9911796707
TMI Blog2022 (11) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... d from the Tax Audit Report which is contrary to the existing facts. Since in the present case, the actual disallowance has been added back to the computation by the assessee, we are of the opinion that, the addition/disallowance made u/s 43B is deserves to be deleted. Accordingly, we allow the Ground No. 1 of the assessee. Disallowance u/s 40A(7) - amount of provision for gratuity debited in the profit and loss account and which was credited to the provision of gratuity account - HELD THAT:- We find force in the contention of the Ld. Counsel for the assessee that the Ld. AO as well as Ld. CIT(A) could not understand the tax audit report and made the addition which has been confirmed by the Ld. CIT(A). The Lower Authorities have disall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd 40A(7), the CIT(A) has ignored the material available on record/ submitted both at the assessment stage and the appellate stage 4. The action of the CIT(A) in placing reliance solely on the Tax Audit Report of the assessee while ignoring the audited accounts and explanations provided is unjust, illegal, arbitrary, unwarranted. 5. The action of the CIT(A) in upholding the additions/ disallowances u/s 40A(7) and 43B is unjust, illegal, arbitrary, unwarranted and the addition deserves to be deleted. 6. The appellant craves leave to add, alter, modify or delete any ground of appeal either before or at the time of the hearing. 3. Brief facts of the case are that the return of income was filed by the assessee declaring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt(Rs.) As per Balance Sheet (Rs.) Opening balance of leave with wages payable as at 01.04.2014 (PB 138) 46,10,159 (P 85) 4,82,769 Less: Paid (PB 138) 3,04,428 (P 83) 41,27,390 43,05,728 46,10,159 Add: Amount of leave with wages payable liability debited for the year ended 31.03.2015 PB 138 11,69,480 (P 85) 9,89,738 (Rs.54,75,211 - 43,05,731) (P 83) 44,85,473 54,75,211 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowable will be Rs. 11,69,480-Rs. 3,04,428 = 8,65,052 which has been added back in the computation. Ld. AO and the Ld. CIT(A) have considered and picked up the figure of Rs. 49,97,853/- mentioned in the Tax Audit Report wherein the assessee has specifically mentioned the figure of Rs. 4,77,358/- paid against leave encashment in the upper row against 26(i)(B)(a). 11. The Ld. CIT(A) observed that the disallowance made on the basis of observation of tax audit report u/s 44AB of the Act and the assessee fail to give proper explanation on that count. It is found that the Ld. A.O has not raised the query on the said issue but suo-moto disallowed the claim of the expenditure. In our opinion, it has to be seen whether the assessee has paid this exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the paper book. It is also found that the difference between opening and closing balance amounting to Rs. 22,43,146/- has been added back in the computation of income at page 22 of the paper book (Rs. 1,03,60,792/- - Rs. 81,17,646/-). As per the gratuity payable account produced at paper book at page 141 wherein a sum of Rs. 74,919/- + 84785/- + 24231/- has been paid aggregating to Rs. 1,83,935/-. The computation of income at page 22 which is as under:- Gratuity 22,43,146 Bonus 17,398 Liability for leave encashment 8,65,052 31,25,596 14. We find force ..... X X X X Extracts X X X X X X X X Extracts X X X X
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