Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (11) TMI 666 - AT - Income TaxAddition u/s 40A(3) - payments of expenditure in cash to any individual/entity exceeded Rs. 20,000/- - HELD THAT:- We note that all the payments were made to various parties either on account of labour charges or painting work or purchases etc. and all these payments are below Rs. 20,000/-. In our opinion, the provisions of Section 40A(3) of the Act are not attracted to these payments and therefore the order of CIT(A) is wrong and cannot be sustained. All the evidences were furnished and placed before the authorities below and somehow escaped their attention. We are inclined to set aside the order of CIT(A) on this issue and direct the AO to delete the addition. Addition on account of closing balances as made by the AO in respect of sundry creditors - HELD THAT:- AO during the course of assessment proceedings issued notice u/s 133(6) of the Act to various sundry creditors and on perusal of the ledger copies received from Mousum Hardware and Paras Aluminium, the AO noted that closing balances as on 31.03.2014 stood at Rs. 150,709/- and 5,44,000/- respectively whereas as per the books of account of the assessee the outstanding balances were Rs. 360,457/- and Rs. 734/- respectively as on that date resulting into difference of Rs. 7,53,014/- which was informed to the assessee vide letter dated 02.12.2016 but assessee did not reply the same and finally it was added to the income of the assessee. Addition on account of closing balance difference of sundry creditor i.e. Mondal Enterprise - HELD THAT:- No discrepancy in the ledger account and the payments made to this supplier as all bills were paid by account payee cheques. So in view of these facts the order of CIT(A) confirming the additions cannot be sustained. In respect of Mousam Hardware and Sanitary a copy of which is filed at page no. 182 of PB and bills and vouchers are placed we note that the said firm is a regular suppliers of the assessee. We observe that in this case also all the payments were made through banks namely Axis Bank as is placed and State Bank of India placed and all the cheques were duly paid and presented during the year except the last cheque issued on 23.03.2014 which was credited in next year. Therefore, considering these details, bills and vouchers and payments by cheques, we are not in agreement with the conclusion drawn by the CIT(A) on this issue and accordingly we set aside the order of CIT(A) and direct the AO to delete the addition. Accordingly ground no. 4 ,5, and 6 are allowed. Addition on account of difference of rental expenses - HELD THAT:- The assessee has also paid room rent vide cheque drawn on State Bank of India amounting to Rs. 25,000/- and similarly the car parking rent of Rs. 10,000/- was paid on 4.12.2013. We note that both the authorities have not considered room rent and car parking rent paid over and above which has attributed to the discrepancy - Undisputedly all these documents as placed before us were also available before the lower authorities but somehow overlooked. Considering these facts and circumstances of the case, we are inclined to set aside the order of Ld. CIT(A) on this issue and direct the AO to delete the addition - The ground is allowed.
|