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2019 (1) TMI 2008 - HC - Income TaxAssessment of trust - Exemption u/s 11 - non deduction of tds - Tribunal held that 40% of professional charges paid to doctors through bearer cheques (60% paid by A/c. payee cheques) without deducting TDS cannot be disallowed u/s. 40(a)(ia) of the Act as the provisions of Section 11 of the Act was applicable to the assessee - HELD THAT:-. Section 40(a)(ia) of the Income Tax Act would be applicable to the amount chargeable under the head “Profit and gain of the business or profession”. Section 11 is with regard to the income from property held for charitable or religious purpose. Subsequently, an explanation was inserted which would come into effect from 01.04.2019 by the Finance Act, 2018 which would clearly indicate that the application under Clause(a) or Clause(b), the provisions of sub-clause(ia) of clause (a) of Section 40 and sub-sections (3) and (3A) of Section 40A, shall, mutatis mutandis, apply as they apply in computing the income chargeable under the head “Profits and gains of business or profession”. Therefore it clearly indicates that the same would stand applicable only from 01.04.2019. Therefore, the contention of the Revenue cannot be accepted. Hence, we hold that the Tribunal was justified in holding the said issue in favour of the Assessee and against the revenue. Whether the Tribunal was correct in holding that professional fee paid to Apollo Hospital for managing and running BGS Medical Foundation would not attract Section 194J and Section 40(a)(ia) of the Act as the provisions of Section 11 of the Act was applicable to the assessee? - On the same analogy, with reference to the amendment in Section 11(6) of the Act amended by Finance Act No.2 of 2014, the amendment was made and deducted from the assessment year 2015-16. In the instant case, the assessment would be with effect from 1st April 2019. Therefore, on this ground also, we do not find any material to interfere in the Order passed by the Tribunal. Consequently, the second substantial question of law is answered in favour of the Assessee and against the Revenue.
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