The Asstt. Commissioner of Income-tax, Srinagar V. J & K Projects Constructions, Srinagar

ITA 214/ASR/2011

• Counselvise Citation: 21420914 RSA 2011
• Duration Of Justice: 2 year(s) 9 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 29-01-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 04-05-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: M A MIR COST ACCOUNTNT
• Keywords: Depreciation; Opportunity of being heard; Additional evidence; Bad and doubtful debts
• Section: 43B; 142(1); 194C

Judgement Text

ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 1 IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.184(ASR)/2011 ASSESSMENT YEAR:2006-07 PAN :AABCJ2455N M/S. J & K PROJECTS CONSTRUCTION CORPN. VS. ASSTT. COMMR. OF INCOME TAX, HAFT CHINAR, SRINAGAR. CIRCLE-3, SRINAGAR. (APPELLANT) (RESPONDENT) I.T.A. NO.214(ASR)/2011 ASSESSMENT YEAR:2006-07 PAN :AABCJ2455N ASSTT. COMMR. OF INCOME TAX, VS. M/S. J & K PROJECT S CONSTRUCTION CORPN. CIRCLE-3, SRINAGAR. HAFT CHINAR, SRINAGAR. (APPELLANT) (RESPONDENT) ASSESSEE BY:SH. M.A. MIR, COST ACCOUNTNT DEPARTMENT BY:SH. MAHAVIR SINGH, DR DATE OF HEARING: 29/01/2014 DATE OF PRONOUNCEMENT:28/02/2014 ORDER PER BENCH ; THESE CROSS APPEALS OF THE ASSESSEE AND THE REVENU E ARISE FROM THE ORDERS OF THE CIT(A), JAMMU DATED 28.02.2011 FOR TH E ASSESSMENT YEAR 2006-07. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 2 1. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS BY NO T QUASHING THE ORDER ON THE GROUND THAT TOTAL INCOME AND TAX THERE ON HAS NOT BEEN COMPUTED ON THE INCOME DETERMINED BY THE A.O. 2. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CON FIRMING THE ADDITION OF RS. 6,31,47,728/- ON ACCOUNT OF TDS DEF AULT WHICH IS BAD IN LAW AND NEEDS TO BE DELETED. 3. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CON FIRMING ADDITION OF RS.74003/- ON ACCOUNT OF DEPRECIATION O N ASSETS WHICH IS BAD IN LAW AND NEEDS TO BE DELETED. 4. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CON FIRMING THE ADDITION OF RS.35,18,325/- ON ACCOUNT OF INTEREST O N FDRS WHICH IS BAD IN LAW AND NEEDS TO BE DELETED. 5. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN NOT TAKING COGNIZANCE OF ADDITIONAL GROUNDS OF APPEAL RAISED A ND DISCUSSED DURING THE APPELLATE PROCEEDINGS. THESE ADDITIONAL GROUNDS ARE ENUMERATED AS UNDER: I) THE LD. AO HAS ERRED IN LAW & FACTS IN DISALLOWING RS.5,00,000/- ON ACCOUNT OF BAD DEBTS. II) THE LD. AO HAS ERRED IN LAW & FACTS IN DISALLOWING AN AMOUNT OF RS.38,46,050/- ON ACCOUNT OF PAYMENT OF EXPENSES IN CASH. THE ADDITION IS BAD IN LAW LIABLE TO BE DELETED. III) THE LD. AO HAS ERRED IN LAW & FACTS IN DISALLOWING RS.56,820/- UNDER SECTION 40A(7). THE ADDITION IS B AD IN LAW LIABLE TO BE DELETED. IV) THE LD. AO HAS ERRED IN LAW & FACTS IN DISALLOWING INTEREST ON LOANS PAYABLE TO PROJECT AUTHORITIES TO THE TUNE OF RS.4,85,056/-. THE ADDITION IS BAD IN LAW LIABLE TO BE DELETED. V) THE LD. AO HAS ERRED IN LAW & FACTS IN MAKING DISALLOWANCE OF RS.4,37,000/- ON ACCOUNT OF SUPPRE SSION OF MATERIAL.THE ADDITION IS BAD IN LAW LIABLE TO BE DELETED. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 3 VI) THE LD. AO HAS ERRED IN LAW & FACTS IN MAKING ADDIT ION OF RS.5,00,000/- ON ACCOUNT OF UNVERIFIABLE EXPENS ES. THE ADDITION IS BAD IN LAW LIABLE TO BE DELETED. VII) THE LD. AO HAS ERRED IN LAW & FACTS IN MAKING ADDIT ION OF RS.2,00,864/- ON ACCOUNT OF PAYMENT OF BONUS. T HE ADDITION IS BAD IN LAW LIABLE TO BE DELETED. VIII) THE LD. AO HAS ERRED IN LAW & FACTS IN MAKING ADDIT ION OF RS.9,15,897/- U/S 43B OF THE INCOME TAX OF THE A CT. THE ADDITION IS UNJUSTIFIED LIABLE TO BE DELETED. 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPE AL: 1. ON THE FACTS AND CIRCUMSTANCES THE LD. CIT(A) H AS ERRED IN ALLOWING RELIEF OF RS.7,76,08,629/- ON ACCOUNT OF A DDITIONS MADE U/S 43B ON THE GROUNDS THAT THE AO HAS MADE TH E ADDITION ON THE PRETEXT THAT THE ASSESSEE WAS NOT FORTHCOMIN G WITH THE DETAILS AS TO WHICH YEAR THE PAYMENT OF TAXES PERTA INED AND NOT APPRECIATED THE FACT THAT THE ASSESSEE COULD PRODUC E THE CHALLANS ONLY FOR RS.5,53,45,469/- AND THUS PROVIDED AN EXCE SS RELIEF OF RS.2,22,63,160/-. 