Chalasani Hospitals (P.) Ltd Vs ACIT (ITAT Visakhapatnam)
ITAT Visakhapatnam held that advertisement expenditure claimed by the hospital has violated the provisions of Indian Medical Council Act 1956 professional conduct, Etiquette and Ethics Regulations, 2002. Hence, expenditure disallowed.
Facts- Assessee is a hospital. AO on perusal of the Profit & Loss Account noticed that assessee has claimed advertisement expenditure to the extent of Rs.36,52,061/-. In absence of any explanation from the assessee the Assessing Officer disallowed a sum of Rs.36,52,061/- under section 37(1) of the Act. CIT(A) partly allowed the appeal. Being aggrieved, the present appeal is filed by the assessee.
Conclusion- Held that the assessee has not substantiated the claim of expenditure which are to be allowed under the Indian Medical Council professional conduct, Etiquette and Ethics Regulations, 2002.
Held that the assessee has violated the provisions of Indian Medical Council Act 1956, professional conduct, Etiquette and Ethics Regulations, 2002. There is no merit in the arguments of the Ld. AR that the assessee has made public only the services offered by the assessee which in our opinion construes advertisement. Further, we also find that Ld. CIT(A) has erred in estimating the disallowances and restricting to 50% of the expenditure claimed by the assessee without providing any valid reasoning and hence we are inclined to set aside the order of the Ld. CIT(A), thereby restoring the order of the Ld. AO on this issue. Accordingly the appeal of the assessee is dismissed.
