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2015 (10) TMI 1742 - AT - Income TaxDisallowance of expenditure u/s 40(a)(ia) - expenditure already “Paid” during the year - whether as Section 40(a)(ia) disallowance applies only to amounts “payable” as of 31st March and not to amounts already “paid” during the year.”? - Held that:- We find that the issue is now settled that the provision of Section 40(a)(ia) of the Act shall apply only to the amount “payable” as on the last day of the relevant accounting year. Accordingly, the Assessing Officer is directed to verify the amount in question and, if the amount was already paid during the year and no expenditure remained “payable” as on the last day of the relevant accounting period, the provision of Section 40(a)(ia) of the Act shall not apply - Decided in favour of assessee. Disallowance of expenditure u/s 40(a)(ia) - expenditure incurred on which no TDS was required to be deducted at source - Held that:- In the facts of the case, we restore this issue to the file of the Assessing Officer with the direction to decide the issue de novo after verification that whether the TDS provisions were applicable on the expenditure after allowing reasonable opportunity of hearing to the assessee - Decided in favour of assessee for statistical purposes. Disallowance of expenditure u/s 40(a)(ia) - expenditure on which TDS was already deducted at source - Held that:- In view of the evidence filed by the assessee in the compilation before us to prove that the assessee has made the TDS on the expenditure we decide the issue in favour of the assessee and direct that no disallowance be made under Section 40(a)(ia) of the Act. - Decided in favour of assessee. Disallowance u/s 40(a)(ia) - whether AO erred in making disallowing without holding assessee as “assessee in default” u/s 201 of the Act - Held that:- We find that there is no force in the arguments of the learned counsel for the assessee on this issue and, since the amount of expenditure in question was not paid during the year and was “payable” as on the last day of the accounting year, the disallowance was rightly made by the Assessing Officer and confirmed by the CIT(A) under Section 40(a)(ia) of the Act. - Decided against assessee.
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