2013 (7) TMI 1057

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..... AO framed the assessment u/s. 143(3) of the I.T. Act, 1961 on 28-04-2009 at total income of Rs. 6,80,460/-. Subsequently, this assessment was reopened u/s.148 by issuing notice on 22-03-2011. Thereafter, AO framed the assessment u/s.143(3), r.w.s. 147 of the I. T. Act on 19-10-2011at total income of Rs. 2,17,24,703/- as under:-     Rs. Total income as per order u/s. 143(3) dt. 28/04/2009     6,80,460/- Less: Lump sum disallowance made out of labour expenses in the assessment order dt.28/04/09   50,279/-     6,30,460/- Add: 1)Addition u/s.40(a)(ia) of the I.T. Act as discussed in para-4 above 2,10,94,243/-   Total Assessed Income 2,17,24,703/- ....

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....(a)(ia) are not applicable if the payment of expenditure has already been made or the expenditure is not outstanding at the end of the financial year. Reliance can also be placed on the decision in the case of Merilyne Shipping & Transport v. ACIT (2012) 136 ITS 23 (Vishakhapatnam (SB) / 20 Taxman 244. Therefore, in view of the facts and circumstances of the appellant's case and the legal position in the cases of Laxmi Protein Products P. Ltd. (supra) & Merilyne Shipping & Transport (supra) the disallowance of Rs. 2,10,94,243/- is hereby directed to be deleted." Aggrieved with the order of ld. CIT (A), the Revenue is in appeal before the Tribunal on the following ground:- 1. The learned CIT (A)-I, Rajkot erred in law and on facts in d....

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....ollowed the judgment of ITAT, Ahmedabad Bench in the case of Laxmi Protein Products Pvt. Ltd. (2010) 3 ITR 768. The second reason given by ld. CIT (A) is reliance on the Special Bench of Vishakhapatnam decision in the case of Merilyne Shipping & Transport (sutra). The ld. DR fairly conceded that the view taken by Special Bench in this decision is not more good in law in view of the judgment of our Hon'ble jurisdictional High Court in the case of CIT v. Sikandarkhan N. Tunvar (supra) relied by ld. DR. Continuing his argument, he pointed out that since assessee was not obliged to deduct TDS, therefore view taken by ld. CIT (A) deleting the decision following the judge of ITAT, Ahmedabad in the case of Laxmi Protein Products Pvt. Ltd. (supra) ....