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TMI Blog2020 (11) TMI 406X X X X Extracts X X X X X X X X Extracts X X X X ..... is not in doubt. Non-deduction of TDS is a separate issue. a) Commission payment to DLDS Collection Agents Rs. 33,45,248/- b) Legal Expenses Rs. 2,52,000/- c) Audit Fees Rs. 81,900/- 4) That it is not correct to say that the amendment to second provision to section 40(a)(ia) with effect from 1.4.2013 is not applicable. It is settled law, that the amendment beneficial to the assessee has retrospective effect has been decided by Honourable Supreme Court in the case of CIT Vs. Doraisamy Chetty [1990] 183 ITR 559 (SC). 5) That the authorities below should have allowed sufficient opportunity to the appellant to furnish form 26A from recipients, in the greater interest of justice and fair play. 6) That the disallowance of EPF of Rs. 1,15,570/- u/s.43B is unjustified, illegal, arbitrary and therefore the learned CIT(Appeals) is not justified in confirming the same. 7) That the disallowance of gratuity payment to staff amounting to Rs. 2,70,000/- disallowed by the AO should not have been confirmed by the CIT(Appeals). 8) That statement of facts and grounds of appeal filed before the CIT(Appeals) may kindly be considered as a part of grounds of appeal before I.T.A.T. 9) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same and added back to the total income of the assessee. The assessee has also claimed EPF paid to staff of Rs. 5,00,244/- during the year under consideration. The asked the assessee to produce the details payment of EPF to staff with supporting evidences and the assessee produced only the challan copies amounting to Rs. 3,84,674/- and could not produce the challan copy of Rs. 1,15,570/- which was payment in arrear from 2007-2008. Therefore, the AO disallowed Rs. 1,15,570/- under section 43B of the Act and added the same to the total income of the assessee. Accordingly, the AO made total addition of Rs. 60,93,567/- and assessed the total income of the assessee at Rs. 90,32,740/-. 4. Against the above order of AO, the assessee preferred appeal before the CIT(A) and the CIT(A) considering the submissions of the assessee and findings of AO, deleted the addition made on account of provision for bad and doubtful debts and partly confirmed the addition made u/s.40(a)(ia) of the Act to the extent of Rs. 36,30,998/- and deleted the addition of Rs. 48,150/- out of the total addition made by the AO of Rs. 37,79,148/-. The CIT(A) has also confirmed the additions made u/s.43B and u/s.3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Finance Act, 2004. In the case of Kanu Bhai Ramji Bhai Vs. ITO, 135 TTJ 364 has also held that provision of section 40(a)(ia) as amended by the Finance Act, 2010 w.e.f. 1st April, 2010 is remedial in nature, designed to eliminate unintended consequences which may cause undue hardship to the tax payers and which made the provision unworkable or unjust in a specific situation and is of clarificatory in nature. Amendment has therefore to be treated as retrospective w.e.f. 1st April, 2005. The learned CIT(Appeals) writes that the second provision has been inserted w.e.f. from 1.4.2013 and therefore applicable for AY 2013-14 onwards. The CIT(Appeals) required Certificates from the recipients which is very much available in the Paper Book. Hence, the same may kindly be deleted. It is not correct to say that the amendment to second provision to sec 40 (a)(ia) with effect from 01.04.2013 is not applicable. It is settled law decided by Honourable Supreme Court of India that amendment beneficial to the assessee will have retrospective effect (CIT Vs. Doraisamy Chetty (1990) 183 ITR 559 (SC). The disallowance of EPF of Rs. 1,15,570/- u/s.43B of the IT. Act, 1961 is unjustified, illeg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o generate employment amongst un-employed younger generation apart from "collection of money" to strengthen financial capacity of the fenk. That is why they are given some responsibility for improvement of the Bank. In the process they are paid honorary remuneration calculated @ 2% of the amount collected. The matter is intimated to the Registering Authority, Certificate from Bank in this regard is submitted herewith. They are paid Honorary remuneration as incentive. This is not commission but an incentive though it is named as agents commission. This is not a new scheme but continuing since long. The list of members engaged in this DLDS scheme for the year under consideration is enclosed herewith with their membership Nos. Another list is given furnishing the details of payment made to them. From the details furnished it would be apparent that none of the members except one or two have received more than Taxable income. Besides for collecting the funds the persons have to run from place to place in different rural areas and the expenses incurred for travelling and other incidental expenses are borne by them out of the money they receive, which is deductable in computing the taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the assessee has not deducted