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2021 (11) TMI 83 - ITAT HYDERABADDisallowance towards sales tax penalty - assessee submitted that it is not a sales tax adjustment though it is mentioned as penalty - HELD THAT:- We observe that it is payment raised for the period from 4/2005 to 5/2007 for under-declared tax and imposed penalty vide order dated 30/07/2009 by the commercial tax department. Any penalty paid for violation of any law, is not allowable u/s 37 - Our view is supported by the decision of CIT Vs. Bharat Steel Tubes Ltd. [1995 (11) TMI 10 - DELHI HIGH COURT] - No infirmity in the action of CIT(A) in confirming the disallowance made by the AO on this account and accordingly, upholding the order of CIT(A), we dismiss the ground raised by the assessee on this issue. Disallowance towards cash payments to labour - HELD THAT:- We find that before the AO the assessee requested to confine the disallowance to the extent of 10%, but, the AO made the disallowance @ 15% of the cash portion of labour payments. On considering the totality of the facts and circumstances of the case, we restrict the disallowance 10% of the cash portion of labour payments and the AO is directed accordingly. Thus, this ground is partly allowed. Disallowance of interest on delay in remittance of TDS to the Govt. Treasury - AO noticed that the assessee claimed expenditure of interest on TDS - HELD THAT:- We observe that before the authorities the assessee submitted that the delay was caused in payment of TDS on account of paucity of funds whereas the revenue's grievance is that the assessee paid the interest for non-remittance of TDS to Govt. Account. Therefore, taking into consideration the request of the assessee that the issue may be remitted to AO for further verification, we remit the issue to the file of AO with a direction to verify whether the amount paid by the assessee towards delay or for non-remittance and decide the issue in accordance with law after providing reasonable opportunity of being heard to the assessee. The assessee is directed to substantiate its claim. Accordingly, this ground is treated as allowed for statistical purposes. Deduction u/s 80IA - additional ground raised by the assessee - HELD THAT:- Hon’ble Bombay High Court in the case of "CIT vs. Pruthvi Brokers and Shareholders Pvt. Ltd [2012 (7) TMI 158 - BOMBAY HIGH COURT] has observed that the assessee is entitled to raise not merely additional legal submissions before the appellate authorities, but is also entitled to raise additional clams before them. The appellate authorities have jurisdiction to deal not merely with additional grounds, which became available on account of change of circumstances or law, but with additional grounds which were available when the return was filed. The words 'could not have been raised' must be construed liberally and not strictly. There may be several factors justifying the raising of a new plea in an appeal and each case must be considered on its own facts. In view of this, the additional ground taken by the assessee is admitted for adjudication - since the facts relating to this issue have not been examined by the lower authorities, hence, this issue is restored to the file of the AO for adjudication of the same as per law. The assessing officer is also directed that while deciding the additional ground of appeal regarding claim of deduction as per u/s 80IA if the Income Tax Act. 1961, the assessing officer will consider the CBDT Circular No. 37 of 2016 dated 2nd November, 2016 issued vide F.No. 279/Misc./140/2015/ITJ also. The assessee is directed to appear before the A.O. with necessary documents to substantiate its claim of deduction as per u/s 80IA and further directed to avoid unnecessarily delay to dispose-off the case. Thus, this additional ground is allowed for statistical purposes.
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