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2015 (6) TMI 242 - AT - Income TaxTDS u/s 194H - Disallowance u/s 40(a)(ia) - assessee had wrongly claimed the amount of consolidation fee under the wrong head of purchase of land in the P & L account in order to avoid tax liability - Held that:- It is seen that clause 3.2 of ht MOU between the assessee and Vikram Electric Equipment P. Ltd. makes it clear that Vikram Electric Equipment P. Ltd. or its agent agreed to assign their rights to purchase the land in favour of the assesse. The above clause also makes it evident that unless the assessee decided to procure less than 27 acres of land through Vikram Electric Equipment P. Ltd., Vikram Electric Equipment P. Ltd., was to procure 27 acres of land for ht assessee, failing which, no payment was to be made by the assessee to Vikram Electric Equipment P. Ltd.This clearly shows that Vikram Electric Equipment P. Ltd. was transacting on a principle to principle basis and it cannot be said that the payment was made by the assessee to Vikram Electric Equipment P. Ltd. for rendering of any service. The provisions of section 194H of the Act are, therefore, not at all applicable. Moreover the amount paid to Vikram Electric Equipment P. Ltd. was duly reflected by the assessee in the purchases closing stock. No sales had been made during the year under consideration. It has not been shown to be otherwise. In such a scenario, in our considered opinion, no disallowance is called for. See case of Finian Estates Developers Pvt. Ltd [2012 (6) TMI 705 - ITAT, Delhi] - Decided in favour of assesse.
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