TMI Blog2018 (1) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... tax from the payment made Disallowance u/s 40(a)(ia) - disallowance of ocean freight, terminal handling charges - Held that:- As per the prescribed Form No. 26A, the deduction under amended section will be allowed only if the (i) payee has furnished his return of income under section 139; (ii) payee has taken into account such sum for computing income in such return of income; and (iii) payee has paid the tax due on the income declared by him in such return of income, and the payer furnishes a certificate to this effect from an accountant in the prescribed form. Thus we set aside the order of the Ld. CIT(A) on the above issue and restore the matter to the file of the AO to make an order in the light of theour above observation, after g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ii. Greenwich Rs.4,59,153/- iii. P.D. Prasad Rs.34,068/- iv. Mahavir Agency Rs.4,03,373/- v. AMI India Logistics Rs.5,82,564/- vi. Others Rs.3,99,926/- Total 20,46,640/- 2.1 The AO made a disallowance of ₹ 15,10,924/- out of the above sum u/s 40(a)(ia) of the Act. 3. The 1st ground raised by the assessee in this appeal is against the order of the Ld. CIT(A) confirming the disallowance of service ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 5,98,934/- be deleted. Reliance is placed by him on the order of the ITAT C Bench Mumbai in the case of ACIT v. M/s P.P. Overseas for AY 2006-07 (ITA No. 733/Mum/2010). 6. On the other hand, the Ld. DR relies on the order passed by the Ld. CIT(A). 7. We have heard the rival submissions and perused the relevant materials on record. In M/s P.P. Overseas (supra) the Tribunal has held: The contract between the assessee and the C F agent is a service contract which has not been specifically included in Explanation III below section 194C. In this view of the matter, the provisions of section 194C are not applicable to the payments to the C F agents. If that is so, there was no obligation on the part of the assessee to ded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) confirming the disallowance of ocean freight, terminal handling charges of ₹ 4,03,893/- paid to Greenwich Meredian Logistics India Pvt. Ltd. 13. The assessee submitted before the Ld. CIT(A) that as per the amended provisions of section 40(a)(ia) w.e.f. 01.04.2013 if the payee has paid taxes on such receipts then for the purpose of allowing deduction of such sum, it shall be deemed that the assessee has deducted and paid the tax. The Ld. CIT(A) was not convinced with the above explanation of the assessee and held that since the amendment is operative only w.e.f. AY 2013-14, the assessee s contention is not applicable. On that reason, the Ld. CIT(A) confirmed the disallowance made by the AO. 14. Before us, Ld. counsel reitera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents/evidence before the AO. Thus, 5th ground of appeal is allowed for statistical purposes. 15. The Ld. counsel has not pressed the 6th ground of appeal. 16. In the result, the appeal is partly allowed. ITA No. 5679/MUM/2013 Assessment Year: 2006-07 17. We find that excepting the 2nd ground of appeal in AY 2006-07, the other grounds are similar to AY 2005-06. The 2nd ground raised by the assessee is against the order of the Ld. CIT(A) confirming the disallowance of amount paid to IAL Shipping Agencies ₹ 28,453/-, Sea Load Shipping Agencies ₹ 16,431/- and Three Star Forwarders Pvt. Ltd. ₹ 6,006/- ignoring the statutory provisions of sub-section 5 of section 194C. The above payments bein ..... X X X X Extracts X X X X X X X X Extracts X X X X
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