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TMI Blog2014 (9) TMI 935X X X X Extracts X X X X X X X X Extracts X X X X ..... mation/evidence with regard to the share capital of ₹ 51,810/- against total share capital of ₹ 24,48,100/- and unsecured loans of ₹ 35,521/- against total loan of ₹ 35,23,925/- could not be filed due to paucity of time to procure the same. In view of these facts, we hold that only on meager amount, the assessee was not able to file the confirmations due to paucity of time. Therefore, in our considered view, no penalty u/s 271(1)(c) of the Act could be levied on such additions made to the income of the assessee, hence we order to delete the same. As regard to disallowance out of freight and cartage expenses for not deducing TDS, we hold that assessee was under statutorily obligation to deduct tax at source as per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 40(a)(ia) for non-deduction of TDS on freight cartage. Thus, the additions and disallowance are made on the following counts :- (i) Addition u/s 68 on account of unexplained Share capital and unsecured loan (Rs.51,810/- ₹ 35,521/- respectively) ₹ 87,321/- (ii) Disallowance out of custom duty expenses ₹ 40,082/- (iii) Disallowance u/s 40(1)(ia) on account of Non-deduction of tax at source Rs.1,69,524/- Penalty proceedings u/s 271(1)(c) were initiated on account of the above additions and disallowances. The Assessing Officer relying o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd dismiss this ground of assessee s appeal. 5. Ground Nos.2 3 of the assessee s appeal read as under :- 2. That on the facts and circumstances of the case, the learned CIT (A) erred in upholding the penalty of ₹ 99,949/- imposed by Income Tax Officer. 3. That on the facts and in the circumstances of the case and without prejudice to ground of appeal no.2 above, penalty of ₹ 99,949/- imposed u/s 271(1)(c) of the Incometax Act, 1961 is excessive. 6. We have heard both the sides on the issue. Ld. AR submitted that the assessee has not preferred an appeal against the quantum order as there was net loss of ₹ 23,16,095/- and even after the additions, loss was reduced to ₹ 20,19,158/-. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , with regard to disallowance out of freight and cartage expenses for not deducing TDS, we hold that assessee was under statutorily obligation to deduct tax at source as per expressed provision of Section 194C of the Act as these were contractual payments. Assessee had not done so and claimed these expenses which are not deductible as per expressed provisions of Section 40(ia) of the Act. Assessee had claimed ex-facie not deductible expenses. In view of these findings, we hold that assessee is liable to levy penalty for claiming ex-facie not allowing expenses. By holding so, we find no fault in the levy of penalty on these additions. We uphold the same up to that extent. 6.2 In view of our above findings, the Assessing Officer is directe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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