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TMI Blog2014 (2) TMI 1153X X X X Extracts X X X X X X X X Extracts X X X X ..... s to the insurer or insured and only collecting the amount from the insurer and passing it on to various hospitals who were providing medical services to the insured. Since, there is no claim of expenditure by the assessee, disallowance under section 40(a)(ia) as was done by the Assessing Officer does not arise. It may be different issue that the amounts paid may be covered by the provisions of section 194J as was held by the hon'ble Karnataka High Court in the case of Medi Assist India TPA P. Ltd. v. Deputy CIT Bangalore (2009 (8) TMI 85 - HIGH COURT OF KARNATAKA), relied upon by the Assessing Officer. In that case, the provisions of section 201 was applicable but certainly disallowance under section 40(a)(ia) does not arise as the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to such hospitals. The assessee herein collects the amount of medical expenses billed by the hospitals on insured persons, from the insurance companies and remit the same to the hospitals. Thus, the case of the assessee is that it only provides services of paper work and guarantee and finally makes payments to hospitals in which the insured persons has availed of the medical facilities or services. The assessee is doing all these works on behalf of insurance companies. The assessee neither credits the receipts nor debits the payments to the profit and loss account. The Assessing Officer held that payment made to the hospitals by the assessee is covered under section 194J and accordingly took the view that the assessee should have tax deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Since, there is no claim of expenditure by the assessee, disallowance under section 40(a)(ia) as was done by the Assessing Officer does not arise. It may be different issue that the amounts paid may be covered by the provisions of section 194J as was held by the hon'ble Karnataka High Court in the case of Medi Assist India TPA P. Ltd. v. Deputy CIT Bangalore (Writ Petition No. 11376/2009 (T-IT) (since reported in [2010] 324 ITR 356 (Karn)), relied upon by the Assessing Officer. In that case, the provisions of section 201 was applicable but certainly disallowance under section 40(a)(ia) does not arise as the assessee is not claiming any such expenditure in its profit and loss account. Moreover, the Revenue accepted the order of the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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