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2020 (5) TMI 303 - AT - Income TaxAddition u/s 40A(2)(b) - payment to the persons specified - computing the profit of the Joint Venture @4% of the gross receipts - HELD THAT:- As decided in M/S KEC SIDHARTH JV, M/S KEC PLR KPIPL JV [2018 (4) TMI 1747 - ITAT DELHI] AO made the addition by invoking the provisions of Section 40A(2)(b) of the Act which are applicable to the expenses considered to be excessive or unreasonable having regard to the fair market value of the goods/services or facilities for which the payment is made. However, in the instant case, the AO estimated the profit of the assessee and determined the income, nowhere he doubted the expenses incurred by the assessee. Therefore, AO was not justified in making the addition by invoking the provisions of Section 40A(2)(b) of the Act which are applicable to the expenditure and not to the receipts and the ld. CIT(A) rightly deleted the same. - Decided in favour of assessee
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