TaxTMI 
TaxTMI 
2015 (6) TMI 665
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....e Assessing officer on account of treating the amount as capital expenditure debited in Profit & Loss A/c. (4) That the ld. CIT(A), Asansol has erred in law and on facts by allowing the relief of Rs. 75,00,000/- disallowed by the Assessing Officer on account of difference in closing stock between audited balance sheet and stock shown in insurance policy certified by Bank. 2. Ground No. 1 in this appeal relates to the deletion of addition of Rs. 90,000/-. Brief facts relating to this ground are that the Assessing officer noted that the assessee has not deducted any tax in respect of payment of Rs. 90,000/- on which TDS was deductible. He, therefore, disallowed the said sum under section 40(a)(ia) of the Act. When the matter went in appeal before the CIT(Appeals), CIT(Appeals) deleted the disallowance following the decision dated 29.03.2012 of ITAT, Special Bench, Vishakhapatnam in the case of Merilyn Shipping & Transport Limited in ITA No. 477/Vizag./2008, wherein it was held that the disallowance under section 40(a)(ia) can be made only in respect to the expenditure which is payable as on 31s t March of the year. 3. After hearing the rival submissions and carefully considering....
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....sallow the genuine and reasonable expenditure on the amounts of expenditure already paid"? Does this not amount to deliberately reading something in the law which is not there? We, as such, have no doubt in our mind that the Learned Tribunal realized the meaning and purport of Section 40(a)(ia) correctly when it held that in case of omission to deduct tax even the genuine and admissible expenses are to be disallowed. But they sought to remove the rigour of the law by holding that the disallowance shall be restricted to the money which is yet to be paid. What the Tribunal by majority did was to supply the casus omissus which was not permissible and could only have been done by the Supreme Court in an appropriate case. Reference in this regard may be made to the judgment in the case of Bhuwalka Steel Industries vs. Bombay Iron & Steel Labour Board reported in 2010(2) SCC 273. 'Unprotected worker' was finally defined in Section 2(11) of the Mathadi Act as follows:- ''unprotected worker' means a manual worker who is engaged or to be engaged in any scheduled employment." The contention raised with reference to what was there in the bill was rejected by the Supreme Court by ....
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.... or sub-contractor differently than the payments on account of interest, commission or brokerage, fees for professional services or fees for technical services because the words "amounts credited or paid" were used only in relation to a contractor or sub-contractor. This differential treatment was not intended. Therefore, the legislature provided that the amounts, on which tax is deductible at source under XVII-B payable on account of interest, commission or brokerage, rent, royalty, fees for professional services or fees for technical services or to a contractor or sub-contractor shall not be deducted in computing the income of an assessee in case he has not deducted, or after deduction has not paid within the specified time. The language used by the legislature in the finally enacted law is clear and unambiguous whereas the language used in the bill was ambiguous. A few words are now necessary to deal with the submission of Mr. Bagchi and Ms. Roychowdhuri. There can be no denial that the provision in question is harsh. But that is no ground to read the same in a manner which was not intended by the legislature. This is our answer to the submission of Mr. Bagchi. The submission ....
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....ring the course of business. These expenses by no stretch of imagination can be regarded to the capital expenditure. The expenses relate to obtaining cash credit facilities and are of recurring nature. We, therefore, do not find any infirmity or illegality in the order of CIT(Appeal s) treating this expenditure to be the revenue expenditure and allowing the relief to the assessee. We accordingly confirm the order of CIT(Appeals) on this ground. Thus this ground stands dismissed. 8. Ground No. 4 relates to the allowing relief to the assessee of a sum of Rs. 75,00,000/- disallowed by the Assessing Officer. 9. After hearing the rival submissions and carefully considering the same, we noted that the Assessing Officer noted that the assessee has debited a sum of Rs. 1,05,729/- under the head "insurance". On examination of the insurance proposal it was noticed by the Assessing Officer that there is material in godown for Rs. 1,25,00,000/-. There was another policy for building of Rs. 15,00,000/-, and stock/contents of Rs. 40,00,000/-, plant and machinery for Rs. 32,00,000/-, Spare for machinery and spare electric motor for Rs. 3,00,000/- and electrical installation/electrical equipment....