2. ON THE FACTS AND CIRCUMSTANCES THE LD. CIT(A) HA S ERRED IN ALLOWING RELIEF OF RS.6,79,732/-/- ON ACCOUNT OF C. P. FUND PAYMENTS AND NOT APPRECIATED THAT THE ASSESSEE HAS FAILED TO FURNISH THE EVIDENCE OF THE DEPOSIT OF THE AMOUNT W ELL IN TIME. 3. THAT THE APPELLANT CRAVES TO AMEND OR ADD ANY ON E OR MORE GROUNDS OF APPEAL 3. FIRST OF ALL, WE TAKE UP APPEAL OF THE REVENUE IN I TA NO. 214(ASR)/2011 FOR THE ASSESSMENT YEAR 2006-07. IN G ROUND NO.1 OF THE REVENUE THE BRIEF FACTS AS EMANATES FROM THE ORDER OF THE AO AT PAGE 8 & 9 ARE REPRODUCED FOR THE SAKE OF CONVENIENCE AS UND ER: ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 4 DURING THE PREVIOUS YEAR RELEVANT TO AY 2006-07, TH E ASSESSEE HAD DECLARED PAYMENT OF SERVICE TAX AT RS. 77608629/- AND DEBITED THE SAME IN ITS P&L ACCOUNT. DURING THE COURSE OF AUDIT U/S 142(2A0, IT WAS POINTED OUT BY THE AUDITO RS THAT THE DETAILS AS TO WHETHER SUCH TAXES PERTAIN TO THE YEA R UNDER CONSIDERATION OR EARLIER YEARS WAS NOT PROVIDED. VI DE THIS OFFICE NOTICE U/S 142(10 OF THE ACT DATED 08.05.2009 THE A SSESSEE WAS REQUIRED TO SUBMIT: THE DETAILS ARE ENCLOSED AS ANNEXURE-3 . IN THIS R EGARD YOU ARE REQUIRED TO FURNISH DOCUMENTARY EVIDENCE OF TAX ES PAID, DUTIES PAID ETC. ALONGWITH THE EYAR TO WHICH SUCH P AYMENTS RELATE TO. FURTHER, YOU HAVE SHOWN SALES TAX AMOUN TING TO RS.1,14,122/- IN SCHEDULE A-II OF YOUR BALANCE SHE ET, WHICH APPEARS TO HAVE NOT BEEN DEPOSITED IN TIME. PLEASE FURNISH COMPLETE ACCOUNT ALONGWITH DOCUMENTARY EVIDENCE OF PAYMENT OF THE AMOUNT AND THE YEAR IN WHICH THIS AMOUNT PER TAINS TO. THE ASSESSEE HAD VIDE ITS REPLY DATED 20.05.2009 SU BMITTED AS UNDER: IN RESPECT OF THE PAYMENTS WHICH HAVE BEEN MADE AT THE HEAD OFFICE, WE ENCLOSE RELEVANT CHALLANS TO SUBSTANTIAT E THE PAYMENT OF TAXES AND DUTIES. HOWEVER, IN RESPECT OF AMOUNT PURPORTED TO HAVE BEEN INCURRED BY UNITS, THE DETAILS ARE BEING SOUGHT FROM THE CONCERNED UNIT CHIEFS AND WILL BE PROVIDED IMME DIATELY AFTER BEING RECEIVED. REGARDING THE OUTSTANDING S ALES TAX OF RS.1,14,122/- WE WOULD LIKE TO CLARIFY THAT THE SAI D AMOUNT HAS BEEN ALREADY ADDED BACK TO YOUR TAXABLE INCOME OF T HE ASSESSMENT YEAR 2001-02 AND THEREFORE IN OUR OPINIO N, THE QUESTION REGARDING THIS ITEM CANNOT BE RAISED AGAI N IN THIS ASSESSMENT YEAR. VIDE ORDER SHEET ENTRY DATED 10.06.2009, THE ASSESS EE WAS GIVEN A FINAL SHOW CAUSE TO SUBMIT ANY DOCUMENTS/EX PLANATIONS. THE ASSESSEE IN REPLY DATED NIL RECEIVED ON 15.06.2 009 SUBMITTED THAT WE HAVE GIVEN ALL EXPLANATION WHICH COULD REASONABLY BE GIVEN ON ALL THE POINTS RAISED EARLIE R AND IN THE ORDER SHEET THROUGH OUR LETTER DATED 20.05.2009. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 5 FROM PERUSAL OF THE DETAILS SUBMITTED BY THE ASSESS EE, IT IS SEEN THAT ONLY THE PAYMENT DETAILS DURING EACH MONTH OF THE YEAR UNDER CONSIDERATION WERE PROVIDED. HOWEVER, THE DET AILS HAS TO WHETHER SUCH TAXES PERTAIN TO THE YEAR UNDER CONSID ERATION OR EARLIER YEARS WAS NOT PROVIDED BY THE ASSESSEE. ACC ORDINGLY, KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE EVIDENCES ON RECORD AN ADDITION OF RS.77608629/- IS BEING HEREBY MADE TO THE TOTAL INCOME OF THE ASSESSEE AS THE ASSESSEE HAS FAILED TO ESTABLISH THE PAYMENTS HAVING BEEN I NCURRED WITHIN THE MEANING OF SECTION 43B OF THE I.T.ACT, 1 961. 4. BEFORE THE LD. CIT(A), THE ASSESSEE MADE THE SUB MISSIONS, WHICH WERE FORWARDED TO THE AO AND THE REMAND REPORT TAKEN. TH E REMAND REPORT OF THE AO AS REPRODUCED IN THE ORDER OF THE LD. CIT(A) AT PAGES 12 & 13 , IS REPRODUCED FOR THE SAKE OF CONVENIENCE AS UNDER: ADDITION OF RS.77608629/- WAS MADE BY THE AO ON ACCOUNT OF EXPENDITURE DEBITED IN THE P & L A/C AND CLAIMED B Y THE ASSESSEE UNDER THE HEAD SERVICE TAX AS THE ASSESSEE COULD N OT FURNISH THE DOCUMENTARY EVIDENCES CHALLANS OF TAXES PAID DURING THE ASSESSMENT PROCEEDINGS AS DESIRED BY THE AO. NOW, THE ASSESS EE IN ITS GROUND OF APPEAL HAS SUBMITTED THAT THIS AMOUNT HAS BEEN CLAI MED AN ACTUAL PAYMENT BASIS U/S 43B OF THE ACT AND THE RELEVANT CHALLANS EVIDENCING THE PAYMENT HAS ALSO BEEN FILED. COPIES OF THE WHIC H HAVE BEEN FORWARDED TO THE UNDERSIGNED FOR VERIFICATION. DURI NG THE PROCEEDINGS OF REMAND REPORT THE ASSESSEE WAS ASKED TO FURNISH DOCUMENTARY EVIDENCE IN SUPPORT OF THE CONTENTION. ASSESSEE PRO DUCED THE COPIES OF CHALLAN/. TDS CERTIFICATES AND AFTER VERIFICATION OF THE FACTS FROM THE COPIES PRODUCED IT HAS BEEN GATHERED THAT AGAINST T HE CLAIMED AMOUNT OF RS.7,76,08,629/- U/S 43B OF THE ACT AS THE ASSES SEE FILED EXPLANATION IN RESPECT OF THE AMOUNT CLAIMED AND THE SAME HAS B EEN FOUND VERIFIABLE AS DETAILED BELOW: . ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 6 1. SALES TAX/SERVICE TAX DEDUCTED BY THE PROJECT. A UTHORITIES RS.68,70,903 DURING THE YEAR 2005-06 CLAIMED CLAIM FOUND TO BE DEDUCTED/DEPOSITED IN THE YEAR NOT RELEVANT TO THE PERIOD UNDER CONSIDERATION (105000-539282+490182) RS.11,34,464 BALANCE RS.57,36,439 II) SALES TAX DEPOSITED DURING THE YEAR 2005-06 RS.4,96,09,030/- TOTAL RS.5,53,45,469/- 5. THE LD. CIT(A) DELETED THE ADDITION OF RS.7,76,0 8,629/- FOR THE REASONS MENTIONED IN HIS ORDER, WHICH ORDER OF LD. CIT(A) FOR THE SAKE OF CONVENIENCE IS REPRODUCED AS UNDER: THE AO HAS MADE THIS ADDITION APPARENTLY U/S 43B OF THE ACT FOR NOT COMING FORWARD WITH THE DETAILS AS TO WHICH YEAR THE PAYMENT OF TAXES PERTAINED. IN RESPECT OF THIS GROUND THE C ONTENTION OF ASSESSEE HAS A LOT OF FORCE THAT AS PER SECTION 43B OF THE A CT, PAYMENTS ARE ALLOWABLE ONLY ON ACTUAL PAYMENT HENCE, IT IS IRREL EVANT AS TO WHICH YEAR THEY RELATED TO. THE AO HAS ADMITTED THAT PAYM ENT DETAILS DURING EACH MONTH OF THE YEAR WERE PROVIDED . IN VIEW OF T HIS, FOR WANT OF DETAILS AS TO THE PAYMENTS RELATES TO WHICH RELEVAN T YEAR CANNOT BE A GROUND FOR ANY DISALLOWANCE, HENCE, THIS DISALLOWAN CE OF RS.7,76,08,629/- IS DELETED. 6. THE LD. DR ARGUED THAT THE ASSESSEE HAS NOT PLAC ED ON RECORD COPIES OF CHALLANS TO THE YEAR THEY PERTAINED. THE ASSESS EE HAS PRODUCED THE COPIES OF CHALLANS /TDS CERTIFICATE AND AFTER VERIFICATION OF THE FACTS, THE AO HAS ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 7 GIVEN THE REMAND REPORT THAT THE ASSESSEE HAS FILED THE EXPLANATION WITH REGARD TO THE AMOUNT OF RS.5,53,45,469/- PNLY 7. THE LD. COUNSEL FOR THE ASSESSEE , ON THE OTHER HAND, ARGUED THAT THE AO DOES NOT HAVE ANY AUTHORITY TO ASK TO WHICH YEAR THE CHALLANS PERTAINED. ONCE THE TAXES HAVE BEEN PAID DURING THE YEAR, THE AO IS BOUND TO ALLOW THE CLAIM. THEREFORE, HE RELIED UPON THE ORDER OF THE LD. CIT(A) AND PRAYED TO CONFIRM THE ORDER OF THE LD. CIT(A). 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. AS PER REMAND REPORT AVAILABLE AT PAGES 12 & 13 OF THE ORDER OF LD. CIT(A), THERE IS NO DISPUTE THAT THE ASSESSEE HAS PRODUCED COPIES OF CHALLANS AND TDS CERTIFICATE AND AFTER VERIFICATION OF THE FACTS , IT HAS BEEN GATHERED BY THE AO THAT THE ASSESSEE CLAIMED THE AMOUNT OF RS. 7,76,08,629/- U/S 43B OF THE ACT. THE ASSESSEE HAS FILED THE EXPLANATION IN RESPECT OF THE AMOUNT CLAIMED AND THE SAME HAS BEEN FOUND VERIFIABLE AS P ER DETAILS AT PAGES 12 & 13 OF CIT(A)S ORDER, WHICH TOTALS TO ONLY RS.5,53, 45,469/-. WITH RESPECT TO THE REST OF THE AMOUNT I.E. RS.2,22,63,150/-, NO DE TAILS OF WHATSOEVER KIND HAS BEEN FILED. IT IS PERTINENT TO MENTION THAT TH E LD. COUNSEL FOR THE ASSESSEE MR. M.A. MIR WAS SPECIFICALLY ASKED BY THIS BENCH T O PRODUCE DETAILS OF THE TAXES PAID DURING THE YEAR FOR AN AMOUNT OF RS.2,22 ,63,160/- WHICH HAS BEEN CLAIMED AS DEDUCTION U/S 43B OF THE ACT. NOTHING WA S PRODUCED INSPITE OF ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 8 SPECIFIC QUERY BY THIS BENCH. THEREFORE, IN THE FAC TS AND CIRCUMSTANCES, THE LD. CIT(A) IS NOT JUSTIFIED IN DELETING THE WHOLE A DDITION OF RS.7,76,08,629/- WHEN IN FACT, THE ASSESSEE ITSELF HAS PRODUCED CHAL LANS OF RS.5,53,45,469/- ONLY WHICH WERE VERIFIABLE BY THE AO IN THE REMAND PROCEEDINGS WHICH FACT IS NOT DISPUTED. NO FURTHER EVIDENCE OR AS AN ADDITIONAL EVIDENCE HAS BEEN BROUGHT ON RECORD BEFORE US. THEREFORE, IN THE FACTS AND CIRCUMSTANCES, DELETION OF ADDITION OF RS.5,53,45,469/- IS ONLY JU STIFIED AND THE LD. CIT(A) IS NOT JUSTIFIED IN DELETING THE ADDITION OF RS.2,2 2,63,160/-. THEREFORE, THE AO IS DIRECTED TO SUSTAIN AN ADDITION OF RS.2,22,63 ,160/- AND THE ORDER OF THE LD. CIT(A) IS ACCORDINGLY REVERSED TO THIS EXTENT. ACCORDINGLY, GROUND NO.1 OF THE REVENUE IS PARTLY ALLOWED. 