AND HAS PAID RS.11 26 500/- TO THE VARIOUS TRUCK OWNERS AFTER KEEPING RS.26 185/- (BEING TDS AMOUNT) AS HIS INCOME FROM TRANSPORT BUSINESS. THE ASSESSEE HAS STATED THAT UPTO 2004-05 THE AMOUNT HELD WAS 3% PLUS TDS MADE BY IOC BUT FROM THE YEAR 2005-06 IT IS ONLY TDS WHICH IS TAKEN AS INCOME AS PER THE ORAL AGREEMENTS WITH TRUCK OWNERS FOR WHICH THERE IS NO DOCUMENTARY EVIDENCE. THE PROVISIONS OF SEC.40(A)(IA) ARE APPLIED AND ADDITION OF RS.11 26 500/- IS MADE UNDER THIS SECTION'. 2.2 BEFORE THE LEARNED CIT(A) IT WAS SUBMITTED TH AT THE ASSESSEE ACTED ONLY ON BEHALF OF THE TRUCK OWNER S AND HE HAS PAGE 4 OF 12 ITA NO.968/BANG/09 4 NOT ENTERED INTO ANY SUB-CONTRACT WITH THE TRUCK OWN ERS. THE PAYMENT MADE TO THE TRUCK OWNERS DOES NOT REPRESENT SUB- CONTRACT PAYMENTS. THE ASSESSEE HAS NOT DEBITED THE AMOUNT TO THE PROFIT AND LOSS ACCOUNT AND THEREFORE THE SAME CANNOT BE TREATED AS AN EXPENDITURE TO BE DISALLOWABLE U/S 40 (A)(IA). ALTERNATIVELY IT WAS SUBMITTED THAT THE ASSESSEE ENT ERED INTO MOU WITH A PERSON WHO WAS HAVING TWO TRUCKS AND THE REFORE THE ASSESSEE WAS NOT LIABLE TO DEDUCT TAX AT SOURCE. T HE ASSESSEE OBTAINED FORM NO.15I FROM SHRI S K ATHAULLA KHAN AN D ACCORDINGLY NO TAX WAS REQUIRED TO BE DEDUCTED. IN CASE TAX WAS NOT REQUIRED TO BE DEDUCTED THEN PROVISIONS OF SECT ION 40(A)(IA) ARE NOT APPLICABLE. 2.3 THE LEARNED CIT(A) OBSERVED THAT THE ASSESSEE OBTAINED A CONTRACT FROM INDIAN OIL CORPORATION LTD . THE ASSESSEE ENTERED INTO AGREEMENT WITH TRUCK OWNERS I N RESPECT OF 5 TRUCKS. IN THE AGREEMENT THE ASSESSEE WAS TREAT ED AS TRANSPORTER AND THE TRUCK OWNER WAS TREATED AS CONT RACTORS. HENCE IN RESPECT OF AGREEMENT WITH THE TRUCK OWNERS THE ASSESSEE WAS A CONTRACTOR AND HAS GIVEN SUB-CONTRAC T TO THE TRUCK OWNERS AND THE LEARNED CIT(A) HELD THAT 194C( 2) IS APPLICABLE. THE LEARNED CIT(A) FURTHER HELD THAT T HE AMOUNTS PAID TO THE TRUCK OWNERS REPRESENTED SUB-CONTRACT P AYMENT AND THEREFORE THE SAME WAS REQUIRED TO BE CONSIDERED F OR THE PURPOSE OF TAX DEDUCTION AT SOURCE U/S 194C. THE A SSESSEE WAS RECEIVING THE PAYMENT FROM THE IOC AND THEREFORE TH E PAGE 5 OF 12 ITA NO.968/BANG/09 5 PAYMENTS MADE TO TRUCK OWNERS WAS PART OF THE EXPEND ITURE INCURRED FOR THE PURPOSE OF INCOME FROM TRANSPORT B USINESS. THE IOC WAS NOT MAKING ANY DIRECT PAYMENT TO THE TRUC K OWNERS. HENCE IT CANNOT BE SAID THAT THE ASSESSEE WAS RECE IVING COMMISSION IN RESPECT