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2015 (10) TMI 1000 - ITAT MUMBAI

2015 (10) TMI 1000 - ITAT MUMBAI - TMI - Disallowance u/s 40(a)(ia) - Held that:- FAA had confirmed the order of the AO as it was found that TDS was not paid by the assessee on due dates,as envisaged by the provisions of the Act,that the assessee contended that payments were made before the due date of filing of return.As far as TDS about interest payment and professional fees are concerned,we find that the assessee has not made any submission before the FAA, however, before us it was stated tha .....

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onal fee he would follow the decision of the Special Bench delivered in the case of Merlyn Shipping and Transport (2012 (4) TMI 290 - ITAT VISAKHAPATNAM). - Decided in favour of assessee for statistical purposes. - ITA No.8404/Mum/2010 - Dated:- 4-9-2015 - Sh. Rajendra and Parthasarathy Choudhury, JJ. For The Assessee : Shri Vijay Mehta For The Revenue : Shri S.R. Walimbe Order PER RAJENDRA, AM Challenging the order dt.30.09.2010 of CIT(A)-31, Mumbai the Assessee has raised following Grounds of .....

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ad-in-law and harsh. The provisions being ultra-virus, bad in law and hence the same cannot be invoked on the facts and circumstances of the case of the appellant. (2) Without prejudice to above, and on the facts and circumstances of the case and in law, the Commissioner of Income Tax (Appeals) erred in confirming addition of an amount of ₹ 2,68,02,688/-, though the appellant was not required to deduct TDS on these payments. The appellant had directly transferred the said contracts to othe .....

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not applicable. (4) Without prejudice to above, Commissioner of Income Tax (Appeals) erred in not considering the modification in the original ground No.2 for which request was made by the appellant vide letter dated 10th August 2010 during the course of hearing. In the original ground the appellant had by mistake taken the amount of addition of ₹ 2,64,03,867/- instead of actual addition of ₹ 2,68,02,688/-. (5) The Commissioner of Income Tax (Appeals) erred in not accepting the fact .....

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nd hence no disallowance of the following expenses is warranted vts: 40(a)(ia) of the Act: a) Sub-contract expenses amounting to ₹ 2,68,02,688/- b) Interest expenses amounting to ₹ 31,500/- 2. The Ld. Commissioner of Income-tax (Appeals) has erred in law and in facts not appreciating that the disallowance of various expenses u/s.40(a)(ia) of the Act can only be made in respect of the amount outstanding payable to the parties at the end of the year. 3. The Ld. Commissioner of Income-t .....

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is about addition of ₹ 2.68 crores on account of non-payment of TDS in time.During the assessment proceedings, the AO found that the assessee had made subcontract payments, interest and professional charges on which TDS deducted was paid into the Central Govt. account beyond the due date prescribed by the provisions of Chapter XVII of the Act,that the total payment made into Govt. account in time under the head sub-contract and interest worked out to ₹ 2.86 crores,(Rs.2.85 crores on .....

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the claim of the assessee for deduction,amounting to ₹ 3.99 lacs that was made in the immediately preceding AY on account of TDS on professional fees. Finally,invoking the provisions of s.40(a)(ia) of the Act,the AO worked out net disallowance of 2.64 crores on account of sub contract charges. He further disallowed ₹ 3.72 lacs and 31,500 on account of professional fees paid and interest paid. 3.Aggrieved by the order of the AO the assessee preferred an appeal before the First Appell .....

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to carry out any work,that the provisions of s.194C were not applicable,that the AO was incorrect in invoking the provisions of s.40(a) (ia).Regarding the disallowance made on account of professional fees and interest paid the assessee did not make any submission before the FAA. After considering the submission of the assessee and the assessment order,the FAA held that the facts regarding the payment of sub contract charges, interest and professional fee as debited to its P&L account was no .....

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ion 194C(2) of the Act, that the it had deducted the tax but same was paid beyond the due date prescribed by the Act, that the AO was fully justified in making disallowance by invoking the prov. of s.40A((ia) r.w.s. 194C(2) of the Act. Similarly, the entire disallowance made on account of disallowance of professional fee and interest was also confirmed by the FAA,as the facts were not disputed by the assessee. 4.During the course of hearing before us,the Authorised Representative(AR)contended th .....

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