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2017 (3) TMI 670 - AT - Income TaxDisallowance u/s.40(a)(ia) - Held that:- AR for the assessee has rightly pointed out that applicability of second proviso to Section 40(a)(ia) of the Act which is held to be retrospective in the case of CIT Vs. Ansal Land Mark Township P. Ltd. (2015 (9) TMI 79 - DELHI HIGH COURT) wherein the AO is directed to verify whether the recipients have included the receipts paid by the assessee in their respective returns of income and also paid taxes on the same. Therefore, we incline to set aside the issue to the file of AO and accordingly, we direct the AO to verify as to whether the recipients have included the income in their respective returns and also paid taxes on the same. The assessee will provide the details of recipients i.e. their assessment particulars etc. to the AO so that the AO can verify. In case the recipient parties are not cooperating in providing details, the AO can call for the information u/s. 133(6) of the Act for verification of the same. Accordingly, this issue is remitted back to the file of AO to decide in terms of the above directions. This issue of assessee's appeal is allowed for statistical purposes. Addition being 5% of delivery charges made by the AO - Held that:- AO has made disallowance under the head delivery charges on adhoc basis. The AO has made adhoc deduction based on surmise and conjecture. The AO has failed to point out specific instances of the expenditure for which the bills were not produced. It is a matter of fact on record that the books of accounts as well as bills and vouchers were produced before the AO and, hence, he was not in a position to specifically point out the discrepancies, however, he has chosen to make disallowance on estimated basis. The AO cannot make the disallowance without giving opportunity to the assessee and without pointing out the specific amounts for which bills were not produced. In view of the above, we delete the addition made by Assessing Officer and confirmed by ld. CIT(A).
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