TaxTMI 
TaxTMI 
2014 (2) TMI 192
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....r Assessment Year 2007-08 vide his order dated 24.11.2009. 2. This appeal of revenue is delayed by 2 days and revenue has filed condonation petition. At the time of hearing no one was present on behalf of assessee. After hearing Ld. Sr.DR, we find that there is reasonable cause for the aforesaid delay hence, we condone the delay and admit the appeal for hearing. 3. The only issue in this appeal of revenue is against the order of CIT(A) deleting the addition made by AO on account of freight recoverable at Rs.7,85,598/-, on account of repacking charges of Rs.3,21,336/-, excess freight charges at Rs.12,76,778/-, dead freight of Rs.1,80,438/- and reimbursement of salary of Rs.6,04,736/-. For this, revenue has raised following ground no.1:....
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....over-loading of railway wagons is not penal in nature as there is no infringement of statutory law. It was argued before me that the appellant was ignorant about the railway rules, and that the wagons were over-loaded with the approval of the station authority. The amount of Rs.12,76,778/- is allowable as business expenditure. The dead freight of Rs.1,80,438/-, deducted by Bokaro Steel Plant due to under-weighment of railway wagons, is not penal in nature, and, is allowable as business expenditure. The addition of Rs.3,50,290/- on account of unabsorbed penal freight paid to the Railways for over-loading is not justified. Ground no. 1, 2 and 3 are allowed." Similarly, in respect to reimbursement of salary was disallowed by AO allowed by C....
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....ed penal freight of Rs.3,50,290/- to the P&L Account. The AO was under wrong impression and hence, wrongly added income from freight recoverable account and repacking charges as not disclosed. The CIT(A) has rightly deleted the same. The penal freight charges of Rs.12,76,778/- was actually paid to the Railways for over-loading of railway wagon and it was in the nature of excess freight for compensation of over-loading. According to Railway Aurhorities, the loading of goods was made with the prior approval of the railway authorities which had not received revised circular notifying revised quantity of permissible limit for loading, but quantity was found as excessive at the designated station as per the revised circular. According to us, the....
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....dmitted by Ld. Sr. DR that the payments were paid i.e. TDS was paid by assessee but after the end of Financial Year i.e. after 31.03.2007. The same were paid in the month of May 2007. This TDS was deducted on account of freight charges credited or paid in the month of July, August, December, 2006 and February, 2007 and tax thereon was deducted. This was paid in the month of May, 2007. In view of the above facts, it is clear that this issue is squarely covered by the decision of Hon'ble jurisdictional High Court in the case of CIT Vs. Virgin Creations in ITAT No.302 of 2011, GA No. 3200/2011 dated 23.11.2011, wherein even amendment made by the Finance Act 2010 in section 40(a)(ia) of the Act is held to be retrospective. Hon'ble High Court he....