TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 36
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.... erred in deleting the addition of Rs. 4,05,31,291/- made on account of bogus expenses debited in the books of account by allowing the additional evidence in disregard to the Rule 46A of the I.T. Rule, 1962 as the case of the company is not covered under any of the circumstances as enumerated in Rule 46A of the I.T. Rules, 1962. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 6,39,401/- made on account of difference in book balance of Mr. Manoj Kumar Jha and Sh. Bam Ram Mandal by allowing the additional evidence in disregard to the Rule 46A of the I.T. Rule, 1962 as the case of the company is not covered under any of the circumstances as enumerated in Rule 46A of the I.T. Rules, 1962. 3.On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 17,74,720/- made on account of temporary site installation by allowing the additional evidence in disregard to the Rule 46A of the I.T. Rule 1962 as the case of the company is not covered under any of the circumstances as enumerated in Rule 46A of the I.T. Rules, 1962. 4. On the facts and in the circumsta....
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....Bam Mandal, Amortisation expenses, work in progress, pre-paid expenses, temporary site installation, provisional expenses and cash payment. Before the Ld. CIT(A), Ld. AR has explained that most of the details were submitted before the AO at the time of assessment. However, the paper book was forwarded to the AO vide letter dated 14.3.2019 and AO had examined the details and submitted her report thereon on 16.5.2019, which was duly considered by the Ld. CIT(A) and held that the present case is covered under Rule 46A(1) of the Rules, hence, it was rightly admitted under Rule 46A of the Rules, hence, this plea of the revenue raised in each ground is not sustainable and deserve to be rejected. We hold and direct accordingly. 6. On the first issue of bogus expenses, we have heard both the parties and perused the records. On the issue of disallowance of Rs. 4,05,31,291/- on account of bogus expenses debited in the books is concerned, we find that ld. CIT(A) noted that during the assessment proceedings, the AO has sent Notices u/s 133(6) to 45 parties, out of that only 4 parties have responded and rest of the parties either not responded or the notices have returned undelivered and the....
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....see company has produced all such details before the AO. During the remand proceedings, the AO has verified the confirmation of accounts viz-a-viz bills and ledger accounts of expenses claimed on test check basis. In this regard nothing adverse has been noticed by the AO. Considering the facts of the case, Ld. CIT(A) correctly noted that AO has erroneously made the addition of Rs. 4,05,31,291/- being 50% of total outstanding with the creditors on adhoc basis. Accordingly, the addition of Rs. 4,05,31,291/- on this account was rightly been deleted. In view of the aforesaid factual matrix, we do not find any infirmity in the finding of the ld. CIT(A) on this issue, therefore, we uphold the same and reject the issue in dispute raised by the Revenue. 7. The next issue on the issue of disallowance of Rs. 6,39,401/- on account of difference in book balance of Mr. Manoj Kumar Jha and Sh. Bam Bam Mandal is concerned, we find that Ld. CIT(A) noted that on perusal of the details (Page number: 26 and 50 & 51 of the paper book), it was found that the difference is due to TDS and retention money. In the remand report the AO has reported that on perusal of reconciliation statement furnished by....
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....f project, temporary structure is constructed for Site Labour Camp/Office, Store, Pantry etc. These expenses have been termed as "Temporary Site Installation" (TSI). During F.Y. 2013-14, the assessee company has incurred TSI expenses of Rs. 53,24,161/- and allocated it to different financial years as under: Rs 9,48,139/- in F.Y. 2013-14, Rs 17,74,720/- in F.Y. 2014-15, Rs 17,74,720/- in F.Y. 2015-16 and Rs 8,26,582/- in F.Y. 2016-17. As per the provision of the Act, purely temporary erections, such as wooden structures are eligible for depreciation @ 100% upto AY 2016-17 whereas the appellant has allocated temporary site installation expenses over a period of four years so as to arrive at the correct profit from a project in a particular year. Considering the nature of the business of the assessee company, Ld. CIT(A) agreed with the observation of the AO in the remand report that the said expenses are necessities for operation of business of the appellant company. Considering the submission of the assessee and the observation of the AO in the remand report, Ld. CIT(A) was of the view that the disallowance of Rs 17,74,720/- on account of the temporary site installation expenses cann....