TDS on payments made to the recipients which was ought to be deducted as per the TDS provisions as prescribed in the Income Tax Act. He also submitted that the amendment made in Section 40(a)(ia) of the Act is applicable from the A.Y.2013-2014. The case of the assessee falls before the amendment i.e. w.e.f.01.04.2013, hence, the case law relied on by the ld. AR of the assessee is not applicable in the present case. 8. After hearing both the sides and perusing the entire material available on record and the order of the authorities below, we noticed that the assessee has violated the provisions of Section 40(a)(ia) of the Act for not deducting & depositing the TDS. The amendment has been made in the second proviso of Section 40(a)(ia) of the Act w.e.f. 01.04.2013 and, therefore, it is applicable for the A.Y.2013-2014 onwards. For this purpose, we would like to rely on the decision of Hon'ble Apex Court in the case of Shree Choudhary Transport Company Vs. ITO [2020] 118 taxmann.com 47 (SC), wherein the Hon'ble Supreme Court while deciding the similar issue regarding applicability of the amendment to Section 40(a)(ia) of the Act Vide Finance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rnment or any State Government; or (b) any local authority; or (c) any corporation established by or under a Central, State or Provincial Act; or (d) any company; or (e) any co-operative society; or (f) any authority, constituted in India by or under any law, engaged either for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both; or (g) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any law corresponding to that Act in force in any part of India; or (h) any trust; or (i) any University established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a University under section 3 of the University Grants Commission Act, 1956 (3 of 1956); or (j) any firm, shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to-(i) one per cent in case of advertising, (ii)in any other case two per cent, of such sum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (1) or sub-section (2) from- (i) the amount of any sum credited or paid or likely to be credited or paid to the account of, or to, the contractor or subcontractor, if such sum does not exceed twenty thousand rupees: Provided that where the aggregate of the amounts of such sums credited or paid or likely to be credited or paid during the financial year exceeds fifty thousand rupees, the person responsible for paying such sums referred to in sub-section (1) or, as the case may be, sub-section (2) shall be liable to deduct income-tax under this section; or (ii) any sum credited or paid before the 1st day of June, 1972; or (iii) any sum credited or paid before the 1st day of June, 1973, in pursuance of a contract between the contractor and a cooperative society or in pursuance of a contract between such contractor and the sub-contractor in relation to any work (including supply of labour for carrying out any work) undertaken by the contractor for the co-operative society." 13.1.2 Sections 200 and 201 of the Act, respectively dealing with the duty of the person deducting tax and consequences on failure to deduct or pay, as applicable at the relevant time, could al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate on which such tax was deductible to the date on which such tax is actually paid. (2) Where the tax has not been paid as aforesaid after it is deducted, the amount of the tax together with the amount of simple interest thereon referred to in sub-section (1A) shall be a charge upon all the assets of the person, or the company, as the case may be, referred to in sub-section (1)." 13.2 Chapter IV of the Act of 1961 deals with the subject "Computation of Total Income" and Section 40 occurs in Part D thereof, carrying the provisions relating to the "Profits and Gains of Business or Profession". Even when Sections 30 to 38 provide for various allowances and deductions in computation of the income from profits and gains of business or profession, Section 40 specifically ordains that certain amounts shall not be deducted, notwithstanding anything to the contrary contained in the said Sections 30 to 38 of the Act. In the present matter, we are concerned with the provisions contained in sub-clause (ia) of clause (a) of Section 40 of the Act, which was inserted by the Finance (No. 2) Act, 2004 with effect from 1-4-2005. Hence, the extraction hereunder is essentially of the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of accounting upon the basis of which the profits or gains are computed under the head "Profits and gains of business or profession"; ** ** ** 13.4 For their relevance in relation to another segment of arguments, we may also take note of the meaning assigned to the expression "assessment year" in clause (9) of Section 2; and to the expression "previous year" in Section 3 of the Act of 1961 as follows: - "2. Definitions.- In this Act, unless the context otherwise requires, - * ** ** (9) "assessment year" means the period of twelve months commencing on the 1st day of April every year; ** ** ** "3. "Previous year" defined.