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================= ITA NO. 1404/Hyd/2013 (appeal by the assessee)

6. Ground No. 1 is pertaining to disallowance of expenditure u/s 37(1) of the Act.

7. Briefly, the facts relating to this issue are that during the proceedings before the Panel, the taxpayer has submitted that it has incurred Rs. 4,44,53,544/- in relation to advertisement, training, business promotion, architectural consultancy, land scraping, professional charges, printing and stationery, travelling and purchase of materials and since these expenses were incurred for the purpose of business the same should have been allowed. However, the AO made disallowance amounting to Rs. 3,82,34,425/- on account of the bills being in name of Maytas Properties Ltd or in the name of Maytas Properties Pvt. Ltd. and since the name of the assessee resemble its holding company, the vendors in some cases have mentioned the name of its holding company on the invoices raised by them. Since, it is a human error, the assessee pleaded that the expenditure should not be disallowed u/s. 37(1) of the Act.

Hill Country Properties Ltd.

================= 7.2 The DRP observed that Maytas Properties Pvt. Ltd. and Maytas Properties Ltd are two different entities and any human error can be once or twice but not so many times covering huge payments and it is also surprising to note that the appellant had never tried to take up the issue with the vendors to correct their mistake and file the appropriate documentary evidence in support of its contention. In view of the facts stated above, the assessee's objection on this ground is rejected and the DRP upheld the proposed addition made by the AO amounting to Rs. 4,44,53,544/-.

8. Before us, the learned AR submitted that though the payment details are in the name of MPPL, which is a subsidiary company, it is accounted in the assessee's books of account and this expenditure is related to the assessee's business and there is no claim of this expenditure by MPPL.

The person, who had rendered the services or supplied mistakenly mentioned the name of the party as Maytas Properties Pvt. Ltd. in stead of Maytas Properties Ltd. and it is an human error and this being so, the expenditure to be allowed in the hands of the assessee. According to the learned AR, such mistake was caused on the reason that both the names resemble. Further, he submitted that even special auditor mentioned in his letter, which is placed on record at page 438 of the paper book, company name as Maytas Infra Ltd. instead of Maytas Properties Ltd. He also invited our attention to paper book at page 439 wherein the Auditor mentioned in his audit report as Maytas Properties Pvt. Ltd., which is wrong. He also drew our attention to summons issued by the DCIT, Circle - 9, Hyd, dated 25/07/2012, which is placed on record at page 435 of assessee's paper book wherein mentioned assessee's name as Maytas Properties Pvt. Ltd. instead of Maytas Properties Ltd. Accordingly, he submitted Hill Country Properties Ltd.

================= that error should be condoned and the deduction towards business expenditure is to be allowed.

9. The learned DR, on the other hand, submitted that it is not a single isolated case, but, there are large number bills which are produced for claiming the expenditure contain the name of the parties as Maytas Properties Pvt. Ltd. in stead of Maytas Properties Ltd. He pointed out that these are two different entities and it cannot be said that human error so as to grant deduction towards business expenditure. The learned DR supported the order of DRP.