9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (9) TMI 762 - AT - Income TaxAddition on account of advance from customers - Accrual of income - appellant had taken advances in cash from its customers against booking of Hero Honda motorcycles - HELD THAT - As decided in M/S. DUTTA AUTOMOBILES PVT. LTD. 2016 (6) TMI 115 - CALCUTTA HIGH COURT advance money, in the present case before us, is adjusted the sale price of the motor cycle and sale is disclosed in the return of income i.e. the trading account of the assessee. Accordingly, no ambiguity in the system followed by the assessee. Therefore, the issue is squarely covered by the jurisdictional High Court in the own case of the assessee. There is no merit in these grounds of the appeal of the assessee and the same are accordingly dismissed. Addition u/s 40(a)(ia) - assessee has not deducted TDS on the payments made under the head freights and insurance to various parties - amount had been debited under the head advertisement expenses whereas, the assessee had not deducted the TDS in respect of that payment also - HELD THAT - As in respect of advertisement expenses the assessee furnished details before the CIT(A) to show that the TDS was duly deducted against such expenses. CIT(A) after going through the documents furnished by the assessee verified the ledger account and held that the TDS was duly deducted on the payments made and accordingly deleted the addition so made by the Assessing Officer. - Decided against revenue.
Issues:
1. Addition of advance from customers. 2. Disallowance of expenses under section 40(a)(ia) of the Income Tax Act. Issue 1: Addition of advance from customers: The appellant, a dealer of Hero Honda two wheelers, appealed against the order of the Commissioner of Income Tax (Appeals) regarding the addition of advances from customers. The Assessing Officer disallowed the amount of Rs. 4,72,37,518/- received as advance from customers after field inquiries revealed discrepancies. However, the CIT(A) deleted the addition based on previous decisions in the appellant's favor for the assessment year 2010-11. The appellant argued that the advances were adjusted in the sale price of motorcycles, and the total sale consideration received matched the amounts shown in the accounts. The Calcutta High Court upheld the Tribunal's decision, supporting the appellant's position. Consequently, the appeal was dismissed, as the issue was covered by the High Court's decision. Issue 2: Disallowance of expenses under section 40(a)(ia) of the Income Tax Act: The Revenue challenged the CIT(A)'s deletion of Rs. 8,58,786/- and Rs. 93,55,197/- in expenses disallowed by the Assessing Officer under section 40(a)(ia) of the Act. The Assessing Officer disallowed these expenses as TDS was not deducted on payments made for "freight and insurance" and "advertisement expenses." The CIT(A) found that the amounts charged by Hero Moto Corp Ltd. were inclusive of transportation and insurance charges, constituting a composite bill. As the appellant did not pay any transporter separately, the CIT(A) deleted the addition for "freight and insurance" expenses. Regarding the "advertisement expenses," the CIT(A) verified that TDS was duly deducted based on the documents furnished by the appellant. The Revenue's appeal was dismissed as no defects were found in the CIT(A)'s order, leading to the dismissal of the Revenue's appeal. In conclusion, the ITAT Kolkata upheld the CIT(A)'s decision to delete the additions in both issues, emphasizing the importance of previous judicial precedents and factual evidence in determining the tax liabilities of the appellant.
|
