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TMI Blog2016 (4) TMI 469X X X X Extracts X X X X X X X X Extracts X X X X ..... of Hire Charges paid by the Assessee on the alleged ground that the assessee failed to discharge his onus of establishing the genuineness of such expenses. 2. That the Learned Commissioner of Income Tax (Appeals) erred in saying that the assessee failed to deduct tax at source u/s. 194C of the Act on the sum of Rs. 26,99,386 paid by the Assessee as Hire Charges of Dupers for is business of transportation of Coal. 3. That the Learned Commissioner of Income Tax (Appeals) further erred in saying that the Assessing Officer was justified in not issuing summons under section 131of the Income Tax Act, 1961 to discharge the primary onus cast on assessee to establish the genuineness of the expenses. 4. That the Learned Commissioner of Income Tax (Appeals) erred in confirming the addition of Rs. 20,000 on account of Balance Sheet difference by wrongly treating it as an unexplained investment. 5. That the Learned Commissioner of Income Tax (Appeals) failed to decide on the ground raised by the assessee for charging of interest under section 234A and section 234B of the Act." 4. The first issue in relation to grounds No. 1 to 3 raised in this appeal is that Ld. CIT(A) erred in confi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n for tax then disallowance should not be made u/s 40(a)(ia) of the Act. On the contrary, Ld. DR vehemently relied on the orders of authorities below. 7. From the aforesaid discussion, we find that expense incurred by assessee on hiring, repair and maintenance of dumpers were disallowed on account of two reasons - firstly the identity and genuineness of the parties were not produced before authorities below and secondly - TDS provision were not complied by assessee while making the above payments. We find force from the submission of Ld. AR regarding the genuineness of the parties as necessary details were placed on record. We also note that the payments to the same parties were also made in AY 2008-09 and the identities of the parties were not disputed. Therefore, the disallowance on account of identity of party cannot me made. Further, we also find that there is amendment of proviso to Sec. 40(a)(ia) of the Act r.w.s 1st proviso to Sec. 201, wherein, if any payee has paid the taxes by offering / disclosing the said receipt in its return of income, then the payer (the assessee herein) should not be treated as assessee in default. Accordingly no disallowance u/s. 40(a)(ia) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of justice and fair play to set aside this issue to the file of AO to decide the issue afresh in the light of the aforesaid judgment. Accordingly, we direct the AO to verify whether the payees have included the subject-mentioned receipts in their respective returns and paid taxes thereon or not. If that is so, then disallowance u/s. 40(a)(ia) of the Act shall not be made in the hands of assessee. Accordingly, we allow assessee's common grounds 1 to 3 for statistical purposes. 8. Next issue raised by assessee is that Ld. CIT(A) erred in confirming the action of AO by making an addition of Rs. 20,000/- on account of balancesheet difference by wrongly treating it as unexplained investment. This addition relates to difference in the opening balance of the party M/s Bengal Emta Coal Mines Ltd. (BECML for short) and as per the confirmation received from the said party the work-in-progress was shown for Rs.5,93,863/- whereas assessee has shown the balance in its books of account for Rs. 5,73,863/-. The difference between the figures was treated as unexplained investment by AO and added to the total income of assessee. 9. Aggrieved, assessee preferred an appeal before Ld. CIT(A) who c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove, we restore this matter before Assessing Officer for fresh adjudication in the light of amended provision of Finance Act, 2012. Hence, this ground of assessee's appeal is allowed for statistical purpose. 14. Last ground raised by assessee is that Ld. CIT(A) erred in disallowing the expenditure of Rs.2,99,459/- towards the cost of fuel by invoking u/s 69C of the Act. The assessee supplied dumpers to BECML on hire for lifting and loading coal to truck or railway wagon. The assessee used to raise the bill for the said dumpers given on hire to BECML. As per the terms & conditions BECML shall pay the fuel cost for the dumper when it is in its custody for the use of the business. However the fuel cost paid by the BECML shall be adjusted/ deducted from the bill raised by the assessee. Accordingly BEMCL deducted a sum of Rs. 33,76,944.00 from the bill of the assessee but the AO observed during assessment proceedings that the fuel expenses claimed by the assessee in profit and loss account by Rs.36,76,403/. Accordingly the AO treated the difference of Rs. 2,99,459/- as unexplained expenditure u/s. 69C of the Act. 15. Aggrieved, assessee preferred an appeal before Ld. CIT(A) who confi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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