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2018 (1) TMI 284 - AT - Income TaxNon deduction of tds - disallowance of service charges E-Mech Enterprises paid to clearing and forwarding agents M/s Shreeji International and M/s Mahavir Agencies - Held that:- As decided in The Assistant Commissioner Versus M/s. PP. Overseas [2011 (2) TMI 830 - ITAT, Mumbai] case the contract between the assessee and the C&F agent is a service contract which has not been specifically included in Explanation III below section 194C. In this view of the matter, the provisions of section 194C are not applicable to the payments to the C&F agents. If that is so, there was no obligation on the part of the assessee to deduct tax from the payment made Disallowance u/s 40(a)(ia) - disallowance of ocean freight, terminal handling charges - Held that:- As per the prescribed Form No. 26A, the deduction under amended section will be allowed only if the (i) payee has furnished his return of income under section 139; (ii) payee has taken into account such sum for computing income in such return of income; and (iii) payee has paid the tax due on the income declared by him in such return of income, and the payer furnishes a certificate to this effect from an accountant in the prescribed form. Thus we set aside the order of the Ld. CIT(A) on the above issue and restore the matter to the file of the AO to make an order in the light of theour above observation, after giving reasonable opportunity of being heard to the assessee. We direct the assessee to file the relevant documents/evidence before the AO. TDS u/s 194C - disallowance of amount paid to IAL Shipping Agencies, Sea Load Shipping Agencies and Three Star Forwarders Pvt. Ltd. - Held that:- The above payments being below the threshold limit of ₹ 30,000/- as per provisions of sub-section 5 of section 194C, we delete the disallowance upheld by the Ld. CIT(A) and allow the 2nd ground of appeal.
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