TaxTMI 
TaxTMI 
2025 (1) TMI 1290
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....T (A)-1. Surat was justified in deleting the addition made by the OCIT CPC to the tune of Rs. 3,05,92,653/- on account of unpaid VAT liability (as shown in Balance Sheet as on 31.03.2017 as per Tax Audit Report), as per provision of section 43B of the Income Tax Act, 1961. 2. Whether on the facts and in the circumstance of the case and in law, the decision of Ld. Addl/JCIT (A)-1, Surat was justified in deleting the addition made by the OCIT CPC to the tune of Rs. 3,05,92,653/- by holding that unpaid VAT could have been disallowed has it been passed charged to Profit and loss account in view of ITAT Varanasi decision in the case of Smt. Husna Parveen vs Commissioner of Income Tax(Appeal), National Faceless Appeal Centre (NFAC), Delhi (ITA No.3VNS/2022 dated 25.8.2022) and the Supreme Court decision in the case of Chowringhee Sales Bureau (P.) Ltd. v. CIT [1973] 87 ITR 542 (SC). 3. The brief facts of the case are that the assessee is a firm engaged in the business of Automative products, had filed its return of income for the AY 2017-18 on 05.03.2018, declaring gross total income at Rs. NIL. Subsequently, the Assessing Officer, CPC has processed the return of assessee and issued a....
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....lowed Rs. 7,42,500/-as expense on Rent on account of non-deduction of TDS thereon. The appellant has requested that disallowance may kindly be restricted to 30% of the amount. Section 40(a)(ia) reads as under:- "Section 40(a){ia} {ia) thirty per cent of any sum payable to a resident, on which tax is deductible at source under Chapter XV/1-B and such tax has not been deducted or, after deduction, has not been paid on or before the due date specified in sub-section (1) of section 139: Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted during the previous year but paid after the due date specified in sub-section (1) of section 139, thirty per cent of such sum shall be allowed as a deduction in computing the income of the previous year in which such tax has been paid: Provided further that where an assessee falls to deduct the whole or any part of the tax in accordance with the provisions of Chapter XVII-Bon any such sum but is not deemed to be an assesses in default under the first proviso to sub-section (I) of section 201, then, for the purpose of this sub-clause, it shall be deemed that the Assessee has deducted....
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....dates that a deduction otherwise allowable under the Act shall be allowed only in computing the income referred in Section 28 of that previous year in which such sum is actually paid by the assessee and since the appellant did not claim any deduction of indirect taxes in computing the income for the previous year i.e. the profit and loss account as expenditure, therefore, the CIT(A) and the ITAT, both, have concurrently erred in dismissing the appeal of the appellant assessee. He would rely upon the decision of this Cou11 in the matter of Assistant Commissioner of Income Tax-I v, M/s Ganapati Motors to buttress his submission. 7. Mr. Amit Chaudhari, learned Standing Counsel for the Income Tax Department/Revenue, would submit that the appellant did not claim the said amount of 62,32,262/- in his profit and loss account as expenditure and the case is covered by the decision rendered by this Court in M/s Ganapati Motors's case (supra). 8. We have heard learned counsel for the parties and considered their rival submissions made herein-above and also went through the record with utmost circumspection. 9. In order to consider the plea raised at the Bar, it would be appropriate ....
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....rofit and loss account as an expenditure/deduction, nor the appellant claim deduction in respect of that account under Section 43B of the IT Act. In that view of the matter, the Assessing Officer, the CIT(A) and the ITAT, all three authorities have concurrently erred in holding that the appellant has claimed deduction/expenditure under Section 43B of the IT Act adding to its taxable income. Accordingly, the impugned order passed by the HAT holding that the appellant is liable to pay tax on 62,32,262/-, is liable to be and is hereby set aside. The substantial question of law is answered in favour of the assessee and against the Revenue. 9. It is further mentioned by the Ld. AR that Ld. CIT(A) had followed the judicial pronouncement by the Hon'ble Chhattisgarh High Court in the case of ACIT vs M/s Ganapati Motors (supra), which is principally agreed to by the Hon'ble Jurisdictional High Court in the case of Assessee's sister concern i.e., M/s Grand Motors, Bilaspur (supra), therefore, the order of Ld. CIT(A) cannot be held as erroneous, thus, the same merits approval. 10. We have considered the rival submissions, perused the material available on record and case laws relied upon by....