TaxTMI 
TaxTMI 
2026 (2) TMI 1135
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.....03.2016, Ld. PCIT has made certain directions u/s 263 of the Act, with regard to receipt of certain money as sales consideration which were not examined and thereby denovo assessment was ordered. In furtherance of which certain additions were made and which have been sustained by the ld. CIT(A) leading to the present appeal by the assessee and the grounds are reproduced below: Legal validity of the impugned Orders 1. That the assessment order dated 31.12.2018 passed under Section263/143(3) of the Income Tax Act, 1961 (the Act) by the Assessing Officer ('AO) and the additions/disallowances made therein are illegal, bad in law, without jurisdiction and not in accordance with the provisions of the Act. hence, the same is liable to be quashed. 2. That the Commissioner of Income Tax (Appeals) |'CIT (Appeals)] has erred in law and on facts in confirming the additions/disallowance made by theAO in the assessment order. 3. That in view of the facts and circumstances of the case, the AO has erred in making additions to the tune of Rs. 3,93,69,350/- to the returned income of the Appellant and the same is liable to be deleted. 4. That in v....
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....Appellant. Disallowance of Interest u/s 40(a)(ia) of the Income Tax Act for non-deduction of TDS 12. That in view of the facts and circumstances of the case, the disallowance of interest to the tune of Rs. 55,08,596/- made by the AO on account of Rs. 39,73,191/- was paid as interest to banking institutions, and only the remaining amount of Rs. 15,35,405/- was paid as interest to NBFCs. 14. That in view of the facts and circumstances of the case, the AO failed to take into consideration that the payment of interest made to banking institutions is exempt from the application of tax deduction at source as per the provisions of Section 194A of the Act. 15. That in view of the facts and circumstances of the case, the AO has erred in law and on facts in charging the interest under Section 234B of the Act. 16. That in view of the facts and circumstances of the case, the AO has erred in law and on facts in initiating the penalty proceedings against the Appellant under Section 271(1)(c) of the Act. The Appellant craves leave to add to, alter, amend, and/or withdraw any ground or grounds of appeal either before or during the course of hea....
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....longwith the transfer deed. Further, it is evident from the transfer deed that the proceeds of the sale was received by N.N. Buidwell Pvt. Ltd., and its Director Narpat Singh. The sale proceeds amounting to Rs. 1,75,000/- were received vide Cheque No. 775634 dated 14.01.2008, Cheque No.775641 dated 15.02.2008, and Cheque No. 775642 dated 23.02.2008.All the aforesaid Cheques were drawn on ICICI Bank Ludhiana Branch.The transfer deed of lease hold rights dated 23.02.2008 is placed at PBPg. 116-132. 5. Ld. AR has contended that appellant is not the beneficial owner of the sale proceeds of the land pursuant to the transfer deed of lease hold rights dated 23.02.2008. It was contended that addition was made in the hands of assessee without bringing any evidence or positive material. 6. Some relevant clauses of the GPA dated. 01.06.2006 has been reproduced herein below for the sake of reference: "2. To get the plan prepared from any architect to get the same sanctioned to deposit the fees, and to receive the sanctioned plan under his/her their won signature, and for the same to give any application, file any objection, to give statement, to file affidavit, undertaking indem....
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.... 8. The case of the Appellant is squarely covered by the Order dated 29.04.2020 passed by the Hyderabad Bench of the Ld. ITAT in the case of Sama Om Reddy v. ITO, ITA No. 2225/Hyd/2018 where while dealing with an identical issue in the bench held as follows: "6. Having regard to the rival contentions and material on record, I find that by virtue of the AGPA dt.29-11-2006, the assessee has parted with his right in the property because he had received the entire sale consideration of Rs. 5,94,000/- as agreed to between both the parties and has also handed over the vacant possession of the property to the Vendee therein. It is also stated therein that the GPA is given to the Vendee for the convenience of the purchaser for doing the necessary acts and things on behalf of the Vendor and the Vendee therein. Since the Vendee has paid the entire sale consideration and has taken possession of the property, the Vendee becomes the owner of the property u/s. 53A of the TP Act and u/s. 2(47) of the IT Act, it is a transter of the property. The Vendee has executed the Sale Deed by virtue of the said AGPA, as he has sold the property to another party for Rs. 9,90,000/-. The sale of the p....
