9911796707
TMI Blog2013 (5) TMI 307X X X X Extracts X X X X X X X X Extracts X X X X ..... of such tax before the due date of filing of the return when the assessee claimed that it had filed the return of income on time in accordance with the provision of section 139(1) of the Act. In favour of assessee Disallowance of of freight charges - identity not proved and verification from angle of violation of non deduction of tax at source - Held that:- AO himself has agreed to the proposition that the said assumption of freight charges to trucks of more than Rs.20,000/- does not apply to the assessee's facts and in so far as the same has come into effect from 1st July, 2007 which the CIT(A) had also acknowledged but as a liberty that the assessee had admitted that there were errors in deduction of tax at source to protect the interest of the revenue confirmed 40% thereof which we are unable to satisfy ourselves either way as mentioned above. There cannot be proportionate disallowance either u/s 40(a) (ia) or 40A(3) which expenses disallowances have to be made on specific items of expenditure cannot be ruled out and the confusion in the minds of the authorities below therefore requires no further deliberation. The ground raised by the assessee is allowed. Confirmation u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter various discussions regarding the purchase, sales and the quantity of empty tins etc. proposed to admit the GP rate as was declared in the immediately preceding assessment year which assessment order has been placed on record by the ld. Counsel for the assessee. The AO by applying the same rate and holding the assessee not able to explain the fall in gross profit rate brought to tax a sum of Rs.23,13,794/- in the impugned assessment order. The ld AO further considered the explanation on account of freight paid to the truck owners on the basis of sales as well as purchases when he proposed to disallow a sum of Rs.4,57,970/- u/s 40(a)(ia) of the Act holding that the tax deduction at source was not deposited on time as claimed by the assessee, when he partly considered that the assessee had also violated the provision of section 40A(3) of the Act. Continuing his finding he further made addition of Rs.91,202/- in respect of freight charges by invoking the provision of section 40A(3) of the Act. Further the AO made addition by disallowing a sum of Rs. 9,71,064/- by combining the provision of section 40(a)(ia) and 40A(3) of the IT Act by holding a view that the assessee was not able ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, the ld. CIT(A) erred in law by deleting the addition amount of Rs.23,13,067/- which was made by invoking provision of section 145(3) of the IT Act 1961. ii) that the ld. CIT(A) while deciding the issue in favour of the assessee, ignored the fact that no corroborating evidence in respect of the deduction of TDS u/s 194C was furnished by the assessee. iii) that the ld. CIT(A) failed to appreciate, while deciding the issue in favour of the assessee, in respect of Freight Charges claimed by the assessee without any cognizable documents in favour of his claim. iv) that the ld. CIT(A) has erred in deletion of the addition made by the AO in respect of Drawings after completion of assessment of the instant case u/s 143(3) of the Act, because the assessee has shown a very low drawings of only Rs.85,000/-. v) the appellant craves leave to add, alter or abrogate any ground of appeal at the time of hearing." 5. We have heard the rival submissions and carefully perused the materials available on record. In respect of the first issue raised by the Revenue with respect to deletion of addition of Rs.23,13,067/- we are of the considered view that the ld. AO rejected the book results ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid sum having been subjected to deduction of tax at source was made known to the AO but whether verified by him in so far as the ld. Counsel for the assessee has submitted that the AO in his order as may be perused has categorically mentioned that the tax deducted at source was deposited on 26.09.2008. In view of the provision of the said section when the tax deducted at source is allowed to be deposited before filing of the return we are of the considered view that the ld. CIT(A) ought not to have directed the AO to verify the deposition of the tax on 26.09.2008 already which was not disputed by the AO. The Revenue has not been able to controvert this as of now therefore does not require any further direction by us. The direction of the ld. CIT(A), therefore, appears to be misplaced and the ground raised by the Revenue in so far as the evidence in respect of the deduction of TDS was made known to the AO who observed that the TDS has been deposited now does not require disallowance u/s 40(a)(ia) of the Act, in so far as 40(a)(ia) allows deposition of such tax before the due date of filing of the return when the assessee claimed that it had filed the return of income on time in acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A(3) of the Act simultaneously. The ld. DR as of now has not been able to identify the portion of the disallowance u/s 40A(3) of the Act being 40% against which they are in appeal in so far as 60% has been deleted by the ld. CIT(A) as has been raised by way of a ground by the assessee before us. We do find that the authorities below have made contrary findings in so far as on one hand they held that the identity of the vehicle was not provided to invoke the provision of section 40(a)(ia) in so far as after having furnished the details before the AO who disallowed the same u/s 40A(3) of the Act. The ld. Counsel has pointed out that the AO himself has agreed to the proposition that the said assumption of freight charges to trucks of more than Rs.20,000/- does not apply to the assessee's facts and in so far as the same has come into effect from 1st July, 2007 which the ld. CIT(A) had also acknowledged but as a liberty that the assessee had admitted that there were errors in deduction of tax at source to protect the interest of the revenue confirmed 40% thereof which we are unable to satisfy ourselves either way as mentioned above. There cannot be proportionate disallowance either u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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