2026 (4) TMI 269

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.... Sr. DR ORDER PER M. BALAGANESH, A. M.: 1. The appeal in ITA No. 15/Del/2026 for AY 2018-19, arises out of the order of the ld National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as 'ld. CIT(A)', in short] dated 13.11.2025 against the order of assessment passed u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') dated 0622.04.2021 by the Assess....

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....ntract expenses of Rs 7,79,23,577 out of which Rs 5,33,37,307 was paid to individual labourers in small amounts depending on site requirements and Rs 2,58,98,470 was paid to subcontractors after deduction of tax at source which was duly deposited and accepted by the Learned AO. The Assessee explained that since construction activities were carried out at six different work sites, labour was requir....

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....d to be made in the instant case. However, we find that a disallowance on ad hoc basis at the rate of 30% is on a very high side. Hence, in our considered opinion, ad hoc disallowance of 10% of labour expenses would meet the ends of justice in the peculiar facts and circumstances of the instant case. We make it very clear that the said ad hoc disallowance shall not act as a precedent for other Ass....

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....st paid on delayed payment of tax is not an allowable deduction as interest partakes the character of the principal portion i.e. tax and that since tax is not an allowable deduction, the interest thereon would also not be allowed as deduction. Drawing the same analogy, we hold that the interest paid on delayed payment of TDS has been rightly disallowed by the lower authorities. Hence the Ground No....