2018 (6) TMI 398 - AT - Income Tax

Addition u/s 40A - Held that - As decided in assessee s own case 2015 (9) TMI 840 - ITAT DELHI section 40A(3) has been wrongly invoked as admittedly no expenses relatable to the addition has been claimed and the assessee has successfully demonstrated that the payment were reimbursement made by CWPPL Decided in favour of assessee. Disallowance on account of additional payment made - Held that - As decided in assessee s own case 2015 (9) TMI 840 - ITAT DELHI the material not having been confronted to the assessee in the face of the argument that even otherwise has no nexus has not been rebutted by the Revenue by any evidence or argument as the thrust of the parties attention remained focused on addressing the additions made. Addition on account of interest on post dated cheques - Held that - As decided in assessee s own case fter examining the loose papers seized at the time of search at the assessee s premises, it was noticed that interest is paid on the PDCs only during the period of extension of PDCs CIT(A) rightly directed the AO to re-compute the interest on PDCs at the time of extension of the PDCs - if it is not possible to work out the extension of PDCs in each case, then the AO is directed to recomputed interest on PDCs after six months from the date of issue of the PDCs the order of the CIT(A) is upheld Decided against revenue.

Summary

Issues:
1. Assessment made under section 153A challenged.
2. Disallowance under section 40A(3) contested.
3. Disallowance of additional payment disputed.
4. Addition on interest on post-dated cheques questioned.

Analysis:
1. The appeal challenged the assessment made under section 153A, arguing that no material was seized during the search on the assessee, and material seized on a different entity was improperly utilized. The Tribunal referenced a previous case to support the assessee's contentions and ruled in favor of the assessee, finding the assessment to be incorrect.

2. The disallowance under section 40A(3) was contested, with the assessee claiming it was not claimed as a deduction. The Tribunal referred to a previous case and ruled in favor of the assessee, stating that since the expenditure was not claimed, there was no basis for disallowance.

3. The confirmation of disallowance of additional payment was disputed, with the assessee arguing it was covered in a previous order. The Tribunal referenced the previous case and ruled in favor of the assessee, stating that since the expenditure was not claimed, there was no ground for disallowance.

4. The addition on interest on post-dated cheques was questioned, with the assessee claiming it was covered in a previous order. The Tribunal referred to a previous case and ruled in favor of the assessee, stating that there was no justification to interfere with the findings of the CIT(A) and deleted the impugned addition.

The Tribunal allowed the appeal of the assessee, ruling in favor of the assessee on all grounds raised in the appeal. The judgment was pronounced on 14/05/2018.