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Issues involved:
The issues involved in this judgment are related to the addition of Rs. 13,33,500 under Section 40(a)(ia) of the Income Tax Act, 1961 in the Assessee's appeal, and the deletion of additions made by the Assessing Officer on account of undervaluation of closing stock and excessive job charges in the Revenue's appeal. Assessee's Appeal - ITA No.1625/Ahd/2008: The Assessee appealed against the addition of Rs. 13,33,500 under Section 40(a)(ia) of the Act. The Assessee argued that the issue is covered in their favor by a previous decision of the ITAT, which held the amendment in Section 40(a)(ia) to be retrospective. The ITAT clarified that if TDS is paid before the due date for filing the return, no disallowance under Section 40(a)(ia) is required. The ITAT considered the amendment as clarificatory and retrospective in nature, citing relevant case laws. The matter was remanded back to the Assessing Officer for factual verification of TDS payment. Revenue's Appeal - ITA No.2286/Ahd/2008: In the Revenue's appeal, the AO had made additions on the grounds of undervaluation of closing stock and excessive job charges. The CIT(A) deleted the additions based on specific findings. The CIT(A) noted that the closing stock was old and unsaleable, hence valued at a lower price, which was justified. The Revenue's appeal was rejected as the factual findings were not contested. Regarding the job charges, the CIT(A) found that the charges were not excessive considering the rates charged to outside parties. The ITAT upheld the CIT(A)'s decision on both grounds, leading to the dismissal of the Revenue's appeal. In conclusion, the Assessee's appeal was allowed concerning the Section 40(a)(ia) addition, and the Revenue's appeal was dismissed regarding the additions made by the AO. The judgment was pronounced on 4th February 2011.
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