Now the issue before us arises so as to whether the labourers are the employees of assessee or they are working in contractual capacity attracting the provisions of TDS.
CIT (Appeals) was not correct in law that the assessee will be liable to deduct the TDS if the amount of a single contract exceeds Rs. 20,000/-. The contract has to be looked into party-wise not on the basis of the individual GR. In our opinion, all the payments made to a truck owner throughout the year are to be aggregated to ascertain the applicability of the TDS provision
The labour sardars are employed/deployed by the labour union to collect the money in bulk and distribute the same amongst the labourers, who are ultimate beneficiaries and not the labour sardars i.e in question. These labour sardars are remunerated by the union only for the job done. The collected money distributed amongst the labours/ labourers by the labour sardars on behalf of assessee and as such deducting of TDS from the said payment amount does not arise at all.
Section 254 does not indicate that Tribunal can recall entire order and pass a fresh decision and power to rectify a mistake under section 254(2) could not be used for recalling entire order.
The assessee has failed to bring on record any evidence to establish his claims that the deposits in the ICICI Bank, saving bank account at Khar (W), Mumbai was out of receipts connected with his business transactions
In ACIT Vs. Texool Ltd., the Mumbai ITAT allowed deduction on rent directly paid to the authority on behalf of Lessor under an Oral agreement. However, the relief was granted subject to a condition that the lessor has offered the same in his return of income.
These two appeals are by the assessees against the respective orders of the CIT(A)-6, Hyderabad dated 29.07.2016. Even though many issues are contested, mainly the issue pertain to whether the income offered by the assessee has to be assessed under capital gains or under ‘other sources.
6. The ld. CIT(A) on consideration of the assessment order, assessee’s submissions and the case laws relied upon by the assessee, has held as under: The only dispute in the instant case is whether the interest paid by the assessee to the bank on loan availed for purchase of property could be allowed as deduction in computing the capital gains income.
A discretion has been conferred on the ITO U/s 69 of the Act to treat the source of investment as income of the assessee if the explanation offered by the assessee is not found satisfactory. However, the said discretion should be exercised keeping in view the facts and circumstances of a particular case. when it is claimed that the assessee could not possibly have any source of income, the addition on his hand is not justified within the parameters of the Income Tax Act.
Circular No. 35 issued by Board clearly states the losses arising due to negligence of employees has to be allowed as expense if the loss took place in the normal course of the business and the amount involved was necessarily kept for the purpose of business. In the present case, the losses were necessarily incurred in the normal course of business of assessee and therefore, the expenditure was allowable.
