TMI Blog2014 (6) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... e had not preferred an appeal before the Tribunal, but still mere not filing of an appeal before the Tribunal do not alter the legal position in respect of the invocation of the provisions of Section 40A(2)(b) as decided by the Respected Co-ordinate Bench in the past years in favour of the assessee - the facts relating to the payment of labour charges to the concern were very much on record and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed u/s.143(3) dated 18.12.2008 and the penalty order passed u/s.271(1)(c) dated 31st March, 2011 were that the assessee company had made a payment of Rs.1,07,63,055/- as labour charges to one M/s. S.J. Clearwater Pumps Ltd. According to AO, the said company had fallen under the category of Section 40A(2)(b) of IT Act. The AO has concluded that the similar disallowance was made in the past for A.Y. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vide paragraph 27, reproduced below: Heard both parties, perused the record and the case laws and find that assessee has made a payment of Rs.52,48,459/- to M/s. S.J. Clear Water Pumps Ltd. towards job work charges. The AO has made disallowance of Rs.8,03,556/- being 15% of these expenses claimed by the assessee on the ground that assessee has made excessive payment to its sister concern by i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and not on the assessee as per the provision of Section 40A(2)(b) of the Act and the same has not been discharged in this case by the Revenue, the addition made by the AO and sustained by learned CIT(A) is hereby deleted. This ground of the assessee is allowed. 4. When the levy of penalty was challenged before learned CIT(A), he had taken the cognizance of the aforecited decision of the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal do not alter the legal position in respect of the invocation of the provisions of Section 40A(2)(b) as decided by the Respected Co-ordinate Bench (supra) in the past years in favour of the assessee. Moreover, the facts relating to the payment of labour charges to the said concern were very much on record and therefore the genuineness was not doubted by the AO but only held that the payme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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