TaxTMI 
TaxTMI 
2017 (9) TMI 1709
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....hout deduction and deposit of TDS within prescribed time by the assessee ? 3. Whether the Tribunal was justified in law in deleting the addition of Rs. 30,96,050/- on account of excess stock found at the time of survey proceedings, ignoring the findings of the CIT(A) upholding it as unexplained investment u/s 69 of the Act ?" 3. The facts of the case are that for the A.Y. 2003-04 the assessee declared income from his Proprietary business named M/s. The Art Palace for the first time. Prior to that, for the A.Y. 2002-03, assessee had income of Rs. 88,240/- i.e. Rs. 7,241/- as interest and Rs. 36,000/- as salary from M/s. Deepak Handicrafts and Rs. 45,100/- as income from other sources. As per the balance sheet of assessee for the A.Y. 2002-03, assessee had loan of Rs. 14,20,000/- from M/s. Indian Art Palace. M/s. Indian Art Palace is a family partnership firm having assessee's brothers, uncles and cousins as partners. M/s. Indian Art Palace was in existence since long and was in the same business as is the assessee even today. In the initial year when the assessee started his business he had no machinery of his own, no business premises of his own and no sufficient capital of his....
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....er:- "Before proceeding with the matter, whether the Tribunal was right in setting aside the order under Section 263 which has been passed by the CIT(A), that question has been considered by the Tribunal in Appeal No.243/2011 and the same was argued by Mr. Sameer Jain. The Tribunal while discussing the issue has relied upon different decisions of the High Court and after considering in detail has come to the conclusion that while invoking the provisions under Section 263 of the Act, the assessment order is prejudicial to the interest of revenue. The subsequent proceedings which took place on 24.09.2008 could not be relied upon. Taking support of Section 263 (1)(b), the concept of record is the record which was available with the A.O. at the time of assessment. If the contention which has been raised by Mr. Jain is taken into consideration, no assessee will be assessee. If the subsequent events to the assessment order is taken into consideration then the scope of Section 263 will be enlarged. In that view of the matter, we are of the opinion that the record which was available with the A.O. is required to be taken into consideration and the tribunal while considering the matter ....
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....ellant paid total of Rs. 43,21,000/- to M/s. Sachin Cargo Movers for transport without deducting tax at source Appellant explained that he only rembursed the actual expenditure increased by M/s. Sachin Cargo Movers who in turn deducted the tax while making payment to the appellant could not prove that the entire transport charges paid to M/s. Sachin Cargo Movers was paid to the transports and no margin was retained by this concern. He therefore, disallowed a sum of Rs. 43,21,000/- U/s. 40(a)(ia) of the Act. A.O. further noticed that the TDS made on some contract payments was not deposited within the due dates. He therefore, disallowed a sum of Rs. 30,92,718/- U/s. 40(a)(ia) of the Act. 5.2. Ld. AR in his written submission stated that no transport charges were paid by the appellant to M/s. Sachin Cargo Movers. He only paid C&F charges which included the reimbursement of various expenses incurred by the C & F agent including the transporting charges. Appellant has not made any direct payment of transport charges to the transporters. Hence, provision of sec. 194C are not applicable on such payment to M/s. Scchin Cargo Movers. It was alternatively claimed that no disallowance U/....
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....these payment with evidence that M/s Sachin Cargo movers having deducted and paid due TDS from transportation charges was furnished. A certificate from M/s Sachin Cargo Movers to this effect is also on record. In these facts of the case the disallowance made u/s 40a(ia) by . A.O. in the hands of assessee is unjustified and bad in law. Ld. CIT (A) upheld the action of A.O. by holding that in effect, the transport charges were paid by appellant on which TDS was required to be made. If agent paid TDS on behalf of assessee it will not exonerate assessee from liability. It ITA No. 479/JP/2013 ACIT ,Circle- Sikar vs. Shri Manoj Kumar Johari. 6 is submitted that both the authorities below did not appreciate that transportation charges were incurred by agent on behalf of assessee and relationship between assessee and agent is principal and agent and in such case assessee is not required to deduct tax at source and there can be no disallowance u/s 40 (a) (ia). The agent reimbursed only transport charges actually paid by him after deducting TDS and for his services charged assessee on which service tax was also paid. The ld. AR of the assessee relied on following decisions. (i) CIT Vs. H....
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....ur for carrying out any work) in pursuance of a contract between the contractor and a specified person shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to- (i) one per cent where the payment is being made or credit is being given to an individual or a Hindu undivided family; (ii) two per cent where the payment is being made or credit is being given to a person other than an individual or a Hindu undivided family, of such sum as income-tax on income comprised therein. (2) Where any sum referred to in sub-section (1) is credited to any account, whether called "Suspense account" or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly. (3) Where any sum is paid or credited for carrying out any work mentioned in subclause (e) of clause (iv) of the Explanation, tax shall be deducted at source- (i) on the invoice value excluding the value of mat....
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....o. Ltd., (2015) 119 DTR (BOM) 278, 8. Commissioner of Income Tax-II and Ors. Vs Delhi Transport Ltd. Manu/ DE/ 2199/2015. 5. We have heard learned counsel for the parties. 6. In view of the fact that issue is concluded by decision of Bombay High Court and Delhi High Court and SLP against the same has been dismissed. In that view of the matter the issues are required to be answered in favour of the assessee against the department." 4.8 Regarding question no.3, he relied upon the decision of Supreme Court in Commissioner of Income Tax vs. Excel Industries Ltd. (2013) 358 ITR 295 wherein Supreme court held as under:- "20. It follows from these decisions that income accrues when it becomes due but it must also be accompanied by a corresponding liability of the other party to pay the amount. Only then can it be said that for the purposes of taxability that the income is not hypothetical and it has really accrued to the Assessee. 21. In so far as the present case is concerned, even if it is assumed that the Assessee was entitled to the benefits under the advance licences as well as under the duty entitlement pass book, there was no corresponding liability on the customs authorit....