DIVYAKANT C. MEHTA Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) The appellant has questioned the concurrent orders of the Income-tax Appellate Tribunal dated February 29, 2012, and that of the Commissioner of Income-tax (Appeals) dated April 20, 2010. Mr. Chatterjee, learned senior advocate appearing on behalf of the appellant-assessee, would submit that this appeal raises a substantial question of law. He submits that the appellant-assessee is an advocate by profession, He filed returns for the year under consideration, viz., assessment year 2005-06 on December 29, 2005, declaring a total income at Rs. 3,70,230. A perusal of the details along with the return, the Assessing Officer noted that the deduction of Rs. 22,25,614 was claimed by the assessee as expenditure incurred for higher education expenses for his daughter, Hemali. The justification was that she joined the appellant's firm of advocates. She gave an undertaking that on attaining higher qualification and degrees from the university abroad, she would come back and join the firm for a minimum period of five years and, therefore, as a part of the firm, being an employee, she was encouraged to go abroad to obtain higher educational qualification, such expenditure coupled with her undertaking would thus said to be an expenditure incurred for the business of the assessee and was allowable as deduction.

(2.) The Assessing Officer held that the appellant was not entitled to claim deduction on account of expenses incurred for education of his daughter. The Commissioner of Income-tax (Appeals) upheld this order and even the Income-tax Appellate Tribunal dismissed the assessee's appeal. Mr. Chatterjee would submit that each one of them were bound by the judgment and order of this court in the case of Sakal Papers Pvt. Ltd. v. CIT, 1978 114 ITR 256. Mr. Chatterjee submits that merely because the assessee had sent his daughter abroad for higher education, it does not mean that the deduction cannot be claimed. The relationship has nothing to do in this case when the daughter was serving in the firm of the appellant-assessee.

(3.) We have, with the assistance of Mr. Chatterjee, perused the concurrent findings and conclusions. We ate not in agreement with him that this appeal raises a substantial question of law. Each of the authorities found that this matter was distinct from Sakal Papers Pvt. Ltd. . It may be that both the cases involved were of daughter being sent abroad for higher education. However, in the present case, what has been found is that the appellant-assessee is a firm of advocates. The daughter joined him and immediately was sent for education abroad. The assessee has not been able to bring on record anything and particularly the scheme so as to provide higher education abroad to the employees or associates. The Commissioner of Income-tax (Appeals) has observed that in the firm of the appellant-assessee, there were at least 14 associate advocates and none were given an opportunity to go abroad prior for higher education. Some of them have worked with him for at least 15 years. In the present case, within a period of 2 to 3 months after the daughter became an advocate and joined the firm as associate, she went abroad. The appellant may have then stared that there was an undertaking signed or bond given to serve the firm for five years after return. But the authorities found that not only she was allowed to continue and stay abroad but permitted to join any firm after completing the higher education. Thus, this was not the decision taken in the interest of the activities and profession of the firm of advocates but for furthering the career prospects of the child/daughter. In such circumstances, neither of the authorities committed any error or perversity in disallowing the deduction.