9. AS REGARDS GROUND NO.2 OF THE REVENUE, THE BRIEF FACTS OF THE CASE AS ARISING FROM THE AOS ORDER, ARE REPRODUCED FOR THE SAKE OF CONVENIENCE AS UNDER: CP FUND CORP. SHARE: THE FOLLOWING DETAILS HAVE BEEN SUBMITTED BY THE COMPANY: TOTAL CREDIT : RS.8,87,745/- TOTAL DEBIT : RS.2,08,013/- VIDE THIS OFFICE NOTICE U/S 142(1) DATED 08.05.200 9, THE ASSESSEE WAS CALLED UPON EXPLAIN AS UNDER: PLEASE FURNISH YEAR WISE DETAILS OF THIS AMOUNT. P RODUCE COMPLETE ACCOUNT OF INTER UNIT TRANSFERS. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 9 VIDE REPLY DATED 20.05.2009, THE ASSESSEE SUBMITTED AS UNDER: THE AMOUNT OF RS.6,79,732/- HAS BEEN DEPOSITED IN THE MONTH OF APRIL,2006 AND THERE IS USUALLY NO DEFAULT IN THE M ATTER OF PAYMENT OF STATUTORY DUES LIKE DP FUND,. VIDE ORDER SHEET ENTRY DATED 10.06.2009 THE ASSESS EE WAS GIVEN A SHOW CAUSE AS UNDER: FINAL SHOW CAUSE GIVEN TO SUBMIT DOCUMENTARY EVIDE NCE. THE ASSESSEE IN REPLY DATED NIL RECEIVED ON 15.06.2 009 SUBMITTED THAT WE HAVE GIVEN ALL EXPLANATIONS WHICH COULD REASON ABLY BE GIVEN ON ALL THE POINTS RAISED EARLIER AND IN THE ORDER SHEE T THROUGH OUR LETTER DATED 20.05.2009. FROM A PERUSAL OF THE REPLY OF THE ASSESSEE, IT IS SEEN THAT THE ASSESSEE HAS FAILED TO PROVIDE ANY DOCUMENTARY EVIDENCE SUCH AS CHALLANS/RECEIPTS TO SUBSTANTIATE THE PAYMENT OF TH IS LIABILITY WITHIN THE DUE DATE AS MANDATED U/S 43B. EVEN DURING THE TIME OF SPECIAL AUDIT U/S 142(2A), THE ASSESSEE FAILED TO PRODUCE THESE D ETAILS. THE ASSESSEE DID NOT PRODUCE ANY EVIDENCE TO SUBSTANTIATE/CONFIRM THE PAYMENT OF THIS LIABILITY WITH ANY DOCUMENTARY EVIDENCES INSPITE OF A SPECIFIC SHOW CA USE HAVING BEEN ISSUED. ACCORDINGLY, AFTER CONSIDERING THE FACTS A ND CIRCUMSTANCES OF THE CASE AND THE EVIDENCES ON RECORD, THE SUM OF RS .6,79,732/- IS BEING TREATED AS AN UNPAID LIABILITY U/S 43B AND IS BEING HEREBY ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. 10. THE LD. CIT(A) DELETED THE ADDITION AND THE OR DER OF THE LD. CIT(A) FOR THE SAKE OF CONVENIENCE IS REPRODUCED AS UNDER: 15. CP FUND: THE AO ASKED THE YEAR WISE DETAILS W HEN SHE NOTICED THAT THE POSITION IN RESPECT OF THE ABOVE WAS AS UN DER: TOTAL CREDIT RS.8,87,745/- TOTAL DEBIT RS.2,08,013/- ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 10 THE ASSESSEE REPLIED THAT THE AMOUNT OF RS.6,79,73 2/- WAS DULY DEPOSITED WELL IN TIME. DETAILED CALCULATION AS WEL L AS STATEMENT PREPARED BY THEIR OFFICE IN THIS REGARD ARE ON RECO RDS AND AS PER WHICH THE PAYMENT OF RS.6,80,606/- WAS MADE IN VIEW OF TH IS THE ADDITION IS DELETED. 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THE LD. CIT(A) HAS ACCEPTED THE EXPLANATION OF THE ASSESSEE THAT THE AMOUNT OF RS.6,79,732/- WAS DEPOSITED WELL IN TIME AND THE DETAILED CALCULATION AS WELL AS STATEMENT PREPARED BY THEIR OFFICE WERE ON RECORDS. IN FACT, NOTHING HAS BEEN PRODUCED BEFORE THE AO, WHO HAS SPECIFICAL LY MENTIONED THAT THE ASSESSEE HAS FAILED TO PROVIDE DOCUMENTARY EVIDENCE S SUCH AS CHALLANS TO SUBSTANTIATE THE PAYMENT OF THIS LIABILITY WITHIN THE DUE DATE AS MANDATED U/S 43B OF THE ACT. EVEN DURING THE TIME OF SPECIA L AUDIT U/S 142(2A), THE ASSESSEE FAILED TO PRODUCE SUCH DETAILS. THE ASSES SEE FAILED TO PRODUCE SUCH DETAILS. THE LD. COUNSEL FOR THE ASSESSEE WAS ASKED SPECIFICALLY TO PLACE ON RECORD SUCH DETAILS BUT NOTHING WAS PLACED ON RECOR D. ACCORDINGLY, THE LD. CIT(A) IS NOT JUSTIFIED IN DELETING THE ADDITION, JUST ON THE BASIS OF THE SUBMISSION OF THE ASSESSEE. ACCORDINGLY, ORDER OF THE LD. CIT(A) IS REVERSED ON THE ISSUE AND GROUND NO. 2 OF THE REVEN UE IS ALLOWED. 12. ACCORDINGLY, THE APPEAL OF THE REVENUE IS PARTL Y ALLOWED. 