OF PAYMENTS BEING MADE BY IOC T HROUGH HIM TO THE TRUCK OWNERS. THE LEARNED CIT(A) FURTHE R HELD THAT TAX WAS REQUIRED TO BE DEDUCTED AT SOURCE BECAUSE T HE PAYMENTS MADE TO THE TRUCK OWNER EXCEEDED RS.50 000/-. SECT ION 44AE CANNOT BE INVOKED BECAUSE THE ASSESSEE IS NOT OWNIN G MORE THAN 10 GOODS CARRIAGE. FORM NO.15I HAS BEEN RECEIVED B Y THE ASSESSEE ON 16TH JANUARY 2009 AND THEREFORE THE SA ME CANNOT BE MADE A GROUND FOR NOT DEDUCTING THE TAX AT SOURC E BECAUSE THE FINANCIAL YEAR INVOLVED WAS 2005-06 WHILE FORM N O.15I IS DATED 16TH JANUARY 2009. ACCORDINGLY THE LEARNED CIT(A) UPHELD THE ADDITION OF RS.11 26 500/-. 2.4 WE HAVE HEARD BOTH THE PARTIES. COPY OF LPG CYLINDER TRANSPORT CONTRACT AGREEMENT IS AVAILABLE A T PAGES 11 TO 26 OF THE PAPER BOOK FILED BY THE LEARNED AR. IN THIS AGREEMENT IT IS MENTIONED THAT THE CONTRACTOR IS O WNER AND OPERATOR OF NEW/OLD CAPACITY TRUCKS. SUCH TRUCKS AR E TO BE MAINTAINED IN THE GOOD WORKING ORDER FOR THE PERIOD OF THE CONTRACT. AS PER CLAUSE 13 OF THE AGREEMENT THE C ONTRACTOR HAS TO PAY THE ENTIRE OPERATION COST OF THE TRUCKS WHICH INCLUDE AND BE DEEMED ALWAYS TO INCLUDE THE EXPENSES WHICH HAVE BEEN PAGE 6 OF 12 ITA NO.968/BANG/09 6 ENUMERATED IN CLAUSE 13 OF THE AGREEMENT. CLAUSE 3 2 OF THE AGREEMENT READS AS UNDER:- 'THE CONTRACTOR SHALL NOT BE ENTITLED TO ASSIGN SUBROGATE SUBJECT OR PART WITH HIS/THEIR RIGHT TITLE AND INTERESTS UNDER THIS CONTRACT FOR ANY REASON WHATSOEVER OR CHANGE THE OWNERSHIP OF THE TRUCK. THE CONTRACTOR SHALL NOT CAUSE OR ALLOW ANY CHANGE IN THE CONSTITUTION OF ITS FIRM WITHOUT OBTAINING THE PRIOR WRITTEN CONSENT OF THE CORPORATION'. 2.5 THERE ARE OTHER CLAUSES IN THE AGREEMENT WHICH CONTAIN AS TO HOW THE PAYMENTS ARE TO BE MADE AND WH AT ARE THE LIABILITIES OF THE PERSON TO WHOM THE CONTRACT AWAR DED. IT IS TRUE THAT THE ASSESSEE ENTERED INTO A MEMORANDUM OF UNDERSTANDING WITH SHRI ATHAULLA KHAN. IN ORDER TO COMPLY WITH THE CLAUSES OF THE AGREEMENT WITH INDIAN OIL CORPOR ATION LTD. IT IS MENTIONED IN THE MOU WITH SHRI ATHAULLA KHAN THA T THE VEHICLE WILL BE RESOLD BACK TO SHRI ATHAULLA KHAN BY THE TRA NSPORTER O.E. THE ASSESSEE. AS PER THE MOU IT IS CLEAR THAT SHR I ATHAULLA KHAN WHO WAS OWNING THE TRUCK AGREED TO ACT AS MA NAGER OF THE TRANSPORTER I.E. THE ASSESSEE. A MOU MADE BETWEEN THE APPELLANT AND SHRI ATHAULLA KHAN MADE IT CLEAR THAT THE APPELLANT MADE SUCH MOU IN VIEW OF CLAUSE