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2016 (5) TMI 1472 - AT - Income TaxNon deduction of tds u/s 194C printing and stationary expenses - Disallowance u/s 40(a)(ia) - Held that:- All the expenses related to printing and stationary on the basis of particular specification given by the assessee and the assessee had paid VAT on it. The Board circular No. 681 dated 08/3/1994 referred by the AR of the assessee is squarely applicable. Accordingly, such payments are not covered U/s 194C of the Act. Case of CIT-XVII, Delhi Vs Silver Oak Laboratories P. Ltd. (2010 (8) TMI 839 - SUPREME COURT) is also squarely applicable including other cited cases of the assessee. Alternatively, the assessee’s claim is allowable on paid basis as relied upon in the case of CIT Vs. Vector Shipping Services (P) Ltd. (2013 (7) TMI 622 - ALLAHABAD HIGH COURT). These facts had not been controverted by the DR during the course of hearing. Therefore, we allow the assessee’s appeal on this ground. Disallowance of provisions of gratuity - Held that:- The facts of the present case and similar additions were made in A.Y. 2008-09 by the ld Assessing Officer, which has been deleted by the Coordinate Bench in assessee’s own by relying on the Hon'ble Supreme Court decision in the case of CIT Vs Textool Co. Ltd. [2009 (9) TMI 66 - SUPREME COURT ]. The assessee had applied before the ld CIT, Kota but approval of the prescribed authority is pending. Therefore, there is no lack on the part of the assessee. Accordingly, this ground of the assessee is allowed. Addition of pension, leave salary - amount allowable only as paid before due date of return - Held that:- CIT(A) wrongly concluded that amount paid on 03/2/2009 had been included in provision. However, as per paper book submitted by the assessee, this amount of ₹ 5,92,714/- was paid over and above ₹ 43,57,530/-. The ld DR has not controverted the facts and figures, therefore, we allow the assessee’s appeal on this ground. Not allowing the provision of agreement arrears - Held that:- This issue has been considered by the Coordinate Bench in assessee’s own case for A.Y. 2008-09, which is squarely applicable on the facts and circumstances of the case for the year under consideration. Therefore, by respectfully following the order of the Coordinate Bench, we allow the assessee’s appeal on this ground. Interest addition - difference in disclosing the interest - credit of TDS had been given on interest payment - Held that:- The assessee had admitted this difference on the basis of 26AS and disclosed the differences of interest income of ₹ 78,563/- in A.Y. 2010-11 and there is no revenue loss if the same amount is considered in A.Y. 2010-11 by the assessee. The Hon'ble Supreme Court decision in the case of Excel Industries (2013 (10) TMI 324 - SUPREME COURT) is squarely applicable. Therefore, we delete the addition confirmed by the ld CIT(A). Addition of excess cash reserve - This amount is not payable on expenditure - CIT(A) restricted this addition of ₹ 34,489/- by observing that as per balance sheet as an amount of ₹ 96,342/- had been shown as excess cash reserve. This amount is not payable on expenditure - Held that:- this issue is considered by the Hon’ble ITAT in assessee’s own case in A.Y. 2008-09 wherein it has been held that reserve account in balance sheet has been created on the liability side. The same represents the excess cash found as per books which the bank is required to repay to the legitimate person on a proper claim. Thus, it is an amount in trust held by the bank, it is not credited to P&L account and is a balance sheet item. The assessee’s explanation is bonafide. Disallowance on account of Ganesh Mahotasava - allowable busniss expenditure - Held that:- Lord Ganesha is the God of Wealth as considering in Indian methodology. The assessee also deals in banking. It is a fact that all the banks generally participate in Ganesh Mahotasava, which motivates the employee as well as maintain good relation with the customers. Therefore, it is an allowable expense U/s 37 of the Act. The case laws relied upon by the assessee is also applicable. Accordingly, order of the ld CIT(A) on this ground is confirmed. Addition on account of leave salary encashment fund U/s 43B(f) - assessee had shown ₹ 94,84,740/- as leave salary encashment fund under “Funds and Reserve” in the balance sheet as against Rs. Nil shown in the assessment year 2008-09 - Held that:- Assessing Officer had made addition by making disallowance U/s 43B(f) of the Act by taking amount from the balance sheet, which is grossly incorrect and without even going through his own action on the same issue for the expenditure claimed in the P&L account. It is a clerical mistake before the ld CIT(A), who had verified from the record, which has also been clarified during the course of hearing by the ld AR, which has not been controverted by the ld DR. - Decided in favour of assessee
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