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2013 (11) TMI 1679 - AT - Income TaxTDS u/s 194C - Addition u/s. 40(a)(ia) - Held that:- The provisions of sec. 194C clearly states that the assessee is liable to deduct tax at source either at the time of credit to the account of the contractor or at the time of payment thereof, whichever is earlier. It is further provided that the said liability would arise even if the amount is credited to any other account whether called “Suspense Account” or by any other name. Hence, in our view, the assessee would be liable to deduct tax at source u/s 194C on the amount provided under the head “provision for expenses”. Hence, we reject the contentions of the assessee that the TDS provisions shall not apply to the provision for expenses. A careful reading of the provisions of sec. 194C would show that the said section is “contract” specific and not related to the income of the assessee. Hence, this argument of the assessee also fails. No submissions would not absolve the assessee from the TDS liability u/s 194C of the Act, since a careful reading of the provisions of sec. 194C would show that the said section is “contract” specific and not related to the income of the assessee. Hence, this argument of the assessee also fails. It is an admitted fact that the assessee has claimed the impugned amount as deduction in the succeeding assessment year, i.e., assessment year 2008-09. Though the assessee contends that it has claimed the same on protective basis, we do not find any such observation in the assessment order which is placed in the paper book filed by the assessee. The Ld. CIT(A) has rightly pointed out that the assessee has claimed the very same amount twice, i.e., in assessment year 2007-08 and also in assessment year 2008-09.- Decided against assessee. In the preceding paragraphs, we have held that the assessee is liable to deduct tax at source on the provision for expenses created by the assessee. It an admitted fact that the assessee herein did not deduct tax at source from the amount of provision so created. We have already rejected various contentions urged by the Ld A.R. Under these circumstances, in our view, the Ld. CIT(A) was justified in confirming the disallowance made by the Assessing Officer u/s. 40(a)(ia) of the Act. Accordingly, we uphold his order on this issue.
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