TMI Blog2015 (8) TMI 277X X X X Extracts X X X X X X X X Extracts X X X X ..... ce under Chapter XVII-B and such tax has not been deducted or, after deduction, has not been paid during the previous year, or in the subsequent year before the expiry of the 'time prescribed' under Section 200(1) of the Act, this provision is attracted. If Section 40(a)(ia) is understood in the manner as laid down in Gurusahai Saigal v. Commissioner of Income Tax, Punjab [1962 (8) TMI 66 - SUPREME COURT] it can be seen that the expression "tax deductible at source under Chapter XVII-B" occurring in the Section has to be understood as tax deductible at source under the appropriate provision of Chapter XVII-B. Therefore, as in this case, if tax is deductible under Section 194J but is deducted under Section 194C, such a deduction would not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and the Tribunal also rejected the appeal filed by the assessee concerning the assessment year 2005-2006. 2. In ITA 572/11 filed against the order of assessment for the assessment year 2006-2007, the assessment order applying tax at the rate of 5% prescribed under Section 194J was upheld. Thereafter, following the Calcutta High Court judgment in Commissioner of Income Tax v. S.K.Tekriwal [2014] 361 ITR 432 (Cal), the Tribunal held that the conditions laid down under Section 40(a)(ia) of the Act for making addition is that tax is deductible at source and such tax has not been deducted. According to the Tribunal, if both the conditions are satisfied, then such payment can be disallowed under Section 40(a)(ia) of the Act. It was also hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Dr.A.Venugopal, Dr.Lekha, Dr.George Jacob etc. the Urology team headed by Dr.George P.Abraham, the Nephrology team headed by Dr.Mohan A Mathew would continue to extent their professional services on behalf of the Second Party to the First Party, for a period of three (3) years from the date of their joining the Second Party or till such time as they are in the services of the Second Party by regular visitations and attending to surgeries, conducting procedures, and other medical services at the Hospital of the First Party as required for maintaining and improving the overall services and facilities of these departments in the First Party. 5. Who among the various Members of the respective Teams should attend at the First Party's Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;time prescribed' under Section 200(1) of the Act, this provision is attracted. 8. This provision is attracted in cases where fee for professional services or technical services is 'payable' on which tax is 'deductible at source' and 'such tax' has not been deducted or after deduction not paid. As rightly contended by the Senior Standing Counsel for the Revenue, provision of Section 40(a)(ia) (supra) is not a charging Section but is a machinery Section and such a provision should be understood in such a manner that the provision is workable. It has been so held by the Apex Court in its judgment in Gurusahai Saigal v. Commissioner of Income Tax, Punjab [ITR (XLVIII - 1963)] which reads thus: Now it is well r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tood as tax deductible at source under the appropriate provision of Chapter XVII-B. Therefore, as in this case, if tax is deductible under Section 194J but is deducted under Section 194C, such a deduction would not satisfy the requirements of Section 40(a)(ia). The latter part of this Section that such tax has not been deducted, again refers to the tax deducted under the appropriate provision of Chapter XVII-B. Thus, a cumulative reading of this provision, therefore, shows that deduction under a wrong provision of law will not save an assessee from Section 40(a)(ia). 10. In so far as the judgment of the Calcutta High Court in Commissioner of Income Tax v. S.K.Tekriwal [2014] 361 ITR 432 (Cal), which was relied on by the Tribunal is conce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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