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2014 (4) TMI 1137 - AT - Income TaxTDS U/S 194C - Disallowance u/s 40(a)(ia) - a contract for supply, erection, testing & commissioning - whether the appellant's income is exempted under Section 10(20) to which provisions of Section 40(a)(ia) do not apply? - Held that:- We concur with the views of learned CIT(A) that the expenditure under consideration was incurred on account of supply, erection, testing & commissioning of lights. M/s Mahaluxmi Enterprises has raised a consolidated bill on account of commissioning, erection of supply of material. The TDS was required to be deducted from the payments made for consolidated bill of material and services as is clear from the circular no. 715 dated 08.08.1995 issued by CBDT. We concur with the views of learned CIT(A) that the provisions of section 40(a)(ia) of the Act are deeming provisions. The deeming provisions are applicable notwithstanding anything otherwise provided under the Act. The assessee has made violations of the provisions of section 194C of the Act and as per section 40(a)(ia) of the Act, no expenditure is deductible if the tax has not been deducted on such payments as per provisions of the Act. The plea of the assessee is that the exemption u/s 10(20) of the act is allowed on such disallowance, is also not sustainable. No benefits in the form of deduction or exemption could be allowed on violating the provisions of the Act. See Mahabir Cotton Traders [2013 (5) TMI 894 - ITAT AMRITSAR] - Decided against assessee.
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