13. NOW, WE TAKE UP APPEAL OF THE ASSESSEE IN ITA N O. 184(ASR)/2013. GROUND NO.1 IS GENERAL IN NATURE, THEREFORE, DOES N OT REQUIRE ANY ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 11 ADJUDICATION. AS REGARDS GROUND NO.2, THE BRIEF FAC TS AS PER AOS ORDER ARE AS UNDER : FROM THE PERUSAL OF THE BOOKS OF THE ASSESSEE, IT WAS OBSERVED THAT THERE HAD BEEN DEFAULTS IN DEDUCTING TAX AT SO URCE IN RESPECT OF PAYMENTS MADE BY THE UNITS OF THE ASSESSEE COMPANY. THE UNIT WISE DETAILS HAD BEEN CULLED OUT TOTALING TO RS.63,147, 728/-, IN RESPECT OF ALL THE 24 UNITS OF THE ASSESSEE COMPANY, THE COMPU TATION OF WHICH WAS CONFRONTED TO THE ASSESSEE. VIDE THIS OFFICE NO TICE U/S 142(1) OF THE ACT, DATED 8.5.2009 THIS VIOLATION WAS CONFRONT ED TO THE ASSESSEE AS UNDER 2. TAX DEDUCTION AT SOURCE DEFAULT: THE DETAILS OF TDS DEFAULTS ARE ATTACHED AS ANNEXURE-1. IN THIS REGARD PLEASE F URNISH COMPLETE DETAILS OF THESE PAYMENTS. THE DETAILS SHOULD INCLU DE THE FOLLOWING INFORMATIONS: I) PAYMENT DETAILS ALONG WITH BILLS AND PROOF THEREOF. II) NAME AND ADDRESS OF THE PAYEE AND NATURE OF PAY MENTS. FURNISH VOUCHERS/BILLS/SALARY REGISTERS/WAGES REGI STER ALONGWITH COMPLETE COPY OF ACCOUNT. III) THE DETAILS SHOULD BE FURNISHED AS PER NATURE OF PAYMENTS ALONGWITH MODE AND DATES OF PAYMENTS. IN THE REPLY THE ASSESSEE SUBMITTED AS UNDER: THE AUDITORS M/S. O.P. GARG & CO. HAVE INCLUDED IN THE LIST OF INSTANCES WHERE TDS PROVISIONS HAVE NOT BEEN OR INC ORRECTLY BEEN APPLIED ALL THOSE PAYMENTS WHICH IN FACT DO NOT ATT RACT TDS PROVISIONS AT ALL. PRESUMABLY, THE AUDITORS HAVE BEEN MISLEAD BY THE USUAL PRACTICE OF THE ASSESSEE TO DEDUCT TAX FROM ALL THE OUTGOING PAYMENTS WITHOUT CONSIDERING THE NATURE OF PAYMENT AS TO WHE THER THE SAID PAYMENT REPRESENTS A CONTRACT PAYMENT OR A SALE OF GOODS/SERVICES PAYMENT. ACCORDINGLY, FOLLOWING PAYMENTS IN OUR OPI NION CANNOT BE SUBJECTED TO TDS U/S 194C OF THE ACT. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 12 A. ADVERTISEMENT-PUBLISHING OF TENDER NOTICES ETC. BEING TOTALLY OUTSIDE THE PURVIEW OF SECTION 194C NOT BEING A WO RKS CONTRACT BUT A SALE OF GOODS/SERVICE CONTRACT RS.6,71,143/- AS PER ANNEXURE2. B. FREIGHT-PAID TO TRUCK DRIVERS AGAINST INDIVIDUAL BILLS ON ORDINARY CASH MEMOS AND NOT IN PURSUANCE OF A CONT RACT WITH THE ASSESSEE. RS.54,14,912 AS PER ANNEXURE 3 C. REPAIRS TO MACHINERY ITEM- NOTE IN PURSUANCE OF A CONTRACT WITH THE ASSESSEE. RS.24,000 AS PER ANNEXURE 4. D. PHOTOGRAPHY-BEING TOTALLY OUTSIDE THE PURVIEW OF SECTION 194C NOT BEING A WORKS CONTRACT BUT A SALE OF GOODS/SERV ICE CONTRACT. RS.4,81,680/- AS PER ANNEXURE 6. E. COMPUTER PRINTING AN ORDINARY SALE OF GOODS/SE RVICE CONTRACT RS.1,98,881/- AS PER ANNEXURE 5. FURTHER, TAX HAS BEEN DEDUCTED FROM THE CONTRACT PAYMENTS AT SERIAL NO. 167 TO 170 AND DEPOSITED AFTER 31.3.3200 6. HOWEVER, THE AUDITRS HAVE RECOMMENDED THE DISALLOWANCE OF EX PENDITURE ON THE GROUND OF NOT HAVING BEEN DEPOSITED BY OR BE FORE 31.3.2006. HOWEVER, SECTION 40(A)(IA) DOES NO REQUI RE THE TAX BEING DEPOSITED PRIOR TO THE CLOSE OF FINANCIAL YEA R BUT BEFORE THE DUE DATE OF REMISSION TO THE GOVT. EXCHEQUER. A CCORDINGLY, THE AMOUNT OF RS.3,75,61,894 DOES NOT QUALIFY FOR D ISALLOWANCE U/S 40(A)(IA) OF THE ACT. THE SUBMISSIONS OF THE ASSESSEE ARE DISCUSSED ON M ERITS AS UNDER: SECTION 194C HAS AN ENLARGED SCOPE TO INCLUDE ALL SUCH WORKS. FURTHER, WRITTEN CONTRACTS ARE NOT NECESSARY WHICH CANA BE ORAL ONES AS CLARIFIED BY CIRCULAR NO.93 DATED 26.0 9.1972 ISSUED BY CBDT. THE COMPANY HAS GIVEN A SIMPLICITER STATEMENT THAT SUCH PAYMENTS DO NOT ATTRACT TDS BU T HAS NOT CORROBORATED IT. AS REGARDS THE CONTRACTS FOR ADVERTISEMENT, THE PR OVISIONS OF SECTION 194C(1) ARE CLEARLY ATTRACTED AND A TDS DED UCTION RATE OF 1% HAS BEEN PRESCRIBED UNDER THE STATUTE BEFORE MAKING THE PAYMENTS FOR ADVERTISEMENT CONTRACTS. THE SCOPE AND THE ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 13 MEANING OF THE ADVERTISING HAS BEEN FURTHER CLARIFI ED VIDE THE CIRCULAR NO.714 DATED 3.8.1995 WHICH PROVIDES THAT: REGARDING THE SCOPE AND THE MEANING OF THE TERM ADV ERTISING USED IN SECTION 194C(1), IT IS CLARIFIED THAT ADVER TISING MAY BE IN PRINT OR ELECTRONIC MEDIA, I.E. IN NEWSPAPER S, PERIODICALS, RADIO, TELEVISION ETC. IN SUCH CASES TAX WILL BE DE DUCTED AT THE RATE OF THE 1% OF THE PAYMENT MADE FOR ADVERTISING INCLUDING PRODUCTION OF PROGRAMMES FOR SUCH BROADCASTING AND TELECASTING TO BE USED IN SUCH ADVERTISING. IT IS, THEREFORE, EVIDENT THAT DISALLOWANCE U/S 40 (A)(IA) R/W 194C OF