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2016 (5) TMI 547 - AT - Income TaxDisallowance of interest paid - whether in the absence of any material to establish that the assessee was not using the building for business purpose, disallowance of interest is not justified? - Held that:- no material is available on record to suggest that the assessee has used the building for its business. The assessee being in the business of engineering contract, it has to necessarily obtain license /permission to use the building from the local Municipal Corporation. The assessee also needs to register itself with sales tax authorities for payment of sales tax. Apart from that, the assessee also needs to get clearance from other statutory authorities for carrying out its business in the premises, which was purchased by using the borrowed funds. In this case, no material is available on record to suggest that the building was used for business. In fact, the assessee demolished the building during the year under consideration. Therefore, the contention of the assessee that the building was used for its business in the year under consideration is farfetched one. When the building was demolished and new construction was started, at no stretch of imagination it can be said that the assessee used the building for its business - Decided against assessee Claim of depreciation on the building - Held that:- The assessee claims depreciation on the building purchased on 24.09.2007. The fact remains that the building purchased was never put to use for the business of the assessee and in fact, the building was demolished and new construction was started. When the building purchased on 24.09.2007 was demolished immediately after its purchase, this Tribunal is of the considered opinion that claiming depreciation on the very same asset is not justified. Disallowance under Section 40(a)(ia - Held that:- Hiring of generator, JCB and paying hire charges are liable for TDS under Section 194-I of the Act. Therefore, failure of the assessee to deduct tax would disentitle the assessee to claim the same as expenditure in view of Section 40(a)(ia) of the Act. Soil testing and concrete mixer testing are nothing but technical services. Therefore, the assessee is liable to deduct tax at the time of payment or giving credit. Hence, the assessee cannot claim the same as expenditure unless the TDS was made. The payment made for centring work is nothing but sub-contract. Therefore, the assessee is liable to deduct tax under Section 194C of the Act. In view of the above, this Tribunal is of the considered opinion that the assessee is liable to deduct tax in respect of all the payments made. Therefore, the Assessing Officer has rightly disallowed the claim under Section 40(a)(ia) of the Act. - Decided against assessee Addition towards sundry creditors - Held that:- Since the liability is not outstanding as on 31.03.2010, the same has to be added as income only for the assessment year 2010-11 and not for the assessment years 2011-12 and 2012-13. Merely because the assessee has offered the same as income for the assessment years 2011-12 and 2012-13 that cannot be a reason to shift the income which is otherwise assessable for taxation for the assessment year 2010-11. In view of the above, this Tribunal do not find any reason to interfere with the order of the CIT(Appeals) and accordingly, the same is confirmed - Decided against assessee
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