2024 (2) TMI 111 - AT - Income Tax

Disallowance u/s. 40(a)(ia) - Non deduction of TDS on surplus service job work contract - noone has represented the assessee even though notice for hearing has been served which were issued by RPAD - assessee had claimed that the contractor SVPL had produced a certificate issued u/s. 197(1) for lower deduction of TDS because of which it had not deducted tax at source on the payment so made - as per AO no certificate of lower deduction of tax u/s. 197(1) was issued in the name of the contractor because of which he made the disallowance. HELD THAT - According to us, these are the facts which are verifiable from the records and appropriate examination would reveal the correct state of affairs in respect of claim made by the assessee and as held by the Ld. AO so as to give the correct effect to the transaction of payment made by the assessee to SVPL. However, from the records available before us, there is nothing to corroborate the above stated facts so as to verify the claim of the assessee as also to corroborate the stand taken by the Ld. AO. Considering the facts on record and the orders of the authorities below, we are inclined to adjudicate upon the matter ex parte qua the assessee. Thus, with the assistance of DR and on perusal of the material available on record, we do not find any reason to interfere with the observations and findings given by the Ld. AO to sustain the disallowance so made - Decided against assessee.

Summary

Issues involved:
The issues in this case involve confirmation of addition made by the Assessing Officer, passing of order ex-parte by the CIT(A), ignoring of adjournment request, confirmation of disallowance of expenses, and confirmation of disallowances made without issuing notice under section 143(2) of the Income-tax Act.

Confirmation of addition made by the Assessing Officer:
The appellant filed an appeal against the order of the CIT(A) regarding the addition made by the Assessing Officer. The Assessing Officer found that the assessee failed to deduct tax at source on a payment made to a company, resulting in the reopening of the assessment under section 147 of the Act. Despite various notices and opportunities, the assessee did not provide a satisfactory explanation or evidence for not deducting tax at source. Consequently, the CIT(A) upheld the disallowance, and the Tribunal dismissed the appeal, noting the lack of representation by the assessee.

Passing of order ex-parte by the CIT(A):
The appellant contended that the CIT(A) erred in passing the order ex-parte. However, it was observed that the appellant failed to provide any explanation or evidence during the appellate proceedings to substantiate the non-deduction of tax at source. The CIT(A) upheld the disallowance made by the Assessing Officer, leading to the dismissal of the appeal by the Tribunal.

Ignoring of adjournment request:
The appellant argued that the CIT(A) erred in ignoring the adjournment request seeking additional time. However, it was found that despite being given sufficient opportunities, the appellant failed to provide any explanation or evidence to justify the non-deduction of tax at source. The Tribunal, after considering the facts on record, adjudicated the matter ex parte and upheld the disallowance.

Confirmation of disallowance of expenses:
The appellant contested the confirmation of the disallowance of expenses made by the Assessing Officer. The disallowance was based on the failure to deduct tax at source on a payment to a company. The Tribunal noted that there was no evidence to support the appellant's claim of not deducting tax at source. Consequently, the Tribunal upheld the disallowance and dismissed the appeal.

Confirmation of disallowances made without issuing notice under section 143(2) of the Act:
The appellant raised an issue regarding the confirmation of disallowances made without issuing a notice under section 143(2) of the Act during the reassessment proceedings. However, the Tribunal found that the appellant did not provide any substantive explanation or documentary evidence to support the non-deduction of tax at source. Therefore, the Tribunal upheld the disallowance made by the Assessing Officer.