THE ACT IS CLEARLY ATTRACTED IN THE CASE O F PAYMENTS IN RESPECT OF THE ADVERTISEMENT CONTRACTS BY THE ASSES SEE COMPANY. AS REGARDS THE PAYMENTS TO TRANSPORTERS, IT HAS BE EN CLARIFIED VIDE THE CIRCULAR NO.715 DATED 8.8.95 THAT: IN THE CASE OF PAYMENTS TO TRANSPORTERS, EACH GR CA N BE SAID TO BE A SEPARATE CONTRACT. IF THE GOODS ARE TRANSPO RTED AT ONE TIME. BUT IF THE GOODS ARE TRANSPORTED CONTINUOUSLY IN PURSUANCE OF A CONTRACT FOR A SPECIFIC PERIOD OR QU ANTITY WILL BE AGGREGATED FOR THE PURPOSE OF TDS .. EVEN WHEN THE GOODS ARE RECEIVED ON FREIGHT TO PAY BASIS THE TDS PROV ISIONS WOULD BE APPLICABLE. IT IS, THEREFORE, EVIDENT THAT DISALLOWANCE U/S 40 (A)(IA) R/W 194C OF THE ACT IS CLEARLY ATTRACTED IN THE CASE OF PAYM ENTS IN RESPECT OF THE FREIGHT CONTRACTS BY THE ASSESSEE COMPANY. PHOTOGRAPHY: AS REGARDS PHOTOGRAPHY IT HAS BEEN HE LD IN ASSTT. STO VS. B.C. KAME 39 STC (SC) TAT TAKING PHOTOGRAPH S OR DOING PHOTOGRAPHIC WORK IS CONTRACT FOR WORKS AND L ABOUR. AS REGARDS THE COMPUTER PRINTING, IT HAS BEEN STAT ED BY THE ASSESSEE HIMSELF THAT IT IS OF THE NATURE OF A SERV ICE CONTRACT WHICH IS COVERED U/S 194C SINCE SERVICE ENTAILS PE RFORMANCE OF ANY WORK AND THE PROVISIONS OF SECTION ARE WIDE ENO UGH TO COVER NOT ONLY WRITTEN CONTRACTS BUT ALSO ORAL CONT RACTS. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 14 AS REGARDS CONTRACTUAL PAYMENTS AT SL.NO.167 TO 17 0, THE ASSESSEE HAD CLAIMED THAT THE SAID PAYMENTS HAVE BE EN DEPOSITED BEFORE THE DUE DATE OF REMISSION TO THE G OVT. EXCHEQUER. IN THIS CONNECTION, VIDE ORDER SHEET ENT RY DATED 10.06.2009 THE ASSESSEE WAS GIVEN A SHOW CAUSE TO S UPPORT THE SUBMISSION WITH DOCUMENTARY EVIDENCES. THE ASSESSEE IN REPLY DATED NIL RECEIVED ON 15.06. 2009 SUBMITTED THAT WE HAVE GIVEN ALL EXPLANATIONS WHIC H COULD REASONABLY BE GIVEN ON ALL THE POINTS RAISED EARLIE R AND IN THE ORDER SHEET THROUGH OUR LETTER DATED 20.05.2009. IT IS SEEN THAT THE PAYMENTS HAVE BEEN MADE AS UND ER S.NO. DATE AMOUNT PAID 167 APRIL, 05 8386917 168 MAY,05 18807222 169 JULY,05 1885057 170 AUG,05 7220328 UNDER THE PROVISIONS OF SECTION 200(1), ANY PERSON DEDUCTING TAX AT SOURCE IS REQUIRED TO REMIT THE SAME WITHIN THE PRESCRIBED TIME. RULE 30 OF THE INCOME TAX RULES, 1962 PROVIDE S THE TIME LIMIT FOR DEPOSIT OF THE SAME TO THE CREDIT OF THE CENTRAL GOVT. ACCOUNT. IN ACCORDANCE WITH THE PROVISIONS OF RULE 30(1)(B) THE SUMS DEDUCTED SHOULD HAVE BEEN DEPOSITED WITHIN ONE WEEK FROM THE LAST DAY OF THE MONTH IN WHICH THE DEDUCT ION IS MADE ASSUMING THAT THE SAID ACCOUNTS HAVE BEEN FINALIZED ON 31.3.2006. THUS, IT IS SEEN AS REGARDS CONTRACT PAY MENTS, MENTIONED AT SL.NOS. 167 TO 170 THAT SINCE THESE PA YMENT HAVE BEEN MADE FROM APRIL, 2005 TO FEBRUARY, 2006 AND AS PER AMENDED PROVISIONS OF SECTION 40(A)(IA) THE TAX DED UCTED FROM THIS PERIOD SHOULD HAVE BEEN DEPOSITED WITHIN THE F INANCIAL YEAR ITSELF FOR CLAIMING THE RELEVANT EXPENDITURE AGAINS T SERIAL NO.167 TO 170. IT IS NOT ALLOWABLE IN THE A.Y. 2006 -07. EXTENSION HAS ALSO BEEN PROVIDED FOR THE MONTH OF M ARCH THE TAX DEDUCTED OF WHICH MAY BE DEPOSITED ON OR BEFORE THE DUE DATE SPECIFIED U/S 139(1) OF THE ACT. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 15 THUS, THE DISALLOWANCE U/S 40(A)(IA) IS CLEARLY ATT RACTED AS IT IS SEEN FROM THE DISCUSSION ABOVE THAT THE TAX WAS DED UCTIBLE ON THE PAYMENTS MADE BY THE ASSESSEE AND THE SAME WAS EITHER NOT DEDUCTED AT THE PRESCRIBED RATES, OR AFTER DEDUCTIO N WAS NOT REMITTED INTO THE CREDIT OF GOVT. ACCOUNT WITHIN TH E TIME PRESCRIBED U/S 200(1). ACCORDINGLY, KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE SUBMISSIONS O N RECORD, THE AGGREGATE OF THE PAYMENTS AT RS.63,147,728/- ON WHICH THERE WAS A DEFAULT IN DEDUCTION OF TDS ARE BEING H EREBY DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF TH E ASSESSEE U/S 40(A)(IA) OF THE ACT. 14. THE LD. CIT(A) CONFIRMED THE ACTION OF THE A.O. 15. