TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 64
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....the addition made by the AO for Rs. 1,44,21,556/- under the provision of section 40(a)(ia) of the Act. 4. The facts in brief are that the assessee in the present case is a private limited company and engaged in the business of Manufacturing Rolled, figured and Wired Glass. The assessee in the year under consideration has claimed the deduction of certain expenses which were disallowed in earlier years in the computation of income. The details of the same stands as under: 1. Expenses on payment u/s 40(a)(ia) in the AY 2010-11 Rs. 1,15,54,910/- 2. Expenses on payment u/s 40(a)(ia) AY 2011-12 Rs. 1,26,67,773/- 4.1 As per the assessee, certain expenses pertaining to different Assessment Years were disallowed in the respective AYs under the provisions of section 40(a)(ia) of the Act on account of non-deduction and non-deposit of TDS. However, the TDS was deducted and deposited in the Government Treasury in the year under consideration, therefore, the same should be allowed under section 40(a)(ia) of the Act, on actual payment basis. However, the AO during the assessment proceedings sought certain details to justify the deduction claim by the assessee but the necessary details were ....
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....us, it was not clear that the amount of TDS paid pertains to the earlier AYs. The Ld. CIT(A) also noted that the assessee failed to justify the genuineness of the expenses claim in the computation of income. In view of the above, the Ld. CIT(A) confirmed the order of the AO by observing as under: 4.5. In the absence of these details, no relief as sought for by the assessee can be granted to it. It was for the assessee to satisfy the Assessing Officer with regard to payment of TDS in respect of expenses which were earlier added due to a non-deduction of TDS. The challans which are filed by the appellant does not show that it is the same payment which was required to be made in earlier years in respect of the amounts which was added by the assessee in those years. The assessee has also failed to satisfy with regard to addition made in the earlier years for the same amount. Without party wise details, return of TDS, and TDS certificate or Form 26AS of 3 parties this verification pertaining to an earlier years can never be completed, During the appellate proceedings also the appellant has been allowed opportunities of hearing on 05.07.2016, 07.07.2016, 21.12.2016, 03.01.2017, 13.01.2....
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....ed on account of non-deduction of TDS should be allowed on an actual payment basis in pursuance to the provision of section 40(a)(ia) of the Act. It is also important to note that if the assessee makes the payment of TDS of the lesser amount, than the amount which he was supposed to deposit with Government treasury, then the corresponding expenses should only be allowed as deduction. There is no confusion with finding of the Ld. CIT(A), as observed that the assessee has made the payment of Rs. 3,51,625/- dated 31/03/2012 but there was no break-up of such amount indicating the amount of TDS and the interest thereon. Admittedly, the assessee has made deposits of TDS belatedly and therefore it is onus upon the assessee to furnish the break-up of the TDS deposited by him. 10.2 Nevertheless, the revenue in the absence of necessary details from the side of the assessee about the interest and the amount of TDS, was very much empowered to re-workout interest embedded in such amount of TDS by doing reverse working. However, we find that the revenue authority has not carried out such an exercise. Therefore, in the interest of justice and fair play, we are of the view that the assessee shoul....
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....fore, respectfully following the order of the Hon'ble Jurisdictional High Court the ground of appeal raised by the assessee is hereby dismissed. 17. The next issue raised by the assessee is that the Ld. CIT(A) erred in confirming the addition of Rs. 2,58,30,000/- representing the unsecured loan written back which is not chargeable to tax. 18. The assessee in the year under consideration has shown income in its profit and loss account of Rs. 3,10,33,778/- which was inclusive of the unsecured loan written back from M/s Haryana Sheet Glass Limited amounting to Rs. 2,58,30,000/- only. However, the assessee in the computation of income has reduced the same on the reasoning that such waiver of loan is not taxable under the provision of the Act. The assessee in support of such waiver of loan has also filed the confirmation from the party namely M/s Haryana Sheet Glass Limited. However, the AO disagreed with the contention of the assessee on the reasoning that the necessary details such as income tax detail, credit worthiness of the party namely Haryana Sheet Glass Limited was not furnished. Furthermore, there was no justification filed by the assessee from the party which waived off suc....
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....r trading activity of the assessee. As such, in the absence of such details the issue cannot be decided in the right prospective. The Ld. DR vehemently supported the order of the authorities below. 24. In the rejoinder the Ld. AR contended that none of the authority below has investigated about the utilization of loan whether it was for capital asset or for running of the business. Therefore, the issue in dispute cannot be further improved to find out whether the amount of loan was towards the trading activity of the assessee. 25. We have heard the rival contentions of both the parties and perused the materials available on record. The controversy in the case on hand relates whether the waiver of loan amounting to Rs. 2,58,30,250/- is chargeable to tax in the hands of the assessee either under the provisions of section 28(iv) of the Act or section 41(1) of the Act. To attract the provisions of section 28(iv) of the Act there must be some benefit to the assessee in any form other than the cash arising from business or the exercise of profession. In the present case, the benefit arising to the assessee is in the form of cash, i.e., waiver of loan represents the benefit in the form ....
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....previous year, if the creditor remits or waives any such liability, then the assessee is liable to pay tax under Section 41 of the IT Act. The objective behind this Section is simple. It is made to ensure that the assessee does not get away with a double benefit once by way of deduction and another by not being taxed on the benefit received by him in the later year with reference to deduction allowed earlier in case of remission of such liability. It is undisputed fact that the Respondent had been paying interest at 6 % per annum to the KJC as per the contract but the assessee never claimed deduction for payment of interest under Section 36(1)(iii) of the IT Act. In the case at hand, learned CIT (A) relied upon Section 41(1) of the IT Act and held that the Respondent had received amortization benefit. Amortization is an accounting term that refers to the process of allocating the cost of an asset over a period of time, hence, it is nothing else than depreciation. Depreciation is a reduction in the value of an asset over time, in particular, to wear and tear. Therefore, the deduction claimed by the Respondent in previous assessment years was due to the deprecation of the machine and....