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TMI Blog2016 (4) TMI 558X X X X Extracts X X X X X X X X Extracts X X X X ..... was already offered to tax on accrual basis in the earlier year. Accordingly, we do not find any error or illegality in the impugned order of the CIT(A) qua this issue. - Decided in favour of assessee Disallowance made u/s 40(a)(ia)- Held that:- TDS which was deducted by the assessee from the transport payment was deposited before the due date as per section 139(1). The CIT(A) has also placed reliance on the judgment of the Hon’ble Calcutta High Court in the case of CIT vs. Virgin Creations (2011 (11) TMI 348 - CALCUTTA HIGH COURT ) as well as the decision of the coordinate bench of this Tribunal in the case of ACIT vs. M.K.Gurumurthy (2012 (6) TMI 293 - ITAT, Bangalore ). The revenue has not disputed the fact that TDS deducted by the assessee on transportation charges was paid along with interest within due date on filing of return of income u/s 139(1).- Decided in favour of assessee Addition u/s 68 - CIT(A) deleted the addition by nothing the fact that the assessee produced confirmation from the party - Held that:- It is clear from the finding of the CIT(A) that the alleged confirmation was neither examined nor verified by the AO nor by the CIT(A). Once a document was avai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 36,70,787/-. The AO proceeded to work out the expenses attributable to excavation activity and arrived at the amount of ₹ 31,80,884/- being not allowable by deduction considering the opening work-in-progress at ₹ 15,25,150/- and no closing work-in-progress. Accordingly, the AO made addition of the said amount of ₹ 31,80,884/-. 4.1 On appeal before the CIT(A), the assessee submitted that while computing the disallowance by AO, the entire diesel expenses of ₹ 27,00,090/- has been wrongly considered to be attributable to excavation activity. Assessee pointed out that the said expenses of diesel purchase of ₹ 27,00,090/- should be apportioned between hire activity and excavation activity. The assessee filed separate profit and loss account in respect of these two activities with proportionate bifurcation of expenses in the ratio of 30:70 between excavation activity and hire charges. The CIT(A), after considering these details filed by the assessee, has deleted the addition made by the AO on this account. 4.2 Before us, learned Departmental Representative has submitted that the CIT(A) has considered the apportionment expenses between excavation acti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of expenses, 30% of which was attributed to excavation activity and 70% to hire charges. A gross profit of ₹ 42,30,003 was shown attributable to hire charges and ₹ 5,19,280 to excavation charges. Considered thus, the AO's conclusions are clearly unwarranted especially since he has given no reason for considering the entire diesel expenditure as attributable to excavation activity only and the appellant's grounds succeed. Thus it is clear that only 30% of the diesel expenses of ₹ 27,00,090/- are attributable to the excavation activity and to that extent, the assessee would get relief. However, the CIT(A) has deleted the entire addition without considering the fact that addition of about ₹ 8 lakhs would be sustained, even if a proportionate 30% of diesel expenses is attributable towards excavation activity. Accordingly, we modify the order of the CIT(A) qua this issue and direct the AO to re-work the addition by allocating the diesel expenses between excavation activity and transportation activity in the ratio of 30:70. Accordingly, this ground of the revenue is partly allowed. 5. Ground No.3 regarding addition of ₹ 7,50,202/- u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Central Government account within stipulated time. Since the assessee has deposited the amount belatedly, the AO made disallowance u/s 40(a)(ia) in respect of entire transport charges of ₹ 1,03,26,985/-. 6.1 On appeal, the CIT(A) allowed the claim by recording the fact that the assessee paid TDS along with interest within the due date of filing of return of income u/s 139(1). 6.2 We have heard the learned Departmental Representative as well as the learned AR of the assessee and considered the relevant material on record. The AO has made disallowance u/s 40(a)(ia) because the assessee made payment of TDS belatedly on 29/5/2008. On appeal, the CIT(A) has allowed the claim of the assessee by considering the fact and the issue in para.8.1 as under: 8.1 Before me in appeal it was contended that the appellant had paid the deducted TDS, along with interest, within the clue date for filing of return u/s 139 (1). Reference was made to the amendment effected by the Finance Act 2010 which allowed for deduction even when the TDS had been deposited before the due date specified u/s 139(1). It was contended that this amendment has been held to be operative with retrospective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the balance was subject to reconciliation, but the AO did not take into account this confirmation available. From the copy of the ledger account of this party/creditor in the appellant's books for FY 2007-08 it is seen that the impugned amount was only an opening balance as on 01.04.2007 against which no payment was made by the assessee during the year. The opening balance in question, therefore, is clearly the result of the transactions of earlier periods. The confirmation to the extent of ₹ 50 lac in respect of this credit entry in the books was also available before the AO. Since the details of the earlier year's transaction which resulted in this credit balance were not made available before me, I am constrained to treat the matter only in terms of the impugned amount representing a credit entry in the books. Since 50 lac out of the same had been confirmed by the creditor the AO's not taking cognition of the same, and giving no reason for the rejection thereof, is not in order. To the extent of ₹ 50 lac, therefore, the credit entry is considered to be evidenced. The addition u/s 68 is to be made only in respect of ₹ 10,06,598, being the balance fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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