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2018 (10) TMI 714

Additions u/s 40(a)(ia) - TDS liability u/s 194C - assessee has not furnished the particulars of all payees/contractors in the prescribed form to the prescribed authority in time - Held that:- requisite return in the prescribed form was ultimately filed albeit belatedly, the assessee could not have deducted TDS on receipt of specific information from the payees/contractors. Therefore, in the absence of any liability to deduct tax at source under section 194C of the Act, provisions of section 40(a)(ia) of the Act does not get triggered. - Decided in favor of assessee. - ITA No.2959/Ahd/2016 - Dated:- 2-5-2018 - Shri Pradip Kumar Kedia, Accountant Member And Ms. Madhumita Roy, Judicial Member For the Appellant : Shri Bhadresh Gandhakwala, A.R .....

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ibed information (PAN) was obtained from the contractors and return in Form No.26Q was filed before the prescribed authority, there was no statutory obligation to deduct TDS on payments made towards transportation charges. It was further contended that any delay or defect in filing the return in Form No.26Q has separate consequences as prescribed under the Income Tax Act but that by itself will not compel an assessee to deduct TDS under section 194C of the Act. In the absence of any statutory obligation to deduct TDS, section 40(a)(ia) will not come into play. The CIT(A), however, did not find merit in the plea of the assessee and rejected the appeal of the assessee. 5. Aggrieved, the assessee preferred appeal before the Tribunal. 6. We hav .....

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as sought to be canvassed by learned AR. The question is whether S.40a(ia) can be invoked when the requisite forms as prescribed under statute for non-deduction has been obtained from the deductee although not filed before proper authority. The provisions of section 40(a)(ia) of the Act is reproduced hereunder to examine this aspect of the matter :- 40. Amounts not deductible Notwithstanding anything to the contrary in Sections 30 to 38, the following mounts shall not be deducted in computing the income chargeable under the head "profits and gains of business or profession ",- (a) In the case of any assessee - (i) ....... (ii) (ia) any interest, commission or brokerage, rent, royalty, fees for professional services or fees for tec .....

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tax is not deductible at source under section 194A on receipt of prescribed form, the mischief provided under section 40(a)(ia) is not attracted. 12. We find that no default can be said to have occurred in terms of the phraseology provided under section 40(a)(ia) of the Act in the facts of the case. Accordingly, we hold that the CIT(A) rightly cancelled the disallowance made by the assessing officer under section 40(a)(ia) of the Act due to mere non-filing of impugned Form No.l5G/15H etc. with the appropriate authority. We have also perused decision of the ITAT in the case of Karwat Steel Traders V/s. ITO (ITA no.68322/Mum/2011 order dated 10.7.2013) relied upon by the CIT(A) in this regard. We find the facts in the present case are identic .....

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