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2015 (12) TMI 1465 - ITAT CHENNAI

2015 (12) TMI 1465 - ITAT CHENNAI - TMI - Disallowance of interest paid to various parties invoking the provisions of section 40(a)(ia) - assessee had belatedly filed form 15G before the Ld.A.O and also before the Ld. CIT. - Held that:- From the facts of the case, it appears that the assessee had filed the Form 15G belatedly before the Ld. A.O except from two individuals. Since there were defect in the Form 15G because the same was undated, the Ld. Assessing Officer as well as the Ld. CIT disall .....

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Following the aforesaid decision of the Hon’ble Jurisdictional High Court, we also hereby remit the matter back to the file of Ld. Assessing Officer with similar direction. - Decided in favour of assessee for statistical purposes. - ITA No. 799/Mds/2015 - Dated:- 11-11-2015 - Shri A. Mohan Alankamony, Accountant Member And Shri Challa Nagendra Prasad, Judicial Member For the Appellant : Shri. P. A. Aswin Kumaar, C. A. For the Respondent : Shri. A. V. Sreekanth, IRS, JCIT ORDER Per A. M .....

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40(a)(ia) of the Act through the assessee had belatedly filed form 15G before the Ld.A.O and also before the Ld. CIT. 3. The brief facts of the case are that the assessee is an individual, engaged in the business of share trading and service provider, filed his return of income for the assessment year 2010- 11 admitting income as ₹ 18,27,970/-. Initially the return was processed U/s. 143(1) of the Act and subsequently the case was taken for scrutiny through CASS and the assessment U/s. 14 .....

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aforesaid amount. In response to AO s proposal dated 11.03.2013, the assessee pleaded that he had obtained Form 15-G from all the payees except Smt, Gowari and Sri Gothandaraman and enclosed the Xerox copies of the Form-15G. On perusing the Form 15G, the Ld. Assessing Officer observed that the Form No.15G was undated. Therefore the Ld. Assessing Officer invoked the provisions of section 40(a)(ia) of the Act and disallowed the interest expenditure claimed by the assessee as deduction. 4.1 On appe .....

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further qualified by the provisions of sec.197A(IA) wherein if a person furnished a declaration in writing in prescribed Form and verified in the prescribed manner to the effect that tax on his estimated total income is to be included in computing his total income will be NIL, there is no need to deduct tax. The assessee has received such Forms as prescribed from those persons to whom interest was paid/being paid and accordingly no deduction of tax was to be made in such cases. i.e. Once Form 15 .....

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STEEL TRADERS Vs. ITO, 13(3)(4), MUMBAI in ITA No..6822/MUM/20II dated 10.07.2013 is filed for the esteemed consideration and reference of Commissioner of lncome Tax (Appeals). During the course of assessment proceedings your appellant has filed copies of twelve I 5G forms, which were already filed before CIT on 12.01.2013 through his Chartered Accountant by his letter 157/12-13 dated 14.03.2013. As such the addition made under this count is not warranted it is requested to be deleted. 5.3. The .....

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as claimed by the assessee. Hence, it is construed that the assessee did not fulfill the conditions laid down in sub rule (3) of Rule 29C of the Income Tax rules 1962 where it was stated that the person responsible for paying the interest etc. shall deliver or cause to be delivered to the Chief Commissioner or Commissioner, one copy of / the declaration on or before the seventh day of the next month in which the declaration is furnished to him. Since the assessee had failed to furnish proof for .....

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that TDS is not deductible as he obtained Form 15G, the onus is on him to establish factually that the said forms were filed before Commissioner of Income Tax before the due date. The AO examined the issue and gave a finding in the remand report that appellant has not proved through evidence that declarations under Form No.15-G were filed before the Commissioner of Income Tax before the due date. Once the forms are not valid appellant deemed to have become default under TDS and therefore, the di .....

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of section 40(a)(ia) of the Act cannot be invoked in the case of the assessee because the assessee was not liable to deduct TDS as he has complied with the provisions of the Act by filing Form 15G. The Ld. A.R. also relied in the decisions of Jurisdictional High Court in the case of Vijay Hemant Finance & Estates Ltd, reported in [1999] 105 Taxmann 519(Mad.) and Mumbai Tribunal in the case of M/s.Karwat Steel Traders Vs. ITO in ITA No.6822/Mum/2011 vide order dated 10.07.2013. On the other h .....

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ing the provisions of section 40(a)(ia) of the Act. The assessee has relied in the decision of the Jurisdictional High Court in the case of Vijay Hemant Finance & Estates Ltd., cited supra which is identical to the case of the assessee wherein the Hon ble High Court remitted the matter back to the file of Ld. Assessing Officer for providing an opportunity to the assessee to rectify the defects in the Form 15H. The relevant para of the order is reproduced herein below for reference:- 11. The .....

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n the application filed for renewal of registration of the firm. Sujatha Manohar, J. (as Her Lordship then was) speaking for the Bench of the Bombay High Court referred to a Circular issued by the Central Board of Revenue dated 114-1955 [Circular No. 14 (XL-35) of 1955] and held as under: It is now well-settled that even if the contents of a circular may amount to a deviation on a point of law, a circular of the Central Board of Revenue which confers some benefit on the assessee is binding on al .....

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