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2018 (11) TMI 476 - AT - Income TaxTDS u/s 194C - contract of supply of material/food - non deduction of tds - assessee-company has purchased Chinese food from M/s Zen Chinese Food and sells those Chinese foods to its customers and charges the VAT thereon - Held that:- In preceding A.Ys. 2006-2007 and 2007-2008, ITAT, Delhi Bench in the case of assessee dismissed the departmental appeals on the same ground considering the Explanation-III to Section 194C of the I.T. Act noted that the transactions relate to sale of material which cannot be termed as contract for work and labour. Hence, Section 194C is not applicable in assessee’s case. Since assessee had paid VAT on sale of goods to its customers, Section 194C of the Act is not applicable. Therefore, provisions of section 40(a)(ia) applied by the A.O. is not justified. Entire addition have been deleted. - Decided in favour of assessee. Addition u/s 14A - absence of any expenditure shown for earning dividend income - Held that:- As onus is upon A.O. to record satisfaction that interest bearing funds have been used for investment to earn tax free income”. Since no borrowed funds have been used by assessee to make investment, therefore, Ld. CIT(A) correctly deleted the addition - Decided in favour of assessee.
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