TMI Blog2020 (3) TMI 1139X X X X Extracts X X X X X X X X Extracts X X X X ..... back this issue to the file of AO for finding out the correct nature of payments made to Shri Khagesh Patel by the assessee company after providing reasonable opportunity of being heard to the assessee and the assessee is also directed to provide the documents and avoid in taking unnecessary adjournments. Therefore, this ground of appeal of the assessee is allowed for statistical purposes. Additional evidence filed by the assessee denied - violation of Rule 46A of the Income Tax Rules, 1962 - HELD THAT:- After hearing both the sides and perusing the entire material available on record, we noted that the documents provided by the assessee go to the root of the matter which are part of the records, therefore, the contention of the assessee is accepted and the matter is sent back to the file of AO for consideration of the documents and decide the issue as per law. The assessee is directed to cooperate with the department for early disposal of the case. This ground of appeal of the assessee is allowed for statistical purposes. Bogus purchases - assessee failed to produce copy of VAT return in the case of Asansol and Dhanbad purchase - VAT return was calculated at 12.5% on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of assessment proceedings, the AO noticed that the assessee has claimed an amount of ₹ 9,57,144/- has been paid to Shri Khagesh Kumar Patel towards commission and assessee s sales at Dhanbad, Asansol and Bilaspur. A copy of ledger account of Shri Khagesh Patel was submitted in which it was noticed that no TDS has been made by the assessee, therefore, the AO issued show cause notice stating that the assessee has violated the provisions of Section 194H of the Act on the above payments, hence, these payments are subject to disallowance of Section 40(a)(ia) of the Act. In this regard, the assessee submitted his written reply and explained that TDS has been deducted u/s.194C @2% on the basis of verbal contract with the person instead of deduction @10%. The assessee also submitted that the cash payments were made below ₹ 20,000/-therefore, the disallowance u/s.40A(3) of the Act is also not attracted. Subsequently, the assessee also produced TDS return in which the assessee has made TDS 1% or 2% on the commission payments made to Shri Khagesh Patel. The AO analysed the provisions of Section 194H and also refer to Chapter XVII-B. The AO also noticed that the assessee has made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed. 7. After hearing both the sides and perusing the entire material available on record and the orders of the authorities below, we noticed that the assessee has made the payments to Shri Khagesh Patel. On perusal of the documents submitted before us, we notice that the assessee has not deducted TDS as per Section 194H of the Act. He has deducted @2% instead of 10%. It is also mentioned before us that major turnover has been achieved by the assessee from the public sector undertakings and how and why the assessee has paid commission to Shri Khagesh Patel for selling of goods. The entire payments have been received by the assessee in his bank accounts through cheques/RTGS. Further on perusal of the TDS return filed by the assessee along with details filed by the assessee, which is placed at paper book pages No.16 to 40, we noticed that in the case of many instances the tax has been deducted @1% or 2% as per Section 194C of the Act which is clear from the exact break up of TDS return. He has also deducted TDS @2% u/s.194C of the Act. Further on perusal of the copies of Income Tax Return produced by the assessee of Shri Khagesh Patel in the form of ITR-IV, It is clear that Shri K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the CIT(A). The assessee filed details of VAT return and documents as an additional evidence but the CIT(A) denied to accept the additional evidence stating that in spite of providing ample opportunities to the assessee the assessee could not provide VAT returns and documents in support of his claim, therefore, he did not accept the additional evidence filed by the assessee and dismissed the appeal of the assessee. 10. Ld. AR submitted that the CIT(A) was not justified to accept the additional evidence filed before him. It was not an additional evidence which was a part of the record, which goes to the root of the matter, therefore, these documents should be accepted by the Bench and he requested for sending back the matter to the file of AO for readjudication of the issue. 11. Ld. DR, on the other hand, objected for accepting the additional evidence filed by the assessee and submitted that the AO had given ample opportunity to provide the details, however, the assessee has shown his inability to produce the same, therefore, it would be clear cut violation of Rule 46A of the Income Tax Rules, 1962. 12. After hearing both the sides and perusing the entire material a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee, therefore, he issued show cause notice which has been incorporated in the assessment order. The assessee was repeatedly asked by the AO to reconcile the difference noted by him but the ld. AR of the assessee also expressed his inability to furnish the additional details. Accordingly, the difference noted by the AO to the tune of ₹ 27,99,978/- was claimed as bogus purchase and added to the total income of the assessee. 18. On appeal before the CIT(A), the assessee filed written submissions and submitted that the discrepancy in purchases is due to comprising of purchase with doubt and purchase without doubt. The assessee filed also a chart with due element along with ledger copies but these documents were not filed before the AO, therefore, he did not accept the documents filed before him and he dismissed the appeal of the assessee. 19. Ld. AR of the assessee submitted that it was a part of the records. The CIT(A) should have accepted to proper adjudication on the issue. It does not file as additional evidence and he requested for sending back to the file of AO for proper adjudication. 20. Ld. DR, on the other hand, vehemently opposed for accepti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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