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2014 (12) TMI 1174 - AT - Income TaxRevision u/s 263 - as per CIT(A) the amount has been split into two parts so as to avoid the attraction of provisions section 40A(3) - Held that:- The copies of the ledger account of the Lorries demonstrate that the payment in question has been made in different points of time. The advance has been paid to the lorry at the first instance and, thereafter when the delivery of the goods has been made, the balance amount has been paid. This fact is reflected by way of passing of journal entries, wherein, the lorries have been credited with the balance payable on the day of payment of advance and it was on subsequent date that the balance has been paid after deducting TDS. This journal entry has not been properly understood by the ld CIT. This is clear from the show-cause notice, where it states that the amount has been split into two parts so as to avoid the attraction of provisions section 40A(3). This is factually incorrect. After the assessee has demonstrated before the ld CIT that the manner in which the entries in the books have been passed, he at page 5 acknowledged that the amounts were split into two parts and one was taken as advance and was given to lorry owners and the balance was paid subsequently by way of cash. This means the ld CIT admits after enquiry that the version of the assessee is correct. While so, we don’t find any justification in the ld CIT directing the AO to verify the details filed by the assessee and determined whether they are factually correct. When the enquiries conducted by the ld CIT have not thrown up any material to demonstrate that the order of the AO was erroneous and prejudicial to the interests of the revenue, the ld CIT should have dropped the proceeding u/s.263.The Ld CIT also cannot without himself conducting enquiries and coming to a conclusion on the basis of material found as a result of enquiry, give direction to the AO to conduct fresh verification. The assessee has satisfactorily explained the issues raised by the ld CIT and in such circumstances, it cannot be said that the order of the AO is erroneous or prejudicial to the interest of the revenue. - Decided in favour of assessee. Deduction u/s.80C - Held that:- Coming to deduction u/s.80C of the Act, it is not the case of the ld CIT that the AO has not verified the claim of the assessee. In fact, the assessee has submitted the details to the ld CIT and ld CIT, on examination of such details, has not recorded any adverse conclusion. A simple direction is given to AO to verify the claim of the assessee. Such a direction is erroneous for the reason that the ld CIT has not recorded that any prejudice is caused to the revenue.- Decided in favour of assessee. Insurance commission - tds u/s 194C or 194D - Held that:- On the issue of alleged insurance commission earned by the assessee, M/s. Bhaskar Prakashan Pvt. Ltd. has clearly explained that a mistake has occurred while mentioning the section 194D instead of 194C and the commission was never received by the assessee. Despite of such categorical confirmation, the ld CIT directed the AO to verify this claim of the assessee without recording a finding that the order of the AO on this issue is either erroneous or prejudicial to the interests of the revenue. In our view, when proper material has been furnished before the ld CIT and the ld CIT has examined the same, he cannot without recording specific finding that the order is erroneous and prejudicial to the interests of the revenue on certain specific aspects invoked his power u/s.263 - Decided in favour of assessee.
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