Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2012 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (10) TMI 174 - ITAT MUMBAIDisallowance u/s. 40(a)(ia) - violation of provisions of Sec. 194 - Held that:- Perusal of the assessment order show that the AO has made the additions on presumption that all the payments are made to sub-contractors without seeking any information/explanation/verification from the assessee and also the CIT(A) fell into the same error while disposing of the grievance of the assessee. This issue needs further verification at the assessment stage therefore deem it fit to restore this issue to the file of the AO - in favour of assessee by way of remand. Disallowance of labour charges - Held that:- On perusal of the assessment order of CIT(A) it is noted that the assessee has not substantiated claim of payment of labour charges - against assessee. Disallowance of expenses - expenses incurred in cash with self made vouchers - Held that:- The AO has made additions on adhoc basis under the account, thus find no reason to interfere with the findings of the CIT(A) who has restricted the total disallowance of 5% of the expenses. Disallowance of depreciation - Held that:- Disallowance of depreciation on vehicle is claimed on block of assets and with effect from 1.4.1989, the depreciation is claimed/allowed on block of assets and not on individual assets. Therefore, while confirming the findings of CIT(A) finding so far as depreciation on vehicle claimed is concerned, the AO is directed to delete the addition of Rs. 92,000/- from the total income - in favour of assessee. Liability of sundry creditors ceased to exist - addition u/s. 41(1) - Held that:- The assessee herself has admitted that the bills of KLB Fabricators and S.D.S Fabricators are over invoiced which itself prove that the assessee is not going to pay this amount. So far as liability of P&R Industries and PMB Engineering are concerned, the assessee has categorically stated that the companies have closed. Just because the assessee has given an assurance that these liabilities will be written back in A.Y. 2009-2010 will not exonerate the assessee as if liability has ceased to exist in the year under consideration, then it has to be added back in the year under consideration and not as per the assurance given by the assessee that it will be written back in A.Y. 2009-2010. No merit and logic in the submission of the assessee - against assessee. Rectification order u/s 154 of CIT(A) - additions made u/s. 41(1) allowed - Held that:- CIT(A) while adjudicating on the application made u/s. 154 was carried away by the submissions of the assessee without appreciating the fact that what assessee has stated during the course of the appellate proceedings was only a promise to consider the write back of liabilities in A.Y. 2009-2010 - the future promise made cannot become a reason for rectification of error apparent from record. The CIT(A) has grossly erred in rectifying the appellate order dt. 18.2.2010 - in favour of revenue.
|