Tax authority's substitution of projected figures with actuals overturned; original acquisition valuation upheld; transfer pricing issues remitted for...
Beneficial owner held liable for differential customs duty; royalties added under Rule 10(1)(c); confiscation, penalties under s.111(m), s.114A, s.112...
ITAT allowed the appeal, directing that cash payments to unnamed sub-contractors be allowed as business expenditure. The tribunal found the assessee, engaged in tentage contracts, had substantiated payments by producing PANs, ITRs of the sub-contractors, TDS deduction and certificates, and assessment records of those recipients. Given the unregulated nature of the trade, the assessee's declared gross receipts and the relatively small quantum of payments (circa 4% of gross receipts), the tribunal held the expenditures were wholly and exclusively for business and could not be denied solely for being settled in cash; any AO misgivings should have prompted further inquiry rather than blanket disallowance.
ITAT allowed the appeal, directing that cash payments to unnamed sub-contractors be allowed as business expenditure. The tribunal found the assessee, engaged in tentage contracts, had substantiated payments by producing PANs, ITRs of the sub-contractors, TDS deduction and certificates, and assessment records of those recipients. Given the unregulated nature of the trade, the assessee's declared gross receipts and the relatively small quantum of payments (circa 4% of gross receipts), the tribunal held the expenditures were wholly and exclusively for business and could not be denied solely for being settled in cash; any AO misgivings should have prompted further inquiry rather than blanket disallowance.
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
TaxTMI 
of 4821 
Join Channel 