- For the purposes of this Act, "previous year" means the financial year immediately preceding the assessment year: ** ** ** 14. We may now take up the questions involved in this matter ad seriatim. Question No. 1 15. In order to maintain that the appellant was under no obligation to make any deduction of tax at source, it has been argued that there was no oral or written contract of the appellant with the truck operators/owners, whose vehicles were engaged to execute the work of transportation of the goods only on freelance and need basis. The su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he goods, all the essentials of making of a contract existed; and, as aforesaid, the said truck operator/owner became a sub-contractor for the purpose of the work in question. The AO, CIT(A) and the ITAT have concurrently decided this issue against the appellant with reference to the facts of the case, particularly after appreciating the nature of contract of the appellant with the consignor company as also the nature of dealing of the appellant, while holding that the truck operators/owners were engaged by the appellant as sub-contractors. The same findings have been endorsed by the High Court in its short order dismissing the appeal of the appellant. We are unable to find anything of error or infirmity in these findings. 15.3 The decision of Delhi High Court in the case of Hardarshan Singh (supra), in our view, has no application whatsoever to the facts of the present case. The assessee therein, who was in the business of transporting goods, had four trucks of his own and was also acting as a commission agent by arranging for transportation through other transporters. As regards the income of assessee relatable to transportation through other transporters, it was found that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... empt to distinguish the nature of contract in Palam Gas Service by suggesting that therein, the assessee's sub-contractors were specific and identified persons with whom the assessee had entered into contract whereas the present appellant was free to hire the service of any truck operator/owner and, in fact, the appellant hired the trucks only on need basis. In our view, such an attempt of differentiation is totally baseless and futile. Whether the appellant had specific and identified trucks on its rolls or had been picking them up on freelance basis, the legal effect on the status of parties had been the same that once a particular truck was engaged by the appellant on hire charges for carrying out the part of work undertaken by it (i.e., transportation of the goods of the company), the operator/owner of that truck became the sub-contractor and all the requirements of Section 194C came into operation. 15.5 Thus, we have no hesitation in affirming the concurrent findings in regard to the applicability of Section 194C to the present case. Question No. 1 is, therefore, answered in the negative; against the assessee-appellant and in favour of the revenue. Question No. 2. 16 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Section 200(1), such sum shall be allowed as a deduction in computing the income of the previous year in which such tax has been paid. 16.3 The purpose and coverage of this provision as also protection therein have been tersely explained by this Court in the case of Calcutta Export Company (supra), which has been cited by learned counsel for the appellant in support of another limb of submissions which we shall be dealing with in the next question. For the present purpose, we may notice the relevant observations of this Court in Calcutta Export Company as regards Section 40(a)(ia) of the Act as follows (at p. 662 of ITR):- "16. The purpose is very much clear from the above referred explanation by the Memorandum that it came with a purpose to ensure tax compliance. The fact that the intention of the Legislature was not to punish the assessee is further reflected from a bare reading of the provisions of section 40(a)(ia) of the Income-tax Act. It only results in shifting of the year in which the expenditure can be claimed as deduction. In a case where the tax deducted at source was duly deposited with the Government within the prescribed time, the said amount can be claimed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , which is clear from the following discussion contained in the judgment of the Punjab and Haryana High Court: "A Division Bench of the Calcutta High Court in CIT v. Crescent Export Syndicate [2013] 216 Taxman 258 (Cal) held : '13. ... The term "shall" used in all these sections make it clear that these are mandatory provisions and applicable to the entire sum contemplated under the respective sections. These sections do not give any leverage to the assessee to make the payment without making TDS. On the contrary, the intention of the Legislature is evident from the fact that timing of deduction of tax is earliest possible opportunity to recover tax, either at the time of credit in the account of payee or at the time of payment to payee, whichever