2025 (6) TMI 940

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....ear [A.Y.] 2020-21. 2. The assessee has raised the following grounds of appeal: "Ground No.1: On the facts and in the circumstances of the case and in law, the NFAC has grossly erred in upholding disallowance of expenses amounting to Rs. 86,97,237/- of business u/s 43B of the I. T. Act. The expenditure of Rs. 86,97,237/- is duly reflected in Form 3CD. Therefore, the appellant prays that the addition may kindly be deleted Ground No.2 On the facts and in the circumstances of the case and in law, the NFAC has grossly erred in upholding disallowance of interest of Rs. 3,09,701/- u/s 23 of MSMED Act. The said expenditure has already bean disallowed by appellant in the return of income under "any other disal....

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....bonus/commission of Rs. 1,78,60,148/- on 01/04/2019 which included unpaid bonus of Rs. 1,05,02,544/-. Out of this amount the assessee paid Rs. 86,97,237/- during the relevant previous year and the same was claimed as deduction u/s. 43B of the Act, the remaining balance on account of unpaid commission of Rs. 73,57,604/- was paid during the previous year before the filing of its return. However, the auditors inadvertently mentioned in Form 3 CD, bonus payment of Rs. 86,97,237/- under clause (b) of section 43B instead of clause (c). Subsequently, auditor's certificate regarding the inadvertent error was also filed before Ld. CIT(A) stating that the deduction is to be allowed on actual payment basis. Ld. CIT(A) while accepting the assessee's su....

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....ns that it is not evident that disallowance of Rs. 3,09,701/- is included in the total disallowance of Rs. 1,74,80,236/- made by the assessee u/s. 37 of the Act at the time of filing of return. In this regard, the Ld.AR has demonstrated during the course of hearing that while computing the business income, disallowance of Rs. 1,74,80,236/- was made u/s. 37 of the Act the break-up of which is as under: "Disallowances of expenditure u/s. 37 Other expenditure Disallowance Penalty or fine for violation of law Interest u/s. 201(1A)/206C(7) 48,782   interest on income tax 31,189 79,971 Capital Expenditure debited to P&L A/c. Loss on sale of fixed assets 67,728   Exchange loss related to....