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TMI Blog2017 (9) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... scharged by the assessee in the instant case. Hence, keeping in view the factual matrix of the case, we are inclined to set aside and restore this matter to the file of the A.O. for de novo determination of the issue on merit in accordance with law. The assessee is directed to file necessary evidences/explanations before the A.O. in the de novo proceeding to reconcile the difference between the income as is reflected in the books of accounts and TDS certificates w.r.t. Provogue India Limited. Infringement of Section 194C - payments being made without deduction of tax at source from labour payments - Held that:- The assessee had made payments to the tune of ₹ 1,01,04,662/- and Rs. ₹ 7,64,497/- to various persons which was claimed by the AO to have exceeded threshold limits as stipulated u/s 194C of the 1961 Act and the assessee had made payments without deducting tax at source as stipulated u/s 194C which as per AO infringed provisions of Section 40(a)(ia). We find that the assessee had claimed that these payments were made to supervisors who distributed payment to labourers without retaining any income for themselves and hence no violation of Section 194C r.w.s. 40( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e accounts of the assessee are audited u/s.44AB of the Act and AO has not found any discrepancy therein ignoring the fact that an opportunity was given and assessee was questioned about the discrepancy who in turn replied that while making TDS deduction the party has not taken into account the debit note issued by them. 3. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of ₹ 19,59,838/- ignoring the fact that the debit notes submitted by the assessee amounts to only ₹ 39,46,344/- whereas the short booking was of ₹ 59,05,882/-. Now on verification from the account copies of assessee in the books of M/s Provogue (I) Ltd. available in assessment record it is found that the actual amount of debit notes raised by M/s. Provogue (I) Ltd. is only ₹ 36,81,029/- and not ₹ 39,46,344/- reported by the AO in the assessment order. 4. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of ₹ 38,375/- made on account of discrepancy in receipt from M/s. Catwalk World Wide Pvt. Ltd. as per TDS certificates and receipts book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s observed by the A.O. in assessment proceedings arising out of directions given by learned CIT u/s 263, that from the TDS certificates that the receipt from M/s Provogue (I) Ltd. amounts to ₹ 6,89,34,259/- while party-wise break up of receipts submitted by the assessee showed that the amount of income booked in the name of Provogue (I) Ltd. was only ₹ 6,30,28,377/-, thereby resulting into an apparent short booking of income to the tune of ₹ 59,05,882/-. On being asked by the AO, the assessee explained that while making TDS deduction, the party had not taken into account the debit note issued by them and deducted TDS from the entire amount of sale as per bill. It was claimed that the said details were again submitted before the AO during the assessment proceedings in pursuance to directions u/s 263 as also it was earlier submitted by the assessee during original assessment proceedings u/s 143(3) r.w.s. 143(2). The A.O. observed that the debit note amount was only ₹ 39,46,344/- and even after taking into account the said discounts, there was a difference in gross receipts to tune of ₹ 19,59,538/- which was not explained by the assessee and of which addi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und that the A.O. had not discharged his onus while making the addition as no enquiry was made by the AO u/s 131/133(6). It is submitted that the power of ld. CIT(A) is coterminus with the power of A.O. and in case the AO did not made enquiry, the learned CIT(A) should have made the enquiry himself or directed the AO to make enquiry u/s 133(6)/131 of the 1961 Act by issuing notices/summons to Provogue India Limited. It was submitted that the learned CIT(A) deleted the additions without any evidence on record. 7. The ld. counsel for the assessee, on the other hand, relied on the order of the ld. CIT(A) and submitted that the ld. CIT(A) has rightly granted the relief.Our attention was drawn to paper book filed with the tribunal. 8. We have heard rival contentions and also perused the material available on record. We have observed that as per the TDS certificate, the receipt from M/s Provogue (I) Ltd. were to the tune of to ₹ 6,89,34,259/- while the amount booked by the assessee as income in its books of accounts from M/s Provogue (I) Ltd. was to the tune of ₹ 6,30,28,377/- which was offered for taxation. There were debit note of ₹ 39,46,344/- ( now claimed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the Revenue, which led to a difference of ₹ 38,375/- being suppressed income short booked by the assessee. The assessee could not furnish any explanation w.r.t. this short booking of income and hence the A.O. added an amount of ₹ 38,375/- to the total income of the assessee, vide assessment order dated 05-03-2013 passed by the AO u/s 263 r.w.s 143(3). 10. Aggrieved by the assessment order dated 05-03-2013 passed by the AO u/s 143(3) r.w.s. 263, the assessee carried the matter in appeal before the ld. CIT(A) who granted relief to the assessee by holding that the income shown against Catwalk Worldwide Pvt. Ltd. was to the tune of ₹ 17,10,712/- which was the same as per the TDS certificate issued by the said party and the difference of ₹ 38,375/- is nothing but the amount of TDS, vide appellate order dated 25-07-2014 passed by the learned CIT(A). 11.Aggrieved by the appellate order dated 25-07-2014 passed by the ld. CIT(A), the Revenue is in appeal before the Tribunal. 12. The ld. D.R. submitted that there was a difference of ₹ 38,375/- as per the TDS certificate issued by M/s Catwalk Worldwide Pvt. Ltd. and the party-wise breakup submitted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TDS has been made from labour payment of ₹ 61,73,124/- paid to contractors and duly remitted to the government treasury and in respect of the balance amount, the assessee had explained that since the assessee is in the business of interior decoration, huge amount of labour is involved like carpenter, painter, electrician, plumbers, helpers etc. on day to day basis, they have been paid in small amounts, which do not exceed the limit prescribed for deduction of TDS. However, the A.O. on verification of the details of the balance amount from the ledger of the assessee observed that an amount aggregating to ₹ 1,01,04,662/-, paid to different parties attracts the provisions of section 194C of the 1961 Act. Since there was a failure on the part of the assessee wherein TDS was not deducted u/s 194C, the expenditure on labour amounting to ₹ 1,01,04,662/- was disallowed by the A.O. and added to the income by invoking provisions of Section 40(a)(ia), The A.O. further made a disallowance of ₹ 7,64,497/-for payments made to contractors without deduction of TDS u/s 194C of the 1961 Act and the payments exceeded threshold limit of ₹ 50,000/- which attracted disallo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal. 18. The ld. D.R. submitted that the assessee has made payments of ₹ 1.01 crores and ₹ 7.64 lacs for labour payments against which no deduction of tax at source was made by the assessee and provision of Section 194C was violated. It was submitted that new plea of payments being made to supervisors who in turn made payments to labourers has been set up by the assessee before learned CIT(A) for the first time which was not raised before the AO. It was submitted that new plea of the assessee required verification by the AO and learned CIT(A) did not called for remand report from the AO and allowed the appeal of the assessee without calling for Remand Report from the AO in violation of Rule 46A of the Income-tax Rules, 1962. Thus, it is prayed that the matter be restored to the AO for denovo determination of the issue on merits by the AO after considering the pleas of the assessee. 17. The ld. counsel for the assessee drew our attention to paper book page No. 91 to 96 and submitted that all the details were filed before the authorities below. The ld. counsel also invited our attention to paper book page 78 whereby copy of reply given to the AO is placed and subm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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