2017 (9) TMI 1741

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....eedings u/s. 143(3) r.w.s. 254 of the Income Tax Act, 1961; in short "the Act". 2. We advert to rival pleadings first. The Revenue appears to be raising three substantive grounds inter alia challenging the CIT(A)'s order deleting disallowances / additions u/s.40(a)(ia) amounting to Rs. 5,48,450/-, interest u/s. 36(1)(iii) and in treating the assessee to be an infrastructure developer than a mere works contractor on " BOT" basis qua its two projects namely Hoshangabad - Harda - Khandwa and Raisen - Rahatgarh; respectively as made in assessment order dated 26.02.2013. The assessee on the other hand pleads four substantive grounds assailing correctness of both the lower authorities' action invoking Section 40(a)(ia) disallowance of Rs. 64,02,....

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....isallowance amount of Rs. 64,02,620/- in lower appellate order leaving the Revenue as well as assessee aggrieved to the extent indicated in their respective pleadings. 5. We have heard both the parties. Relevant findings perused. We first proceed to deal with Revenue's arguments in support of its grievance that the Assessing Officer had rightly disallowed assessee's expenses to the tune of Rs. 5,48,450/- since it had deducted less than the prescribed TDS deduction in chapter XVIIB of the Act. We find that hon'ble Calcutta high court's judgment in CIT vs. S. K. Tekriwal (2014) 361 ITR 432 (Cal) holds that Section 40(a)(ia) disallowance does not apply in case of short deduction of TDS. Learned Departmental Representative thereafter seeks to ....

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....ibility in consequential proceedings as per law. The assessee succeeds in its first substantive ground for statistical purposes. 7. The Revenue's second substantive ground pleads that the CIT (A) has erred in law and on facts in deleting Section 36(1)(iii) interest disallowance of Rs. 9,89,280/- as made in the course of assessment proceedings. It emerges that he has followed this tribunal's order in ITA No. 2820/Ahd/2010 for assessment year 2009-10 decided on 25.07.2013 (pages 165 to 172 in paper book). He thereafter concludes that the assessee's advances in question of Rs. 63.08 crores are much less than its interest free funds of Rs. 29.90 crores. Relevant parties have also been found to be the same as in the said earlier assessment year....

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....Ahd/2013 therefore fails. 10. We stay back on assessee's grievance now challenging correctness of allocation of expenses resulting in the impugned disallowance of Rs. 7,45,28,297/- made by both the lower authorities. The relevant items are Director's remuneration, audit fees, consultancy charges, postage / telegram expenses, general expenses, telephone expenses, board meeting sitting fees expenses and depreciation etc. Learned counsel appearing at assessee's behest is fair enough in not pressing for the impugned challenge made to all above heads of allocation except depreciation. We therefore uphold both the lower authorities' action allocating the impugned expenses other than depreciation pertaining to building, air conditioner, computers....