TaxTMI 
TaxTMI 
2014 (1) TMI 247
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....fficer for the assessment year 2005-06, following grievances are raised: On the facts and in the circumstances of the case, the learned CIT(A) erred in deleting the disallowance of Rs 15,49,163 under section 40(A)(2) of the Act, out of the payment of the bus rent. The learned CIT(A) erred in not appreciating that the assessee has failed to reconcile the difference in payments as per tax audit report and as submitted during the assessment proceedings and had also not produced any comparative prices to justify payments made to the related concerns. 4. Briefly stated, the relevant facts are like this. The assessee is engaged in the business of bus hire. During the course of the scrutiny asse....
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....ngs, that alone cannot be the basis for disallowance. The AO has not made out any case for excessive or unreasonable payments to the related parties. No comparative case for payment for similar transport services was cited by the AO. It is also seen that in the past also, such dire charges had ranged from 46-57% of the total expenses which compare favourably with 48.66% charges paid this year. The addition of Rs 15,49,163 is, accordingly, directed to be deleted. 5. The Assessing Officer is aggrieved of the relief so granted by the CIT(A) and is in appeal before us. 6. We have heard the rival contentions, perused the material on record and duly considered facts of the case in the light of the applicable legal position. 7. It is plain on p....
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....at the payment made by the assessee to the specified persons is not unreasonable or excessive, and it is thus failure of the assessee which has resulted in disallowance under section 40A(2). However, proving a negative, as the assessee has been called upon to do in this case, is an impossible onus to perform. In any event, this onus is on the Assessing Officer and the AO has failed to discharge the said onus. For this reason also, the disallowance is unsustainable in law. As regards the discrepancy in the figures of the tax audit report and the assessee, neither such a situation can be a reason enough to make a disallowance under section 40A(2) nor the onus of explaining such a variation is on the assessee. A tax auditor is an independent p....
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.... up the cross objections filed by the assessee for the assessment years 2005-06 and 2006-07. 13. As for the cross objection for the assessment year 2005-06, learned counsel for the assessee did not press the same. This CO is, accordingly, dismissed as not pressed. 14. As for the cross objection for the assessment year 2006-07, learned counsel only pressed the following ground of appeal: The learned CIT(A) has erred in holding that provisions of Section 40(a)(ia) apply to the facts of this case and that the AO has rightly disallowed Rs 93,25,426 holding that IDS was not deducted before the due date. It is submitted that Section 40(a)(ia) does not apply and the disallowance of Rs 93,25,426 is deleted. 15. The shor....