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2022 (1) TMI 1098 - AT - Income TaxTDS u/s 194C - Payment to sub-contractors for hiring the vehicles either from them or arranged by them - addition u/s 40(a)(ia) - scope of amendment made to section 194C(6) - HELD THAT:- Insofar as the provision applies to the assessment year 2014-15, it requires the contractor to obtain the PAN details of the transport suppliers and after obtaining the PAN there is no need to deduct any TDS under section 194C, whereas w.e.f. 1/6/2015 the transport suppliers shall also furnish a declaration that he owns less than 10 carriages at any time during the financial year relevant to the assessment year - the provision as applicable up to 31/5/2015 does not bar the exemption to small or large transport operators and is only w.e.f. 1/6/2015, it was made applicable to the transporter owning less than 10 goods carriages at any time during the financial year for which the declaration was to be furnished. The impact of the amendment to this provision has been considered in the decisions relied upon by the assessee before the Ld. CIT(A). Apart from this there is no dispute that the assessee furnished the certificate from Chartered Accountant under the 1st proviso to sub-section (1) of section 201 of the Act in respect of the payments made. AO did not consider the provisions of section 194C as they stood prior to 1/6/2015 and applicable for the assessment year 2014-15 and since the assessee satisfied the conditions required, he is not liable for disallowance of the amount under section 40(a)(ia) - Since the Ld. CIT(A) followed the binding precedents in applying the pre-amended provisions to the case of the assessee it cannot be said that the Ld. CIT(A) committed any illegality or irregularity. We are of the opinion that such findings need to be upheld. Consequently we dismiss ground No. 1 of Revenue's appeal. Disallowance of vehicle running expenses - AO disallowed 25% of the vehicle running expenses on the ground that the assessee failed to produce the supporting evidences/bills and vouchers in support of this claim - HELD THAT:- AO did not spell out any basis to disallow 25% of the expenses. Ld. CIT(A), having considered the factual issue in the light of the nature of business of the assessee thought it fit to restrict the expense to ₹ 5 Lacs. The assessee does not prefer any appeal challenging the upholding of the disallowance of the expense to ₹ 5 Lacs. At the same time, Revenue also does not show how this restriction of the disallowance to ₹ 5 Lacs is unsustainable. Since the quantum of disallowance is a question of fact and the Ld. CIT(A) reached a conclusion having regard to the nature of business and other attendant factors, we find that it's not fair to interfere with the findings of the Ld. CIT(A). We, accordingly, declined to interfere with such findings. Ground No. 2 of Revenue's appeal is accordingly dismissed.
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