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2023 (10) TMI 441 - ITAT INDOREDisallowances of 10% of operating expenses, cost of material consumed and employee benefits and other expenses debited in P&L account - CIT(A) deleted the addition - HELD THAT:- AO has considered the total amount as found debited in the profit and loss account while making adhoc disallowance of 10%. AO has completely ignored the fact that the assessee itself has made suo-moto disallowance u/s 40a(ia) of the Act while computing the total income. Therefore, it is manifest from the order of the AO that the adhoc disallowance is made by the AO in a casual manner without considering any material on record and facts. AO has not brought any fact or material before us to controvert the fact recorded by the Ld. CIT(A) while deciding this issue. Decided against revenue. Difference in the liability as on 31.03.2012 and 31.03.2013 - CIT(A) deleted the addition - HELD THAT:- CIT(A) has specifically stated the statutory liability arisen from provisions of TDS, Income Tax, Service Tax, entry tax, professional tax, interest and interest on these taxes for the various years cannot be treated as unexplained liability. It is further recorded that the increase in current and long term liabilities is due to amount received from directors and their relatives and concerns. Assessee filed a copy of confirmation letter from these creditors/lenders giving the details of name, Pan, Address and date of transactions. CIT(A) has also recorded the fact that no fresh long term borrowing has been taken by the assessee. Rather the assessee has paid of Rs. 75,48,418/- on outstanding loan of Rs. 3.90 crore as on 31.03.2012 the payment of interest was subjected to TDS. AO has not controverted these facts records and considered by the Ld. CIT(A) while deleting addition even the AO was given an opportunity of verification and examination of additional evidence but the same was not availed by the AO. Hence we do not find any error or illegality in the impugned order of the Ld. CIT(A) same is upheld. Disallowance u/s 14A r.w. Rule 8D - CIT(A) deleted the addition - HELD THAT:- We note that there is no exempt income earned by the assessee during the year under consideration whereas the AO has made disallowance u/s 14A@ 0.5% of the average value of investment. Ld. CIT(A) has deleted this addition by considering the fact that there is no exempt income earned by the assessee and by following the decision of Cheminvest Limited [2015 (9) TMI 238 - DELHI HIGH COURT] as well as decision of Keti KJ Construction Limited [2023 (1) TMI 1285 - ITAT INDORE] - Thus as there is no exempt income in the year under consideration no error or illegality in the impugned order of the Ld. CIT(A) for this issue. Appeal of revenue dismissed.
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