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TMI Blog2019 (12) TMI 493X X X X Extracts X X X X X X X X Extracts X X X X ..... interst u/s. 40A(ia) of the Act; 2. Rs. 7,94,786/- on account of wagers paid u/s. 40a(ia) of the act; 3. Rs. 80,000/- being the amount of remuneration paid by invoking provision of section 40(A)(2) of the Act; 4. Rs. 26,000/- by applying provision of section 40A(3) of the Act; 5. Rs. 19,424/- and Rs. 33,947/- under the heads 'vehicle running expenses' and 'telephone expenses' respectively on estimate basis treating the same as personal in nature. All the above actions being arbitrary, erroneous and unjust must be quashed with directions for appropriate relief. 2. Assessee has also filed an Application for admission of additional ground, the contents thereof are read as under:- "APPLCIATION FOR ADMISSION OF AD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is directed against the order of the Id. CIT (Appeals)-XXII, New Delhi, in Appeal No. 228/2009-10 dated 27.02.2014. 2.1 The grounds taken in appeal are five in number as under: "On the facts and in the circumstances of the case and in law the authorities below erred in making the following additions to the returned income:- I. Rs. 10,68,968/- being the amount of reimbursement of interest u/s 40a(ia) of the Act; 2. Rs. 7,94,786/- on account of wages paid u/s 40a(ia) of the Act; 3. Rs. 80,000/- being the amount of remuneration paid by invoking provision of Section 40 (A) (2) of the Act; 4. Rs. 26,000/- by applying provision of Section 40A (3) of the Act; 5. Rs. 19424/- and Rs. 33,947/- under the heads 'vehicle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at source. As per the provisions of Section 194A of the Act the assessee was required to deduct TDS on amount exceeding Rs. 5,OOO/- at the specified rates. In the instant case, however, the assessee failed to deduct TDS. Since it was credited to a resident on which tax had not been deducted consequently the same not be deducted in computing total income chargeable under the head 'Profit and gains from business and profession'. So the interest charges of Rs. 10,68,968/- were disallowed u/s 40a(ia) by adding it back to the assessee's income. The Ld. CIT (Appeals) confirmed the addition as made by the Assessing Officer with observations as are contained on page 19 of the impugned appellate order. He observed that the Appellant had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such return of income; and the person furnishes a certificate to this effect from an accountant in such form as may be prescribed:] 3.3 Appellant seeks leave to submit a copy of the acknowledgement of the Income Tax Return as filed by for the year UITCDPL. In terms of the proviso, therefore, Appellant deserves relief but connected after verification of the connected tects. Pleaded accordingly. 4.1 Ground No. 2 is against the confirmation of the disallowances of wages in a sum of Rs. 7,94,786/- also u/s 40a(ia) of the Act. The Appellant has paid wages to temporary staff numbering 19 in a sum of Rs. 10,15,778/-. These were in respect of securities and maintenance services amongst other availed by the Appellant in the normal course o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord to establish the existence of any contract, valid or otherwise, between the Appellant and these casual workers. Each pqyment has to be considered separately for TDS in terms of Section 194A of the Act. Each one of these payments made to casual workers was less than the maximum amount not exigible to tax during this year. There was therefore, no liability to deduct tax at source even under section 194A of the Act. Consequently section 40a(ia) of the Act had no application to the facts of the case. The disallowance as made by the Assessing Officer and confirmed by the Id. CIT (Appeals) is thus palpably erroneous and merits to be annulled. 5. Ground Nos. 3 concerns disallowance u/s 40 (A) (2) of the Act. The Appellant had paid remunerat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Act and personal use for vehicles and phones. It is submitted that the expenses as incurred are all genuine and being so in terms of the decision of the Hon'ble Punjab & Haryana High Court in the case of Gurudas Kamat no disallowance of Section 40A(2) varity was warranted. As to personal expenses the Ld. CIT(A) had arbitrarily confirmed 20% disallowance which was highly excessive. Pleaded accordingly." 4. Ld. DR relied upon the orders of the authorities below. 5. I have heard both the parties and perused the records especially the impugned order; additional ground as well as written synopsis filed by the assessee counsel. After perusing the aforesaid additional ground, I am of the view that in the interest of justice, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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