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TMI Blog2017 (3) TMI 1466X X X X Extracts X X X X X X X X Extracts X X X X ..... ta u/s 147 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') vide his order dated 31.03.2013 for assessment year 2009-10. Shri Anand Kumar Singh, Ld. Departmental Representative represented on behalf of Revenue and Shri S. Jhajharia, Ld. Authorized Representative appeared on behalf of assessee. First we take up Revenue's appeal in ITA No.856/ol/2014 for A.Y. 09-10. 2. Facts in brief are that assessee in the present case is a Limited Company and engaged in the business of real-estate, construction of building and promotion. The assessee filed its return of income on 30.09.2009 declaring total income of Rs.9,49,918/-. Originally the assessment was framed u/s. 143(3) of the Act at a total income of Rs.11,57,200/-. Thereaft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f disallowance of the same due to non-deduction of TDS. The Ld. CIT(A) after considering the submission of assessee has deleted the addition made by the AO. Being aggrieved by this order of Ld. CIT(A) Revenue is in appeal before us. 6. Before us both the parties relied on the orders of Authorities Below as favourable to them. 7. We have heard the rival submissions of both the parties and perused the materials available on record. It is the admitted fact that the assessee has no deducted any TDS on the impugned expenses on the ground that the relevant expenses were capitalized as work in progress. Since the expenses has not been claimed in the profit and loss account, the question of any disallowance under section 40(a)(ia) of the Act does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arises where the claim of depreciation u/s 32 of the Act is covered u/s 40(a)(ia) of the Act. The provisions of Section 40(a)(ia) of the Act is applicable to payments specified therein which are allowable u/s 30 to 38 of the Act. Since the claim of depreciation is not payment or expenditure in strict sense but the same is statutory allowance, so strictly the claim of depreciation will not be covered u/s 40(a)(ia) of the Act. Further, the actual cost and WDV is defined in Section 43 of the Act and provisions of Section 40(a)(ia) of the Act does not override the provisions of Section 43 of the Act. In the case of Shri Vishnu Anant Mahajan vs. ACIT in ITA No. 3002/Ahd/2009 for A.Y. 2006-07 the Hon'ble Special Bench ITAT, Ahmedabad vide its ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 72/- was made by the assessee. Accordingly, the AO has disallowed proportionate expenses of Rs. 49,05,549/- under the provisions of section 40(a)(ia) of the Act and added to the total income of the assessee. 10. Aggrieved, assessee preferred an appeal before Ld. CIT(A). The assessee before Ld. CIT(A) submitted that the provisions of section 40(a)(ia) of the Act are not applicable in case of short deduction of the TDS. The Ld. CIT(A) after considering the submission of assessee has deleted the addition made by the AO. Being aggrieved by this order of Ld. CIT(A) Revenue is in appeal before us. 11. Before us both the parties relied on the orders of Authorities Below as favourable to them. 12 We have heard the rival submissions of both the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in sub-section 3 (1) of section 139'. This section 40(a)(ia) of Act refers only to duty to deduct tax and pay to government account. If there is any shortfall due to any difference of opinion as to taxability of any item or nature of payments falling under various TDS provisions, assessee can be declared to be an assessee in default u/s. 201 of Act and no disallowance can be made by invoking provisions of section 40(a)(ia) of Act. Accordingly, order of CIT (A) allowing claim of assessee was confirmed and this issue of revenue's appeal was dismissed. No substantial question of law was involved in this case. Appeal was dismissed. Expenses are not liable to be disallowed u/s 40(a)(ia) on account of short deduction of tax at source" The pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n favour of assessee, therefore we are not inclined to adjudicate the CO raised by assessee in its CO on technical matter. Hence, the ground raised in CO is dismissed as infructuous. 18. Next issue raised in CO is that there was violation of provision of Rule 46A of the IT Rules. We have already held that there was no additional evidence admitted by Ld. CIT(A) in contravention the provision of Rule 46A of the IT Rules in Revenue' appeal (ITA No.856/Kol/2014) vide para-14 of this order. Hence, the ground raised in CO is allowed. 19. Next issue raised in CO is that Ld. CIT(A) was correct in holding that the provision of Sec. 40(a)(ia) of the Act are not applicable in the case where short deduction of TDS has been made and we have already al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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