MENTIONED IN THE CO NTRACT AWARDED TO HIM BY THE IOC. IT IS TRUE THAT THE ASSE SSEE MENTIONED IN THE AGREEMENT THAT HE WILL RETAIN ONLY 3% OF THE COMMISSION BUT ACTUALLY IN THE INCOME SHOWN IN THE R ETURN THE PAGE 7 OF 12 ITA NO.968/BANG/09 7 ASSESSEE HAS SHOWN INCOME TO THE EXTENT OF AMOUNT F OR WHICH TAX AT SOURCE WAS DEDUCTED BY THE IOCL. WE ARE AW ARE THAT THE LEARNED AR MADE A CONTENTION THAT THE ASSESSEE WAS REGISTERED WITH IOCL AND THE TRUCK OWNER WAS NOT RE GISTERED AND THEREFORE THE CONTRACT WAS TAKEN FOR THE BENEF IT OF THE PERSON WHO WAS OWNING THE TRUCK. THIS MAY BE A DEFA CTO RELATIONSHIP. HOWEVER ONE HAS TO CONSIDER THE LE GAL AGREEMENTS BETWEEN THE ASSESSEE AND THE IOCL AND ALSO CONSIDER ING THE MOU BETWEEN THE ASSESSEE AND THE TRUCK OWNER AND FR OM SUCH AGREEMENTS ONE HAS TO DRAW A CONCLUSION THAT DEJUR E RELATIONSHIP OF THE APPELLANT WITH IOCL WAS IN THE FORM OF A PERSON WHO HAS BEEN AWARDED CONTRACT. THE APPELLAN T WAS REQUIRED TO ABIDE WITH THE CONDITIONS MENTIONED IN THE AGREEMENT. IT IS ALSO A FACT THAT THE ASSESSEE HAS NOT GOT THE ACCOUNTS AUDITED FOR TRANSPORT BUSINESS. AS PER TH E AGREEMENT WITH THE TRUCK OWNER THE ASSESSEE BECAME OWNER OF TWO TRUCKS FOR THE PERIOD OF CONTRACT. THE ORIGINAL TRUCK OWN ER BECAME A MANAGER FOR THE TRANSPORT BUSINESS OF THE ASSESSEE. IN RESPECT OF CONTRACT WITH IOC THE ASSESSEE WAS OWNER OF TWO TRUCKS. SINCE THERE WAS NO TAX AUDIT REPORT IN RESPECT OF T RANSPORT CONTRACT BUSINESS THEREFORE THE INCOME WAS TO BE ASCERTAINED AS PER SECTION 44AE OF THE I T ACT. SECTION 44AE S AYS THAT NOTWITHSTANDING TO THE CONTRARY CONTAINED IN SECTION 28 TO 43C AN INCOME IS TO BE DETERMINED AS PER SECTION 44AE(2 ). ONCE AN INCOME HAS BEEN DETERMINED U/S 44AE THEN PROVISION S OF SECTION 40(A)(IA) WILL NOT BE APPLICABLE. HENCE WE HOLD T HAT INCOME OF PAGE 8 OF 12 ITA NO.968/BANG/09 8 THE ASSESSEE IN RESPECT OF TRANSPORT BUSINESS IS TO BE DETERMINED AS PER SECTION 44AE(2) AS AGAINST THE IN COME SHOWN BY THE ASSESSEE. 2.6 WE ARE NOT SATISFIED WITH THE CONTENTIONS OF T HE LEARNED AR THAT NO TAX WAS REQUIRED TO BE DEDUCTED AT SOURCE IN VIEW OF FORM NO.15I SUBMITTED. FORM NO.15I HAS BEE N SUBMITTED SUBSEQUENTLY AND HAS NOT BEEN GIVEN TO THE ASSESSEE DURING THE FINANCIAL YEAR RELEVANT TO THE ASST. YEAR UNDER CONSIDERATION FOR NOT DEDUCTING THE TAX AT SOURCE. THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V ACE MULTIPLEX