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TMI Blog2021 (9) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... accepted by the Assessing Officer. He, however, subsequently reopened the assessment for the reason that there was escapement of income of the assessee on account of undisclosed closing stock amounting to Rs. 86,91,408/- and also on account of failure of the assessee to deduct tax at source u/s. 194-I and 194C of the Act from the payments aggregating to Rs. 10,60,90,375/- made during the year under consideration which required disallowance u/s. 40(a)(ia) of the Act. The Assessing Officer accordingly issued a notice u/s. 148 of the Act to the assessee on 07/12/2012. During the course of reassessment proceedings, the following explanation was offered on behalf of the assessee in respect of the undisclosed closing stock of Rs. 86,91,408/- as alleged by the Assessing Officer:- "That there no exclusion of stock, as pointed out. The data disclosed in the schedule 20 item no. 24 is an disclosure as additional information as per provision of Part II of schedule VI of the Companies Act, 1956. the real fact may please be dealt in the Trade account of Internal Raw Jute-Price support & internal raw jute- commercial at page 54 & 55 of the accounts for the year 2007-08. there is no question a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... moisture and the corporation following the basic principle of accounting over the years duly adjust the same in its annual accounts. The said stock of 4248 bales have already considered as excess to the accounts and the value taken accordingly. The excess 4248 bales as were shown in schedule-19, Notes to Accounts in Item no. 24, to disclose the quantitative data as required for disclosure under VI schedule of the Co Act 1956 and had already impacted on value as the quantity of closing stock. On subsequent sale of the said quantities in following year the income generated there from duly accounted in following years also. A reconciliation statement as presented here under will clear the position of said shocks to the accounts and its effect for the year Closing stock reconciliation statement; Particular Quanity (In bales) Opening Stock of Raw Jute on 01.04.2007 4,07,691 Add. Purchases during the year 7,66,076 Sub Total 11,73,767 Less Sales during the year 5,91,835 Less Stock loss due to damage/claims 2,359 Actual Closing stock as on 31.03.2008 5,79,573 Closing stoc as credited in Profit & Loss Account 5,83,821 So ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee on this issue before the ld. CIT(A), duly supported by the reconciliation statement was not submitted before the Assessing Officer during the assessment proceedings and the Assessing Officer, therefore, should be given an opportunity to examine/verify the same. However, as rightly pointed out by the ld. Counsel for the assessee, the submission made on behalf of the assessee on this issue along with the reconciliation statement was forwarded by the ld. CIT(A) to the Assessing Officer seeking the latter's comments and after taking into consideration the comments offered by the Assessing Officer in the remand report dt. 04/08/2014 submitted to the ld. CIT(A), this issue was decided by the ld. CIT(A) in favour of the assessee. Moreover, the explanation as regards the alleged closing stock as pointed out by the Assessing Officer was also made on behalf of the assessee even during the course of assessment proceedings before the Assessing Officer and as rightly observed by the ld. CIT(A) in his impugned order, the same was summarily rejected by the Assessing Officer without assigning any reason. It is noted that the ld. CIT(A), on the other hand, had duly considered and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee was not found acceptable by the Assessing Officer and he proceeded to make a disallowance of Rs. 10,60,90,375/- u/s. 40(a)(ia) of the Act on the ground that no further details and documents were filed by the assessee to support and substantiate its explanation on this issue. 9. The disallowance made by the Assessing Officer u/s. 40(a)(ia) of the Act was challenged by the assessee before the ld. CIT(A) and the following submissions were made on behalf of the assessee before the ld. CIT(A) in support of its case on this issue:- "That AO has erroneously made addition of Rs. 10,60,90,375/- for non-deduction of TDS on payment of storage charges and freight. In course of hearing it was explained to the AO that TDS were duly deducted in all applicable cases and proper compliances were made It was informed to AO that as most of the storages were hired in year's back at remote localities of jute prone areas with very nominal rate of monthly rent they did not qualified for TDS for the year. However TDS were deducted in all eligible cases as applicable under the provision and necessary documents were shown in this regard to AO during assessment. As regard payment of frei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ference can be drawn on the submission. Bethuadahari 607731 NIL Partial details As no landlord wise details are available, no inference can be drawn on the submission ; Berhampore 1102981 NIL Partial details As no landlord wise details are available, no inference can be drawn on the submission. Malda 1801608 142161 Partial details As no landlord wise details are available, no ! inference can be drawn on the submission. Siliguri 837817 NIL Yes It appears from the details that the payment made to landlord is below the threshold ' Coochbehar 947344 22535 Yes j No TDS was made on payment of Rs. 122516 made to RMC, Tufanganj and Rs. 120750 to Prakash Ch. Patni, though these payments were liable to TDS deduction. Dhubri 529597 NIL Yes It appears from the details that the payment j made to landlord is below the threshold puwahati 965293 NIL Yes No TDS was made on payment of Rs 687135 and Rs. 72\230 made to ASWC, though these payments were liable to TDS Nagaon 2438792 &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lated rate while paying the frieght charges. Guwahati 4754987 105179 Yes It appears that the assesse had deducted TDS at stipulated rate while paying the frieght charges. Nagaon 470861 4423 Yes The assessee failed to deduct tax on payment of Rs. 93497 ma e to Pranial Kakati Purnea 3331538 52177 Yes The assessee failed to deduct tax on payment of Rs. 363952 an on Rs. 503347 made to Saraogi Goods Carrying Com. at SAharsa 2890764 60978 Partial details As no partywise-details are available, no nference can be drawn on the submission Cuttack 80188 Partial details As no party-wise details are available, no inference can be drawn on the submission Agartala 21131 1053 Yes It appears that the assesse had deducted TDS at stipulated rate while paying the freight charges Head Office 45901862.5 284730 No No details filed and hence no inference can be drawn on the submission From the above details, it is apparent that in some cases the assessee company failed to deduct TDS an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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