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2014 (6) TMI 812 - AT - Income TaxDisallowance u/s 40(a)(ia) of the Act shortfall in deducting TDS - Revenue was of the view that the assessee was only acting as agent and received commission for arrangement of transport Held that:- if there is any shortfall in deducting TDS, the assessee can be declared to be an assessee in default u/s 201 of the Act and no disallowance can be made by invoking the provisions of section 40(a)(ia) Relying upon COMMISSIONER OF INCOME TAX, KOLKATA-XI Versus M/s SK. TEKRIWAL [2012 (12) TMI 873 - CALCUTTA HIGH COURT] - Decided in favour of assessee. Non deduction of TDS - bonafide mistake - Held that:- where the certificate u/s 197 has been issued, the assessee can claim that it has a bonafide belief that tax is not required to be deducted on the basis of the certificate for the payment exceeds the exemption limit specified in the certificate. - Ld.CIT(A) is not justified in confirming the disallowance made by the AO on this count. - Decided in favor of assessee. Disallowance u/s 40A(3) of the Act Cash payment eceeds limit on single day Held that:- section 40A (3) has been w.e.f 01/04/2009 providing that all the payments made to a person in a single day would be considered for making the disallowance - The amendment is not applicable so far as the case in hand being related to the AY 2008-09 - In the absence of a provision conferring the power to aggregate all the payments made in a single day for making the disallowance during the year under consideration and in view of the position that section 40A (3) as applicable in for the assessment year permits only single payment during the day has to be considered for disallowance - CIT(A) is not justified in confirming the action of the AO in aggregating the sums paid on a day for making the disallowance - the AO is directed to identify each of the payment made by the assessee less than Rs.20,000/- and allow the expenditure Decided in favour of Assessee.
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