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2018 (5) TMI 61 - AT - Income TaxDisallowance u/s 40(a)(ia) towards software usage charges paid by the assessee - Held that:- In the present case the payment for royalty charges was made under consent terms before the Hon’ble Delhi High Court on which no TDS was deducted. It is true that explanation 4 to 6 were inserted to section 9 by the Finance Act, 2012 with retrospective effect from 01.06.1976 but at the same time there is merit in the submissions of the Ld. A.R. that as on the date of payment the assessee could not have foreseen the amendment which was to take place in the subsequent year making the deduction of TDS from software applicable from the retrospective effect. We are of the considered view that the Ld. CIT(A) has correctly allowed the appeal of the assessee and accordingly we uphold the same by dismissing the ground Nos.1 & 2. Addition on the basis of AIR information - Held that:- In this case TDS has been deducted by the customer on the provisions created in the books of accounts whereas the assessee invoiced and recorded the sale in the next financial year. We observe that the CIT(A) has taken a very balanced and correct view of the matter and also recorded the finding of the fact that there is no escapement of tax as the income stands offered to tax in the next financial year when the assessee invoiced the customer and it is irrelevant that the customer has deducted TDS on the provisions created in the books of accounts. We affirm the order of Ld. CIT(A) by dismissing the ground raised by the Revenue.
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