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Income Tax Officer Ward-2 (4) , Kolkata Versus Systems Incorproate Pvt Ltd, Kolkata

2016 (1) TMI 536 - ITAT KOLKATA

Addition undisclosed receipts - CIT(A) deleted the addition - Held that:- The amounts in question have already been shown and included in the gross receipts of the assessee in the earlier assessment year and in the absence of any thing contrary being brought to our notice by the learned DR , We are of the view that the addition made by the AO was rightly deleted by CIT(A). - Decided in favour of assessee

Disallowance u/s 40(a)(ia) - CIT(A) deleted the addition - Held that:- We have pe .....

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ctions on this contention in the remand report. Consequently ground no.2 raised by the revenue is dismissed. - Decided in favour of assessee

Disallowance of non- essential expenses made on the grounds of failure to produce any evidence - CIT(A) deleted the addition - Held that:- The basis on which AO made the impugned disallowance cannot be sustained and was rightly deleted by CIT(A). The law is well settled that it is for the assessee to decide what expenses are necessary for the pur .....

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ed by the assessee reads as follows:- "1. That the Id. CIT(A) erred in deleting the addition of ₹ 16,44,488/- being undisclosed receipts of the assessee without proper verification and analysis of bills raised and payments received during the I- Yr 2005-06 vis-a-vis F Yr. 2006-07.", 3. The assessee is a company. It is engaged in the business of software development. The AO noticed that the assessee had claimed credit for TDS of ₹ 1,56,335/-. The AO noticed from the profit a .....

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the sum of ₹ 24,34,488/- which are receipts as per the TDS certificate and the sum of ₹ 7,40,000/- which was the income shown on sale in the profit and loss account. 4. Before the CIT(A) the assessee pointed out that the assessee follows mercantile system of accounting. It had raised bills for jobs executed and these appeared in the debtors list till the payments were realized. The TDS is deducted only when the actual payment is received. However, the amounts due have already been sh .....

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AO by holding that the payments reflected in the TDS certificate have already been shown and included in the gross receipts of the earlier years of the assessee. 5. Aggrieved by the order of CIT(A) the revenue has raised Ground No.1 before the Tribunal. 6. We have heard the learned DR, who relied on the order of the AO. In the light of the findings of CIT(A) that the amounts in question have already been shown and included in the gross receipts of the assessee in the earlier assessment year and .....

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essee. " 8. The assessee made payment of ₹ 1,88,155/- towards office rent and maintenance. The assessee also made payment of ₹ 67,671/- as consultancy charges. In respect of rent and maintenance charges AO found that no tax had been deducted at source and accordingly ₹ 1,88,155/- was added to the total income by invoking the provisions of section 40(a)(ia) of the Act. 9. Before CIT(A) the assessee pointed out that out of the sum of ₹ 1,88,155/- claimed under the head .....

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he addition of ₹ 55,000/-. 10. Aggrieved by the order of CIT(A) revenue has raised ground No.2 before the Tribunal. 11. The grievance of the revenue as projected in the grounds of appeal is that the remand report of AO filed before CIT(A) has not been taken into consideration by CIT(A). We have perused the relevant part of the remand report of the AO as extracted in the order of CIT(A) and find that no specific objections was pointed out before CIT(!.) by the AO in the remand report except .....

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erred in deleting the disallowance of ₹ 1,22,875/- out of non- essential expenses made by the A.O on the grounds of failure to produce any evidence." 13. AO identified expenses to the tune of ₹ 6,59,188/- debited to the profit and loss account which were expenses towards house rent, printing and stationery and office expenses etc. AO was of the view that the aforesaid expenses were not necessary for the purpose of business of the assessee. AO also observed that the assessee fail .....

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