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TMI Blog2014 (1) TMI 391X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 40(a)(ia) of the Act. - This aspect also should be considered by AO - The issue was restored to the file of AO. Rectification of mistake - Disallowance under section 40(a)(ia) – Whether tax already paid by the deductee be recovered again from the assessee - Held that:- Since provisions of section 40(a)(ia) and section 201 operate in a different context, the Bench thought it fit not to give any specific direction but only to place on record the fact whether the recipient paid the taxes or not - This direction was already given in the order – Thus no direction can be given specifically for application. - MA No. 619/Mum/2012 - - - Dated:- 7-2-2013 - Shri D. K. Agarwal And Shri B. Ramakotaiah,JJ. For the Appellant : Shri Vijay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment order the software was held to be royalty and the provisions of section 194J were held applicable. Since TDS was not made, AO disallowed the entire purchase amount under section 40(a)(ia). After considering the rival submissions the Bench recorded that the issue is covered in favour of assessee by the Coordinate bench in assessment year 2007-08, but consequent to the decision of the Hon'ble Karnataka High Court in an appeal on orders under section 201 on payments made to non-residents wherein it was held that the amounts are royalty in nature, the matter was set aside to AO to decide the issue afresh after giving due opportunity to assessee. In addition AO is also directed to keep in mind the Special Bench decision of the ITAT in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no requirement to give specific direction on the applicability of the jurisdictional High Court judgment as it is binding on AO to follow the principles laid down by the Hon'ble jurisdictional High Court and the issue was restored to AO to consider in the light of the facts and law. Now that assessee requested for specific direction on this issue, we add the following vide Para 33 of the order which should be considered as inclusive of this. "AO is also directed to examine whether the principles laid down by the Hon'ble Bombay High Court in the case of CIT vs. Kotak Securities Ltd (Supra) wherein the Hon'ble Court took the view that due to the bonafide belief if a person does not deduct the tax while making payment, then there can b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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