TMI Blog2017 (2) TMI 735X X X X Extracts X X X X X X X X Extracts X X X X ..... 2-2017 - Shri D. Manmohan, Vice President And Shri B. Ramakotaiah, Accountant Member For Assessee : Shri A.V. Raghu Ram, AR For Revenue : Smt Suman Malik, DR ORDER Per B. Ramakotaiah, A. M. This is an appeal by assessee against the order of the Commissioner of Income Tax (Appeals)-Tirupati, dated 04-01-2017 confirming the disallowance made u/s. 40(a)(ia) of the Income Tax Act [Act]. Assessee has preferred Stay Application seeking stay of outstanding demand of ₹ 7,19,653/- by his petition dt. 30-01-2017. When this was taken up, it was noticed that the issue in main appeal is also covered in favour of assessee and accordingly, after hearing both parties, the appeal itself is disposed-off along with Stay Petition. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ability of section 194-I, whereas the learned DR relied upon the assessment order and submitted that provisions of section 194-I are applicable. Therefore, we are not going in to the dispute regarding applicability of section 194-I, however, we limit our adjudication to the extent of applicability of provisions of section 40(a)(ia) of the Act. As the Assessing Officer has no occasion to examine the issue with reference to the special bench decision (supra), which was settled on a later date and there is no examination of the fact whether the expenses incurred by the assessee paid or payable, as on the date of Balance Sheet i.e. 31st March of accounting year, therefore, we set aside the orders of the CIT(A) and restore the issue to the file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e disallowance is not warranted as the amount was already paid and was offered by the payee. 5. Ld. DR fairly admitted the legal position but relied on the orders of the CIT(A). 6. We have considered the rival contentions and perused the details available on record. There is no dispute to the fact that the amount was already paid during the year. Ld.CIT(A) in the first round of appeal has already considered this fact and gave relief. It is also fact that the scope of examination given to AO was limited to examine facts for applicability of the decision of Special Bench. 6.1. We further find that while deciding the appeal in the case of Janapriya Engineers Syndicate (I.T.T.A. No.352 of 2014 dated 24-06-2014) the Hon ble Andhra Prade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of the jurisdictional High Court or the decision of the ITAT Hyderabad Bench was brought to our notice wherein a contrary view was taken on this aspect. Since the ITAT is following the observations of the Hon'ble jurisdictional High Court which in turn was referred to by the ITAT Hyderabad Benches in number of cases and in various cases as stated in assessee submissions this principle was accepted. Respectfully following, We direct the AO to delete the addition so made following the principles laid down by the Hon'ble Special Bench of ITAT in the case of Merilyn Shipping and Transport Ltd., Vs. ACIT [136 ITD 23 (SB)] [16 ITR 1] (SB)(Visakha.)(Trib.). Accordingly, assessee s grounds are allowed. 7. In the result, appeal of as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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