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2017 (8) TMI 1322 - HC - Income TaxDisallowance of expenditure under section 40(a)(ia) - Non deduction of tds - whether payee has paid the tax? - Held that:- Quite apart from the assessee’s legal contention that appropriate tax as prescribed under the law was deducted from time to time, the Tribunal in the impugned judgement referred to the decision of the Delhi High Court in case of Commissioner of Income-Tax vs. Ansal Land Mark Township (P) Ltd vs. reported in [ 2015 (9) TMI 79 - DELHI HIGH COURT] and held that if the payee has paid the tax, disallowance under section 40(a)(ia) would not be applicable. For verification of full details in this regard the Tribunal placed the matter back before the Assessing Officer. We notice that Delhi High Court in the said judgement had referred to the newly inserted proviso to section 40(a)(ia) and considered in light of the proviso to sub-section (1) of section 201 of the Act with effect from 01.07.2012. It was noticed that such provisos were added to obviate the difficulties of an assessee who, though may not have deducted tax at source while making certain payments, can establish that the payee had furnished the return of income and also paid the tax due on such income. In such a case, the assessee would not be treated as assessee in default. - Decided in favour of assessee.
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