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Dy. Commissioner of Income-tax Versus M/s Acharya Brothers, & vice versa

2015 (12) TMI 1520 - ITAT NAGPUR

Disallowance vls 40(a)(ia) - amount payable or paid by the end of the year - Held that:- Supreme Court in Vector Shipping Services (P) Ltd. [2015 (12) TMI 1131 - SUPREME COURT OF INDIA ] has approved the special bench judgment in the case of Merilyn Shipping and Transport Ltd.[2012 (4) TMI 290 - ITAT VISAKHAPATNAM ] in which it was held that disallowance u/s. 40(a)(ia) applies only to amounts 'payable' as of 31st March and not to amounts already 'paid' during the year. Since the said matter has .....

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from the order of learned CIT(Appeals)-II, Nagpur dated 22- 08-2014. The grounds of the Revenue are as under : 1. On the facts and in the circumstances of the case and in law the Ld. CIT(A) was not justified in allowing appeal on the basis of a non speaking order of Hon'ble Supreme Court rejecting SLP in the case of Victor Shipping Services (P) Ltd. The CIT(A) failed to appreciate that it has been held in various decisions of the apex court itself including the decision in the case of Kunhay .....

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already been made, during the accounting year from the purview of section 40(a)(ia). 3. On the facts and in the circumstances of the case and in law the Ld. CIT (A) was not correct in directing to delete the addition without appreciating the fact 4. that the Aa had made disallowance u/s 40(a)(ia) of the I. T. Act on transportation charges only amounting to ₹ 56,86,316/- for which tax was not deducted at source by the assessee. 5. The CIT(A) failed to appreciate the view given by the Board .....

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) Disallowance Labour payments u/s 40(a)(ia) ₹ 54,58,831/- Total ₹ 1,11,45,147/- An appeal was preferred before the learned CIT(Appeals) who has granted relief and deleted the disallowance of ₹ 54,58,831/-, however, confirmed the disallowance of ₹ 56,86,316/-. Being aggrieved by the part relief, further an appeal was filed before the Tribunal, Nagpur Bench who had set aside the matter to the AO. In compliance of the direction again the impugned assessment was finalised. H .....

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e "payable" as on 31st of March and not to amounts already "paid" during the year. The Department had gone in appeal before the Hon'ble SC in the said case of CIT vs. Vector Shipping Services (P) Ltd (supra) and the Hon'ble SC has dismissed the special leave petition filed by revenue and approved the judgement passed by the Hon'ble Allahabad He. In other words Supreme Court has approved the special bench judgment in the case of Merilyn Shipping and Transport Ltd. .....

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s on 31.03.2006 and consequently the disallowance vls 40(a)(ia) has to be limited to the said amount. 3. After hearing the submissions of both the sides, we have noted that the issue is now covered by several decisions, namely, Merilyn Shipping and Transports 16 ITR (Trib) 1, M/s Victor Shipping Services (P) Ltd. etc. 4. Learned CIT(Appeals) has reproduced the finding of the Hon ble Allahabad High Court in the case of CIT vs. Victor Shipping Services (P) Ltd. as under : 6.1 It also relevant to r .....

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