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2018 (5) TMI 174 - ITAT DELHIDisallowances made u/s. 40(a)(ia) - tds liability on legal and professional charges - Held that:- TDS has been deducted as well as paid within the same financial year on expense of ₹ 45,000/- only. Hence to this extent no disallowance u/s. 40 (a) (ia) can be made. However for the balance expense ₹ 1,01,000/-, the Ld. A.R. could not state as to why to this extent the disallowance u/s. 40 (a) (ia) has been incorrectly made. Thus, the disallowance to the extent of ₹ 1,01,000/- stands confirmed and disallowance to the extent of ₹ 45,000/- stands deleted. This ground is partly allowed. Addition u/s.14A r/w Rule-8D - Held that:- It is not in dispute that exempted income is only ₹ 13,063/-. Thus in view of all the disallowance u/s.14A/Rule-8D cannot exceed the amount of exempted income which is only ₹ 13,063/-. Addition of deemed dividend u/s.2 (22)(e) - Held that:- On examining the facts of present case, the assessee is a share holder in M/s Nanak Builders & Investors (P) Ltd., having 48.86% of share holdings. The assessee is having a running account with the company. There is no finding or evidence on record or otherwise to show that the transactions are undertaken with the object of evasion of any tax. Hence, find that the ratio of law as laid down in Suraj Devi Dada (2014 (5) TMI 625 - PUNJAB & HARYANA HIGH COURT) squarely applies to the facts of this case also. D.R. also did not controvert the contention of the Ld. A.R. that under the peculiar facts of this case, only the transactions of A.Y.2010-11 should be considered independently ignoring the opening balance for the limited purposes of examining the applicability of sec.2 (22) (e). Thus addition deleted - Decided on favour of assessee Correct head of income - hire charges receipts - busniss income or income from other sources - Held that:- The head of income being income from other sources is a residuary head of income wherein, apart from the specific nature of income as are to be covered under the head income from other sources, only such other incomes are to be included which cannot be assessed under any other head of income. ₹ 2,50,000/- have been received as hire charges of some farm land for one day to a private party for some event. Thus it is an activity in the nature of the business activity. Therefore, amount should be assessed under the head income from business and profession. On perusal of asstt. order as find that the A.O. has not assigned any reason for opting the head of income as income from other sources for this addition. Income stands assessed under the head income from other sources should be set off against un-absorbed brought forward depreciation - Held that:- Sec.72 (2) provides that any allowance shall be first treated as provided in sec.71 (1) and only thereafter the balance shall be carry forward. Thus, sec.72 (2) nowhere restricts for setting offf of income from other sources from B/F depreciation. It is also found that in the case of the assessee, in A.Y.2009-10, the A.O. himself allowed similar set off u/s.143 (3). It is also noteworthy that for not allowing this set off, in this year, the A.O. has not assigned any reason whatsoever. Thus direct that whatever income stands assessed under the head income from other sources should be allowed to be set off against B/F depreciation and B/F losses. In result this ground of appeal is allowed.
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