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2013 (10) TMI 420 - AT - Income TaxAccrual of income - determination of income out of the receipt not disclosed in the books of account - difference between the total receipts shown by the assessee in his books of accounts and by the contractee in Form No. 26AS - Held that:- when the receipts were out of the books of accounts, the payment on account of expenses may also be out of the books of accounts. In such circumstances, the only way to determine the income is application of NP rate. In the instant case, the assessee in the earlier years was showing the income under section 44AB of the Act, which provides that the NP rate must be applied at 8%. Since, the contract receipts amounting to Rs. 22,29,386/- (Rs. 24,09,162/- - Rs. 1,79,776/-) were not shown by the assessee, so the NP rate was to be applied on those receipts Disallowance on account of section 40A(3) of the Income Tax Act – cash payment in each day exceeded to Rs. 20,000/- Held that:- Assessee made the payments towards meals charges to labourers and staff members to Shri Amar Singh Solanki and the said payments during the year under consideration amounted to Rs. 5,11,800/- - Payments made to Shri Amar Singh Solanki were on account of dining charges i.e. for meals of the labourers and the staff members - When the Assessing Officer himself admitted that those payments were made on account of meals provided to the labourers, then it can't be presumed that the payments were made only for one person in a single day and not for fooding charges of many persons. However, as the details of such employees/labourers were not provided to the Assessing Officer and in absence of the details, the disallowance was made under section 40A(3) of the Act - Remanded the issue back to the file of Assessing Officer to verify from the details, if any, submitted by the assessee as to whether the impugned amount was reimbursement of the meal charges to Shri Amar Singh Solanki or it was payments towards expenses exceeding to Rs. 20,000/-
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