TMI Blog2014 (6) TMI 771X X X X Extracts X X X X X X X X Extracts X X X X ..... out in bill itself- So far as obligation to deduct tax at source form payment of transport charges and other charges was concerned, same was complied with by agent, who had made payment on its behalf – thus, the order of the CIT(A) is set aside – Decided in favour of Assessee. Addition of estimated disallowance of freight charges – Held that:- Assessee filed certain details but CIT(A) after scrutinizing them held that the accounts prepared by the assessee were not in order and since all the expenses were not fully vouched, AO was justified in making this adhoc disallowance of Rs. 6,27,500 - no evidence has been furnished to deviate from the findings of lower authorities and the order passed by CIT(A) is hereby confirmed – Decided against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irst ground relates to addition of Rs. 61,22,877/- made by AO invoking the provisions of section 40(a)(ia) of the Act for the payment made to C F agent. During the assessment proceedings, AO found that assessee had paid the impugned amount towards clearing and forwarding charges without deducting tax. Assessee s submission was that this amount represents reimbursement of expenses and hence no tax was deducted on this amount. It was further submitted that TDS was deducted on the agency charges for the services of C F agent. Before the AO the assessee placed reliance on the decision of Hon ble ITAT Hyderabad in the case of Merrilyn Shipping and Transport. The AO however relying on the provisions of section 194C as well as Board s Instruct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ACIT vide ITA Nos. 2825/Ahd/2010 2826/Ahd/2010 dated 29/04/2014 Concluding his argument learned counsel of the assessee submitted that the addition made by AO and sustained by Ld. CIT(A) of Rs. 61,22,877/- u/s. 40(a)(ia) may kindly be deleted. Ld. DR on the other hand relied on the orders of lower authorities. 7. After hearing both the parties and perusing the record, we find that there is no dispute about the fact that addition has been made by AO by invoking the provisions of section 40(a)(ia) for non-deduction of tax on expenses incurred by the agent on behalf of the assessee-company which were subsequently reimbursed by the assessee-company to the agency. There is also no dispute about the fact that on agency charges for services r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bill itseIf- So far as obligation to deduct tax at source form payment of transport charges and other charges was concerned, same was complied with by agent, who had made payment on its behalf - Whether no part of amount reimbursed was to be disallowed-Held, yes [Para 3] [In favour of assessee. In view of the above, this ground of assessee is allowed. In view of the above addition of Rs. 61,22,877/- made by AO and sustained by Ld. CIT(A) is hereby deleted. This ground of assessee s appeal is allowed. 8. Ground No. 2 relates to addition of Rs. 6,27,550/- being estimated disallowance of freight charges i.e. 10% of Rs. 62,75,535/-. During the assessment proceedings, assessing officer found that assessee had claimed total freight ch ..... X X X X Extracts X X X X X X X X Extracts X X X X
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