TaxTMI 
TaxTMI 
2018 (5) TMI 578
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.... company filed return of income declaring loss of Rs. 14.93 crores. The main objects of the company are to carry on the business of developers, colonizer, builders, contractors, agents in real estate. During the course of assessment proceedings, the assessee filed revised computation of its income vide letter dated 23.07.2014, wherein it has disallowed an amount of Rs. 1,03,57,150/- which is payment to M/s Dhanna Nandu Sons Civil Contractors on which TDS was not deducted within the period allowed. The details of which were placed on record. The AO disallowed the amount in question u/s 40(a)(ia) of the Act. It is also noted that the assessee did not revise the return within the time allowable u/s 139(5) of the Act. Penalty proceedings were a....
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....) of the Act. The submission of the Ld. AR that provisions of section 40(a)(ia) shall not get attracted as the said expenditure is not claimed in the P & L A/c is not a valid explanation. It is evident from schedule 19 of the Balance sheet that the said expenditure is claimed by way of purchases which has gone to enhance the closing stock (WIP) disclosed at the end of the year. In effect, therefore, the expenditure is claimed, as it is debited as purchases in the current asset account. The impugned expenditure of Rs. 1,03,57,150/- is embedded in the WIP which is valued at cost at the end of the year. It is only because of the presentation of the accounts that the impugned amount is not shown as expense claimed in the P & L A/c but debited t....
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....ge Computation Method and debited the amount in question to work in progress. He has submitted that till date, the assessee did not debit the amount in question in P&L A/c. He has relied upon the order of ITAT, Hyderabad Bench in the case of Aditya Housing & Infrastructure Development Corporation P.Ltd. vs DCIT [2014] 42 CCH 0072 (Hyd. Trib.) in which it was held that disallowance can be made only out of amounts claimed in the P&L A/c. 6. On the other hand, Ld. Sr. DR relied upon the orders of the authorities below. 7. We have considered the rival submissions and perused the material on record. It is not in dispute that the assessee company was carrying on business of developers, colonizers, builders, contractors and is in real estate bus....
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....n be levied at income earned by the assessee. He has submitted that the assessee made a wrong offer for taxing the amount in question before the AO. Ld.CIT(A) considered the explanation of the assessee whether provision of section 40(a)(ia) of the Act, are attracted in this case. Ld.CIT(A) noted from Schedule 19 of the balance sheet that the said expenditure is claimed by way of purchases which has gone to enhance the closing stock (WIP) disclosed at the end of the year. It was found that, in effect, the expenditure is claimed as it is debited as purchases in the current asset account. The impugned expenditure is embedded in the work in progress which is valued at cost at the end of the year. Ld.CIT(A) in view of these facts found that it i....