TaxTMI 
TaxTMI 
2014 (7) TMI 88
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.... 3. Brief facts leading to the only addition in the case are that the assessee, engaged in the business of trading in air conditioners (ACs) and maintenance/servicing of ACs, filed its return of income admitting income of Rs. 38,64,840/-. During the course of assessment proceedings, the Assessing Officer asked for bifurcation of the receipts from trading in ACs and maintenance/ servicing of ACs. From the information so produced the Assessing Officer observing that the gross profit ratio admitted was low at 6.6%, proceeded to verify the results admitted with reference to books of accounts and expenses claimed. In the process the Assessing Officer commented as follows: "On observation of month-wise analysis also, it has b....
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....is 20% on work expenses (Rs. 1,24,01.835) and Rs. 7,33,253/- which is 2% on ancillary material purchases (Rs. 3,66,62,677) has been disallowed including considering the non TDS amount of work expenses and low profit ratio" 4. Accordingly, the Assessing Officer made an addition of Rs. 32,13,620 to the total income of the assessee. Aggrieved the assessee preferred an appeal before the CIT(A). 5. Before the CIT(A) the assessee furnished issue-wise explanations on the observations made by the Assessing Officer in the assessment which are as under: 1. Non TDS amount - TDS on work expenses was due to the amounts being below the limits of attracting TDS. During the course of assessment proceedings we have produced all the vou....
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....the assessee against the deficiencies pointed out by the Assessing Officer, held that he is in concurrence with the submissions of the assessee. The CIT(A) observed that the Assessing Officer had not brought out any specific defects with the vouchers maintained by the assessee and without even pointing out to the normal profit rate being admitted in comparable cases, disallowed certain portion of the expenses claimed. Further, the CIT(A) pointed out that when the assessee submitted that these labour payments are much below the applicable TDS limits, without contradicting such statement or without bringing any finding against such claim, the Assessing Officer shows non-deduction of TDS on some labour payments as the reason for the disallowan....