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TMI Blog2012 (11) TMI 513X X X X Extracts X X X X X X X X Extracts X X X X ..... Id. AR, the assessee's counsel, would submit that the issue arising in the present appeals stands covered by the order by the Tribunal in the assessee's own case (in ITA Nos. 1216 and 1387/Kol/2011 and ITA Nos. 1217 and 1388/Kol/2011 dated 19.6.2012) for assessment years 2006-07 and 2008-09 respectively, placing a copy of the same on record. These were, as is also the position in the instant case, cross appeals; the first appellate authority having allowed partial relief, so that the disallowances as effected by the Assessing Officer (AO) may be broken-up or considered in two separate components. The assessee-company, a Clearing and Forwarding Agent (CFA) for Hindustan Lever Ltd., Mumbai (HLL), makes payment of various charges, which are i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40(a)(ia) would ensue. The same, it was prayed, be followed. 2.3 The ld. DR would, in response, submit that there is no question of the matter being considered as covered by the order by the Tribunal even though it is in the assessee's own case. As would be apparent therefrom, the only basis of the acceptance of the assessee's claim qua transportation charges in that case was the filing of Form 15-J by the assessee, so that no TDS on the said payment was in fact payable. In the instant case, on the other hand, the assessee's claim for filing Form 15-I or 15-J has been specifically contested and assailed by the AO (refer page 3 of the assessment order). With regard to the other payments also, it stands abundantly clarified that the privity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... copy of the order of each of the three Members constituting the Special Bench, which decided the same per majority decision, on record. The same being now available and applicable, formed yet another reason for non-application of section 40(a)(ia) in the instant case; the payment, in most part, having been made and not outstanding as at the year-end. 2.5 The Id. DR, on this, relied on the decision in the case of Milk Specialties Ltd. v. CIT, placing a copy of the said decision on record. The hon'ble court has clarified that where there is a liability to deduct tax at source under section 194C, which was not deducted and paid, disallowance under section 40(a)(ia) would follow. 3. We have heard the parties, and perused the material on reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the payments under reference are in pursuance to the same continuing arrangement with the principal, i.e., as for the other years. A uniformity of adjudication by the Tribunal, as well as by the Revenue, would therefore dictate such a course, i.e., as aforestated. The onus, though. we may clarify, would be strictly on the assessee to exhibit that the said expenditure stands incurred only for and on behalf of the principal, who was obliged to reimburse the same in full, and indeed did so, so that there is no claim in respect to the same by the assessee per its return of income. Further, though the Tribunal in ITO v. Dr. Willmar Schwabe India (P.) Ltd. [2005] 3 SOT 71 (Delhi), relied upon by the assessee, clarifies that the reimbursable e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to any third party, but only represents the deduction made by the principal on account of short delivery of stock and, therefore, is by way of transportation shortage. There is no question of application of sec. 40(a)(ia), and stands rightly deleted by the ld. CIT(A). We decide accordingly. 3.3 With regard to the former claim (i.e., for Rs. 307.99 lakhs), we are not at all impressed with the basis on which the first appellate authority has allowed relief to the assessee. The findings by the Assessing Officer in this respect are definite and uncontroverted. When the transporters had not issued Form 15-I to the assessee, where is the question of its filing Form 15-J to the Department, of which the former are but an integral part. And, ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 194C being on the person responsible for making the payment and not on the one who may finally bear it, so that it (the payment) could be on account of a different person, as the assessee's principal in the instant case, the disqualification and the consequential disallowance under section 40(a)(ia) would apply only where the claim for expenditure is preferred in its respect by the assessee, i.e., as the person obliged to and in fact making the payment. If, as claimed, the same stands claimed as a reimbursement, and in fact reimbursed, clearly no expenditure has been claimed by the assessee, for thereto be any scope for disallowance under section 40(a)(ia) for the relevant year. The matter, therefore, as in the case of other expenses fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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