TaxTMI 
TaxTMI 
2017 (11) TMI 1076
X X X X Extracts X X X X
X X X X Extracts X X X X
....has taken up the case for revision u/s 263 due to the following discrepancies noticed by him in the revision proceedings: (a) As per VAT returns, the sales were declared at Rs. 3,03,10,204/-, whereas in the income tax return, the sales were admitted at Rs. 2,97,06,705/- resulting in difference of Rs. 6,03,499/-. (b) As per P&L a/c, the VAT paid was Rs. 9,50,983/- and as per VAT returns it was observed by the CIT that the VAT paid was Rs. 1,94,624/- only and there was difference of Rs. 7,56,359/- which remained unexplained. (c) As per Trading and P&L a/c, the CIT noticed that a sum of Rs. 33,63,840/- was incurred towards binding charges, computer maintenance, printing charges and freight charges.However as per 3CD ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the issue with regard to the difference in sales amounting to Rs. 6,03,499/- was dropped. 2.2. With regard to the second issue of difference in payment of VAT amounting to Rs. 7,56,359/-, it was remitted back to the file of the AO with a direction to allow the claim after verification of the payment. 2.3. With regard to the third issue of non deduction of tax at source, the Ld.CIT remitted the matter back to the file of the AO with a direction to verify the payments liable for TDS and apply the provisions of 40(a)(ia) of the I.T.Act. 2.4 Accordingly, the Ld. CIT held that the order passed u/s 143(3) dated 13.12.2010 was erroneous and prejudicial to the interst of revenue and set aside the assessment order and directed the A.O. to redo the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....er maintenance of Rs. 3,46,734/-, printing charges of Rs. 13,12,981/- and freight charges of Rs. 5,44,020/- aggregating to Rs. 33,63,840/-. The assessing officer examined the above issues and found that there was no case for making addition u/s 40(a)(ia) in the case of printing, binding charges and computer maintenance and allowed the same. 3.2 With regard to freight charges, the assessing officer found that a sum of Rs. 2,56,961/- attracts the TDS which was not deducted by the assessee and accordingly brought to tax u/s 40(a)(ia) of I.T.Act. 3.0 The AO passed the consequential order giving effect to the order of the CIT u/s 263 by an order u/s 143(3) r.w.s. 263 on 29.01.2014. In the consequential order the AO did not find any difference....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ovisions of TDS were not applicable, hence issued the show cause notice to the assessee and the assessee filed the objections. The Pr.CIT has gone through the explanation of the assessee. Being not convinced with the explanation of the assessee, the Ld.Pr.CIT set aside the order passed u/s 143(3) r.w.s. 263 on 29.01.2014 and directed the assessing officer to redo the assessment. that the assessing officer did not follow the directions of the Ld.CIT u/s 263 dated 18.03.2013. The Ld.Pr.CIT observed that in the orders u/s 263 it was clearly mentioned that the assessee had accepted the non deduction of tax at source and assured to pay the tax with interest and accordingly directed the A.O. to make the addition. The A.O. instead of making the en....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arges u/s 40(a)(ia) to the extent of Rs. 2,56,961/-. Since the assessing officer has correctly followed the instructions of CIT and made proper examination, there is no case for making the revision u/s 263 in the second round and requested to quash the order passed u/s 263 by the Pr.CIT, Vijayawada on 12.01.2016. 6. On the other hand, Ld.DR relied on the orders of the Pr.CIT. for redoing the same. According to the Ld.AR, the Ld.CIT has stated that the liability with regard to the deduction of tax at source and binding charges, computer maintenance, freight charges required to be examined by the AO and assess the income for which the tax was not deducted in accordance with the provisions of the I.T.Act. Hence, Ld.AR argued that the AO has co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to pay the tax with interest. Therefore, the AO is directed to verify all such payments which are liable for TDS and apply the Provisions of 40(a)(ia)." 7.1. From the plain reading of order u/s 263 extracted above, it is clear that the assessee had accepted that some payments were made without making the TDS and assured to pay tax on such amount and the CIT directed to verify all such payments liable for TDS and apply the provisions of section 40(a)(ia) of I.T.Act which shows that the Ld.CIT has not directed the AO to make the addition of the entire sum of Rs. 33,63,840/- and the assessee also did not accept for such addition. In the consequential order, the assessing officer has verified the payments made for binding charges, computer c....