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2016 (7) TMI 101 - ITAT PUNE

2016 (7) TMI 101 - ITAT PUNE - TMI - Delayed payment of TDS - addition under section 40(a)(ia) - retrospectivity - Held that:- Assessing Officer himself has returned a finding of fact that the TDS has been deposited with the Government Treasury albeit after the prescribed due date. We also notice from the order of the CIT(A) that except for one or two instances involving paltry amount, the entire amount has been paid during the relevant financial year itself. The other two small payments were al .....

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te the addition on being satisfied that the TDS on the aforesaid payment has been deducted and paid on or before the due date of filing of the return of income. The assessee shall be given reasonable opportunity of being heard while deciding the issue. - Decided in favour of revenue for statistical purposes. - Some expenses were not fully verifiable - Ad-hoc disallowance made @ 10% of such expenses. - ITA No.1438/PN/2014, ITA No.1470/PN/2014 - Dated:- 8-6-2016 - MS. SUSHMA CHOWLA, JM AND SHR .....

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lidated order. ITA No.1438/PN/2014 (By Revenue) : 3. First, we shall take-up the appeal of the Revenue for adjudication. By way of Ground No.1 of the Revenue appeal, the Assessing Officer has impugned the order of the CIT(A) in deleting the addition of ₹ 52,14,078/- under section 40(a)(ia) of the Act holding that amendment to section 40(a)(ia) by the Finance Act, 2010 is retrospective in operation without appreciating that the law to be applied should be the one which is applicable to the .....

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prescribed dates as referred to in Rule 30 of the Income Tax Rules, 1962 and therefore owing to the failure of TDS compliance, the deduction of the aforesaid amount cannot be allowed as expenditure. He, accordingly, proceeded to make addition of ₹ 52,14,078/- to the total income of the assessee. 3.2 In first appeal, the CIT(A) however noted that the entire amount of TDS has been paid in the financial year 2008-09 only. He, accordingly, placed reliance upon the order of the Hon ble Calcutt .....

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Due date being 7th of the following month after 31/03/2009 8,284 211 09/04/2009 13,867 314 09/04/2009 7. In the above cases too, there is delay of only two days as due date was 07.04.2009 against which payment has been made on 09.04.2009. In this regard, it is seen that the rigours of Sec. 40(a)(ia) of the Income-tax Act were relaxed by Finance Act 2010 w.e.f. 01.04.2010 to enable an assessee to pay the tax deducted by him at source under Chapter XVII-B of the Income-tax Act on or before the due .....

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of the Income-tax Act. It would not be out of place to mention that in case the amount is claimed in A.Y. 2010-11 on payments basis or allowed by the Assessing Officer, the same is required to be withdrawn. Subject to the above remarks, the ground is allowed. 3.3 The Ld. Authorized Representative (AR) for the assessee vehemently exhorted that there is no dispute that the TDS has been deposited in the Government Treasury during the financial year itself and in any case before the due date of fili .....

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from the order of the CIT(A) that except for one or two instances involving paltry amount, the entire amount has been paid during the relevant financial year itself. The other two small payments were also found by the CIT(A) to be made in the month of April 2008 only. In the background of the aforesaid facts, we find no infirmity in the order of the CIT(A). Thus, the Ground No.1 of the Revenue appeal is dismissed. 5. By way of Ground No.2 of the Revenue appeal, the Revenue has also impugned the .....

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the TDS was not deducted and particulars of PAN/TAN of the parties were not furnished. 5.2 Before the CIT(A), the assessee submitted that the PAN in respect of M/s Reliable Manpower Services remained to be typed due to clerical oversight at the auditor s office. A copy of the PAN card of the recipient was submitted before the Assessing Officer during the course of assessment proceedings, which has not been considered. The assessee claimed that it has deducted TDS on the aforesaid amount and depo .....

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's office. The learned counsel of the appellant submitted that the copy of PAN card of Mr. Zain Farook Merchant was submitted before the Assessing Officer during the course of assessment proceedings which has not been considered by the Assessing Officer. Accordingly, the same has been furnished as per Paper Book, page No. 46. Further, the appellant has shown that there is no adverse comments in respect on account of compliance of TDS provisions as well as disallowance u/s. 40(a)(ia) of Incom .....

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the issue to the file of the Assessing Officer for de novo examination. The Assessing Officer is directed to delete the addition on being satisfied that the TDS on the aforesaid payment has been deducted and paid on or before the due date of filing of the return of income. The assessee shall be given reasonable opportunity of being heard while deciding the issue. We direct accordingly. 7. Thus, Ground No.2 of the Revenue appeal is allowed for statistical purposes. 8. In the result, the appeal of .....

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that major expenses are towards Hotel expenses, lunch expenses, entertainment of guests etc. which cannot be categorically classified as incurred exclusively for business promotion. As these expenses are not fully verifiable and not beyond doubt, he estimated reasonable disallowance of 10% out of the total expenditure on discussion with the AR present for the assessee. 10.1 Before the CIT(A), the assessee furnished the breakup of the expenditure which read as under :- Goods used for Demo and pr .....

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