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2018 (11) TMI 1003 - AT - Income TaxAddition u/s 68 - Held that:- Addition was made u/s.68 though there is no reference to that section in the assessment order. In the course of remand proceedings, the assessee has furnished all the relevant details and documents examination of the same, the AO is of the opinion that the credit liabilities disclosed in the accounts are genuine. The provisions of section 68 cannot be applied to sundry creditors and the assessee cannot be applied to sundry creditors and the assessee cannot be asked to prove the 3 ingredients of cash credits in respect of sundry creditors. The sundry credits have arisen out of transactions with the assessee of supply of goods or services and unless the AO proves that the goods or services were never supplied, he cannot make an addition on account sundry creditors. Keeping the above in view and the report of the AO, the addition on account of sundry creditors is deleted. TDS u/s 40(i)(a) - TDS deposited in the account of Central Government before the due date of furnishing of return of income u/s.139(1) - Held that:- On a perusal of the TDS certificate filed by ld A.R. of the assessee during the course of hearing, we find that TDS of ₹ 10,707/- was deducted out of the total payment of ₹ 10,70,713/- and the related TDS was deposited in the account of Central Government on 29.9.2012 i.e. before the due date of furnishing of return of income u/s.139(1) of the Act. The said TDS certificate is generated from the site of Income Tax Department. Assessee made a statement at bar that this TDS certificate was filed before the lower authorities was not disputed by D.R. Hence, we find that addition made by the CIT(A) was on wrong appreciation of facts and, therefore, we set aside the order of the CIT(A) and delete the addition of ₹ 10,40,713/ and allow this ground of cross objection of the assessee. Payments by the firm to the partners were in violation of section 40A(3) - Held that:- We find that there is no payment in cash by the firm to the partners. Rather, the undisputed facts are that the partners’ capital account was credited by the amount of expenditure paid by the partners on behalf o the firm. Thus, there is no payment to a particular person in excess of ₹ 20,000/- in violation of section 40A(3) of the Act. Thus, we find that the disallowance was made without bringing the necessary facts on record for which the onus was on the revenue. We, therefore, find that the disallowance made by the CIT(A) by invoking the provisions of section 40A(3) is unsustainable.
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