TMI Blog2015 (10) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... ee would bear all expenses in the nature of labour wages staff salaries, manufacturing expenses etc. It was also agreed interalia that at the expiration of the term, the Assessee will hand over vacant possession of the set up. Revenue has not brought any material on record to demonstrate that the agreement entered into by the Assessee was not in existence or an afterthought. In view of the aforesaid facts, we are of the view that the payment made by Assessee consisted of agreed payments towards rent and therefore also reimbursements. Further, with respect to reimbursements, no material has been brought on record by Revenue to doubt its genuineness. Further the submission of ld. A.R. that the payee’s have also paid the taxes has not been dou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reimbursement of wages and power expenses on actual basis 650,000 530,000 1,180,000 Total 1,016,000 848,000 1,864,000 The appellant craves leave to add, amend, alter, substitute, modify the above ground of appeal, if necessary on the basis of submissions to be made at the time of personal hearing. As regards ground No.2 of the assessee, the brief facts are that the Assessing Officer observed that the assessee had incurred expenses for getting production through other parties but no TDS on sub-contract payments to Shree Arbuda Textiles and Natraj Synthetics as well as the sister c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore the contention of the assessee in respect of rent payment was only any afterthought. The AO held that since the assessee had not deducted tax on credit of payments made to the parties and accordingly disallowed the claim of ₹ 18.64 lakh u/s.40(a)(ia) of the Act. 3. Aggrieved by the order of A.O, Assessee carried the matter before CIT(A). CIT (A) upheld the order of A.O by holding as under:- Before me, the Id. AR submitted that in the manufacturing of grey cloth the appellant was required to possess extra number of looms and accordingly obtained manufacturing set-up of two independent parties on rent. It was agreed that those parties would provide their factory land and building and plant and machinery on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of section 40(a)(ia) are clearly attracted in this case and disallowance has rightly been made by the A.O. The same is hereby confirmed. 4. Aggrieved by the order of CIT(A), Assessee is now in appeal before us. 5. Before us, ld. A.R. reiterated the submissions made before A.O and CIT(A). He further submitted that Assessee had taken the factories on rent for which the Assessee had entered into rent agreement and the rent agreements were placed in the paper book. He further submitted that rental payments are not covered u/s. 194C. He further submitted that TDS was deductible on machinery with effect from 2006 and not under the period under review. As an alternate contention he submitted, that the payee s to whom the payments w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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