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TMI Blog2018 (6) TMI 894X X X X Extracts X X X X X X X X Extracts X X X X ..... llowance u/s 40(a)(ia) for failure to deduct tax at source - Held that:- the learned counsel for the assessee has not raised any material contention to show that the assessee was not liable to deduct tax at source from the relevant payment. It is thus clear that the assessee had failed to deduct tax at source from the payment u/s 40(a)(ia) - we therefore, modify the impugned order of the Ld. CIT(A) on this issue and restrict the disallowance of ₹ 1,16,51,016/ - partly allowed in favor of assessee. Disallowance of amount paid on donation and subscription - Held that:- the assessee is a construction company executing the work at different sites. On these sites, different pujas and functions are performed for which the assessee has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration was filed by it on 29.09.2011 declaring a total income of ₹ 1,96,40,682/-. As noted by the AO during the course of assessment proceedings, tax at 1% was deducted by the assessee from the payments made to some subcontractors whose permanent account numbers were neither mentioned nor available with the assessee. According to the AO, the assessee was liable to deduct tax @20% in such cases as per the provision of section 206AA and since there was short deduction of tax, he made a disallowance of ₹ 22,46,041/- on account of relevant payments made to the sub-contractors under section 40(a)(ia) of the Act. The AO also found that the assessee had made payments to two sub-contractors namely Aman Construction Co. and Biswas Cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The judgement of S.K. Tekriwal (supra) is in respect of bonafide mistake when there was some confusion regarding the nature of payments and the appropriate section of TDS applicable in that case. Under the circumstances Hon ble Kolkata, ITAT held that assessee cannot be faulted for short deduction. In that case TDS was to be deducted u/s 194I whereas appellant had deducted tax u/s 194C(2). Similarly in other decisions, cited by the appellant, fact was that assessee had deducted tax by applying different section of the Act under bonafide belief regarding the nature of payments. This is not so in the present case. On the contrary Hon ble Delhi ITAT in the case of DCIT vs Neemrant Hotel Pvt. Ltd., ITA No. 3134/Del/2013 has upheld the disallowa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e threshold limit of deducting tax, is not acceptable because appellant has neither provided the details of these payments at assessment stage nor in appeal proceedings. Hence the additions made of ₹ 37,23,755/- are confirmed. This ground is dismissed. 6. We have heard the arguments of both the sides and also perused the relevant material available on record. It is observed that the disallowance under section 40(a)(ia) to the extent of ₹ 22,46,041/- and ₹ 56,81,220/- was made by the AO on account of short deduction of tax at source by the assessee from the relevant payments. In the case of DCIT vs S.K. Tekriwal 260 CTR 76 cited by the learned counsel for the assessee, Hon ble Kolkata High Court has held that section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the impugned order of the Ld. CIT(A) on this issue and restrict the disallowance of ₹ 1,16,51,016/- made u/s 40(a)(ia) to ₹ 37,23,755/-. Ground no 2 of the assessee s appeal is thus partly allowed. 7. The issue raised in ground no 3 relates to the disallowance of ₹ 3,26,412/- made by the AO and confirmed by the Ld. CIT(A) on account of donation and subscription. 8. In the profit and loss account filed along with its return of income, the assessee had debited a sum of ₹ 3,26,412/- on account of donations and subscriptions. During the course of assessment proceedings, the assessee however was unable to furnish any documentary evidence to establish that the expenditure on donations and subscriptions was incurred ..... X X X X Extracts X X X X X X X X Extracts X X X X
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