TaxTMI 
TaxTMI 
2017 (3) TMI 670
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..../- and disallowance of other charges Rs. 40,060/-. 3. Aggrieved from the order of Assessing Officer, the assessee filed an appeal before the ld. CIT(A), who has confirmed the order passed by the AO observing the followings :- "Decision: The appellant's has claimed that provisions under section 194C were not applicable in the assessee's case. It was stated firstly that the impugned payments to parties were including supply of material and therefore such payments could not be reflected to deduction u/s. 194C of the I.T. Act. However, the assessee's assertion in this regard is not found to be tenable as no supporting evidences or copies of bills were produced to indicate that the payments made included supply of material nor was such a plea raised before the A.O. Moreover, the assessee was also unable to substantiate the alternate plea that single or aggregate payments made to parties enumerated above were below the prescribed Unlit as no substantive evidence was produced to substantiate this claim with documentary evidence before the AO or during appellate proceedings. Hence, the contentions made by the appellant's A.R. in this regard are found to be devoid of sub....
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....licable to the appellant as facts and circumstances of its case are found to be distinguishable. Therefore, the disallowance made by the A.O.u/s 40(a)(ia) of the Act is confirmed. This ground of appeal is dismissed. 5.3. Ground Nos. 3:. For the in the facts and circumstances of the case the assessing officer erred in making addition of Rs. 40,060/- being 5% of delivery charged expenses. The addition made is uncalled for, unjustified and unwarranted and hence the same be deleted. Decision: The A.O is found to have made the disallowance of an estimated 5% of the expenditure debited as delivery expenses to the P&L a/c holding that the supporting vouchers were not properly vouched. It is well settled that the onus lies upon the assessee to substantiate the claim for deduction of expenditure with proper documentary evidence, considering the totality of facts of the case the disallowance made by the A.O appears to be reasonable. The appellant has not pressed this ground and no written submission was filed in support of this ground of appeal. The addition of Rs. 40,060/- made by the A.O. is confirmed. This ground is dismissed." 5. Not being satisfied with the order of ld. CIT(A), th....
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.... payment exceeds the TDS limit then the provisions of Section 194C of the Act would apply. Thus the AO be directed to examine the bills and then adjudicate the matter in lines of the above submissions. The ld AR for the assessee has pointed out that in the case under consideration the Recipient of the income has paid the taxes on behalf of the assesse therefore it would be sufficient compliance. For that, the ld AR for the assesse has relied on the following judgments: The Hon`ble ITAT Kolkata Bench in the case of M/s Vas Electronics Vs. ACIT, ITA No.662/Kol/2013, dated 24.11.2015, wherein it has been held as under :- 4. At the outset, Ld. Counsel for the assessee fairly conceded the grounds but requested only on the issue of applicability of second proviso to section 40(a)(ia) of the Act, which is held to be retrospective by Hon'ble Delhi High Court in the case of CIT Vs. Ansal Land Mark Township P. Ltd. (2015) 377 ITR 635 (Del), wherein the AO is directed to verify whether the recipients have included the receipts paid by the assessee in their respective returns of income and also paid taxes on the same. When this plea of the Ld. Counsel for the assessee was confronted to L....
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....nd also paid taxes on the same. The assessee will provide the details of recipients i.e. their assessment particulars etc. to the AO so that the AO can verify. In case the recipient parties are not cooperating in providing details, the AO can call for the information u/s. 133(6) of the Act for verification of the same. Accordingly, this issue is remitted back to the file of AO to decide in terms of the above directions. This issue of assessee's appeal is allowed for statistical purposes. 5.6 In the result, the appeal filed by the assesse on ground No.3 is allowed for statistical purposes. 6. Ground No.4 relates to adhoc addition of Rs. 40,060/- being 5% of delivery charges made by the AO. 6.1 Ld. AR for the assessee has submitted that AO was wrong in making the addition on adhoc basis @5% of delivery charges. The assessee has submitted the vouchers and evidence to the AO and without brining any specific defects in the vouchers and submissions, the adhoc disallowance @5% is not permitted. The AO without rejecting the books of accounts made the adhoc addition, which is not permissible under the Act. In addition to this, ld. AR for the assessee has relied on the judgment of Ho....