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TMI Blog2023 (2) TMI 858X X X X Extracts X X X X X X X X Extracts X X X X ..... due date i.e. before the date on which return of Income u/s 139(1) of the Act has to be filed. The grounds are determined in favor of assessee. AO shall delete the addition. Addition on account TDS Income mismatch - As argued there is no mismatch of TDS and corresponding Income as the assessee is following cash system of accounting and the income has been credited to income account when received in subsequent financial year and appropriate reconciliation filed - HELD THAT:- Assessee has claimed that it is maintaining cash system of accounting and claims that income has been credited to accounts when received in subsequent financial year. On behalf of the assessee at page no. 2 of the paper book statement of difference and reconcili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue : Sh. Parikshit Singh , Sr. DR Sh. Kanv Bali , Sr. Dr ORDER PER ANUBHAV SHARMA , JM : The appeal has been filed by the assessee against order dated 25.06.2019 in appeal no. 10205 / 2018 - 19 in assessment year 2016-17 passed by Commissioner of Income Tax (Appeals)-20, New Delhi (hereinafter referred to as the First Appellate Authority in short Ld. F.A.A. ) in regard to the appeal before it arising out of assessment order dated 26.12.2018 u/s 143(3) of the Income Tax Act, 1961 passed by ACIT, Circle 61(1), Delhi (hereinafter referred to as the Assessing Officer AO ). 2. The assessee has come in appeal raising following grounds :- 1. That the Id. CIT(A) as well as A.O. have erred in adding a sum of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Ground No 1 to 3; Return of income was filed by the assessee declaring a total income of Rs. 1,20,21,590/-. The assessee is a Chartered Accountant Firm and derived its Income from Business or Profession and income from other sources. The case was selected for compulsory manual scrutiny. The balance sheet submitted by the assessee as on 31.03.2016, the assessee had shown following current liabilities payable : 1. TDS payable : Rs. 87,800/- 2. Service Tax : Rs. 12,38,907 Ld. AO observed that the above mentioned statutory liabilities payable are a part of the expense which the assessee has claimed as expenditure in his P L account. As the assessee is following cash system of accounting whereby only payments which have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be allowed. 6.2.2 The appellant during appeal hearing submitted that the provisions of Sec. 43B of the act over-right all provisions of Income Tax Act and as per Sec. 43B the amount should be allowable to the appellant. The appellant has also submitted the decision of Hon'ble Delhi High Court in the case of Commissioner of Income Tax vs. Rajinder Kumar (supra) where the Hon ble Delhi High Court have decided that the Assessing Officer was not justified in invoking Sec. 40(a)(ia) of the act in the case. 6.2.3 I have carefully perused the order of the Assessing Officer and the submission of the appellant. The Assessing Officer has disallowed TDS payable as the appellant is following cash system of accounting. The Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... context in para no. 7 of ITA no. 6986/Del/2017 for A.Y. 2013-14, in assessee s own case the Co-ordinate Bench has held :- 7. We have heard both the parties and perused all the relevant material available on record. It is pertinent to note that the Assessing Officer is not disputing the accounting method of the assessee which is cash system. In fact, the Assessing Officer as well as the CIT(A) is admitting that TDS has been deducted by the concerned party while crediting the account of the assessee and deposited into government account as per 26AS of the assessee. The assessee has made TDS payment before the due date of filing of the return under Section 139(1) which emerges from page no. 6 to 11 of the paper book annexing challans as w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fication of statement of difference and reconciliation of income corresponding to Tax credit statement as per 26 AS vs. ITR for A.Y. 2016-17 and accordingly the grounds are allowed for statistical purposes. 8. Ground no. 6; There has been an adhoc disallowance of the travelling expenses for want of evidence to establish that the expenses were wholly and exclusively for the business. The ld. CIT(A) has also sustained the disallowance to the extent of 10% on assumption that the expenses could have been for purposes other than the business. The Bench is of view that such adhoc allowances without any inquiry and evidence is not sustainable. Such disallowances earlier made in assessee s case for the year 2014-15 and 2013-14 were deleted as th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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