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TMI Blog2016 (11) TMI 529X X X X Extracts X X X X X X X X Extracts X X X X ..... on verification of the invoices given by Port Management Board that the said payment is made towards supply of fresh water to the ships. Hence, the same does not fall under the ambit of deduction of tax at source under any of the provisions of the Act. Hence, disallowance made u/s. 40(a)(ia) of the Act to that effect is deleted. In respect of payments made towards stevedoring charges, we find that the ld AO had not given any finding in his order as to how the subject mentioned expenditure would fall under the ambit of provisions of deduction of tax at source. Accordingly, we deem it fit and proper to set aside this issue to the file of the ld AO to give a clear finding in this regard in the light of the evidence submitted by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment was framed by Addl.CIT, Range-9, Kolkata u/s. 143(3) of the Income tax Act, 1961 (hereinafter referred to as the Act ) for AY 2008-09 vide his order dated 28.12.2010. For the sake of brevity, we dispose of both the appeals by this consolidated order. 2. First we take up assessee s appeal. The only issue involved in this appeal of assessee is with regard to the disallowance of ₹ 14,93,044/- towards freight expenses by the AO u/s. 40(a)(ia) of the Act. 2.1. The AO observed that the assessee has paid freight expenses of ₹ 14,93,044/- without deduction of tax at source and accordingly disallowed the same u/s. 40(a)(ia) of the act. Before the Ld. CIT(A), the assessee produced all the details and the same were subjecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfructuous. 3. In revenue s appeal the only issue to be decided is as to whether the Ld. CIT(A) is justified in deleting the disallowance made u/s. 40(a)(ia) of the Act in respect of (a) Payments made to Port Management Board - ₹ 17,29,970/- (b) Stevedoring charges - ₹ 5,08,277/- (c) Freight charges - ₹ 14,93,044/- (d) Payment made to Indian Registrar of Shipping - ₹ 3,52,726/- The AO observed that the aforesaid payments were made without deduction of tax at source and accordingly invoked the provisions of section 40(a)(ia) of the Act. The Ld. CIT(A) deleted the disallowance on the ground that the payments were made before the end of the previous year and accordingly by placing relianc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot warrant deduction of tax at source in terms of section 194C of the Act. Hence, provisions of section 40(a)(ia) of the Act could not be invoked in the same, in support of which he placed copies of invoices for the same issued by Port Management Board, Anadaman Nicobar Islands, Port Blair. He argued that in respect of payments made towards stevedoring charges, no finding has been given by the ld AO in his assessment order as to how the subject mentioned expenditure would fall under the purview of deduction of tax at source. He also submitted the details of stevedoring charges paid to various parties throughout the year including the relevant ledger account which he fairly stated that the same may kindly be directed to be verified by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision of Hon ble Calcutta High Court in the case of CIT Vs. Crescent Exports Syndicate (2013) 33 Taxman.com 250 (Cal) wherein it has been held that the provisions of section 40(a)(ia) of the Act would be applicable even if amounts were paid before the end of the previous year. 3.4. In respect of payments made to Port Management Board in the sum of ₹ 17,29,970/-, we are convinced on verification of the invoices given by Port Management Board that the said payment is made towards supply of fresh water to the ships. Hence, the same does not fall under the ambit of deduction of tax at source under any of the provisions of the Act. Hence, disallowance made u/s. 40(a)(ia) of the Act to that effect is deleted. 3.5. In respect of paym ..... X X X X Extracts X X X X X X X X Extracts X X X X
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