TMI Blog2014 (2) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... A) has rightly deleted the addition – The reimbursement of salary, bonus etc. of the staff employed by an associate concern and for the services utilised for the purpose of its business - Revenue even now before us has not contented that there was no services rendered – Decided against Revenue. Disallowance u/s 40(a)(ia) of the Act – deposit of TDS after the due date but before filing of return u/s 139(1) – Held that:- The decision inRB Jodha Mal Kuthiala Versus Commissioner of Income-Tax, Punjab, Jammu And Kashmir And Himachal Pradesh [1971 (9) TMI 2 - SUPREME Court] followed - The provision which has inserted the remedy to make the provision workable, requires to be treated with retrospective operation so that reasonable deduction can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue is against the order of CIT(A) deleting the addition made by AO on account of freight recoverable at Rs.7,85,598/-, on account of repacking charges of Rs.3,21,336/-, excess freight charges at Rs.12,76,778/-, dead freight of Rs.1,80,438/- and reimbursement of salary of Rs.6,04,736/-. For this, revenue has raised following ground no.1: "1. The Ld. CIT(A has erred in disallowing the addition made by the Assessing Officer u/s. 143(3) for the above assessment year under the head of Freight Recoverable of Rs.7,85,590/-, Repacking of Rs.3,21,336/-, Penal Freight of Rs.12,76,778/- and dead freight of Rs.1,80,438/- reimbursement of salary of Rs.6,04,736/-." 4. We have heard Ld. Sr. DR and gone through facts and circumstances of the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ghment of railway wagons, is not penal in nature, and, is allowable as business expenditure. The addition of Rs.3,50,290/- on account of unabsorbed penal freight paid to the Railways for over-loading is not justified. Ground no. 1, 2 and 3 are allowed." Similarly, in respect to reimbursement of salary was disallowed by AO allowed by CIT(A) by observing at page 5 as under: "I have considered the submissions of the appellant. As the amount of Rs.1,85,393/- on account of selling expenses recovered is duly credited in the books of account, the addition of the same is not justified. The AO has disallowed the claim of Rs.6,04,736/- on the ground that rembursement of salary, bonus, etc. of the staff employed by an associate concern cannot be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loading. According to Railway Aurhorities, the loading of goods was made with the prior approval of the railway authorities which had not received revised circular notifying revised quantity of permissible limit for loading, but quantity was found as excessive at the designated station as per the revised circular. According to us, the excess freight is not penal in natue and there is no violation of any statutory provisions. Even the dead freight of Rs.1,8,438/- was deducted by Bokaro Steel Plant due to under weighment of railway wagons, which means that quantity of goods dispatched was lower than the optimum permissible limit. It means that CIT(A) has rightly deleted the addition and we confirm the same. 5. As regards to the disallowance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is clear that this issue is squarely covered by the decision of Hon'ble jurisdictional High Court in the case of CIT Vs. Virgin Creations in ITAT No.302 of 2011, GA No. 3200/2011 dated 23.11.2011, wherein even amendment made by the Finance Act 2010 in section 40(a)(ia) of the Act is held to be retrospective. Hon'ble High Court held as under: "We have heard Mr. Nizamuddin and gone through the impugned judgment and order. We have also examined the point formulated for which the present appeal is sought to be admitted. It is argued by Mr. Nizamuddin that this court needs to take decision as to whether section 40(a)(ia) is having retrospective operation or not. The learned Tribunal on fact found that the assessee had deducted tax at sour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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