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2021 (5) TMI 890 - AT - Income TaxDisallowance u/s 40(a)(ia) - return of income on presumptive basis u/s.44AD - whether the assessee can take the advantage provided in section 44AD of the Act? - HELD THAT:- Since the assessee’s turnover for the Assessment Year 2013-14 is to the tune of ₹ 92,33,844/- and the assessee had filed the return of income on presumptive basis u/s.44AD of the Act, therefore assessee is entitled to take the benefit of the provisions of section 44AD of the Act, and hence assessee is not liable to deduct TDS under section 40(a)(ia). Whole of the process of taxation must follow the procedures which are valid under the law and must adhere to law i.e. substantive one as well as procedural one too. Therefore,as provided in the Constitution of India that every step should be taken to ensure that levy and collection of the taxes is strictly in accordance with law – not only substantive one but the procedural law, as well. Therefore, we do not agree with the statement of the assessing officer to the effect that “the dues to the crown has no limitation and has precedence over all other allowance and claims. The assessee’s turnover for the Assessment Year 2013-14 which is below one crore rupees, the threshold limit prescribed u/s 44AD of the Act and the assessee had filed the return of income on presumptive basis u/s.44AD of the Act therefore assessee is entitled to take the benefit of the provisions of section 44AD of the Act. In view of the reasons set out above, as also bearing in mind entirety of the case, we are of the considered view that the assessee is entitled to take the benefit of the provisions of section 44AD of the Act. Based on the above factual position narrated above and precedents applicable to the facts, it is abundantly clear that assessee is not liable to deduct TDS under section 40(a)(ia) of the Act, therefore we delete the addition. - Decided in favour of assessee.
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