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2012 (7) TMI 69 - AT - Income TaxDisallowance the claim of expenses invoking the provisions of S.40(a)(ia)- Held that:- Considering the submission of assessee that he has paid freight charges and TDS was also deductible but, on the same the lower authorities have not given any finding as to whether the assessee has made all the payments of freight charges before the year end - remit the issue to the file of A.O. for verification as only outstanding amount or the provision for expenses (and not the amount already paid) is liable to disallowance if TDS is not deducted - in favour of assessee by way of remand. Addition made u/s. 40A(3) - Held that:- As the assessee has not been able to conclusively demonstrate that its case falls under the exceptions as provided under Rule 6DD, invoking the provisions of Sec. 40A(3) and disallowed 20% of the payment made in cash as the assessee had made payments aggregating to Rs.2,52,800 by cash/bearer cheque each of which were more than Rs.20,000 - against assessee. Partly confirmation of addition on account of gross profit - Held that:- As the assessee has started dealing in cement business in the present assessment year and the turnover of the assessee increased due to it is an accepted fact that to penetrate into an already existing market, the businessmen has to offer competitive rates - as CIT (A) has granted the relief to the extent of 50% of net profit estimated by A.O. on estimation basis in view to meet the ends of justice the disallowance need to be reduced to the extent of Rs.1.50 lacs as against Rs.1,73,289 sustained by CIT(A) - partly in favour of assessee.
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