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2018 (3) TMI 728 - AT - Income TaxExpenses incurred in cash in excess u/s 40A(3) added to the income of the assessee which is untoward & liable to be deleted - Held that:- The assessee filed copy of the confirmation from M/s. Kalra Bus Service, Jaipur with regard to supply of diesel. This confirmation states that diesel were supplied in drums. As per this confirmation none of the payments in a day exceed ₹ 20,000/-. The confirmation filed by the assessee is admitted as an additional evidence for the purpose of adjudicating the issue involved in the appeal. The AO did not have the benefit of looking at the additional evidence. The addition confirmed by the CIT(A) is set aside and the issue is remanded to the AO for fresh consideration. We may also add that before the AO and CIT(A) the expenditure of ₹ 4,44,527/- was stated to be for purchase of spare parts of the truck. Now a different stand is taken by the assessee. This aspect may also be taken note of by the AO in the set aside proceedings. Addition u/s 40(a)(ia) - tds u/s 194C - payments made to M/s. Kathat Freight Services towards supply of labour - Held that:- Before us the limited prayer for the assessee was to set aside the order of CIT(A) and remand the issue to the AO to enable the assessee to show before the AO that M/s. Kathat Freight Services had shown receipts from the assessee in the return of income filed for the relevant assessment year. The prayer for the assessee is based on the second proviso to section 40(a)(ia) which provides that if the payee has shown the receipts from the assessee in his return of income and paid tax on such receipts and has furnished in the return of income then no disallowance can be made u/s 40(a)(ia) should be made. This proviso was inserted by the Finance Act, 2012 w.e.f. 01.04.2013. This amendment was held to be applicable retrospectivley in the case of Anasal Land mark Township (P)Ltd (2015 (9) TMI 79 - DELHI HIGH COURT)). Disallowance of wages - Held that:- Addition sustained by the CIT(A) deserves to be deleted because the books of accounts have been produced along with the vouchers by the assessee before the AO. Specific instances of unverifiable vouchers was not pointed out by the AO . Thirdly, the AO did not even call upon the assessee to show cause as to why disallowance should not be made before making the disallowance. For these reasons the addition sustained by the CIT(A) is directed to be deleted.
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