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2011 (11) TMI 759 - AT - Income TaxDisallowance of expenses u/s 40(a)(ia) - short deduction of tds - Held that:- Provisions of section 40(a)(ia) would apply only in case of non deduction of tax and not in case of short deduction of tax. The Tribunal has also held that in case of short deduction of tax, the assessee could be declared in default under the provisions of section 201 and corresponding tax along with interest could be collected from the assessee. Therefore no disallowance is required to be made under section 40(a)(ia). We also note that in this case the assessee had deducted tax but there were small amounts of shortfall which in many cases are less than ₹ 10 in each case and in some cases less than ₹ 1/-. Therefore, plea of the assessee that the shortfall was only because of some clerical error or rounding off error has to be accepted as reasonable. No case for making any disallowance. Accordingly we see no infirmity in the order of CIT(A) in deleting the addition and the same is, therefore, upheld.
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