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2018 (9) TMI 1690 - AT - Income TaxTDS u/s 194A - disallowance u/s 40(a)(ia) - interest paid on term deposits to the members by assessee Co-operative bank - Held that:- We find that similar issue i.e. the obligation of assessee Co-operative bank to deduct tax out of interest payment to the members or other Co-operative societies on time deposits arose in Saraswat Co-operative Bank Ltd. Vs. ITO and Anr [2017 (3) TMI 741 - BOMBAY HIGH COURT] as held The Explanatory Notes has made the position of law clear that such Co-operative Banks are not liable to deduct any amount from the TDS, prior to the effective date 1/06/2015. The appellant Co-operative Bank was not under obligation to deduct the amount from the TDS, for the assessment years prior to 1/06/2015 i.e. from 2010-11 to 2013-14. Assessee had not defaulted in not deducting tax at source out of such payments made to its members / Co-operative societies. Thus, there was no liability to deduct tax at source and the assessee cannot be said to have violated the provisions of section 194A - decided in favour of assessee.
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