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TMI Blog2016 (5) TMI 968X X X X Extracts X X X X X X X X Extracts X X X X ..... on the facts of the case in confirming the disallowance of Rs. 1,35,500/- u/s 40(a)(ia) of the Act on account of legal and rent payment because of the alleged non-compliance of TDS provisions. The disallowance so made and confirmed by the CIT(A) being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 4. Rs. 14,630/-: The Id. CIT(A) erred in law as well as on the facts of the case in confirming the disallowance of Rs. 14,630/- on account of watchman expenses on the plea that the said expenditure did not relate to the subjected year. The disallowance so made and confirmed by the CIT(A) being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 5. Rs. 13,898/-: The Id. CIT(A) erred in law as well as on the facts of the case in confirming the disallowance of Rs. 13,898/- on account of Mobile & telephone expenses on the plea that it was a capital asset and not a consumable. The disallowance so made and confirmed by the CIT(A) being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 6. Rs. 19,810/-: The Id. CIT(A) erred in law as well as on the facts of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts of the case in confirming the addition of Rs. 22,500/- (out of total disallowance of Rs. 27,500/-) on account of estimated realizable scrap value relating to raw material. The addition so made and partly confirmed by the CIT(A) being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 13. Rs. 18,70,000/-: The Id. CIT(A) erred in law as well as on the facts of the case in confirming the addition of Rs. 18,70,000/- on account of the allegation of non submission of valuation papers of work in progress. The addition-so- made and confirmed by the CIT(A) being totally contrary to the provisions of law and facts of the case, kindly be deleted in full. 14. The Ld. AO further erred in law as well as on the facts of the case in charging interest u/s 234A & 234B & 234D of the Act. The appellant totally denies its liability of charging of any such interest. The interest so charged, being contrary to the provisions of law and facts, kindly be deleted in full." 2. Ground Nos. 1 and 12 of the appeal are not pressed, therefore, we dismiss the same as not pressed. 3. The assessee is engaged in the business of manufacturing of Hybrid Micro Circuit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Evidences furnished before the ld CIT(A) was found him additional evidence, which was submitted without any application for additional evidence under Rule 46A of the Income Tax Rules, 1962 (in short the Rules). Earlier this was claimed by the assessee that Rs. 30,000/- was paid as rent for the period 10/12/2007 to 09/2/2008 but before him he has claimed this payment for watchman charges. The total payment exceed Rs. 1.20 lacs, therefore, provisions of Section 194(I) of the Act is applicable, which is liable to be deducted TDS. Before us, the ld AR claimed that Rs. 1.35 lacs was payment for rent of various offices hired by the company for the purpose of smooth operation of project work. The rent was paid to the single person was only Rs. 1,05,000/- which does not require deduct TDS but Rs. 30,000/- was paid on account of different services to the watchman-cum-supervisor as a salary @ 5,000/- per month for six months, it was shown in the rent account by mistake. The ld AR has also drawn our attention on page No. 46 and 47 of the paper book to demonstrate that these are the payments to the watchmen-cum-supervisor. Ld. DR supported the order of the lower authorities. After considerin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allized during the year under consideration. Genuineness of the expenses has not been doubted by the lower authorities, therefore, we allow the assessee's appeal on this ground. 4.4 The ld CIT(A) partly allowed the appeal under the head travelling expenses ROT for Rs. 27,565/- on the ground that bill for Rs. 2,480/- is pertained to year under consideration and remaining expenses were pertained to earlier year. The ld AR has argued that these expenses were booked when the assessee received the bills from the employees as the assessee's activities is all over the India, therefore, expenses could not booked in the relevant year. He has drawn our attention on page No. 7 of paper book of para No. 9. Ld. DR supported the order of the lower authorities. After considering the assessee's submission, it is but natural that expenses is to be booked when the assessee received the bills from the employee as already held that the assessee's activities are in all over the India, therefore, he booked the travelling expenses of ROT when it received by it. The genuineness of the expenses has not been doubted by the lower authorities, it is crystallized during the year under consideration. Accord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arried out the same exercise for valuing the work in progress also. The amount of Rs. 18.70 lacs included a sum of Rs. 9.90 lacs, which was the value of FCT Kits. Before the Assessing Officer the assessee claimed that these expenses were written off on the basis of independent valuation report, however, no such report was furnished before the Assessing Officer. 7. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that written off valuation of work in progress under the head computer kit for Rs. 8,47,503/- pertained to year 2004, ASV card Rs. 32,497 (damage) and reduction in value of FCT assembly Rs. 9,90,000/- pertained to year 2006. The work in progress is a sub assembly stage, the final assembly is cleared only against firm orders, the work in progress under consideration pertains to year 2004 and 2006, the extensive follow up for sale of FCT (Fixed Cellular Terminal) and computers could not yield results. Since completion of the job required additional components and additional cost hence company took decision not to procure additional components to avoid further losses, this was resulted into continuation of work in progress in subsequent years. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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