TMI Blog2023 (12) TMI 921X X X X Extracts X X X X X X X X Extracts X X X X ..... -09 2009-10 while upholding the action of the Assessing Officer treating the rental receipts as income from business or profession and also directed to grant deprecation on the building. Therefore we are unable to see any valid reason to interfere with the findings recorded by the ld. CIT(A) on this issue based on order of Tribunal in assessee s own appeals - Decided against assessee. Addition u/s 40(a)(ia) - cost of sales as covered by the provision of section 194C(6) 194C(7) - HELD THAT:- As we note that the Hon'ble Delhi High Court in the case of CIT Vs. Ansal Land Mark Township (1) Pvt. Ltd [ 2015 (9) TMI 79 - DELHI HIGH COURT] has taken the view that the insertion of the second proviso to Sec.40(a)(ia) of the Act is retrospective and will apply from 1.4.2005. Once it is held that the Assessee is entitled to the benefit of 2nd proviso to Sec.40(a)(ia) of the Act, the CIT(A) ought to have directed the AO to verify whether the recipients have included the receipts paid by the assessee in their respective returns of income and also paid taxes on the same. To the extent the recipients from the Assessee have so included the sum in their returns of income and fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act but they have not show cause the assessee to file relevant documentary evidence including confirmation etc. substantiating the claim of capital contribution. Therefore in our consider view the assessee should be allowed to explain his case before the Assessing Officer with the support of all relevant material, documentary evidence etc. Hence the issue of capital contribution by the partner is restored to the file of the Assessing Officer for readjudication of issue after allowing due opportunity of hearing to the assessee. - SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER AND DR. B.R.R. KUMAR, ACCOUNTANT MEMBER For the Appellant : Shri Kapil Goel, Adv. and Shri Sandeep Goel, Adv. For the Respondent : Ms. Smita Singh, Sr. DR ORDER PER CHANDRA MOHAN GARG, J.M. This appeal has been filed against the order of CIT(A)-11, New Delhi dated 13.11.2017 for A.Y. 2012-13. 2. The grounds have been raised by the assessee are as follows:- 1. That the order of the learned CIT(Appeal) is bad both in law and on facts. 2. That the order of the learned CIT(A) on the issue of holding statutory deduction claimed u/s 24(a) as income to tax as income from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther sources is perverse in as much as he has not classified the stand of granting depreciation which will only enhance the deduction in favour of the appellant. He further submitted that the learned CIT(A) has not distinguished the facts of the assessee's case as noted by the Hon'ble apex court decision relied upon by the appellant before it at the time of hearing of the appeal. He also contended that the learned CIT(A) has therefore not complied with the provision of section 251 of the Income Tax Act ,1961 and the issue be decided in favour of the appellant on the facts and circumstances in confirmily with the squarely applicable facts as rendered in the case of Raj Dadarkar Associates VS. ACIT(2017)81 taxman.com 193(SC). 5. The ld. Senior DR submitted that while dismissing the grounds of assessee the ld. CIT(A) has followed order of ITAT Delhi dated 05.05.2017 in assessee s own appeals ITA No. 5641/Del/2012 6550/Del/2013 for AY 2008-09 2009-10 respectively wherein the Tribunal held that the rental income earned by the assessee from lease of building would be taxable under the head income from business and profession and the Assessing Officer was also directed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at placing reliance on the judgment of Hon ble jurisdictional High Court of Delhi in the case of JDS Apparels reported as 370 ITR 454 (Del) presumption u/s. 40(a)(ia) of the Act is that payee when of big size paying tax on the some receipt and in such a situation the onus is on the revenue to contradict such facts. 10. Replying to the above the ld. Senior DR supporting the First Appellate Order submitted that the assessee failed to establish that the appellant has fulfilled the conditions laid down in the provision of section 194C(6) and 194C(7) of the Act therefore the Assessing Officer rightly invoked provisions of section 40(a)(ia) of the Act and hence ground of assessee may kindly be dismissed. 11. On careful consideration of submissions we are of the view that the ld. CIT(A) in para 9.2.1 has considered relevant provisions of the Act and thereafter observed the all five parties to whom the appellant has made the payment are big transporter and logistic companies which appears to be owning more than carriages and the assessee was required to fulfill the obligation as per requirement of section 194C(7) of the Act by furnishing required information before the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad for exhibiting the products exported where orders are received for conducting the business of the assessee in the impugned year. The same should have been allowed in full. He also submitted that assessee being an exporter and having handsome exports of more than Rs. 6 crore refer audited defect free final accounts addition is not justified existing business connection and business activities in foreign countries not doubted. The ld. counsel submitted that the assessee has documentary evidence such as ledger account of travel expenses, bills and vouchers of travelling expenses and exhibition outside India for business purposes. Therefore foreign travel expenses incurred for the purpose of business may kindly be allowed. 14. Replying to the above, the ld. Senior DR submitted that the assessee was to ask commercial expediency of the foreign travel as all the travellers were family members of partners but the assessee did not file any reply in this regard and thus failed to proof business expediency and therefore the ld. CIT(A) rightly confirm the disallowance by observing that by observing that the assessee has failed to establish business expediency and the trouble was availed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordingly, ground no. 6 of assessee is dismissed upholding the addition. Ground no. 7 of assessee 17. Apropos ground no. 7 the ld. counsel submitted that the Assessing Officer has made baseless addition on account of capital contribution to the assessee firm by a partner namely Shri Dinesh Kumar Gaind u/s. 68 of the Act amounting to Rs. 67,45,000/- despite the fact that the capital contribution was reflecting and tallying with the partner capital account in audited books of accounts filed with the income tax return of assessee company. Placing reliance on the judgement of Hon ble Allahabad High Court in the case of Kesharwani Sheetalya dated 24.04.2020 in ITA No. 17/2007 and order ITAT Delhi dated 15.02.2019 in the case of Alliance Engineers and Construction vs. ACIT in ITA No. 6108/Del/2015 the ld. counsel submitted that where a sum is credited to the books of partnership as capital contribution by a partner and all partners are identifiable and separately assessed to tax then in case the partner is confirming capital contribution then no addition can be made to the income of partnership firm and in the event the is not satisfied the addition could have been made in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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