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2015 (3) TMI 184 - ITAT HYDERABADUnexplained sundry creditors - addition of 5% of trade creditors deleted by CIT(A) - Held that:- With respect to the addition of 10% of the cultivated creditors the assessee had already disclosed ₹ 25 lakhs in the earlier assessment year, it was restricted to 5% of the trade creditors. The table given shows that the assessee had disclosed ₹ 25 lakhs in the hands of the firm and a further sum of ₹ 25 lakhs was disclosed in the hands of the partners. AO had not disputed the purchases made, the turn over achieved, consumption, closing stock, trade results, etc. The assessee submitted that it never recorded the full address of the agriculturists and it was the general practice of the assessee over the years. As per list submitted by the assessee before authorities in respect of trade creditors, there are trade creditors running into hundreds. The Assessing Officer did not dispute all these facts and only proceeded to disallow 5% of the trade creditors, after considering that the assessee had disclosed ₹ 25 lakhs in the earlier year. Under these circumstances, the CIT(A) held that the addition made by the Assessing Officer does not have legs to stand. We do not find any infirmity in the order of the CIT(A) and uphold the same. - Decided against revenue. Payments to APNPDCL violating the provisions of rule 6DD - CIT(A) allowed the claim - Held that:- transactions have been recorded in the books and are genuine payments in the course of business. By Rule 6DD(b) the payments are exempted as the payment is to Government undertaking. Rule 6DD(b) reads as 'where the payment is made to the Government and, under the rules framed by it, such payment is required to be made in legal tender. The assessee placed reliance on the order of ITAT Delhi Bench in the case of MR Soap Pvt. Ltd. vs. Inspecting ACIT, (1988 (9) TMI 95 - ITAT DELHI-D ) wherein it was held that cash payments made to Government Undertaking do not attract the provisions of Section 40A(3) of the Act. Since the facts of the present case are similar, the payment to the Government undertaking for supply of electricity are not covered by the provisions of section 40A(3), this addition is deleted. We do not find any infirmity in the order of the CIT(A) and the ground raised by the Revenue on this issue is dismissed. - Decided against revenue.
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