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TMI Blog2014 (3) TMI 1154X X X X Extracts X X X X X X X X Extracts X X X X ..... years. Even after the AYs under consideration i.e., AYs. 2003-04, 2004-05 2005-06, the assessee has been following the same method of deducting TDS at the time of effecting the payments and depositing the same within the time prescribed u/s.200(1) of the Act and the Revenue has accepted the same. We do not find any infirmity in the impugned orders. The appeals of the Revenue are dismissed being devoid of merit. X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Year. The CIT(Appeals) further observed that the assessee has been following this practice for the past several years and even in the AYs subsequent to the AYs under consideration, the assessee is following the same practice. The assessee has furnished complete details of the tax deducted at source and deposited in the Government Exchequer. The CIT(Appeals) concluded that the liability of the assessee to deduct TDS on Royalties and fee for technical services arises in the year in which such payments were actually paid by the assessee. The CIT(Appeals) deleted the addition made by the Assessing Officer u/s.40a(i) and allowed the appeals of the assessee. Aggrieved against the order of CIT(Appeals), the Revenue has come in appeals before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t 17.02.2012). iii. DCIT vs. UHDE GMBH (1996) 54 TTJ 355 (Bom). iv. National Organic Chemical Industries limited versus DCIT (2006) 5 SOT 317 (Mum)". The CIT(Appeals) after considering the same and the facts of the case has held as under: "6.4.1. In view of the above discussed decisions as the income of the recipient of the royalty and fees for technical services becomes liable to be taxed on the receipt basis under the Income Tax Act, the liability to deduct TDS on such payments arises in the year of payment. This, as observed in the case of Pizza Hut International LLC (supra) can lead to deferment of payment of tax for some time or for indefinite time. However, after considering this matter the ITAT held that this issue has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch payment is actually made by the appellant. The AO, therefore, is directed to delete the aforesaid disallowances made on account of non-deduction of TDS under section 40(a)(i). The grounds of appeal with regard to this issue, therefore, are allowed". We find that the order of the CIT(Appeals) is well reasoned and detailed. The assessee has been consistently following this method of deducting and depositing of tax at source for the past several years. Even after the AYs under consideration i.e., AYs. 2003-04, 2004-05 & 2005-06, the assessee has been following the same method of deducting TDS at the time of effecting the payments and depositing the same within the time prescribed u/s.200(1) of the Act and the Revenue has accepted the sam ..... X X X X Extracts X X X X X X X X Extracts X X X X
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