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....alf of assessee a comparative analysis of the fuel expense for the assessment year under consideration compared to previous years and subsequent years was filed and reflects that the expense on petrol/diesel/fuel incurred during AY 2008-09 is proportionate to the turnover, and indicates no significant/ abnormal increase. The said comparative for AY 2007-08, AY 2008-09, AY 2009-10, AY2010-11, is as follows; A.Y. 2007-08 2008-09 2009-10 2010-11 Revenue from transport services (in INR) 7,88,99,678/- 9,75,09,573/- 13,32,39,607/- 16,20,10,093/- Petrol/Diesel/Fuel Expenses (In INR) 2,12,50,007/- (2,11,13,626+1,45,16,786) = 3,56,30,412/- 4,03,37,334/- 5,08,80,630/- % of revenue spent on fuel expenses 26.93% 36.54% 30.27% 31.40% 11.1 We find from the above table that the petrol/diesel/fuel expenses are consistent with the appellant's business size and have not significantly increased when compared to previous or subsequent years. There is no disproportionate or abrupt jump in the expenses that would suggest they were inflated. If the fuel expense of Rs. 1,45,16,786/- incurred during 2008-09 is disregarded the % of revenue s....
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.... of disallowance of interest to the tune of Rs. 55,08,596/- u/s 40(a)(ia) of the Act for non-deduction of TDS. The assertion of ld. AR is that the appellant was not required to deduct TDS on the interest amounting to Rs. 39,73,19l/- paid to banking institutions us 194A(3)(iii) of the Act. 13.1 It comes up that the total amount of interest to the tune of Rs. 55,08,596/- paid by the Appellant during AY 2008-09, a sum of Rs. 39,73,191/- was paid as interest to banking institutions, and only the remaining amount of Rs. 15,35,405/- was paid as interest to NBFCs. Details of the interest on secured loan paid by the Appellant during AY2008-09 are as follows: Sr. No. Institution to which interest paid Amount (in INR) i. Kotak Mahindra Bank 6,23,079/- ii. ICICI Bank 26,24,544/- iii. Indusind Bank 4,83,183/- iv. HDFC Bank 43,599/- v. Centurion Bank 1,96,386/- vi. Oriental Bank of Commerce 2400/ vii. Reliance 4,22,236/- viii. Tata Motors Financed Ltd. 11,13,142/- ix. Total 55,08,596/- x. Interest paid to Banking institution (i+ii+iii+iv+v+vi) 39,73,191/- xi. Interest paid to NBFCs(vii+vi....
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.... event, 'it shall be deemed that the assessee has deducted and paid the tax on such sum on the date of furnishing of return of income by the resident payee referred to in the said proviso'. 13. Turning to the decision of the Agra Bench of ITAT in Rajiv Kumar Agarwal v. ACIT (supra), the Court finds that it has undertaken a thorough analysis of the second proviso to Section 40 (a)(ia) of the Act and also sought to explain the rationale behind its insertion. In particular, the Court would like to refer to para 9 of the said order which reads as under: "On a conceptual note, primary justification for such a disallowance is that such a denial of deduction is to compensate for the loss of revenue by corresponding income not being taken into account in computation of taxable income in the hands of the recipients of the payments. Such a policy motivated deduction restrictions should, therefore, not come into play when an assessee is able to establish that there is no actual loss of revenue. This disallowance does deincentivize not deducting tax at source, when such tax deductions are due, but, so far as the legal framework is concerned, this provision is not for ....