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Sri Raghunath Prasad Versus I.T.O., Ward – 2 (3) , Asansol

2016 (7) TMI 612 - ITAT KOLKATA

TDS u/s 194C - non deduction of tds - Disallowance u/s 40(a)(ia) - Held that:- We find that the expenses incurred is only towards promotion of business of the assessee and does not fall under the definition of ‘work ‘as defined in 194C of the Act. Hence there is no obligation to deduct tax at source in terms of section 194C of the Act. Accordingly we direct the ld. AO to delete the disallowance made u/s 40(a)(ia) of the Act. - Decided in favour of assessee - Addition towards notional rental .....

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e properties either before us or before the lower authorities. We find that the revenue is justified in making this addition which is in accordance with the provisions of the Act. Hence we do not find any reason to interfere with the orders of the lower authorities. - Decided against assessee - ITA.1035/Kol/2013 - Dated:- 8-7-2016 - Shri N.V.Vasudevan, JM & Shri M.Balaganesh, AM For The Appellant : Shri R.N.Ram, AR For The Respondent : Shri U.K.sardar, Addl. CIT,Sr.DR ORDER Per Shri M.Balaga .....

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sessee deals in trading of electronics products as a super stockiest of M/s. Blue Star Ltd, Sharp India Ltd & others under the name and style M/s. Ramson Traders. Apart from trading activities, the assessee also runs authorized service centre of M/s. Sharp India Ltd., M/s. Blue Star Ltd., M/s. Haier Ltd, M/s. Crompton Greaves Ltd etc. During the course of hearing the assessee submitted Tax Audit Report in Form No. 3CB & 3CD dtd. 15.09.2009 in respect of M/s. Ramsons Traders along with it .....

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) observed that the ld.AO has made exhaustive computation and claimed that there is no surplus fund available with the assessee to explain the accretion to his capital account. He observed that the assessee had not pointed out any specific error in the reconstructed capital account prepared by the ld. AO. He further observed that the assessee did not submit any proof of filing a combined personal and business fund flow statement containing all the transactions and accordingly upheld the addition .....

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t of the assessee for the period 01.04.2008 to 31.03.2009; loan account of Dena Bank against FDR and National Savings Certificate together with details of personal drawings vide pages 57 to 60 of the paper book and argued that these papers were not properly considered by the lower authorities and accordingly prayed for setting aide of this issue to the ld. AO. In response to this the ld. DR vehemently supported the orders of the lower authorities. 2.4. We have heard the rival submissions and per .....

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ee is allowed for statistical purposes. 3. The next issue to be decided in this appeal is as to whether the addition in the sum of ₹ 1,42,145/- could be made towards difference in the balance of sundry creditor i.e. M/s.Haier Appliances (P) Ltd. 3.1. The ld.AO obtained information u/s 133 (6) of the Act from the sundry creditor M/s. Haier Appliances Pvt. Ltd and found that there is a difference in the balance to the tune of ₹ 1,42,145/-. The assessee explained the difference as below .....

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ear. Moreover, for the balance amount of ₹ 38,493/- no bill was raised because the company has disputed it and the company has not paid these bills till date. 3.2. The ld. AO observed that the explanation of the assessee was not tenable at all because of the following facts :- (i) M/s. Haier Appliances paid the amount to the assessee after deducting necessary taxes under section 194C of the I.T. Act, thus the question of reimbursement of payment did not arise. (il) Clause 11 (a) of Form No .....

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was upheld by the ld. CIT(A). Aggrieved the assessee is in appeal before us on the following ground :- 2) That on the fact & circumstances of the case Id. CIT (A) erred in confirming the addition of ₹ 1,42,145 made by the assessing officer on the ground that there was difference of amount debited by M/s Haier Appliances (P) Ltd. & amount credited by the assessee where as the difference was fully reconciled & statement was furnished before the A/O & CIT (A) in course of ass .....

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the ld. DR argued that the assessee did not bother to file the reconciliation statement before the lower authorities. 3.5. We have heard the rival submissions and perused the materials available on record including the paper book filed by the assessee in this regard. We feel that, in the facts and circumstances of the case, the issue needs to be examined by the ld. AO in the light of the evidences available in the paper book filed by assessee and accordingly, deem it fit and appropriate, to set .....

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hat the issue is not pressed by him and the same is taken as a statement from the bar. Accordingly, ground no.3 raised by the assessee is dismissed as not pressed. 5. The next issue to be decided in this appeal is as to whether disallowance u/s 40(a)(ia) of the Act could be made in the sum of ₹ 1,10,719/- in the facts and circumstances of the case. 5.1. In the P&L account an amount of ₹ 1.10,719/- was found debited under the head Tour Expenses of customers . On specific query fro .....

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dia) Pvt. Ltd had raised the bill in favour of M/s. Ramson Traders for arranging a package tour cost for 30 persons at Sunderbans Tiger View point from 25.02.2009 to 27.02.2009. It was further observed that before conducting the said package tour M/s. Make My Trip (India) Pvt. Ltd had received an advance of ₹ 80,000/- from M/s. Ramson Traders and raised the invoice for rest of the bill amount ₹ 30,719/-. On perusal of the bank statement, it was observed that M/s.Ramson Traders had pa .....

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ob for which it received necessary payments. As such the payments made to M/s. Make My Trip (India) Pvt. Ltd was nothing but a payment of contractual nature and as such the assessee was bound to deduct tax at the time of crediting the payment to the account of M/s. Make My Trip (lndia) Pvt. Ltd, as the quantum of payment exceeds the statutory limit. But the assessee failed to deduct any tax at the time of crediting the payment. 5.2. The ld. AO accordingly made disallowance u/s 40(a)(ia) of the A .....

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. We have heard the rival submissions and perused the material available on record including the paper book filed by the assessee in this regard. The facts stated herein above remain undisputed and hence the same are not reiterated for the sake of brevity. We find that the expenses incurred is only towards promotion of business of the assessee and does not fall under the definition of work as defined in 194C of the Act. Hence there is no obligation to deduct tax at source in terms of section 194 .....

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ssessee to explain the details of various properties used by the assessee. The assessee replied as below :- In compliance, the assessee submitted that- The assessee has three house properties out of that two at Gurunanak Complex, G. T. Road, Asansol and another one at Hill view park, Asansol. Out of three properties two is being used for residential purpose and one for business purpose. No house property has ever been let out so there does not arise any question of rental income. The Axis Bank a .....

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In view of the above it was inferred that out of three house properties, two properties were used for self occupation and other for business use. As the assessee resides with his family at Hill View Park, Asansol, the said property is treated as self occupied and annual value of that property is taken as Nil and the Flat No.1, of. 1st floor, Gurunanak Complex, G.T. Road, Asansol is treated as if the property had been let out during the entire previous year under consideration. 6.2. The ld. AO e .....

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