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. WE CONCUR WITH THE VIEWS OF THE LD. CIT(A) THAT TH E SUBMISSION OF THE ASSESSEE DURING THE ASSESSMENT AND DURING THE PROCE EDINGS HAS BEEN FAR FROM SATISFACTORY. BY SIMPLY OUT STATING THAT PAYMENTS WERE ADVERTISEMENT, FREIGHT PAYMENTS, REPAIRS FOR MACHINERY, PHOTOGRAPH Y AND COMPUTER PRINTING WERE NOT SUBJECTED TO TDS AND COMPUTER PRINTING WER E NOT SUBJECTED TO TDS PROVISIONS IS NO EXPLANATION. THE AO HAS RIGHTLY PO INTED OUT THAT IN VIEW OF SECTION 194C. CIRCULAR OF CBDT NO.93 DATED 26.09.1 972 AND 715 OF 8.8.1995 ALL SUCH PAYMENTS WERE COVERED BY PROVIS ION OF SECTION 194C OF THE ACT AND TDS WAS CLEARLY DEDUCTIBLE. AS FAR AS T HE ASSESSEES CLAIM OF DEPOSTING THE TDS AMOUNT OF RS.3,75,61,894/- OUT OF THE AMOUNT OF RS.6,31,47,720/- BEYOND THE FINANCIAL YEAR AND SUCH PAYMENT SHOULD NOT BE ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 16 ADDED IN THE YEAR 2006-07 ALSO DOES NOT HOLD WATER . THE ASSESSMENT ORDER AND MORESO THE REMAND REPORT CLEARLY BROUGHT OUT TH E FACTS THAT SUCH PAYMENTS ON WHICH TDS WAS DEDUCTED BUT DEPOSITED BE YOND THE FINANCIAL YEAR WERE MADE FROM APRIL,2005 TO FEB; 2006 AND HAD TO BE DEPOSITED WITHIN THE FINANCIAL YEAR. MOREOVER, NO DETAILS OF SUCH DEPOSITS ARE ADMITTEDLY FILED. ACCORDINGLY, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A), WHO HAS RIGHTLY UPHELD THE ACTION OF THE A. O. THUS, GROUND NO.2 OF THE ASSESSEE IS DISMISSED. 16. AS REGARDS GROUND NO.3, THE BRIEF FACTS OF THE CASE AS PER AOS ORDER ARE AS UNDER: 10. DEPRECIATION ON FIXED ASSETS: DURING THE COU RSE OF ASSESSMENT PROCEEDINGS , ASSESSEE WAS CALLED UPON TO PRODUCE T HE BILLS OF ADDITIONS TO FIXED ASSETS. VIDE THIS OFFICE NOTICE U/S 142(10 DATED 08.05.2009, THE ASSESSEE WAS CALLED UPON TO EXPLAIN AS UNDER: PLEASE REFER TO ANNEXURE-7, ENCLOSED HEREWITH. IN THIS REGARD YOU MAY FURNISH DOCUMENTARY EVIDENCE OF ADDITIONS TO AS SETS ALONGWITH DETAILS OF PAYMENT, DATE MONTH AND YEAR OF ADDITION S. VIDE REPLY DATED 20.05.2009 M THE ASSESSEE SUBMITT ED AS UNDER: THE NECESSARY BILLS FOR ADDITIONS ARE ENCLOSED. VIDE ORDER SHEET ENTRY DATED 10.06.2009, THE ASSES SEE WAS GIVEN A SHOW CAUSE AS UNDER; BILLS IN RESPECT OF ADDITION TO FIXED ASSETS WHIC H HAVE BEEN REMARKED BY THE AUDITORS CONDUCTING SPECIAL AUDIT U/S 142(2A ) IN THEIR AUDIT REPORT. ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 17 THE ASSESSEE IN REPLY DATED NIL RECEIVED ON 15.06 .2009 SUBMITTED THAT WE HAVE GIVEN ALL EXPLANATIONS WHICH COULD REASONA BLY BE GIVEN ON ALL THE POINTS RAISED EARLIER AND IN THE ORDER SHEE T THROUGH OUR LETTER DATED 20.05.2009. FROM A PERUSAL OF THE REPLY OF THE ASSESSEE, IT I S SEEN THAT THE BILLS/VOUCHERS IN SUPPORT OF THE ADDITIONS TO FIXED ASSETS ENUMERATED IN NOTICE DATED 08.05.2009 COULD NOT BE PRODUCED BY TH E ASSESSEE. ACCORDINGLY, THE DEPRECIATION CLAIMED THEREON AT R S.74,053/- IS BEING HEREBY DISALLOWED AND ADDED BACK TO THE TOTAL INCOM E OF THE ASSESSEE. 17. THE LD. CIT(A) CONFIRMED THE ACTION OF THE ASSE SSING OFFICER. 18. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. WE CONCUR WITH THE VIEWS OF THE LD. CIT(A) THAT TH E CONTENTION OF THE ASSESSEE THAT THE ASSESSEE IS A GOVERNMENT COMPANY AND NO ADDITION WAS CALLED FOR IS TOTALLY DEVOID OF MERITS AND IT IS A FACT THAT BILLS WERE NOT PRODUCED AND AS SUCH THE DISALLOWANCE WAS JUSTIFIED AND CONFIRMED. ACCORDINGLY, WE FIND NO INFIRMITY IN THE ORDER OF T HE LD. CIT(A). THUS, GROUND NO.3 OF THE ASSESSEE IS DISMISSED. 19. AS REGARDS GROUND NO.4 OF THE ASSESSEE, THE BR IEF FACTS OF THE CASE AS ARISE FROM THE ORDER OF THE AO ARE REPRODUCED FOR T HE SAKE OF CONVENIENCE AS UNDER: FROM THE PERUSAL OF THE BALANCE SHEET OF THE ASSE SSEE IT WAS SEEN THAT THE ASSESSEE HAD DECLARED FDRS WORTH RS.12,88 ,18,667/- IN THE ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 18 BALANCE SHEET. VIDE THIS OFFICE NOTICE U/S 142(1) D ATED 08.05.2009, THE ASSESSEE WAS CALLED UPON TO EXPLAIN AS UNDER: PLEASE FURNISH DETAILS OF THE FDRS ALONGWITH DETA ILS SUCH AS DATE, MONTH AND YEAR OF AVAILING THESE FDRS, SOURCE OF I NVESTMENT IN THESE FDRS, NAME AND COMMUNICABLE ADDRESS OF THE BANK, AM OUNT OF INTEREST ACCRUED/RECEIVED INTEREST SHOWN AS INCOME IN YOUR RETURN OF INCOME. PLEASE FURNISH YEAR WISE DETAILS OF THESE F DRS ALONGWITH CORRESPONDING ACCRUAL/RECEIPT OF INTEREST ON THESE FDRS. PRODUCE COMPLETE ACCOUNT OF THESE FDRS. VIDE REPLY DATED 20.05.2009, THE ASSESSEE SUBMITTE D AS UNDER: THE DETAILS ARE ENCLOSED. VIDE ORDER SHEET ENTRY DATED 10.06.2009, THE ASSES SEE WAS GIVEN A SHOW CAUSE AS UNDER: PLEASE FURNISH EVIDENCES IN SUPPORT OF CLAIMS ALO NGWITH DETAILS OF INTEREST EARNED AND SHOW CAUSE AS TO WHY THE DIFFER ENCE OF INTEREST AS POINTED OUT BY AUDITORS U/S 142(2A) MAY NOT BE ADDE D TO THE TOTAL INCOME. THE ASSESSEE IN REPLY DATED NIL RECEIVED ON 15.06. 