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TMI Blog2013 (12) TMI 182X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1961, even if it is established in the assessment proceedings that the assessee has clearly contravened the stipulations given in the section 40(a)(ia) of the Income-tax Act, 1961. 2. Whether within the meaning of section 144 of the Income-tax Act, 1961 while making an assessment of taxable income to the best of his judgment the Assessing Officer is lawfully debarred to invoke the provisions of section 40(a)(ia) of the Income-tax Act, 1961." The brief facts as have been brought on record are that the assessee derives income from publication and trading in books. The return for the assessment year under consideration was filed on September 30, 2008 showing total income of Rs. 2,27,870 which was processed under section 143(1). Later on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee. If those books are not correct or complete, the Assessing Officer may reject those books and estimate the income to the best of his judgment. When such an estimate is made it is in substitution of the income that is to be computed under section 29. In other words, all the deductions which are referred to under section 29 are deemed to have been taken into account while making such an estimate.' In Teja Constructions v. Asst. CIT [2010] 5 taxmann.com 61 (HydITAT) the above decision of the hon'ble High Court has been followed and it has been held that 'where income of the assessee having been determined by resorting to estimation, there is no scope for any further disallowance either in terms of section 40(a)(ia)/40 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 129 TTJ (Hyd) (UO) 57, the learned Commissioner of Income-tax (Appeals) as specifically says that "where income of the assessee have been determined resorting the estimation, there is no scope for any further disallowance either in terms of section 40(a)(ia)/40A(3) of the Act or otherwise". The question regarding application of section 144 of the Income-tax Act as raised by the Department is not the issue involved and therefore not tenable in law. The issue is once the income is determined estimating profit there is no scope for further disallowance either under section 40(a)(ia)/40A(3) and this principle decided by the Andhra Pradesh High Court in Indwell Constructions [1998] 232 ITR 776 (AP) and the Income-tax Appellate Tribunal the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 22 ITR 594 (P&H) and the Himachal Pradesh High Court in the case of ITO v. Rama Nand and Co. [1987] 163 ITR 702 (HP) in the following cases : 1. Ankul Bhandar, ITA No. 134/CTK/2008 dated February 26, 2009 ; 2. National Transport, ITA No. 95/CTK/2008 dated May 6, 2009 ; 3. Gurudev Singh, ITA No. 201/CTK/2008 dated May 7, 2009 ; 4. R. R. Carrying Corporation, ITA No. 179/CTK/2009 dated December 24, 2009 ; 5. Chandrakant Thacker, ITA No. 247/CTK/2009 dated December 24, 2009 ; 6. Nabin Kumar Sahoo, ITA No. 143/CTK/2010 dated April 21, 2011 ; and 7. Sanjay Kumar Pradhan v. Asst. CIT [2012] 14 ITR (Trib) 150 (Cuttack), ITA No. 450/CTK/2011 dated December 16, 2011. The case of the assessee being similar is otherwise squarely covered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the non-deduction of tax at source was to be considered under the provisions of Chapter XVII-B which the learned Departmental representative pointed out was to be considered under section 201 of the Income-tax Act. The various decisions cited at the Bar and noted by the learned Commissioner of Income-tax (Appeals) therefore indicate that the assessee would have never tried to deduct tax at source on these payments for claiming these expenditures for the purpose of its business in so far as the Assessing Officer having allowed these expenditures on estimation of the income at a percentage indicated allowance of expenditure of the remaining receipts as expenditure. Those receipts were spent by the assessee therefore could not have been furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not the case of the Assessing Officer to go back to those very books of account which indicated nondeduction of tax at source on certain expenditures that had ripened to be disallowed under section 40(a)(ia). Confining ourselves to the issue on hand we are inclined to follow the decision of the Income-tax Appellate Tribunal, Cuttack Bench in the case of Sanjay Kumar Pradhan v. Asst. CIT [2012] 14 ITR (Trib) 150 (Cuttack) in ITA No. 450/CTK/2011 dated December 16, 2011 (copy placed on record) indicating that it cannot be said that a change of stand can be taken up later when the finding of fact remains the same as were available to the Assessing Officer in view of the fact that part deduction of tax on certain payments do not lead to the f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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