TMI Blog2011 (11) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... 4AB is without any material on record in the preceding Assessment Year. Nothing has been placed by the assessee in the Paper Book containing 85 pages. Further, the remand report has also not confirmed total sales, gross receipts or turnover to be below the monitory limit specified under section 44AB of the Act in the preceding year. Therefore, in the circumstances and the facts of the case, the ld. CIT(A) is not justified in deleting the addition made by the Assessing Officer. Unexplained opening balance of the assessee’s capital - Held that:- This is the first year of the assessee and, therefore it was argued that there is no possibility of any income and which cannot be introduced as opening capital which of course submitted by the ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reduction of cost of material ad other charges deducted by M/s. Gammon India Limited; 2. That the Ld. CIT(A)-1, Agra has erred in law and on the facts of the case in deleting the addition of ₹ 3,23,00,625/- on the ground that since the appellants profit has been calculated after applying net profit, the separate addition u/s. 40(a)(ia) cannot be sustained and without appreciating the fact that the assessee s turnover for A.Y. 2005-06 was worked out at ₹ 40,60,239/-; 3. That the CIT(A)-1, Agra has erred in law and on the facts of the case in deleting the addition of ₹ 2,24,890/- made on account of opening balance in capital account without appreciating the fact that during A.Y. 2005-06 no books of account were mainta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n account of material purchased. 4. We have heard the rival contentions and perused the facts of the case. We concur with the views of the ld. CIT(A) that the cost of material reimbursed cannot be a part of the contract receipt which has rightly been deducted by the ld. CIT(A) and therefore, we find no error in his order. Thus, ground no.1 of the Revenue is dismissed. 5. A regards ground no.2 of the Revenue, the Assessing Officer has invoked section 40(a)(ia) of the Act and made additions accordingly. The assessee made the submissions before the ld. CIT(A) which were forwarded to the A.O. for his comments and the A.O. reiterated the views taken in assessment order. The ld. CIT(A) was of the view that the books of account of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of business or profession . For the assessment year 1984-85, the assessee claimed deduction for an amount of ` 41,790 representing the insurance premium paid to the LIC to insure against all the liabilities that might arise under the Payment of Gratuity Act, 1972. The Assessing Officer held that the amount was not deductible but the Tribunal held that the amount was allowable under section 37(1). On a reference : Held, that the payment representing the premium paid to the LIC securing an insurance against the liabilities arising under the 1972 Act was hit by the provisions of section 40A(7)(a) of the Act and was not an allowable deduction under section 37(1) of the Act. 7. The Hon ble Allahabad High Court in the aforementioned judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of any other section by providing that the provisions of the section will have effect notwithstanding anything to the contrary contained in any other provision relating to the computation of income under the head profits and gains of business or profession . In the present case there is non-obstante clause in section 40 also which reads as under :- Notwithstanding anything to the contrary in sections 30 to 38, the following amounts shall not be deducted in computing the income chargeable under the head profit and gains of business or profession 9. Therefore, in the circumstances and facts of the case, the disallowance made under section 40(a)(ia) of the Act is independent of any other provisions of the Act. The cases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as opening capital which of course submitted by the ld. Authorised Representative in his submission dated 16.06.2009 is out of the Savings Bank Account of the assessee maintained with ICICI Bank, Sanjay Place as at 01.04.2005. The bank account number is 628701501674. Therefore, in the circumstances and facts of the case, we find no error in the order of the ld. CIT(A) who has rightly deleted the addition. Thus, ground no.3 of the Revenue is dismissed. 13. In ground no.4, the brief facts are that he A.O. has made an addition of ₹ 8,95,000/- on account of investment in Car and ₹ 38,000/- as investment in scooter. The assessee submitted expenses before the ld. CIT(A) which were forwarded to the A.O. for remand report which was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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