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TMI Blog2018 (7) TMI 375X X X X Extracts X X X X X X X X Extracts X X X X ..... th the appeals are common, hence, we are disposing of the appeals by this consolidated order for the sake of convenience. 2. The grounds raised in (A.Y. 2007-2008) read as under:- 1. That the order passed by the Ld. CIT(A) Rohtak vide dated 23.1.2015 is bad in law. Further the said order is contrary to the facts and submissions on record. 2. That the confirming the penalty u/s. 271(1)(c) at ₹ 1240582/- is quite arbitrary, excessive, unjustified , against facts and law of the case. 3. That the Ld. CIT(A) Rohtak has grossly ignored erred in not considering the additions explanations and disallowance of payments made under the head of Inland haulage to the intermediatery alongwith relevant documentary evidence. 4. That not considering the quoted citations nor any contradictions made by the Ld. CIT(A) Rohtak are quite arbitrary, excessive and unjustified. Further to say that additions are held in appeal before CIT(A) Rohtak does not amount to wilfully concealed the particulars nor furnishing inaccurate particulars subject to penalty provisions of Section 271(1)(c). 3. The grounds raised in (A.Y. 2009-10) read as under:- 1. That the order passed by the Ld. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orders passed by the revenue authorities alongwith the Written Synopsis filed by the assessee as well as the case laws cited by him. After going through the assessment order, we are of the view that the additions in dispute have been made by the AO for want of evidence and for nonproduction of evidence, as required by him. Similarly, Ld. CIT(A) has also upheld the order of the AO, because the assessee has not produced any evidence before him also. 10. Ground 1 and 2 relate to additions of ₹ 12,67,193/- and ₹ 3,86,041/- on account of unexplained cash payments reflected in cash book of M/s. Mosaic House and M/s Diler Stone, proprietorship concerns of the appellant. From the perusal of the cash book of M/s. Mosaic House, the Assessing Officer noted that there is no opening cash in hand and payments in cash upto 30.3.2007 were of ₹ 17,97,141/-; whereas the cash receipts amounted to only ₹ 5,29,948/- and as such, there was a difference of ₹ 12,67,193/- which was added as income. Further, the cash book of M/s Diler Stone for the period l.4.2006 to 3l.3.2007 revealed that assessee has made cash deposit of ₹ 4,62,000/- but cash in hand on the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 10.2 On appeal, the CIT(A) directed the Assessing Officer to furnish a remand report whereby the Assessing Officer admitted that appellant furnished affidavits of all the persons who had advanced the sums to the appellant. He also admitted that one of the persons Shri Santosh Kumar attended and admitted to have advanced ₹ 1,15,000/- - though not as an advance against the property. As regards Shri Rajesh Kumar, another person produced before the Assessing Officer, the Assessing Officer did not record any statement as name of the person in the agreement was Rajesh Chauhan and not Rajesh Kumar. The CIT(A) thus rejected the explanation of the appellant on the ground that there is a denial of the sole purchaser produced before the Assessing Officer of entering into any such agreement and appellant failed to produce remaining parties. 10.3. As regards ground nos. 1 and 2, having gone through the record, we find that the balance sheet of M/s. Mosaic House furnished along with return of income shows the addition of ₹ 1,50,000/- against the property. Moreover it is not in dispute that assessee is an owner of the property although a personal property. It is also a m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the appellant to prove that the liability exists by producing them or furnishing reconciliation statement etc. Instead the assessee has merely given the address etc. of the creditors which was already available with AO. In the background of the aforesaid discussions, we find that the Ld. CIT(A) was right in upholding the addition of ₹ 1,07,939/-, which does not need any interference on our part, hence, we uphold the order of the Ld. CIT(A) on this issue and dismiss the ground no. 3 raised by the assessee. 12. Ground 4 of the Grounds of Appeal relates to disallowance of ₹ 18,72,599/- representing expenditure incurred on export of goods through agents of freight shipping companies. The Assessing Officer has held that no evidence was filed to prove that payments were made to agents of shipping companies and therefore, since appellant did not deduct TDS under section 194C of the Act, the same is not allowable under section 40(a)(ia) of the Act. During the course of appellate proceedings, the appellant highlighted page 45 which is a certificate from M/s. Pooja Freight Forwarders stating that M/s. Pooja Freight Forwarders is an International freight forwarding company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 40(a)(ia) of the Income Tax Act, we see no reason to interfere with the same. No error has been committed by the learned tribunal in confirming the order passed by the CIT(A). No question of law, much less substantial question of law, arises in the present appeal. Hence, the present appeal deserves to be dismissed and is accordingly dismissed. 