2009 SUBMITTED THAT WE HAVE GIVEN ALL EXPLANATIONS WHICH COULD REASONA BLY BE GIVEN ON ALL THE POINTS RAISED EARLIER AND IN THE ORDER SHEE T THROUGH OUR LETTER DATED 20.05.2009. FROM THE PERUSAL OF THE REPLY OF THE ASSESSEE, IT IS SEEN THAT THE ASSESSEE HAS FAILED TO PROVIDE ANY DOCUMENTARY EVID ENCES TO SUBSTANTIATE THE DETAILS OF THE FDRS. EVEN DURING THE TIME OF SPECIAL AUDIT U/S 142(2A), THE ASSESSEE FAILED TO PRODUCE T HESE DETAILS. IT IS FURTHER SEEN THAT THE INTEREST INCOME OF ONLY RS.18,81,675/- HAS BEEN SHOWN ON THESE FDRS OF RS.12,88,18,667/-. THE OPENING BALANCE AS ON 01.04.2005 AS APPEARING IN THE BALANCE SHEET IS RS.6,01,68,397. THEREFORE, EVEN IF THE INTEREST IS CONSIDERED ON TH E OPENING BALANCE AT AROUND 6% PER ANNUM, THE INTEREST INCOME SHOULD BE AROUND RS.36,00,000/- AS AGAINST RS.18,81,675/- SHOWN BY T HE ASSESSEE. BUT KEEPING IN VIEW THE CLOSING BALANCE AT RS.12,88,18, 667/- THE INTEREST INCOME SHOULD BE AROUND RS.54,00,000/- ON THE AVERA GE BALANCE OF RS. 9 CRORE DURING THE YEAR. ACCORDINGLY, THE DIFFE RENCE AT RS.54,00,000/- - RS.18,81,675/- = RS.35,18,325/- IS BEING HEREBY ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 19 ADDED ON ACCOUNT OF THE INTEREST INCOME THAT SHOULD HAVE BEEN DECLARED BY THE ASSESSEE. 19. THE LD. CIT(A), CONFIRMED THE ACTION OF THE ASS ESSING OFFICER. 20. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE CONCUR WITH THE VIEWS OF TH E LD. CIT(A) THAT THE AO ASKED YEAR WISE DETAIL OF THE FDRS WHICH WAS NOT PROVIDED. THE AO HAS NOTICED THAT INTEREST WAS SHOWN AT RS.18,81,675/- O NLY. THE AO ESTIMATED THE INTEREST @ 6% ON OPENING BALANCE OF RS.6,01,68, 397/- SHOULD YIELD AN INTEREST OF AROUND RS.36,00,000 AND IF THE CLOSING BALANCE OF RS.12,88,18,667/-IS CONSIDERED IT WOULD BE RS.54,00 ,000/-. THE DIFFERENCE OF RS.35,18,326/- WAS ADDED BY THE AO. THE REPLY OF TH E ASSESSEE IS THAT THE INTEREST WAS ACCOUNTED ON RECEIPT BASIS. NO WORKING OR EVIDENCE TO THIS ASSERTION IS PROVIDED. ACCORDINGLY, IN THE ABSENCE OF ANY EVIDENCE TO CONTRARY, THE ADDITION BASED ON A FAIR ESTIMATE ON THE BASIS OF MATERIAL ON RECORDS IS ACCEPTABLE AND CONFIRMED. IN VIEW OF TH E ABOVE DISCUSSION, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) AN D THE SAME IS UPHELD. THUS, GROUND NO.4 OF THE ASSESSEE IS DISMISSED. 21. AS REGARDS GROUND NO.5(I) TO (VIII), THE ASSESS EE HAS FILED ADDITIONAL GROUND OF APPEAL WHICH HAS NOT BEEN ADJUDICATED BY THE LD. CIT(A). 22. WE HAVE HEARD THE RIVAL PARTIES AND PERUSED THE FACTS OF THE CASE. THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE H AS RAISED THE ADDITIONAL ITA NO.184(ASR)/2011 ITA NO.214(ASR)/2011 20 GROUNDS BEFORE THE LD. CIT(A), AS MENTIONED HEREINA BOVE AND THE LD. CIT(A) HAS NOT ADJUDICATED THE SAME. THEREFORE, THE MATTER WITH REGARD TO GROUND NO.5(I) TO (VIII) IS SET ASIDE TO THE FILE OF THE L D. CIT(A), WHO WILL ADJUDICATE THE SAME AND PASS THE SPEAKING ORDER BUT AFTER AFF ORDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACCORDI NGLY, GROUND NO.5 (I) TO (VIII) OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. THUS, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURP OSE. 23. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN I TA NO.184(ASR)/2011 IS PARTLY ALLOWED FOR STATISTICAL PURPOSE AND THE APPE AL OF THE REVENUE IN ITA NO.214(ASR)/2011 IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 28TH FEBRUARY, 2014. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 28TH FEBRUARY, 2014 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: M/S. J & K PROJECT CONSTRUCTION CORPO RATION LTD; SRINAGAR. 2. THE ACIT, CIRCLE-3, SRINAGAR. 3. THE CIT(A), JAMMU 4. THE CIT, JAMMU 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR)