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2014 (12) TMI 1105 - AT - Income TaxDisallowance u/s 40(a)(ia) - outstanding balance as on 31st March – Failure to TDS u/s 194H - Held that:- As decided in DCIT vs. Shri Ananda Marakala [2014 (12) TMI 613 - ITAT BANGALORE] wherein the applicability of section 40(a)(ia) has been discussed and held that the provisions of Section 40(a)(ia) are applicable only to the amounts of expenditure which are payable as on the date 31st March of every year and it cannot be invoked to disallow expenditure which has been actually paid during the previous year, without deduction of TDS Hon’ble Allahabad High Court has however upheld the view taken by the Special Bench ITAT in the case of Merilyn Shipping (2012 (4) TMI 290 - ITAT VISAKHAPATNAM) in the case of M/s. Vector Shipping Services Pvt. Ltd. (2013 (7) TMI 622 - ALLAHABAD HIGH COURT) Thus there are two views on the issue, one in favour of the assessee expressed by the Hon’ble Allahabad High Court and the other against the assessee expressed by the Hon’ble Gujarat & Calcutta High Courts. - following the decision of the Hon’ble Supreme Court in the case of Vegetable Products Ltd. (1973 (1) TMI 1 - SUPREME Court), we hold that where two views are possible on an issue, the view in favour of the assessee has to be preferred. - Decided in favour of assessee.
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