is earlier.' Ms. Dhugga invited our attention to a judgment of the Division Bench of the Madras High Court in Tube Investments of India Ltd. v. Asst. CIT (TDS) [2010] 325 ITR 610 (Mad). The Division Bench referred to the statistics placed before it by the Department which disclosed that TDS collection had augmented the revenue. The gross collection of advance tax, surcharge, etc. was Rs. 2,75,857.70 crores in the financia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the consequences which are stipulated in the Act itself. Certain consequences of failure to deduct tax at source from the payments made, where tax was to be deducted at source or failure to pay the same to the credit of the Central Government, are stipulated in section 201 of the Act. This section provides that in that contingency, such a person would be deemed to be an assessee in default in respect of such tax. While stipulating this consequence, section 201 categorically states that the aforesaid sections would be without prejudice to any other consequences which that defaulter may incur. Other consequences are provided under section 40(a)(ia) of the Act, namely, payments made by such a person to a contractor shall not be treated as deductible expenditure. When read in this context, it is clear that section 40(a)(ia) deals with the nature of default and the consequences thereof. Default is relatable to Chapter XVII-B (in the instant case sections 194C and 200, which provisions are in the aforesaid Chapter). When the entire scheme of obligation to deduct the tax at source and paying it over to the Central Government is read holistically, it cannot be held that the word "payable" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provisions of Chapter XVII-B. The consequences under section 40(a)(ia) would only operate on account of failure to deduct tax where the tax is liable to be deducted under the provisions of the Act and in particular Chapter XVII-B thereof. It is in that sense that the term "payable" has been used. The term "payable" is descriptive of the payments which attract the liability to deduct tax at source. It does not categorize defaults on the basis of when the payments are made to the payees of such amounts which attract the liability to deduct tax at source." (Emphasis in bold Supplied) 16.7 We find the above-extracted observations and reasonings, which have already been approved by this Court in Palam Gas Service (supra), to be precisely in accord with the scheme and purpose of Section 40(a)(ia) of the Act; and are in complete answer to the contentions urged by the learned counsel for the appellant. It is ex facie evident that the term "payable" has been used in Section 40(a)(ia) of the Act only to indicate the type or nature of the payments by the assessees to the payees referred therein. In other words, the expression "payable" is descriptive of the payments which attract the lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ided on the basis of Section 194C, has only been noted to be rejected. The interplay of these provisions is not far to seek where Section 40(a)(ia) is not a stand-alone provision but provides one of those additional consequences as indicated in Section 201 of the Act for default by a person in compliance of the requirements of the provisions contained in Part B of Chapter XVII of the Act. The scheme of these provisions makes it clear that the default in compliance of the requirements of the provisions contained in Part B of Chapter XVII of the Act (that carries Sections 194C, 200 and 201) leads, inter alia, to the consequence of Section 40(a)(ia) of the Act. Hence, the contours of Section 40(a)(ia) of the Act could be aptly defined only with reference to the requirements of the provisions contained in Part B of Chapter XVII of the Act, including Sections 194C, 200 and 201. Putting it differently, when the obligation of Section 194C of the Act is the foundation of the consequence provided by Section 40(a)(ia) of the Act, reference to the former is inevitable in interpretation of the latter. 16.11 In view of the above, reference to the definition of the term "paid" in Section 43(2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no doubt that in PIU Ghosh (supra), the Calcutta High Court, indeed, took the view which the learned counsel for the appellant has canvassed before us. The Calcutta High Court observed that the said Finance (No.2) Act, 2004 got presidential assent on 10-9-2004 and it was provided that the provision in question shall stand inserted with effect from 1-4-2005. According to the Calcutta High Court, the assessee could not have foreseen prior to 10-9-2004 that any amount paid to a contractor without deducting tax at source was likely to become not deductible in computation of income under section 40 and that the legislature, being conscious of the likely predicament, provided that the provision shall become operative from 1-4-2005. The High Court further proceeded to observe that any other interpretation would amount to punishing the assessee for no fault of his. The High Court further observed