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TMI Blog2016 (7) TMI 1479X X X X Extracts X X X X X X X X Extracts X X X X ..... as filed its return of income disclosing the payment received by and in which the income earned by it is embedded and has also paid tax on such income, the assessee would not be treated as a person in default. The issue is covered in favour of the assessee by the judgement of the Hon'ble Delhi High Court in the case of CIT Vs. Ansal Land Mark Township P. Ltd [2015 (9) TMI 79 - DELHI HIGH COURT] which is of later dated 26..8.2015. It is well settled law that when two views are possible, the decision in favour of the assessee may be followed. Other conditions are not disputed. We delete the entire addition. - decided in favour of assessee. - ITA No. 718/CHD/2016 - - - Dated:- 19-7-2016 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nership firm running Reebok outlet under the name and style of M/s Aman Creations at G.T. Road, Shahbad (M), Kurukshetra. During the year under consideration, the assessee had paid ₹ 1,75,691/- to M/s Aman Dhaba being the share of generator expenses on actual basis but the same is disallowed by the Assessing officer in terms of provisions contained u/s 40(a)(ia) r.w.s. 194C of the Income-tax Act, 1961 (in short 'the Act'). The assessee submitted before Ld. CIT(A) that generator expenses have been paid to the neighbour on actual basis. Moreover, these are shown as income of the recipient and declared in its return of income for the said assessment year. Moreover, by insertion of second proviso to section 40(a)(ia) by Financ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'ble Delhi High Court in the case of CIT Vs. Ansal Land Mark Township P. Ltd [2015] 377 ITR 635 (Delhi), in which it was held as under:- Section 40(a)(ia) of the Income-tax Act, 1961, is aimed at ensuring that an expenditure should not be allowed as deduction in the hands of an assessee in a situation in which income embedded in such expenditure has remained untaxed due to tax withholding lapses by the assessee. It is not a penalty for tax withholding lapse but it is a sort of compensatory deduction restriction for an income going untaxed due to tax withholding lapse. The insertion of the second proviso to section 40(a)(ia) is declaratory and curative in nature and it has retrospective effect from April 1, 2005, being the date fro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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