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TMI Blog2022 (2) TMI 1193X X X X Extracts X X X X X X X X Extracts X X X X ..... before us In our considered view, now when the aforesaid payee, viz. M/s Magna Fincorp Limited(supra) had duly accounted for the interest/finances charges in its return of income and had paid the corresponding taxes, therefore, as per the 2nd proviso to Sec.40(a)(ia) of the Act the aforementioned amount could not have been brought within the realm of the disallowance contemplated under the said statutory provision. Apart from that, as stated by the Ld. AR, and rightly so, we find that the Hon'ble Supreme Court in the case of M/s. Hindustan Coca Cola Beverages Pvt. Ltd. [ 2007 (8) TMI 12 - SUPREME COURT] had observed, that in case the payee of the amount in question had paid the taxes on the same, then, the payer cannot be held as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the deductees have considered the income in that return of income and paid the taxes and that no amount is outstanding as payable as on end of the year to the deductees. 3. That the Ld. CIT(Appeals) further erred in not considering the supporting with regard to inclusion of income by the deductees in their return of income, payment of taxes and filing of return. Prayed that disallowance of ₹ 3,71,587/-. 2. Succinctly stated, original assessment in the case of the assessee was framed by the Assessing Officer vide his order passed u/s.143(3) of the Act dated 21/12/2010 assessing the total income of the assessee at ₹ 1,85,943/-. Observing that the assessee having failed to deduct tax at source on the interest/financ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its return of income and deposited the corresponding taxes pertaining to the aforesaid amount of interest received from the assessee. It was submitted by the Ld. AR that as the aforesaid documentary evidence would have a substantial bearing on the adjudication of the issue in hand, therefore, the same may kindly be admitted. 6. Per contra, the ld. D.R did not raise any objection to the admission of the aforesaid additional evidence filed by the assessee. 7. We have given a thoughtful consideration to the aforesaid issue before us and, are of the considered view, that as the aforesaid certificate of the Chartered Accountant, dated 19.12.2014 (supra) as had been filed by the assessee as an additional evidence would have a substantial be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e certificate issued by the Chartered Accountant, dated 19.12.2014 (supra) proved to the hilt that the payee, i.e, M/s Magna Fincorp Limited (supra) had duly accounted for the interest/finance charges received from the assessee in its return of income for the year under consideration and had paid the taxes on the said amount, therefore, the assessee cannot be held as an assessee-in-default within the meaning of sub-section (1) of Section 201 of the Act, and resultantly, the said amount could not be disallowed u/s.40(a)(ia) of the Act. In order to drive home his aforesaid claim the Ld. AR had drawn our attention to the 2nd proviso to Sec. 40(a)(ia) of the Act. 9. We have heard the ld. Authorized Representatives for both the parties, per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, that in case the payee of the amount in question had paid the taxes on the same, then, the payer cannot be held as an assessee-in-default as regards the said amount for the purpose of enforcing the recovery of the corresponding tax liability u/s. 201(1) of the Act. We, thus, in terms of our aforesaid observations are unable to subscribe the disallowance of ₹ 3,71,587/-made by the Assessing Officer u/s.40(a)(ia) of the Act. Accordingly, we herein set-aside the order of the CIT (Appeals) and vacate the disallowance of ₹ 3,71,587/- made by the Assessing Officer. The Grounds of appeal No(s).2 3 are allowed in terms of our aforesaid observations. 10. As the ld. A.R had not raised any contention as regards the Ground of app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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