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2014 (11) TMI 438 - AT - Income TaxSustenance of addition u/s. 40(a)(ia) - Non-deduction of TDS on payments to various persons for delivery and supply - Held that:- The AO disallowed the amount by invoking the provisions of section 40(a)(ia) of the Act and no disallowance had been made u/s. 40A(3) of the Act - CIT(A) himself admitted in the impugned order that there was no formal contract between the assessee and his agents/relatives, but there was an oral contract - However, it is not clear how the CIT(A) came to the conclusion that there was an oral contract when nothing is available on the record to substantiate the same, neither the AO stated that there was oral contract between the assessee and his trustworthy persons - The assessee made the payments on account of hiring of the vehicles for transportation and nothing was payable at the end of the year. In CIT Vs. Vector Shipping Service (P) Ltd. [2013 (7) TMI 622 - ALLAHABAD HIGH COURT] it has been held that for disallowing expenses from business and profession on the ground that TDS had not been deducted the amount should be payable and not which had been paid by the end of the year - there was no contract between the assessee and the agents/relatives to whom payment for hiring the vehicles had been made and nothing was payable at the end of the year - the disallowance made by the AO and sustained by the CIT(A) was not justified – Decided in favour of assessee. Sustenance of disallowance out of the godown repair expenses – Non-deduction of TDS – Held that:- CIT(A) categorically stated that the provisions of section 40A(3) of the Act were not applicable to the amount, therefore, the AO was not justified in holding that the provisions of section 40A(3) of the Act were applicable because payment was made on Sunday, the banks were closed on account of holiday - since the amount was not payable as on 31/03/2009, the provisions of section 40(a)(ia) of the Act were not application as decided in CIT Vs. Vector Shipping Service (P) Ltd. [2013 (7) TMI 622 - ALLAHABAD HIGH COURT] thus, the order of the CIT(A) is set aside – Decided in favour of assessee.
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