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2016 (10) TMI 495 - ITAT KOLKATAUnaccounted purchases - addition made by Assessing Officer from M/s Konked International which was not verified u/s. 133(6) - AO has made the addition on the ground that inspector could not trace the address of the party M/s KI and notice issued u/s. 133(6) of the Act was returned un-served - Held that:- the payment was made by assessee through account payee cheque and that party was duly registered with Sales Tax Departments of Govt. of West Bengal. There was also no defect in the books of account of assessee. Therefore, we do not find any reason to interfere in the order of Ld. CIT(A) in granting relief to assessee Addition on account of outstanding liability in respect of M/s Bhart Somani - Held that:- AO has made the addition on account of non-existence of the party however payment was made through account payee cheque, so the identity of the party cannot be doubted. Therefore, we do not find any reason to interfere in the order of Ld. CIT(A) and we also rely in the judgment of Hon'ble jurisdictional High Court in the case of Diagnostics vs. CIT & ANR (2011 (3) TMI 15 - CALCUTTA HIGH COURT ). TDS u/s 194C - Non-deduction of TDS on transport charges - Held that:- At the outset we find that the provisions of section 194C of the Act were made applicable to the individual assessee w.e.f. 1.6.2007 and it is admitted position that the matter relates to the assessment year 2006-07. Therefore in our considered view the assessee in the instant case was not liable to deduct TDS and accordingly there is no default for non-deduction of TDS. Bogus purchases - Held that:- We find that AO has made the addition on the ground that there was bogus purchase in the books of the assessee. However the ld. CIT(A) deleted the same by observing that the all the transactions are genuine. From the facts we find that the lower authorities have not brought anything on record about the payment claimed by the assessee to the party. The payment was made through account payee cheque. The lower authorities have not confronted the reply received from the party under section 133(6) of the Act to the assessee. There was no defect in the bills of the purchases of the party. The ld. CIT(A) has given clear finding that the payment to the P. Beriwal has been made as authorized by the party M/s SE. The ld. DR has not brought anything on record contrary to the findings of ld. CIT(A). Hence we do not find any reasons to interfere in the order of ld. CIT(A). Hence this ground of revenue’s appeal is dismissed. Addition on account of excess liability shown in the respect of ESS Refilling Station - AO has made the addition on account of the difference in the balance shown by the assessee and the party - Held that:- The excess balance shown by the assessee in its books of accounts is balance sheet item and it has corresponding effect in the form of purchases which was shown in the profit & loss account of the assessee. In the instant case the AO has not brought any defect in the amount of purchases shown by the assessee in relation to the excess balance of the party. Therefore in our considered view the AO should have disallowed the amount of the purchases corresponding to the excess balance shown by the assessee. In the instant case before us the AO has admitted all the purchases as genuine in relation to the excess balance shown by the assessee for ₹ 90752.00. The AO has not taken into account the opening balance as shown by the assessee. All the transactions took place during the year are matching with the confirmation of the party as received in response to the notice issued under section 133(6) of the Act. The learned DR has not brought anything on record contrary to the finding of ld. CIT(A). We also find that the confirmation received by the AO in response to notice under section 133(6) of the Act have not been confronted to the assessee. In view of above we find no reason to interfere in the order of learned CIT(A). Hence this ground of appeal of the Revenue is dismissed. Short deduction of TDS under section 194-I viz a viz 40(a)(ia) - whether the expenses claimed by the assessee are allowable deduction though the TDS on such expenses has been deducted at the lower rate? - Held that:-From the provisions of section 40(a)(ia) of the Act we find that it requires deduction of tax and deposit of tax in Government account. The provisions of section are silent to treat the assessee as defaulted in case of short deduction of TDS. Therefore, in our considered view of the action of AO for making the disallowance deserves to be deleted Decided in favour of assessee
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