SYSTEMS PVT. LTD. 317 ITR 207 IS NOT APPLI CABLE AS THE ISSUE WAS DIFFERENT. MOREOVER THE OUTER LIMIT OF GETTING FORM NO.15I IS THE DATE ON WHICH PAYMENTS WERE TO BE MADE OR CREDIT WAS GIVEN. FORM HAS NOT BEEN FILED BY THAT DATE. 2.7 THE LEARNED AR SUBMITTED THAT 40(A)(IA) WILL N OT BE APPLICABLE IN RESPECT OF AN AMOUNT WHICH IS NOT DE BITED TO PROFIT AND LOSS ACCOUNT. FOR THIS PROPOSITION THE LEARNE D AR RELIED ON THE FOLLOWING JUDGEMENTS:- A W FIGGIS & CO. LTD. V CIT 256 ITR 268; INDIAN CARBON LTD. V INSPECTING ACIT 200 ITR 759 CIT V NOBLE & HEWATT (P) LTD. 305 ITR 324 DYNAVISION LTD. V ACIT 121 ITD 461 (CHENNAI) TM PAGE 9 OF 12 ITA NO.968/BANG/09 9 WE HAVE SEEN THAT HON'BLE CALCUTTA HIGH COURT IN TH E CASE OF A W FIGGIS (SUPRA) HELD THAT THE ASSESSEE COLLECTED SALES TAX AS BROKER. WE HAVE ALREADY HELD THAT ASSESSEE IS NOT R ECEIVING COMMISSION BUT GOT TRANSPORT CONTRACT. HENCE THIS DECISION IS OF NO HELP. OTHER DECISIONS ARE IN RESPECT OF APPLICA BILITY OF SECTION 43B. IN ALL OTHER CASES THE LIABILITIES WERE SHOW N IN BALANCE SHEET WHICH MEANS THAT AMOUNTS ARE PAYABLE BUT ARE N OT TO BE CLAIMED AS EXPENSES. IN THE INSTANT CASE THE ASSE SSEE IS RECEIVING THE ENTIRE PAYMENT FROM IOCL AND HENCE PAYM ENTS MADE TO OTHER PARTIES BECOME EXPENSES IN THE CASE O F ASSESSEE. BOOK ENTRIES ARE NOT CONCLUSIVE AND ONE HAS TO CONS IDER THE ALLOWABILITY AS PER PROVISIONS OF THE ACT. 2.8 THE ALTERNATIVE SUBMISSION OF THE ASSESSEE IS THAT THE AO SHOULD HAVE RESTRICTED THE DISALLOWANCE U/S 40(A)(IA) TO THE EXTENT OF RS.5 14 725/-. IN RESPECT OF GROSS P AYMENTS RECEIVABLE FROM IOCL THE ASSESSEE RECEIVED NET PAYM ENT TO THE EXTENT OF RS.5 14 725/-. THE DEDUCTIONS WERE IN RE SPECT OF DIESEL TDS AND OTHERS. A SUM WAS DEDUCTED BY IOCL IN RESPECT OF DIESEL MADE AVAILABLE FOR PLYING OF TRUCK AND THE REFORE THE SAME WAS DEDUCTED AND PAID TO IOCL AND NOT TO THE S O-CALLED SUB-CONTRACTOR. HENCE WE ALSO HOLD THE ALTERNATIV E SUBMISSION OF THE LEARNED AR THAT DISALLOWANCE U/S 40(A)(IA) S HOULD HAVE BEEN RESTRICTED TO RS.5 14 725/-. WE HAD ALREADY UP HELD THAT SECTION 40(A)(IA) IS NOT APPLICABLE BECAUSE THE INC OME OF THE ASSESSEE IS TO BE DETERMINED U/S 44AE(2). PAGE 10 OF 12 ITA NO.968/BANG/09 10 3. THE SECOND GRIEVANCE OF APPELLANT IS THAT THE LEARNED ASSESSING OFFICER HAS ERRED IN MAKING DISAL LOWANCE OF RS.2 25 300/- U/S 40A(3). 