TMI Blog2016 (12) TMI 1190X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee for statistical purposes Income from undisclosed source u/s. 69A - Held that:- We find that the AO added the impugned addition for not disclosing the same in the balance sheet and by observing the same was settled through cheque on 14- 04-2010. Admittedly, the submission as made by the assessee before the CITA that assessee has taken into consideration the gross bill, which was disclosed and offered for taxation, wherein the said impugned amount is part and parcel of said gross bill. The CIT-A found the same as independent and doubted the same is taxed or not. In view of such observations and taking into considerations the submission as advanced by the ld.AR of the assessee, we are of the view that the issue requires fresh examination in terms of the contention of the assessee the gross bill amount have been disclosed and offered the tax or not. Hence, AO is directed to decide this issue afresh in accordance with law, uninfluenced by earlier decision and decision of CIT-A in this regard. - Decided in favour of assessee for statistical purposes - I.T.A. No. 701/KOL/2015 - - - Dated:- 21-12-2016 - Shri M.Balaganesh, Accountant Member and Shri S.S.Viswanethra Ravi, Judic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OTIF 3,00,000 2. Baron Kr Mondal 5,97,000 3. Ashok Kr Chandak 9,12,975 4. Mukesh Kr. Singh 1,35,000 5. Sohan Lal Ruprai 4,27,352 Total 23,72,327 7. In explanation, the Assessee submitted written submissions on 18.12.2012 as under: The assessee firm have paid ₹ 25,59,52 as Machine Hire Charges to various parties, the details of which is already furnished to you good offices. No amount of Machine Hire Charges is outstanding as on 31st March,2010. The assessee firm has not deducted any tax at source. But failure to deduct tax at source on Machine Hire Charges should not qualify for disallowance of the entire expenditure which has already been paid. In support of this I on behalf of my client submitting before you the judgment of ITAT, Vishakhapatnam Bench, Vishakhapatnam in the case of M/s Marilyn Shipping Transporters, Vishakhapatnam, which is self-explanatory.( ITA No - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t accepted by me. Hence ground 2 is dismissed. 9. Before us the ld.AR submits that the assessee gathered information regarding the payee disclosing such payment as income in return of income and the same was brought to the notice of CIT-A. He also submits that the reliance was placed on in the case of Merlyn Shipping Transport reported in 20 taxmann.com 244(Visag)(SB). Inspite of which the CIT-A dismissed the ground involving the same. 10. Heard the ld.AR and perused the material available on record. We find that the Assessee relied on the decision of a Special Bench in the case of Merilyn Shipping Transports held that if all the amounts have been paid, no addition shall be made. The CIT-A after going through the various decisions as relied on by the Assessee found the principle laid down by the Hon ble Jurisdictional High Court of Calcutta in the case of CIT Vs. Crescent Export Syndicate reported in (2013) 33 taxmann.com 250(Cal) is binding on him and applied the ratio therein to the facts of the present issue. The Hon ble Jurisdictional High Court of Calcutta in the case of CIT Vs. Crescent Export syndicate did not agree with the finding of the Special Bench that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liability is admitted and it becomes payable. Therefore wherever the payment is covered by aforesaid sections whether paid or credited, tax has to be deducted. Sections 194 L and 194 LA may also be looked into which says that tax has to be deducted only at the time of payment. The language in these sections therefore shows that the Legislature has used different language in different sections. It is trite law that each and every word of the section has its own meaning and while drafting section 40(a)(ia) was meant to be applicable only if the amounts covered therein was payable at the end of the year. Reference may be made, for the scope and effect of section 40(a)(ia) as clarified by CBDT in Circular No.5 of 2005, date 15th July, 2005 to show that the intention to introduce this provision was brought to curb bogus payments by creating bogus liability. 12.4 In our considered opinion, there is no ambiguity in the Section and term 'payable' cannot be ascribed narrow interpretation as contended by assessee. Had the intentions of the legislature were to disallow only items outstanding as on 31st March, then the term 'payable' would have been qualified by the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hi High Court in the case of CIT Vs. Ansal Land Mark Township (P) Ltd reported in 377 ITR 635 (Del). Respectfully following the said decision, we deem it fit and proper and in the interest of justice and fair play set aside this issue to the file of the AO for examination of subject mentioned receipts in the hands of the respective payees based on details provided to that effect by the assessee. Once, if it is proved to be correct then no disallowance u/s. 40(a)(ia) of the Act would be operative in the hands of the assessee. Accordingly, ground no.1 of assessee s appeal is allowed for statistical purpose. 13. Ground no. 2 is relating to addition of ₹ 2,05,102/- being the income from undisclosed source u/s. 69A of the Act. 14. During the course of assessment the AO obtained information from M/s. S.K Enterprises, Bokaro Steel City, Jharkhand u/s. 133(6) of the Act. On verification of such information the AO found that the closing balance of assessee in the books of said M/s. S.K Enterprises. But the same was not reflected in assessee s audited balance sheet. Further he found that the said amount was cleared on 14-04-2010 through cheque relevant to FY 2009-10. The AO treat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT-A to prove that the said cheque was never received by the assessee. Without considering the same the CIT-A confirmed the impugned addition made by the AO. The CIT-A also observed that the explanation offered by the assessee before him was independent and doubted whether it was taken to profit and loss account and offered to tax or not. In such circumstances, the ld.AR submits that the assessee undertakes to appear before the AO for verification of such details and urged to remand the issue to the AO. 18. Heard the ld.AR and perused the material available on record. We find that the AO added the impugned addition for not disclosing the same in the balance sheet and by observing the same was settled through cheque on 14- 04-2010. Admittedly, the submission as made by the assessee before the CITA that assessee has taken into consideration the gross bill, which was disclosed and offered for taxation, wherein the said impugned amount is part and parcel of said gross bill. The CIT-A found the same as independent and doubted the same is taxed or not. In view of such observations and taking into considerations the submission as advanced by the ld.AR of the assessee, we are of the vi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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