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2017 (8) TMI 1246 - AT - Income TaxSuppression of the receipts - N.P. determination - Held that:- Net profit rate declared for the year under consideration was better than the earlier year i.e. for the A.Y. 2010-11, it was 17.43% and for the year under consideration, it was 18.93%. The Assessing Officer has not specified the defects in the books of account and he has simply stated that the labour charges vouchers were self made and quantitative and qualitative consumption of raw material could not be worked out or verified in absence of day to day stock register, therefore, he made a lump sum addition. When the assessee has declared better NP rate than the earlier year then the Assessing Officer was not justified in making lump sum trading addition without giving specific defects in the expenses debited in the P&L account or specific finding with regard to the suppression of the receipts. The assessee claims that his books of account were audited and nothing specific is qualified by the auditor in the audit report, therefore, mere suspicion should not be made a basis for addition. Also agree with this view that an allegation remains allegation unless it is proved. Suspicion may be strong but it cannot take place of reality, therefore, direct to delete this addition. - Decided in favour of assessee. Non-deduction of tax on payment of interest paid to creditors - TDS on paid or payable - amount payable at the end of FY or any time during the year - Held that:- Controversy regarding TDS on paid and payable has been settled down by the decision of the Hon'ble Supreme Court in the case of M/s Palam Gas Services Vs. CIT [2017 (5) TMI 242 - SUPREME COURT] wherein held it cannot be held that the word 'payable' occurring in Section 40(a)(ia) refers to only those cases where the amount is yet to be paid and does not cover the cases where the amount is actually paid. If the provision is interpreted in the manner suggested by the appellant herein, then even when it is found that a person, like the appellant, has violated the provisions of Chapter XVIIB (or specifically Sections 194C and 200 in the instant case), he would still go scot free, without suffering the consequences of such monetary default in spite of specific provisions laying down these consequences. - Decided in favor of revenue.
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