- (1.) HEARD Sri S.K. Garg, senior advocate assisted by Sri Rahul Shukla, learned Counsel for the appellant and Sri D.D. Chopra, learned Counsel for the respondent.
(2.) BOTH these appeals have been filed by the assessee against the different orders of the Tribunal dated 22 -7 -2008 and 21 -1 -2008 for the assessment years 2000 -01 and 2002 -03. The brief facts of the cases are that the assessee company is engaged in the manufacturing and sale of writing instruments under the brand name of Rotomac and located at Kanpur. The learned Counsel for the appellant stated that the affairs of the appellant company hereinafter known as assessee were being managed by the board of directors as per the Companies Act. Being a whole -time director, he is operating from his residence as a matter of necessity. The payment was made to the director pertaining to the telephone, electricity, and traveling expenses etc., as per the details given in the assessment orders, apart from the above monthly remuneration. He further submitted that as per Section 17(2) of the Income Tax Act, it falls under the 'perquisites' and the same is allowable expenditure, which may be considered in the hands of the beneficiary.
(3.) HOWEVER , the assessing officer has disallowed the said expenses for both the assessment years under consideration. The first appellate authority has disallowed the expenses pertaining to the electricity and telephone. However, the matter pertaining to the traveling expenses was restored to the assessing officer.;