that Section 11 of the said Finance Act, inserting sub-clause (ia), did not provide that the same was to become effective from the assessment year 2005-2006. We may usefully reproduce the opinion of the Calcutta High Court in the case of PIU Ghosh, as under (at p. 326 of ITR):- "9. Admitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per Section 4 of the Act of 1961, the charge of income tax is with reference to any assessment year, at such rate or rates as provided in any central enactment for the purpose, in respect of the total income of the previous year of any person. The expression "previous year" is defined in Section 3 of the Act to mean 'the financial year immediately preceding the assessment year'; and the expression "assessment year" is defined in clause (9) of Section 2 of the Act to mean 'the period of twelve months commencing on the 1st day of April every year'. 17.5 In the case of Commissioner of Income-Tax, West Bengal v. Isthmian Steamship Lines: (1951) 20 ITR 572, a 3-Judge Bench of this Court exposited on the fundamental principle that 'in income-tax matters the law to be applied is the law in force in the assessment year unless otherwise stated or implied.' This decision and various other decisions were considered by the Constitution Bench of this Court in the case of Karimtharuvi Tea Estate Ltd. v. State of Kerala: (1966) 60 ITR 262 and the principles were laid down in the following terms (at pp. 264-266 of ITR):- "Now, it is well-settled that the Income-tax Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the financial year 2005-2006. 17.7 The observations of Calcutta High Court in the case of PIU Ghosh (supra) as regards the likely prejudice to an assessee in relation to the financial year 2004-2005, in our view, do not relate to any legal grievance or legal prejudice. The requirement of deducting tax at source was already existing as per Section 194C of the Act and it was the bounden duty of the appellant to make such deduction of TDS and to make over the same to the revenue. Section 201 was also in existence which made it clear that default in making deduction in accordance with the provisions of the Act would make the appellant "an assessee in default". The appellant cannot suggest that even if the obligation of TDS on the payments made by him was existing by virtue of Section 194C(2), he would have honoured such an obligation only if being aware of the drastic consequence of default that such payment shall not be deducted for the purpose of drawing up the assessment. 17.7.1. Apart from the above, significant it is to notice that by the amendment in question, clause (ia) was added to Section 40(a) of the Act with a proviso to the effect that where, in respect of the sum re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the TDS amount to the revenue during the same financial year or even in the subsequent year, as per the relaxation available in the proviso to Section 40(a)(ia) of the Act but, the appellant simply avoided his obligation and attempted to suggest that it had no liability to deduct the tax at source at all. Such an approach of the appellant, when standing at conflict with law, the consequence of disallowance under section 40(a)(ia) of the Act remains inevitable. 19. In yet another alternative attempt, learned counsel for the appellant has argued that by way of Finance (No.2) Act, 2014, disallowance under section 40(a)(ia) has been Ltd. to 30% of the sum payable and the said amendment deserves to be held retrospective in operation. This line of argument has been grafted with reference to the decision in Calcutta Export Company (supra) wherein, another amendment of Section 40(a)(ia) by the Finance Act of 2010 was held by this Court to be retrospective in operation. The submission so made is not only baseless but is bereft of any logic. Neither the amendment made by the Finance (No.2) Act, 2014 could be stretched anterior the date of its substitution so as to reach the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome of the previous year in which such tax has been paid. ** ** ** (ii) After the amendment by Finance Act, 2010 "40. Amounts not deductible.-Notwithstanding anything to the contrary in sections 30 to 38, the following amounts shall not be deducted in computing the income chargeable under the head "Profits and gains of business or profession",- (a) in the case of any assessee- ** ** ** (ia) any interest, commission or brokerage, rent, royalty, fees for professional services or fees for technical services payable to a resident, or amounts payable to a contractor or sub-contractor, being resident, for carrying out any work (including supply of labour for carrying out any work), on which tax is deductible at source under Chapter XVII-B and such tax has not been deducted or, after deduction, has not been paid on or before the due date specified in sub-section (1) of section 139: Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted during the previous year but paid after the due date specified in sub-section (1) of section 139, such sum shall be allowed as a deduction in