TaxTMI 
TaxTMI 
2019 (4) TMI 666
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....TDS are not applicable in respect of payment of Rs. 14, 59, 857/- and therefore the same should not be disallowed u/s 40(a)(ia) of the Act. 1.3 The appellant therefore submits that the disallowance of Rs. 14, 59, 857/- made u/s 40(a)(ia) of, the Act made by Assessing Officer be deleted. 2.1 That the learned CIT( Appeal) has erred in confirming addition of Rs. 1,56,498/- u/s 14A of the Act. 2.2 The appellant respectfully submits that on the fact of the case and evidence on the record, addition of Rs. 1,56,498/- u/s 14A of the Act be deleted. 3.1 That the learned CIT(Appeal) has erred in confirming disallowance of building repairing expenditure of Rs. 13,65,683/- as capital expenditure. 3.2 The appellant respectfully submits that building repairing expenditure is in the nature of current repairs only. No new assets is created and therefore the disallowance of Rs. 13,56,683/- be deleted. 4.1 That the learned CIT(Appeal) has erred in confirming addition of Rs. 18,91,764/- u/s 145A of the Act. 4.2 The appellant respectfully submits that the closing stock is valued without excise duty and VAT. Therefore every year Excise Duty....
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....apply to the assessee. 9. Being aggrieved by the order of Ld. CIT (A), the assessee is in appeal before us. 10. The Ld. AR before us submitted that the assessee had furnished the PAN of all the transport contractors during the assessment proceedings as required under section 194C(6) of the Act. 11. The Ld. AR further submitted that the disallowances cannot be made on account of non-deduction of TDS under section 194C of the Act where the payment does not exceed Rs. 75,000/- in a year. In view of the above, the Ld. AR submitted that no disallowance on account of non-deduction of TDS in the given facts and circumstances is warranted. 12. On the other hand the Ld. DR submitted that there is no evidence filed by the assessee suggesting that it has filed the PAN to the AO during the assessment proceedings. Thus the assessee has defaulted for non-deduction of TDS under section 194C of the Act. The Ld. DR vehemently supported the order of the authorities below. 13. The Ld. AR in his rejoinder submitted that the argument of the Ld. DR cannot be entertained as the Revenue is not in appeal before the ITAT on the issue of non-furnishing of PAN. 14. We have heard the rival....
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....mentioned in two provisions are different. Second proviso is to be complied with at the time of making payment to the sub-contractor, whereas compliance of third proviso can be deferred till 30th June of next financial year. In other words, the contractor can wait to comply with third proviso till 30th June of next financial year after complying with second proviso. However, the decision on deductibility of tax from the payment made to the sub-contractor cannot be deferred till 30th June of next financial year. He has to take this decision (about deductibility of tax from payments being made by it to the sub-contractors) just at the time when he is releasing the payments to the sub-contractors. It is at this point of time that second proviso would come into play and when Form No. 15-I are submitted by the sub-contractors to the contractor, then contractor was not required to deduct tax from such payments. Once deductibility of tax depends upon submission or non-submission of Form No. 15-I from the sub-contractor to the assessee, then non-compliance of third proviso becomes merely technical without affecting in substance the deductibility or non-deductibility of tax on paym....
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....eved assessee preferred an appeal to Ld. CIT (A). The assessee before the Ld. CIT (A) submitted that there could not be any disallowance on account of interest as its fund exceeds the amount of investment in the shares. 20. The assessee also submitted that the disallowance had been made under section 14A read with rule 8D without recording the satisfaction as required under the provisions of law. 21. However the Ld. CIT (A) disregarded the contention of the assessee by observing that it was the duty of the assessee to demonstrate that borrowed fund has not been invested in such shares. 22. Being aggrieved by the order of Ld. CIT (A) the assessee is in appeal before us. The Ld. AR before us reiterated the submissions as made before the Ld. CIT (A). 23. On the other hand the Ld. DR vehemently supported the order of authorities below. 24. We have heard the rival contentions and perused the materials available on record. There is no dispute about the fact that the own fund of the assessee exceeds the amount of investment. Therefore in our considered view presumption can be drawn that there was no investment in the shares out of the borrowed fund. Therefore there cannot b....
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....t it has not incurred any expense in relation to such income. Thus in the absence of any working from the side of the assessee, the AO had no alternative except to resort to the provisions of section 14A read with rule 8D of Income Tax Rules. Thus we confirm the disallowance of the administrative expenses made by the authorities below. Hence the ground of appeal of the assessee is partly allowed. 26. The next issue raised by the assessee is that Ld. CIT (A) erred in confirming the disallowance made by the AO for Rs. 14,37,772/- by treating the repairing expenses as capital in nature. 27. The assessee during the year has claimed repair expenses on the factory building amounting to Rs. 14,37,772/- only. These repairing expenses were incurred for the purchase of bricks, kapachi, steel, stone, cement, etc. 28. The AO treated the expenses above as capital in nature. Accordingly, the AO disallowed the same after allowing the depreciation on such expenses. 29. Aggrieved assessee preferred an appeal to the Ld. CIT (A). The assessee before the Ld. CIT (A) submitted that there had not come any fixed assets out of such repairing expenses. As such the factory building is quite old,....
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....e applied blindly and mechanically without regard to the particular facts and circumstances of a given case." 33.2 Regarding this we also find support and guidance from the judgment of Hon'ble Gujarat High Court in the case of CIT Vs. Bharat Suryodaya Mills Co. Ltd. reported in 202 ITR 942 wherein it was held as under: "An old wall was required to be rebuilt because of demolition. Thus, the expenditure which was incurred was more in the nature of repairs rather than creation of a new capital asset. A wall was required to be built by the assessee as a necessity for running his business. The Tribunal was, therefore, right in holding that the expenditure was allowable as revenue expenditure." In view of the above, we disagree with the finding of the learned CIT-A. Accordingly we direct the AO to delete the addition made by him by treating the repairing expenses as capital in nature. Hence the ground of appeal of the assessee is allowed. 34. The next issue raised by the assessee is that Ld. CIT (A) erred in confirming the addition of Rs. 18,91,764/- u/s 145A of the Act by increasing the closing stock and addition of CENVAT receivable. 35. The assessee is followi....
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.... 2010-11 +21,59,393/- 2009-10 +21,30,195 2008-09 -28,64,214 Accepted in scrutiny assessment u/s 143(3) of the Act. 2007-08 +25,96,019/- 40. The assessee regarding the addition of CENVAT credit of Rs. 1,81,870.00 submitted that the Revenue did not make such kind of addition in the earlier years including the year where assessment was framed under section 143(3) of the Act. 41. However the Ld. CIT (A) disregarded the contention of the assessee and confirmed the order of the AO by observing as under: 7.2 Decision: I have gone through the facts mentioned in the assessment order of the AO and the submission filed by the appellant. The appellant itself is submitting information in such a way so as to confuse the matter. On the other hand, AO 's stand is consistent and tries to bring true taxable income in the tax net. Also it is noted that the book results relevant to A.Y.2011-12 can only be considered in the present appeal. AO has rightly highlighted the postponement of liability by undervaluation of closing stock. For instance, the cenvat receivables has to be added to the closing stock as the appellant ....