Case Law Details
DCIT Vs Om Shakthy Agencies (Madras) Pvt. Ltd. (ITAT Chennai)
ITAT Chennai held that addition based merely on presumptions and assumptions and without allowing cross-examination is unsustainable in law and liable to be set aside.
Facts- The assessee is dealing in real estate and income arising therefrom constitutes business income for the assessee. The assessee admitted income of Rs.426.72 Lacs on turnover of Rs.2848.30 Lacs.
The disallowance u/s 40A(3) stem from the fact that the assessee purchased lands in cash aggregating to Rs.263.56 Lacs from various persons. In the absence of any plausible explanation forthcoming from the assessee, in this regard, the said amount was added back u/s.40A(3) of the Act. Further, AO made disallowance u/s.40(a)(ia) aggregating to Rs.54.91 Lacs for want of Tax Deduction at Source (TDS) on certain payments.
Conclusion- With respect to disallowance u/s 40(a)(ia), the assessee established that TDS was duly deducted on payment made to one M/s Jaghuste & Co. for Rs.32.25 Lacs. The same was evidenced by Form No.16A and copy of ledger account. Accordingly, the disallowance to that extent was deleted and the remaining disallowance was confirmed.
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