TaxTMI 
TaxTMI 
2018 (3) TMI 1040
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....ision of Rs. 18,48,646/- was certainly excessive. Similarly against provision of expenses in Nova Space of Rs. 18,00,000/-, Rs. 18,48,646/- has been written back by assessee in A. Y. 2013-14. The provision of Rs. 18,00,000/- in Nova Space was not called for. (iii) Without prejudice - the CIT(A) has failed to appreciate that no TDS was deducted u/s.40(a)(ia) and the provision of expenses was therefore not allowable. (iv) On the facts and circumstances of the case, the Ld. CIT(A) failed to appreciate that in case of Universal Trading Co. and Pioneer Trading Co. the TIN No. by the Sales Tax deptt. Was cancelled in 2008 & 2009 respectively. In case of M/s. Shubh Enterprises, no payment was made during the year under consideration. At Page 14 of assessment order, the A.O. has clearly mentioned that the assessee did not furnish copies of purchase invoices and details of payments although assessee was specifically asked to furnish the same vide order sheet dt. 20/12/2012 & 08/01/2013. The appellant failed to discharge the onus to prove the genuineness of purchases when he was specifically informed that the suppliers were non-existent and suppliers were hawala operators a....
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....er for which these expenses have been provided for by the Assessee in the books of accounts on the basis of reasonable estimates. The authenticity and genuineness of estimates and supporting evidences as submitted by the AR of the Appellant have not been disputed and doubted by the Assessing officer. As per submission of the Ld. AR entire Provision for the expenses have been gradually spent in the subsequent years in the case of M/s Divya Development i.e Rs. 38,48,253/- in F.Y. 2010-11 AND Rs. Rs. 3,79,886/- in FY 2011-12 and therefore it is the case of the Assessee that merely because the Assessee has not been able to spend the entire provision in the subsequent year it can not be said that the entire provision for the expenses is contingent and un ascertain able. The Assessee further contends that since entire pending work was not completed till 31/3/2012, the balance provisions was still outstanding in the books of account as per the statement filed by the AR. However in the case of M/s Nova Space the assessee has spent Rs. 20,68,129/- in F.Y. 2010-11 against the provision of Rs. 18,00,000/- . On perusal of the Assessment order it is observed that the Assessing officer has not p....
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....quarely covered by the decision of Hon. ITAT Mumbai in the case of M/s Manish Builders Vs. ITO (2012-TIOL 159 ITAT MUM) wherein it is categorically held that in a case where the project is regarded as complete and all the receipts from the project are considered for taxation, provision for expenses which are yet to be incurred need to be allowed as a deduction while computing the profits chargeable to tax. If the same are not allowed, the assessee will not be able to claim deduction in future when the expenses are actually incurred because in the said years the assessee will not have any receipts from the project to set them off against the expenditure. In response to the enquiry calling for the information u/s 250(4) of the IT Act, the AR of the Appellant filed the complete details of the Subsequent spending of the Provisions for Expenses of Rs. 85,00,000/- in the subsequent financial years in the case of Divya Development. On perusal of the?-s Retails it is observed that the Appellant has actually spent Rs. 66,51,354/-in subsequent years(Rs. 38,48,253/- in A.Y. 11-12, Rs. 3,79,886 in A.Y. 2012-13 AND Rs. 24,23,2157- in A.Y. 2013-14) out of the total provisions of Rs. 85,....
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....rther from the paper book submitted before me I find that the Assessee had submitted the copies of Tax Invoices, bank statements highlighting the payments to suppliers by Account payee cheques and the available confirmations. The Assessing officer while disallowing the purchases has vehemently relied on the appearance of the name of the suppliers on the list of suspicious dealers on the website of the Sales Tax Department of Maharashtra. Audited books of accounts and the Books results i.e Profit and Loss Account and Balance sheet of the Assessee have been accepted by the Assessing officer without pointing out any discrepancy or deficiency in the same. Facts of the case before me are squarely covered by the decision of Hon. Bombay High Court in the case of Babulal C. Borana VS. ITO (2006 Bombay High Court) 282 ITR 251 wherein it is categorically held that If the Assessee's sales are accepted there is no reason or legal basis to deny the corresponding purchases in re absence of rejection of books of accounts and book results. Further in the case of G.G. Diamond International Vs. DCIT(2006) 104 TTJ 809 (Mumbai Tribunal) the Hon. ITAT has observed that Once the sales are accepted p....
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....o the project whose income is offered for taxation by the assessee in the respective proprietary concern. The relevant projects were Vaishnavei Project in M/s Divya Development and Divya Ambe Project in M/s Nova Space. From the record, we found that these provisions were based on various evidences and proof of actual expenditures in subsequent years were duly furnished to the Assessing officer during the course of hearing by the assessee vide his submissions dated 10/12/2012 and 20/12/2012. As against these provisions, the actual disbursement of expenses were to the tune of Rs. 38,48,253/- in F.Y. 2010-11 and Rs. 3,79,886/- in F.Y. 2011-12 in Vaishnavi Project in M/s Divya Development and Rs. 20,68,120/- in Divya Ambe Project in M/s Nova Space. In both these projects formalities for obtaining occupation certificates from the Local Authorities were pending. Complete details of these provisions for expenses viz bills, vouchers, estimates for the expenditures for various pending works for both these projects in both the concerns viz. M/s Divya Development and M/s Nova Space were submitted to the Assessing officer vide assessee's submissions dated 20/12/2012. Categorical finding ha....