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2016 (5) TMI 760 - AT - Income TaxDisallowance u/s 40(a)(ia) - failure to deduct TDS u/s 194C - Held that - The details ought to have been submitted before the AO, but in the interest of justice, the ld.CIT(A) has also called for the details viz. copies of GRs. not submitted by the assessee with regard to the 11 parties. The assessee did not file their income tax details in order to determine whether these parties have paid taxes on the amounts paid by the assessee to them without deduction of taxes. Thus, a perusal of the CIT(A) s order would indicate that the ld.CIT(A) was conscious of the fact that other issues have also bearing on the controversy and they are required to be examined. Before us, neither any paper book has been filed by the assessee nor any one has appeared in spite of service of notice. Therefore, we do not have any material on the strength of that we could dispute the finding of the facts recorded by the CIT(A). - Decided against assessee.
Issues Involved:
Quantification of disallowance under section 40(a)(ia) of the Income Tax Act on account of non-deduction of TDS. Detailed Analysis: Issue 1: Quantification of Disallowance under Section 40(a)(ia) of the Income Tax Act - The case involved cross-appeals by the assessee and the Revenue against the order of the ld.CIT(A) for the Assessment Year 2008-09. - The primary issue was the quantification of disallowance under section 40(a)(ia) concerning non-deduction of TDS on freight payments exceeding ?50,000 to sub-contractors during the year. - The ld.AO disallowed the claim of the assessee for not deducting TDS under section 194C of the Income Tax Act on the mentioned payments. - The CIT(A) upheld the disallowance for outstanding amounts as of March 31st, while deleting the disallowance for payments made during the year based on the judgment of M/s.Merilyn Shipping & Transports Vs. ACIT. - The Revenue appealed against the deletion of disallowance, while the assessee contested the addition for outstanding amounts. - The Hon'ble Gujarat High Court's decision favored the Revenue, overruling the Special Bench's decision in the case of M/s. Merilyn Shipping & Transports vs. ACIT. - The CIT(A's rejection of the assessee's contentions was based on the failure to produce crucial documents like GRs and income tax details of the parties involved. - The CIT(A) directed the AO to verify audited P&L account and balance sheet for allowing payments made during the previous year. - Despite opportunities, the assessee failed to provide necessary documentation, leading to the confirmation of disallowance for outstanding amounts and addition of ?19,06,615. - The Tribunal upheld the appeal of the Revenue and dismissed the appeal of the assessee, restoring the assessment order. In conclusion, the judgment focused on the quantification of disallowance under section 40(a)(ia) due to non-deduction of TDS, emphasizing the necessity of providing essential documentation to support claims and decisions in tax matters.
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