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TMI Blog2015 (9) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... see is against the order or Ld. CIT(A) for confirming the action of AO for disallowing interest expense amounting to Rs. 4,48,861/- u/s 40(a)(ia) of the Act for failure to deduct income tax at source and non procurement of Form 15G from the parties within the stipulated time. For this, assessee has raised following ground:- "1. That in the facts and circumstances of the case the ld. CIT(A) was wrong in confirming the action of ld. AO who disallowed interest expenses amounting to Rs. 4,48,861/- u/s 40(a)(ia) of the Income Tax Act 1961 despite receipt of Form no 15G." 3. Briefly stated facts are that during the course of assessment proceedings, AO in order to verify the compliances of TDS provision, asked, the assessee to furnish the requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the parties within the stipulated time. Aggrieved, assessee went for appeal before Ld. CIT(A) and Ld. CIT(A) also confirmed the view taken by AO and said in his order vide para-5.2 which reproduced as under:- "5-2 I have perused the assessment order and considered the submission of the appellant. The fact of the case is that the appellant paid interest on loans to various persons but no tax was deducted. The appellant claimed that they had received Form no. 15G from the persons concerned, hence, no tax was required to be deducted. However, the A found that the date on Form No. 15G was 04.04.2008 and signed by the deductees on 04.04.2008 itself. The appellant argued that original form submitted by the deductees were misplaced, therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduct the tax TDS on the interest payments made to the parties from whom assessee had received Form 15G hence, the interest payment should not be disallowed u/s. 40(a)(ia) of the Act. On the contrary, Ld. DR supported the orders of authorities below and did not put any fresh submission before me. 6. I have heard rival contentions and gone through the facts and circumstances of the case. Section 194A provides for deduction of TDS interest paid by the assessee at the appropriate rate and Sec. 197A provides that notwithstanding anything contained in Sec. 194A no deduction shall be made under this Section if the payee of the interest furnish to the person responsible for paying the interest, a declaration in writing in duplicate in the presc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er in case before me, the AO has never objected to any details as were provided in the Form 15G and only point on which basis the AO has disallowed the interest paid is the date of signing of the declaration of Form 15G which has been 4th April, 2008 in a few cases. However, the copies of those misplaced Form 15G which were later on located by the assessee are also on record and which has the declaration date mentioned as on 01-03-2008. There was a reasonable cause on the part of the assessee in regard to Form 15G which were misplaced and again located after sometime and assessee made due efforts to again get fresh Form 15G so as to comply with the provision of Sec. 197A(1A) to furnish Form 15G before 7th April of each year. There is no dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee, who is the payer of the interest, to file the declarations given to him by the payees of the interest, within the time limit specified in sub-section (2) to section 197A is distinct and separate and merely because there is a failure on the part of the assessee to submit the declarations to the income-tax department within the time limit, it cannot be said that the assessee did not have declarations with him at the time when he paid the interest to the payees. That would be a separate matter and separate proof and evidence is required to show that even when the assessee paid the interest, he did not have the declarations from the payees with him and therefore he ought to have deducted the tax from the payment. No such evidence or pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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