Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2012 (8) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (8) TMI 152 - HC - Income TaxReopening of assessment - non deduction of TDS on the labour charges paid - assessee stated that he was covered under Section 44AB - Held that:- An individual or HUF should deduct tax at source under sub-section (2) of Section 194C on payments made to a sub-contractor and must establish that in the financial year immediately preceding the financial year in which such sum is paid or credited, total sales, gross receipts or turnover of such individual or HUF from profession or business exceeded the limits provided in Section 44AB and the accounts were thus compulsorily auditable. The assessee as an individual or HUF may be required to make the payments to a sub-contractor on the first date of the financial year or at any rate in the early part of the financial year when obviously assessee will not be in position to foresee whether total sales, gross receipts or turnover would exceed statutory limits and his accounts would be therefore required to be audited under Section 44AB, thus in such a situation, the assessee could not be expected to deduct tax at source - It is precisely for this reason that the liability of an individual or HUF to deduct tax at source upon the payments being made to the sub-contractor, is made relatable to financial year immediately preceding the year when such payment is made or credited - AO's reason to believe that the income chargeable to tax has escaped assessment is without any foundation and lacks validity - in favour of assessee.
|