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Shri. N. Palanivelu, Prop. M/s. Nagamalai Textiles Versus The Income Tax Officer, Ward II (1) , Salem

2015 (10) TMI 1415 - ITAT CHENNAI

TDS u/s 194C not deducted - Addition made under section 40(a)(ia) - assessee involved in sizing work - Held that:- Special Bench of the Tribunal in the case of Merilyn Shipping and Transports v. Addl. CIT (2012 (4) TMI 290 - ITAT VISAKHAPATNAM ) and judgment of CIT v. Vector Shipping Services (P.) Ltd. [2013 (7) TMI 622 - ALLAHABAD HIGH COURT] held that section 40(a)(ia) is not applicable when there is no outstanding balance at the end of the close of the year relevant to the assessment year in .....

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shall place necessary evidence in support of his claim.

Further, we make it clear that if the impugned amount is not outstanding at the end of the close of the assessment year in respect of the expenses either as outstanding expenses or as sundry creditors, this amount cannot be disallowed. This ground is remitted back to the Assessing Officer for fresh consideration. - Decided in favour of assessee for statistical purposes.

Disallowance at 20 per cent. on weaving charges .....

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h, IRS, JCIT. ORDER Chandra Poojari (Accountant Member).- This appeal by the assessee are directed against the order of the Commissioner of Income-tax (Appeals), Salem, dated January 29, 2015 for the assessment year 2009-10. 2. The first ground for consideration is with regard to the addition made under section 40(a)(ia) of the Income-tax Act, 1961. 2.1. The brief facts of the case are that the assessee is a proprietor of M/s. Nagamalai Textiles, which concern is indulged in the manufacturing of .....

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s in the hands of the assessee and alleged sub-contract work was executed, i.e., the sizing work under the full control of the assessee itself. There are no such discretion with alleged sub-contractors for executing the above works. They were executing the work as per the requirement of tender under full control and supervision of the assessee. The Assessing Officer has disallowed an amount of ₹ 23,18,855 on the ground that no TDS was made by the assessee as required under section 194C of .....

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, 2013 held that section 40(a)(ia) is not applicable when there is no outstanding balance at the end of the close of the year relevant to the assessment year in respect of these payments. However, the assessee has not brought on record, the details of outstanding expenses or schedule of sundry creditors showing whether the impugned amount is outstanding at the end of the close of the previous year relevant to the assessment year either in the name of the party or outstanding expenses. Hence, in .....

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