2015 (7) TMI 1219

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..... this fact has not been disputed. Thus no disallowance is justified u/s 40(a)(ia) of the Act in this case of the assessee. Hence, the ground of the assessee is allowed.
R. P. Tolani (Judicial Member) For the Assessee : Siddharth Ranka, Muzaffar Iqbal For the Revenue : Neena Jeph, JCIT -DR ORDER R. P. Tolani (Judicial Member) This is an appeal filed by the assessee against the order of the ld. CIT(A)-I, Jaipur dated 28-01-2013 for the assessment year 2008-09 challenging the disallowance of ₹ 2,46,478/- u/s 40(a)(ia) r.w.s. 194C for non-deduction of TDS from the payments made to job workers. 2.1 Brief facts of the case are that the assessee paid job work charges for processing the stones. During the course of assessment proceedi .....

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..... d. Thus the taxability of the job work income in the hands of the payee stood demonstrated by the assessee. 2.4 Reliance is placed in the case of CIT vs. Banwari Lal Bansidhar, (1998) 229 ITR 229 for the proposition that if the books of account are rejected and profits are estimated then no separate addition u/s 40A(3) can be made. It is held as under:- "Section 40A(3) of the I.T. Act, 1961, read with rule 6DD of the Income-tax Rules, 1962 - Business disallowance - Cash Payment exceeding prescribed limits - Assessment year 1971-72 - Whether where income of assessee was computed applying gross profit rate and when no deduction was claimed or allowed to assessee in respect of purchase, no disallowance u/s 40A(3), read with rule 6DD(j), cou .....

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..... e Supreme Court in the case of CIT vs. Vegetable products Ltd. (1973) 88 ITR 192 for the proposition that if two views are possible then one view in favour of the assessee should be adopted. Besides, in this case, the taxes have been paid in the hands of the payees. Further reliance is placed in the case of ITO vs. Nardev Kumar Gupta vs. ITO (ITA No. 829/JP/2012 dated 23-01- 2012) of ITAT Jaipur Bench. 2.7 The ld. DR supported the order of the ld. CIT(A). 2.8 I have heard the rival contentions and perused the materials available on record. I find merit in the arguments of the ld. Counsel for the assessee. Hon'ble Allahabad High Court in the case of CIT vs. Banwari Lal Bansidhar (supra) has taken a view that once the books of account a .....

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