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2022 (1) TMI 1365 - ITAT CHANDIGARHDisallowance as prior period expenses - as argued expense was paid at a later date due to pending negotiation with the landlord - HELD THAT:- The factum of negotiation between the assessee and the landlord and an agreement towards the revised licence fee as happened in the month of Aug 2009 is clearly borne out of records and the liability towards the rent/licence fee though pertaining to the earlier period has crystallized during the year and is allowable in the hands of the assessee. We therefore find that these expenses are duly allowable in the hands of the assessee as settled during the year and in any case, there are no changes in the tax rates and thus, no prejudice is caused to the Revenue and as held by the Courts, such an exercise of disallowing otherwise allowable expenses treating as mere prior period expenses will only result in an academic discussion without any tangible results. Also aforesaid expenses in nature of rental payments are subject to TDS u/s 194I and the provisions of section 40(a) (ia) are equally attracted which provides for the allowability of expenses in the year in which the TDS has been deducted and paid. In the instant case, it is a matter of record that the assessee has paid and accounted for these expenses in the books of accounts in the financial year relevant to the impugned assessment year and has deducted and deposited TDS in the financial year relevant to the impugned assessment year and not in the earlier assessment year. Therefore, even from the perspective of harmonious construction of all relevant provisions, the assessee deserves an allowance towards these expenses in the year under consideration. Decided in favour of assessee. TDS u/s 194C - assessee has not deducted TDS under the head “Advertisement and publicity” on certain transactions - Disallowance u/s 40(a)(ia) - HELD THAT:- Assessee has filed relevant invoices/documentation in support of its contentions before the ld CIT(A) and therefore,CIT(A) findings that the assessee has not filed any evidence in support of his contention that the said payment does not require any TDS, is not borne out from the records. Given that the material available on record has not been examined and no findings on merits of the additions have been recorded by the ld CIT(A) , we deem it appropriate that the matter be set-aside to the file of the ld CIT(A) to examine the same on merits after providing reasonable opportunity to the assessee. The contentions advanced on the merits have been left open and the assessee is free to advance the same before the ld CIT(A) as so advised. In the result, the ground no. 3 is allowed for statistical purposes. Expenses debited under the head “general charges” - HELD THAT:- Going by the nature of expenses such as assets written off , provisions for expenses and old balances written off , it is prima facie not very clear whether these expenses can be claimed as revenues expenses and allowable under section 30 to 37 of the Act. Since these contentions have been raised for the first time and in absence of any findings of the lower authorities, we deem it appropriate to set-aside the same to the file of the ld CIT(A) who shall examine the aforesaid contentions so raised - ground no. 4 is allowed for statistical purposes.
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