2013 (11) TMI 57 - AT - Income Tax

Disallowance u/s 40(a)(ia) of the Income Tax Act - Payments of the tax deducted well before filing of the return Held that - No material has been produced by the Revenue to rebut the findings under challenge that TDS amount had not been deposited by the assessee before filing the return Reliance has been placed on the judgment of case law Alum Extrusions Limited 2009 (11) TMI 27 - SUPREME COURT Decided in favor of Assessee.

Summary

Issues:
1. Disallowances/additions of machining charges and general expenses.
2. Deletion of additions made by the Assessing Officer for labour wages, drilling wages, freight charges, and NDT payments.
3. Disallowance of general expenses claimed by the assessee.
4. Failure to deduct TDS for certain payments.

Analysis:

1. The cross-appeals filed by the assessee and the Revenue pertain to disallowances/additions of machining charges and general expenses. The assessee argued that the CIT(A) wrongly confirmed these additions, while the Revenue supported the CIT(A)'s findings. The Revenue's appeal also challenged the deletion of additions made by the Assessing Officer for various payments. The tribunal considered the arguments and case files before making a decision.

2. The assessee, a fabrication company, had its total income assessed by the Assessing Officer, who disallowed/additions for various payments due to failure to deduct TDS. The CIT(A) found that the TDS amount was paid before the due date, following which he deleted all additions except for machining charges and general expenses. The tribunal noted that the Assessing Officer should have disallowed the machining charges for lack of proof submitted by the assessee.

3. Regarding the disallowance of general expenses, the CIT(A) found that only a portion of the claim was objectionable, while the genuineness of the rest was not doubted. The tribunal accepted the assessee's contentions in part and granted relief for a portion of the general expenses claimed.

4. The Revenue's appeal focused on the additions made for various payments due to failure to deduct TDS. The CIT(A) confirmed these additions, noting that the tax deducted was paid before filing the return. The tribunal upheld the CIT(A)'s decision, as the Revenue failed to provide evidence to rebut the findings that TDS was not deposited before filing the return. Consequently, one appeal was partly allowed, while the other was dismissed.

This judgment, delivered by the ITAT Chennai, addressed issues related to disallowances/additions, TDS deductions, and general expenses, providing detailed analysis and decisions for each matter raised by the parties involved.