computing the income of the previous year i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the last month of previous year; and observed in paragraph 18 that the said amendment of the year 2008 was brought about with a view to mitigate such hardship. After reproducing the said amendment of the year 2008 and after noticing its retrospective operation, this Court delved into the position obtaining after 2008, where still remained one class of assessees who could not claim deduction for the TDS amount in the previous year in which the tax was deducted and who could claim benefit of such deduction in the next year only; and, after finding that the amendment of the year 2010 was intended to remedy this position, held that the said amendment, being curative in nature, is required to be given retrospective operation that is, from the date of insertion of Section 40(a)(ia). 19.4 Learned counsel for the appellant has only referred to the concluding part of the decision in Calcutta Export Company but, a look at the entire synthesis by this Court, of the reasons for the amendments of 2008 and 2010, makes it clear as to why this Court held that the amendment of the year 2010 would be retrospective in operation. We may usefully reproduce the relevant discussion and exposition of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... traders who may not be in a position to bear the burden of such disallowance in the present assessment year. 22. In order to remedy this position and to remove hardships which were being caused to the assessees belonging to such second category, amendments have been made in the provisions of section 40(a) (ia) by the Finance Act, 2010. ** ** ** 24. Thus, the Finance Act, 2010 further relaxed the rigors of section 40(a)(ia) of the Income-tax Act to provide that all TDS made during the previous year can be deposited with the Government by the due date of filing the return of income. The idea was to allow additional time to the deductors to deposit the TDS so made. However, the Memorandum Explaining the Provisions of the Finance Bill, 2010 expressly mentioned as follows: "This amendment is proposed to take effect retrospectively from April 1, 2010 and will, accordingly, apply in relation to the assessment year 2010-11 and subsequent years." 25. The controversy surrounding the above amendment was whether the amendment being curative in nature should be applied retrospectively, i.e., from the date of insertion of the provisions of section 40(a)(ia) or to be applicable from the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not required to deduct TDS or under the mistaken belief that the methodology of splitting a single payment into parts below Rs. 20,000/- would provide him escape from the rigour of the provisions of the Act providing for disallowance. In either event, the appellant had not been a bonafide assessee who had made the deduction and deposited it subsequently. Obviously, the appellant could not have derived the benefits that were otherwise available by the curative amendments of 2008 and 2010. Having defaulted at every stage, the attempt on the part of assessee-appellant to seek some succor in the amendment of Section 40(a)(ia) of the Act by the Finance (No.2) Act, 2014 could only be rejected as entirely baseless, rather preposterous. 19.7 Hence, Question No. 3 is also answered in the negative, i.e., against the assessee-appellant and in favour of the revenue. Question No. 4 20. Before finally answering the root question in the matter as to whether the payments in question have rightly been disallowed from deduction, we may usefully summarise the answers to Question Nos. 1 to 3 that the provisions of Section 194C were indeed applicable and the assessee-appellant was under obligati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payments in Truck Freight Account at Rs. 1,37,71,206/- and total receipts from the company at Rs. 1,43,90,632/-. What has been disallowed is that amount of Rs. 57,11,625/- on which the appellant failed to deduct the tax at source and not the entire amount received from the company or paid to the truck operators/owners. Viewed from any angle, we do not find any case of prejudice or legal grievance with the appellant. 21.1 Hence, answer to Question No. 4 is clearly in the affirmative i.e., against the appellant and in favour of the revenue that the payments in question have rightly been disallowed from deduction while computing the total income of the assessee-appellant. We noted from the order of AO that the assessee has made the payments to the recipients but no TDS has deducted by him at all. Considering the submissions of the assessee that concerned recipients have included to the receipts from the bank in his total income and it paid income tax thereon as per the provisions of Income Tax Act, we find that the assessee tried to prove that there is no loss to the Revenue and requested for sending back the matter to the file of AO for verification. On perusal of the order of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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