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TMI Blog2019 (4) TMI 781X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to AO, in the process of selling distributorship of re-charge vouchers, the company had allowed the assessee certain commission and throughout the year the assessee had earned commission amounting to Rs. 69,50,644/- and the company had deducted tax at source on the said commission payment. Thereafter, the AO noted that the assessee had debited two sums of Rs. 34,40,341/- and Rs. 2,26,100/- respectively as expenses and termed those as incentive allowed to the retail sellers of the re-charge vouchers. However, according to AO, the assessee had failed to deduct any tax at source on those commission payments (though the assessee had termed it as incentive) nature of payment cannot be determined by the nomenclature adopted by the assessee and, therefore, AO was of the opinion that assessee failed to deduct tax at source on the said payment against section 194H of the Act and, therefore, he invoked section 40(a)(ia) of the Act and disallowed the expenditure of Rs. 36,66,441/-. Aggrieved, assessee preferred an appeal before the Ld. CIT(A), who was pleased to uphold the action of the AO. Aggrieved, the assessee is before us. 5. We have heard rival submissions and gone through the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly be on M/s. UWPL and not against the assessee who is only a distributor and receiving his share of commission/margin provided by the service provider. We note that the determination of sale price of re-charge coupons is in the sole domain of the service provider and the assessee has no role in determining the retail price at which the retailer is selling the recharge coupon to the customer or the end user of the service. And as such, we note that assessee's role is only that of an intermediary and passing the service from one hand to other hand and the assessee has shown the amount of commission/incentive/discount in the books of account for completeness of accounts and the said transaction will not depict any liability for deducting tax at source. For the aforesaid view, we rely on the decision of coordinate bench of ITAT Jaipur in the case of M/s. Chocopoack Enterprises Vs. ITO, ITA No. 821/JP/2016 for AY 2011-12, dated 13.10.2017. In a similar case decided by the ITAT, Cuttack Bench in the case of pareek Electricals Vs. ACIT, 27 taxmann.com 219 wherein the facts of that case was that the assessee was a Franchise of BSNL and it received commission on gross value of purchase an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce M/s. UWPL had informed the assessee that the payee M/s. Adeeco Flexion Work Force Solution possessed certificate for non-deduction of TDS u/s. 197 of the Act, the assessee had not made any endeavour to deduct tax at source (TDS). However, as an alternative ground, without prejudice to the aforesaid submission submitted that in the light of the recent amendment of the TDS provisions in the light of the Finance Act, 2012 wherein amendment in sec. 201 and sec. 40(a)(ia) of the Act has been made, it can be verified by the AO whether the payees have disclosed this payment in their return of income and has paid the due tax in their returned income. We find force in the alternative submission of the assessee and taking note of the amendment in Finance Act, 2012 made in section 201 and sec. 40(a)(ia) of the Act the payer assessee would not be deemed to be in default if the recipient of income has taken into account the amount received from the payer in computing income and declared it in their return and has paid taxes on the returned income. We note that the Tribunal has held in a plethora of decisions that insertion of 2nd proviso to sec. 40(a)(ia) of the Act is curative. 9. We note ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) in confirming the addition of Rs. 2,78,825/- made by AO on account of alleged unexplained cash credit. 11. Brief facts of the case are that the AO noted that while examining the assessee's books of account i.e. ledger account he found that the assessee has shown to have received a sum of Rs. 2,78,825/- as loan from one M/s. Tishita Cellular out of the said amount of Rs. 2,78,825/-, the assessee has shown to have received total sum of Rs. 1,52,000/- in cash. According to AO, since the assessee failed to prove the identity, genuineness and creditworthiness of the person who has lent the money, he made the addition. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) who confirmed the same. 12. We have heard rival submissions and gone through the facts and circumstances of the case. We note that before the Ld. CIT(A) it was brought to his notice that M/s. Trishita Cellular has paid the money for purchase of goods and ultimately the said dealer has not purchased the goods within the financial year 2011-12 and finally the dealer purchased goods in the next year and the entire amount was adjusted with the goods purchased within the financial year 2012-13. So, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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