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TMI Blog2014 (4) TMI 342X X X X Extracts X X X X X X X X Extracts X X X X ..... ant record consisting of bills, vouchers etc. was lost during the floods in July, 2005. Thus, non production of such supporting documents was neither intentional nor deliberate and hence, the learned Assessing Officer was not justified in rejecting the books of account under Section 145(3) of the Act. 1. 3 It is submitted that even if the book results are rejected and income is estimated, one cannot loose sight of the past record and history of the assessee to arrive at the % of income to be estimated. In view of the above, the appellant prays that the estimation of income @ 7% of turnover is excessive, unreasonable and unwarranted and accordingly, the same be reduced considerably keeping in mind the past results of the appellant. II. EN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n time, that during the first week of January 2011, he realised the lapse, that on 07. 01. 2011 he forwarded the order of the First Appellate Authority(FAA)to his Chartered Accountant(C. A), that the C. A. in turn consulted M/s. AMJ & Company who filed the appeal before the Tribunal, that delay was neither intentional nor deliberate, that it was because of over site and inadvertence, that delay should be condoned. Before us, Authorised Representative (AR) of the assessee reiterated the submissions made by the M. D. He further stated that at that time M. D. was out of Mumbai regularly, that no other responsible person was present in the office at that time. He relied upon the order of Shri Y. P. Trivedi(ITA/5994/Mum/2010-dt. 11th July 2012. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, he held that net profit rate of 7% of the turnover (Rs. 6. 02 Crores) would be reasonable income to be taxed for the year under appeal. Accordingly, he assessed the income of Rs. 42, 17, 941/-. 3. 1. Aggrieved by the order of the AO, assessee preferred an appeal before the FAA. After considering the submissions of the assessee, he held that in absence of supporting documents of expenses there was no other alternative left to the AO to estimate the income after rejecting the books results, that there was no infirmity in the order of the AO. Finally, he confirmed the action of the AO about rejecting the books results and estimating the income at rate of 7% of the turnover. 3. 2. Before us, AR submitted that assessee-company had shown th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of provisions of section 40(a)(ia) of the Act. During the appellate proceedings, FAA found that assessee had failed to deduct TDS on the payment of transport charges of Rs. 12, 64, 942/- and professional and legal charges of Rs. 1. 31 lacs, that the AO had omitted to disallow the expenditure and to add it to the returned income. It was argued before the FAA that income of the assessee should be enhanced by Rs. 13. 95 lacs. As per the FAA, AR of the assessee signed an order-sheet agreeing for the said disallowance. Accordingly, he directed the AO to make an addition of Rs. 13. 95 lacs to the income of the assessee. 4. 1 Before us, AR submitted that in the case of estimated addition, no further disallowance u/s. 40 a (ia) of the Act could b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not applicable. It is only applicable in respect of "payable amount" shown in the balance sheet as outstanding expenses on which TDS has not been made. Further, tax is deductible under ss. 193, 194A, 194G, 194H and 194J either at the time of payment or at the time of giving credit to the recipient. However, s. 40(a)(ia) is applicable only in respect of TDS defaults when amount is "payable. If amount is actually paid and tax is not deducted under the above section, s. 40(a)(ia) is not applicable. There is difference between the word 'paid or payable the legislature used the word very carefully in s. 40(a)(ia) and in all its wisdom at the time of incorporating the section by way of Finance (No. 2) Bill, 2004. Sec. 40(a)(ía) has to be s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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