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TMI Blog2018 (1) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... is indeed engaged in the business of insurance. As the appellant has failed to provide clear evidence to support its claim that Reliance Capital is involved in Insurance business, this argument of the appellant is not acceptable. AO has rightly invoked the provisions of section 40 (a) (ia) Disallowance of freight - Held that:- Though the AO has mentioned about the provisions of section 40(a)(i) but that is apparently a typographical error and he actually meant that the expenses are disallowable in view of provisions of section 40(a) (ia). In my opinion, inadvertent reference to wrong provisions would not make the disallowance bad in law as long as there is another provision which is actually applicable in the given facts. The appellant h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 88]. 4. The learned Commissioner of Income Tax (Appeals) has erred in law and on facts in disregarding the decision of Special Bench of Visakhapatnam Income Tax Appellate Tribunal in the case of Merilyn Shipping Transports (ITA No. 477/Viz/2008). 5. The learned Commissioner of Income Tax (Appeals) has erred in law and on facts on disregarding the argument that only expenditure payable at the end of year shall be disallowed. 6. The learned Commissioner of Income Tax (Appeals) has erred on facts in not considering the argument that M/s Reliance Capital is carrying on the business of insurance and hence out of the ambit of the provisions of section 194Aof the Income Tax Act, 1961. 7. The learned Commissioner of Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition of ₹ 2,87,765/- . The appellant has however submitted that the provisions of section 40(a) (ia) will be applicable only if the amount remains payable at the yearend. In this regard, Judgement of M/s Merilyn Shipping and Transport company (20 Taxman 244) and Jaipur Vidyut Vitran Nigam Ltd. V/s DCIT (123 TTJ 888) have been cited. However, this contention of the appellant is not acceptable as Gujarat High Court in the case of CIT V/s Sikandarkhan N Tunvar [2013] 357 1TR 312 and Calcutta High Court in the case of CIT V/s Crescent Export Syndicates ITA No. 20 of 2013 and Jakir Hossain Mondal IT A No. 31 of 2013 have held that section 40(a) (ia) covers not only the amount which are payable as on 31st March but also amounts p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing ₹ 20,000/- made to two transporters should have been subjected to TDS. As no tax was deducted on these payments, the AO has disallowed these expenses. In the written submission, the appellant has submitted that the AO has made disallowance of the freight payment u/s 40(a) (i) and the provisions of that section relate only to payments made to nonresident. It has been argued that the two companies in respect of which disallowance has been made are not non- resident companies. In my opinion, though the AO has mentioned about the provisions of section 40(a)(i) but that is apparently a typographical error and he actually meant that the expenses are disallowable in view of provisions of section 40(a) (ia). In my opinion, inadvertent ref ..... X X X X Extracts X X X X X X X X Extracts X X X X
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