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2014 (1) TMI 895 - ITAT MUMBAIDisallowance on outsourcing expenses u/s 40(a)(ia) of the Act – Held that:- From the agreement it is clear that DEOs and the Cos had to perform particular functions as per the requirements of the asssessee -They had to scan the documents besides carrying out the job of Bar Coding of the papers - As per the agreement, minimum qualification to do the job of Scanning/Bar Coding was diploma course after passing 12th standard - work done by these operators(DEOs/Cos) cannot termed as labour work - For Bar Coding and other related activities a minimum professional qualification and proficiency is required – Thus, work done by the operators has to be treated as technical service and provision of section 194J would be attracted to the payment made to them by the assessee company. The decision Deputy Commissioner of Income-tax - 11(2) Versus Chandabhoy & Jassobhoy [2011 (7) TMI 956 - ITAT MUMBAI] and in APOLLO TYRES LTD Versus DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-1(1), ERNAKULAM [2013 (11) TMI 209 - ITAT COCHIN] followed - short deduction of TDS, if any, could have been considered as liability under the Income-tax Act as due from the assessee – thus, the disallowance of the entire expenditure, whose genuineness was not doubted by the assessing officer is not justified - in case of short/lesser deduction of tax, the entire expenditure whose genuineness was not doubted by the AO, could not be disallowed - Matter remitted back to the AO for fresh adjudication – Decided partly in favour of Assessee.
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