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....r to arrive at the actual profit earned during F.Y. 2014-15. The assessee company has also deducted TDS from these amounts and deposited the TDS within 30.04.2015. There is no violation of section 40(a)(ia). Thus, Ld. CIT(A) has rightly directed the AO to delete the addition of Rs. 60,16,153/- under Provisional costs which had accrued up to 31.03.2015 and decided the ground in favour of the assessee. In view of the aforesaid factual matrix, we do not find any infirmity in the finding of the ld. CIT(A) on this issue, hence, we uphold the same and reject the issue in dispute raised by the Revenue. 10. The next issue on the disallowance of Rs. 13,90,109/- made u/s. 40A(3) of the Act is concerned, it is noted that in the remand report the AO has reported that in this regard the assessee company furnished the list of persons whom the assessee company made payment in cash during the year under scrutiny and also produced bills and vouchers before the CIT(A). During remand proceedings, the same was verified by the AO. The Assessing Officer has given categorical findings that cash payments exceeding to Rs. 20,000/- was not made to a single entry during the F.Y. 2014-15. Thus, Ld. CIT(A) ....
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.... and debited in the books of accounts under the head amortization of dormant and unusable assets like structures, small assets and equipments on account of closure of various project sites like Ariana project at Bombay. The assessee has given details of these unused assets claimed on account of foreclosure of various projects. The details are as under: S.No. Date Particulars Amount Remarks 1 10/10/2014 Tools & Equipments 1,615,449 Copy of ledger attached 2 10/10/2014 Air Conditioner 88,977 Copy of ledger attached 3 10/10/2014 Almirah - Steel 9,911 Copy of ledger attached 4 10/10/2014 Bar Bending Machine 207,076 Copy of ledger attached 5 10/10/2014 Camera 5,425 Copy of ledger attached 6 10/10/2014 Computer Desktop 60,150 Copy of ledger attached 7 10/10/2014 Cutting Machine 246,289 Copy of ledger attached 8 10/10/2014 Drill Machine 17,966 Copy of ledger attached 9 10/10/2014 Fan 53,440 Copy of ledger attached 10 10/10/2014 Furniture & Fixture 108,274 Copy of ledger attached 11 10/10/2014 Hammer Drill 44,025 ....
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....holly and exclusively for the purpose of business, profession or vocation. When the money is lost to the business as a result of embezzlement, there is no expenditure on the part of the employer. It is true that there is loss to the business, but that los is entirely involuntary, and although the loss may arise in the course of the business or be incidental to the business, it cannot be said that the amount represented by the loss was an amount spent wholly and exclusively for the purpose of the business, profession or vocation. Therefore we must differ from the view taken by the Tribunal that a case of embezzlement falls under section 10 (2) (xv). But does it then follow that an assessee who suffers a loss in his business due to an embezzlement by his employee can get no relief, because the various cases of deductions dealt with under section 10 do not cover such a case ? The answer is very simple. As has been often pointed out, the object of section 10 is to ascertain the true profits and gains of an assessee. The profits must be ascertained from a commercial point of view. The sub-section (2) of section 10 deals with certain specific cases of permissible deductions. But even apa....
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....ion project, at the particular date there is always some activity which is yet to be completed. Accordingly, at the end of the year work in progress is prepared for such incomplete activity and therefore, increase in net work in progress means work in progress of previous year consumed during the year and that is why it is debited from the profits and loss account in the current year. Accordingly, the assessee claimed this as Revenue expenditure. The Assessing Officer after examining reply of the assessee noted that the expenditure is payable by the assessee to subcontractor who raises a bill on the assessee after completion of activity and as admitted by assessee, since the activity itself is not complete and invoices in this regard has not been raised by the concerned vendor on the assessee, there is no question of recognizing this expenditure in this financial year. Therefore, the AO disallowed the same. 21. Aggrieved the assessee preferred appeal before the CIT(A). The CIT(A) confirmed the action of the AO by considering the observation of the AO that as per the claim of assessee that since this is a consumption and hence it is allowable as Revenue expenditure, the said expe....