12.1. Also, Jodhpur Bench in the case of ACIT vs. Minpro Industries 143 TTJ 331 (Jodh) has held as under: 8.2 We have gone through the Board Circular No. 723, copy of which is placed on record and contents of the same have been tabulated in the order of learned CIT(A) also and found that about certain payments it has been clarified by the Board that on these payments provisions of ss. 194C and 195 will not apply and provisions of s. 172 will be applicable. The learned CIT(A) has taken into consideration this circular and found that certain payments made by the assessee to the C and F agents who have already made the payment on behalf of the assessee were not covered either under s. 194C or under s. 195, as they are covered under the provisions of s. 172. Therefore, we hold that learned CIT(A) was justified in hol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very clear that such type of payments which are made by assessee had been held that they are not part of regular income and, therefore, provisions of ss. 194C and 195 are not applicable and Board has clarified the same. Therefore, there is no question of making any TDS on the part of the assessee and learned CIT(A) was justified in deleting the disallowance. One more decision has been relied on by the learned Departmental Representative in case of Associated Cement Co. Ltd. (supra) and we find that facts in this case are also distinguishable. In this case also we find that facts are totally different from the facts involved in the case in hand. Moreover, the payments made by assessee are covered by s. 172 where provisions of ss. 194C and 195 are not applicable as clarified by the Board vide Circular No. 723, dt. 19th Sept., 1995. The AO has placed reliance on the Circular No. 715 which is of earlier date from the Circular No. 723. The learned CIT(A) has observed that this circular was wrongly applied by AO as Circular No. 723 is applicable on the facts of the present case. Nature of payments has already been discussed by learned CIT(A) at p. 11 of his order. Therefore, we are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard to the above factual position which is not disputed by authorities below, we hold that since the payments have been made as reimbursement of expenses to the agents of the appellant, therefore, appellant was not obliged to deduct TDS under section 194C of the Act and as such, no disallowance is warranted u/s 40(a)(ia) of the Act. Having regard to the above, we delete the addition and allow the ground raised by the appellant. 13. With regard to ground no. 5 relating to confirmation of addition of ₹ 1,54,665/- is concerned, we find that the AR of the counsel has submitted that all the expenses claimed are supported with vouchers. The action of the AO in disallowing 50% of the expenditure without pointing out any defect is arbitrary and unjustified. Ld. CIT(A) has considered the issue and the submissions made by the AR and observed that the AO made a categorical finding regarding the genuineness, reasonableness and verifiability of the bills. The Revenue Authority below has come to the conclusion against the assessee, after verifying the vouchers produced by the assessee. Keeping in view of the facts and circumstances, Ld. CIT(A) has rightly held that the disallowan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court in the case of Highways Constructions Co. Pvt. Ltd. Vs. Commissioner of Income Tax 199 ITR 702 held that notional interest cannot be charged. This ground is allowed. 18. The ground no. 7 relating to confirmation of addition of ₹ 95830/- is not pressed before us, hence, the same is dismissed, as not pressed. 19. With regard to ground no. 8 relating to confirmation of addition of ₹ 33900/- i.e. 20% disallowances of expenses under various heads is concerned, we find that the Ld. CIT(A) has observed that a fact finding has been given by the AO that some of the expenses are unvouched or not properly vouched. The Assessee s counsel has not contravened these observations of the AO. Therefore, in view of the above factual finding of the AO and Ld. CIT(A), Ld. CIT(A) upheld the disallowance of 20% of the expenses, which does not need any interference on our part, hence, we uphold the order of the Ld. CIT(A) on this issue and decide the issue against the assessee by dismissing the ground no. 8 raised in its appeal. 20. With regard to ground no. 9 relating to confirmation of addition of ₹ 20000/- under house hold expenses is concerned, we find that ..... 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