3.1 WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE. THE ASSESSEE HAS FILED A CERTIFICATE FROM STATE BANK OF MYSORE WHICH SHOWS THE PAYMENTS MADE TO SHRI ATHAULLA KHAN. THERE ARE 13 PAYMENTS AS AVAILABLE IN PAGES 33 OF THE PAPE R BOOK. EXCEPT THE PAYMENTS MENTIONED AT SERIAL NO.1 AND 13 ALL OTHER PAYMENTS ARE LESS THAN RS.20 000/-. DISALLOWANCE U/ S 40A(3) COULD NOT HAVE BEEN MADE IN RESPECT OF PAYMENTS WHIC H ARE LESS THAN RS.20 000/-. HENCE DISALLOWANCE U/S 40A(3) S HOULD HAVE BEEN RESTRICTED TO 20% OF PAYMENTS MADE AT SL. NO.1 AND 13 OF RS.28 443/- AND RS.47 190/-. SINCE WE HAD HELD THA T INCOME HAS TO BE ASCERTAINED U/S 44AE AND THEREFORE PROVISION S OF SECTION 44AE WILL NOT BE APPLICABLE. HENCE NO DISALLOWANC E IS REQUIRED TO BE MADE U/S 40A(3). ALTERNATIVELY THE DISALLOWANCE WILL BE RESTRICTED IN RESPECT OF ONLY TWO PAYMENTS WHICH HAS BEEN REFERRED ABOVE. 4. THE THIRD GRIEVANCE OF THE APPELLANT IS THAT TH E LEARNED AO HAS ERRED IN MAKING ADDITION ON ACCOUNT OF LOW DRAWINGS. 4.1 THE ASSESSING OFFICER HAS HELD THAT THE DRAWIN GS MADE BY THE ASSESSEE IN HIS BOOKS OF ACCOUNT WERE LO W AND ACCORDINGLY ESTIMATED THE HOUSEHOLD EXPENSES OF THE ASSESSEE. PAGE 11 OF 12 ITA NO.968/BANG/09 11 AFTER CONSIDERING THE WITHDRAWALS MADE IN THE BOOKS OF ACCOUNT THE AO ESTIMATED A SUM OF RS.76 286/- AS UNDISCLOSE D INCOME UTILIZED FOR HOUSEHOLD PURPOSES. 4.2 THE LEARNED CIT(A) HAS HELD THAT THE AO HAS MA DE A REASONABLE ESTIMATE AND THEREFORE THE ADDITION M ADE BY THE AO WAS UPHELD. 4.3 AFTER CONSIDERING THE ORDER OF THE AUTHORITIES BELOW WE FEEL THAT ONE HAS TO MAKE AN ESTIMATE OF EXPENSES. THE AO HAS POINTED OUT THAT A SUM OF RS.33 000/- HA S BEEN DEBITED TOWARDS SCHOOL FEES AND THEREFORE THE BALA NCE OF RS.73 714/- WAS HELD TO BE ON THE LOWER SIDE FOR ME ETING THE OTHER EXPENSES. LOOKING TO THE QUANTUM OF EXPENSES TOWARDS SCHOOL FEES AND CONSIDERING THE FACT THAT THE AO HA S ALSO DISALLOWED PART OF THE CAR EXPENSES IT WILL BE FAI R AND REASONABLE IF THE ADDITION TOWARDS LOW WITHDRAWAL IS ESTIMATED TO RS.40 000/-. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON 29TH JANUARY 2010. SD/- SD/- (GEORGE GEORGE K) (N L KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE DATED:29/1/2010 PAGE 12 OF 12 ITA NO.968/BANG/09 12 COPY TO :- 1. THE ASSESSEE 2. THE REVENUE 3. THE CIT(A) CONCERNED. 4. THE CIT CONCERNED. 5. THE DR 6. GF 7. GF ITAT DELHI BENCH BY ORDER MSP/28/1/ ASSISTANT REGISTRAR ITAT BANGALORE.