TMI Blog2017 (4) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... R ORDER PER G.S. PANNU, AM : The captioned appeal by the assessee is directed against the order of the CIT(A)-20, Mumbai dated 01/02/2012, pertaining to the Assessment Year 2009-10, which in turn has arisen from the order passed by the Assessing Officer dated 27/07/2011 under section 143(3) of the Income Tax Act, 1961 (in short the Act ). 2. Although the assessee has raised multiple Grounds of appeal, but the solitary dispute relates to disallowance of ₹ 18,27,675/- made out of labour charges paid by invoking provisions of Sec. 40(a)(ia) of the Act. 3. At the outset, the learned representative for the assessee submitted that there was a delay in filing of appeal before the Tribunal and referred to the appellant s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax hearing. In view of the above, the appellant pleads that delay in filing of an appeal be condoned and appeal may be admitted. There cannot be any intention of non filing of appeal or there was no malafide intention to delay the matter. 4. The learned representative vehemently pointed out that the delay in filing of appeal is for bona fide reasons and, in any case, the issue in appeal has already been decided in assessee s favour by the Tribunal in Assessment Year 2008-09 in ITA No. 6673/Mum/2011 vide order dated 22.8.2012 and, therefore, there would not have been any justifiable reason for the assessee to deliberately delay filing of appeal. 5. Considering the reasons advanced, and the fact that the bona fide of the rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 194C of the Act as against 10% required u/s 194J of the Act, the disallowance be limited to the expenditure corresponding to such differential of 8%. Accordingly, the CIT(A) has scaled down the amount disallowable u/s 40(a)(ia) of the Act. Against such a decision of the CIT(A), assessee is in appeal before us. 7. Before us, the limited plea of assessee is that the provisions of Sec. 40(a)(ia) of the Act come into operation only when there is a failure to deduct tax at source, but not in cases where there is a mere shortfall in the deduction of tax at source. In this context, he has referred to the decision of Tribunal dated 22.8.2012 (supra), wherein under identical circumstances, the disallowance out of payments made to M/s. Aeromatic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid for 18 consultants is only an amount of `26,75,535/-, which indicates that they are in employment and not professional consultants. It is also not the case that assessee has not deducted any amount. Assessee has indeed deducted tax under section 192 and so we are of the opinion that provisions of section 40(a)(ia) also do not apply as the said provision can be invoked only in the event of non deduction of tax but not for lesser deduction of tax. In view of this, we are of the opinion that there is no merit in Revenue s contention that the amount paid to the employees should be disallowed as provisions of section 194J would attract. On the facts of the case, there is no merit in Revenue s appeal. Accordingly the order of the CIT(A) is co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax is deductible at source and such tax has not been deducted. If both the conditions are satisfied then such payment can be disallowed u/s. 40(a)(ia) of the Act but where tax is deducted by the assessee, even under bonafide wrong impression, under wrong provisions of TDS, the provisions of section 40(a)(ia) of the Act cannot be invoked. Here in the present case before us, the assessee has deducted tax u/s. 194C(2) of the Act and not under section 194I of the Act and there is no allegation that this TDS is not deposited with the Government account. We are of the view that the provisions of section 40(a)(ia) of the Act has two limbs, one is where, inter alia, assessee has to deduct tax and the second where after deducting tax, inter alia, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
