Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (8) TMI 1051 - AT - Income TaxDisallowance u/s 40(a)(ia) - interest payment made to trust, who claimed exemption u/s 10(23C)(vi) - applicability of second proviso to section 40(a)(ia) - HELD THAT:- The recipient had admitted the impugned interest and filed in the return of income. The assessee had also filed acknowledgement of returns for the A.Y. 2008-09 and 2009-10 admitting the said income. This fact was not disputed by the AO. AO’s grievance is that the income of the assessee was exempt u/s 10(23C)(vi), therefore, contended that the recipient has not paid the tax, thus not complied with the directions. Irrespective of the payment of tax, the question is it is to be seen whether the recipient had admitted the income representing the interest paid by the assessee or not. If the interest is included and exemption u/s 10(23C)(vi) is allowed, the assessee satisfied the requirement of not to treat the assessee in default for the purpose of section 201(1) of the Act. In the instant case, there is no dispute that the recipient had filed the returns of income by including the interest received from the assessee. Therefore, there is no case for making the addition u/s 40(a)(ia), hence the orders of the lower authorities are set aside and the appeal of the assessee is allowed.
|