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Income Tax Appellate Tribunal, HYDERABAD BENCHES “A” (SMC
Before: SHRI B. RAMAKOTAIAH
This is an appeal by assessee against the order of the Commissioner of Income Tax (Appeals)-10, Hyderabad, dated 04-04-2016.
Assessee has raised the following grounds:
“1. On the facts and in the circumstances of the case, the order of the ld. Commissioner of Income Tax (Appeals)-10, Hyderabad, allowing the appeal only in part is perverse, illegal and unsustainable on facts and in law. The Commissioner (Appeals) ought to have allowed the appeal in entirety. 2. The Commissioner (Appeals) erred in not granting relief in respect of the of expenditure of Rs. 4,59,738 which was claimed on payment basis in the asst. year under consideration in respect of contract.
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The Commissioner (Appeals) erred in not granting relief in respect of commission expenditure of Rs.5,367 which was claimed on payment basis in the asst. year under consideration.
The Commissioner (Appeals) erred in sustaining the addition made by the Assessing Officer as alleged unexplained income from job work charges amounting to Rs.23,75,863.
The findings of the Commissioner (Appeals) with respect to alleged noncompliance to the notices issued, and with respect to the correspondences submitted by the Appellant are incorrect and at any rate does not have any bearing on the appellate proceedings especially when all the information is filed on record by the Appellant. The Commissioner (Appeals) failed to appreciate the information filed on record by the Appellant in the form of books of account and other record.
For these and other grounds that may be urged at the time of hearing, it is prayed that the Hon'ble Tribunal may be pleased to allow the appeal”.
Assessing Officer (AO) has passed an assessment order u/s. 143(3) of the Income Tax Act [Act], in which the income from business was calculated as per P&L A/c whereas assessee made adjustments to the above amount wherein house property income credited to the P&L A/c was deducted as the same was separately assessed. Further, assessee claimed amounts of expenditure disallowed u/s. 40(a)(ia) of the Act in AY. 2006-07 on payment basis during the year. It also disallowed the amount on which TDS was not paid during the year. Ignoring the computation made to the profit in P&L account and without any discussion, AO brought the amount of Rs. 1,09,274/- i.e., profit in P&L A/c to tax. It was reconciled before the Ld.CIT(A) which was extracted in para 7.1 of the order. Ld.CIT(A) in his wisdom directed the AO to allow only the house property income, but there is no
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discussion on the other amounts. He rejected them stating that the evidence has not been filed.
3.1. The other issue is about the receipts from one M/s. AGI Glasspack. On the reason that there is difference in the turnover reported by the said concern and assessee, AO made an addition of Rs. 23,75,863/- to the income and brought the same to tax. Assessee made the reconciliation as extracted in para 8.2 of the order of CIT(A) and filed necessary evidences in the form of Paper Book before the Ld.CIT(A). However, Ld.CIT(A) rejected them stating that no corroborative evidence has been filed (para 8.6).
It was the submission of the Ld. Counsel that the relevant evidence has been filed and referred to the Paper Book containing 476 pages in which there is no additional evidence.
Ld.DR, however, requested for referring the matter to AO for verification.
I have examined the order of the AO and CIT(A) and the written submissions made by assessee before the authorities with enclosures (which are also placed in Paper Book). Since AO and Ld.CIT(A) failed to consider them and rejected the claims stating that no corroborative evidence is filed, I am of the opinion that no useful purpose would be served, if the matter is set aside again. The claims made by assessee are genuine and are supported by the documents placed on
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record. The issue in Ground Nos. 2 and 3 are amount of claim disallowed in AY. 2006-07 in the computation and claimed in this year on payment basis u/s. 40(a)(ia). Similarly in this year, assessee disallowed an amount of Rs. 1,65,648/- u/s. 40(a)(ia) of the Act. Even these amounts are not considered by the authorities. The other amount is reconciliation of turnover from M/S AGI Glasspack. Since I am satisfied with the claims and reconciliation filed by assessee with necessary evidence, I direct the AO to delete the additions made. The computation filed in the return of income has to be accepted and AO is directed to pass the order accordingly. All the grounds are allowed.
In the result, the appeal of assessee is allowed.
Order pronounced in the open court on 11th July, 2018
Sd/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER
Hyderabad, Dated 11th July, 2018 TNMM
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Copy to : 1. M/s. Kaluram Babulal, C/o. A.V. Raghu Ram & P. Vinod, Advocates, 610, Babukhan Estate, Basheerbagh, Hyderabad. 2. The Income Tax Officer, Ward-7(4), Hyderabad.
CIT (Appeals)-10, Hyderabad. 4. Pr.CIT-3, Hyderabad.
D.R. ITAT, Hyderabad.
Guard File.