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2014 (11) TMI 282 - AT - Income TaxDeletion of disallowance u/s 40(a)(ia) – Held that:- The assessee has deducted the tax at source on 31.03.2009 and deposited it in May/June, 2009 – following the decision in DCIT vs. Rajasthan Art Emporium [2014 (11) TMI 43 - ITAT JODHPUR] - the amendment brought in by Finance Act, 2010 in the provisions of section 40(a)(ia) should be read as clarificatory in nature and applied retrospectively - the entire expenditure has been paid by the assessee and nothing remains payable as on the end of the year – thus, the order of the CIT(A) is upheld – Decided against revenue. Delayed deposition of Employees Contribution to PF & ESI – Held that:- Following the decision in CIT vs. Hindustan Organics Chemicals Ltd. [2014 (7) TMI 477 - BOMBAY HIGH COURT] - the Employees Contribution to PF & ESI has been found allowable if the same is paid till the due date of filing return of income u/s 139(1) - even the employees contribution to PF and ESI has been found allowable if paid prior to the due date of filing return u/s 139 (1) – Decided against revenue. Advertisement and Publicity Expenditure – Held that:- Complete details of payment to each individual is available with the assessee along with the details of work done - the AO without going into details of the issue has made the disallowance as he has applied provisions of section 40A(3) without considering the fact that many parties are involved and payment to none of them exceeds ₹ 20,000 – the order of the CIT(A) is upheld – Decided against revenue. Disallowance out of discount expenses deleted – Held that:- Apparently the AO appears to have not applied his mind and not gone into detailed enquiry of the matter - CIT(A) has perused the material made available before him which is part of regular books of accounts of the assessee - CIT(A) rightly found that as there are many parties involved in total discount of ₹ 23,000/- , provision of section 40A(3) does not apply – thus, the order of the CIT(A) is upheld – Decided against revenue. Disallowance on interest expenses in interest free advances given to sister concern deleted – Held that:- The AOhas observed about reducing the interest cost without finding any nexus of advance to sister concern with the interest bearing funds - Assessee has ample interest free funds as capital of partners - the partners fund has been given to sister concern – relying upon CIT vs. Arihant Avenue & Credit Limited [2014 (10) TMI 790 - GUJARAT HIGH COURT] – the order of the CIT(A) is upheld – Decided against revenue.
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