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2023 (3) TMI 1190 - ITAT KOLKATALate deposit of employee’s contribution to ESI and PF - HELD THAT:- As assessee has fairly admitted that the issue is covered by the decision in Chekmate Services Pvt. Ltd.. [2022 (10) TMI 617 - SUPREME COURT] wherein it has been held that “deduction u/s 36(1)(va) in respect of delayed deposit of amount collected towards employees’ contribution to PF cannot be claimed even though deposited within the due date of filing of return even when read with Section 43B of the Income-tax Act,1961. Decided against assessee. Disallowance of puja expenses - assessee has explained that the aforesaid expenses on account of puja were incurred for boosting morale of the employees and keeping the employees in good humour so that maximum work output can be achieved - HELD THAT:- Considering the above submissions that the aforesaid small expenses are relating to the business of the assessee, the aforesaid disallowance made by the Assessing Officer is ordered to be deleted. Ground No.3 of the assessee is allowed. Disallowance of 10% of travelling and conveyance expenses - HELD THAT:- AO has made adhoc disallowance on percentage basis out of the claim of small amount on account of travel expenses. It is not a case of huge travelling and conveyance expenses, wherein, the AO may suspect element of personal expenses. In view of this, we do not find any justification on the part of the Assessing Officer in making the impugned disallowance and the same is ordered to be deleted. Ground No.4 is allowed. Disallowance u/s 14A r.w.r. 8D - assessee has submitted that no exempt income was earned by the assessee during the assessment year under consideration and there is no expenses were made by the assessee in making the investment in question - HELD THAT:- As decided in various cases like Cheminvest Ltd. [2015 (9) TMI 238 - DELHI HIGH COURT], Shivam Motors (P.) Ltd. [2014 (5) TMI 592 - ALLAHABAD HIGH COURT] the assessee has not derived any tax exempt income from investments, then no disallowance is attracted u/s 14A - A/R, has relied upon the recent decision of Era Infrastructure (India) Ltd. [2022 (7) TMI 1093 - DELHI HIGH COURT] wherein, it has been held that the aforesaid explanation inserted to Section 14A of the Act is applicable prospectively. We allow ground no.5 of the assessee. Non-deduction of TDS u/s 40(a)(ia) on security charges - HELD THAT:- Since the assessee did not give any satisfactory explanation for non-deduction of TDS. Therefore, AO was justified in making the impugned disallowance. Contention of the AR that the disallowance be restricted to 30% of the expenditure in view of amended provision of section 40(a)(ia) of the Act is concerned,the issue is covered by the decision of Shree Choudhary Transport Company vs. Income Tax Officer [2020 (8) TMI 23 - SUPREME COURT] as held that the amendment made by the Finance (No.2) Act, 2014, could not be stretched anterior after the date of its substitution so as to reach the assessment year 2005-06. That the amendment by the Finance Act, 2014 was specifically made applicable w.e.f. 01/04/2015 and clearly represents the will of the legislature so as to what is to be deducted or what percentage of deduction is not to be allowed for a particular eventuality, for assessment year 2015-16. In the case of Commissioner of Income-tax, Kolkata v. Calcutta Export Company [2018] [2018 (5) TMI 356 - SUPREME COURT] dealing with curative amendment brought by the Finance Act, 2010, relating more to the procedural aspects concerning deposit by TDS, cannot be applied to the amendment of the substantive provisions by Finance Act (No. 2) Act, 2014. In view of this, Ground No.6 of the assessee is accordingly dismissed. Disallowance on estimation basis of 50% of miscellaneous expenses - HELD THAT:- Considering the nature of expenses and smallness of amount, in our view, disallowance of 50% of the misc . expenses is not justified and the same is accordingly ordered to be restricted to 10% of the misc. expenses. This ground is accordingly partly allowed.
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