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TMI Blog2022 (9) TMI 1358X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, where it is deducted in a subsequent year, or where, though deducted, is paid after the due date specified u/s. 139(1). A second proviso was inserted by Finance Act, 2012, w.e.f. 01/4/2013, i.e., AY 2013-14 onwards, whereby the provision of sec. 40(a)(ia) shall not apply even where assessee fails to deduct or deposit tax deductible at source where the assessee is not deemed to be in-default under the first proviso to S. 201(1), which provision was simultaneously amended by insertion of the first proviso thereto, whereby the assessee, despite having failed to deduct tax at source in terms of Chapter-XVII would not be deemed to be in-default where the conditions listed therein are satisfied, being toward the satisfaction of his tax lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contractual payments toward printing charges paid on packing material (jhilli) of the bidis sold by the assessee, a bidi manufacturer. The default u/s. 194-C, admitted by the assessee, the tax deductible was paid by it at the time of assessment, i.e., during F.Y. 2009-10, relevant to AY 2010-11 (pg. 6 of the assessment order). The default being admitted, the disallowance was confirmed in first appeal. Aggrieved, the assessee is in appeal. 3. The assessee's case before us was that the deductee, i.e., Chandu Ram, proprietor, M/s. Samaj Papers, to whom the printing charges had been paid, had in fact returned the impugned sum as a part of his income for the relevant year (AY 2007-08), toward which copy of the acknowledgement of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eously amended by insertion of the first proviso thereto, whereby the assessee, despite having failed to deduct tax at source in terms of Chapter-XVII of the Act, would not be deemed to be in-default where the conditions listed therein are satisfied, being toward the satisfaction of his tax liability for the relevant year on the relevant sum by the payee-deductee. The assessee has before us made out a prima facie case by exhibiting nil tax liability of the payee, also claiming that the assessee has not claimed deduction in respect of the impugned sum for AY 2010-11, which becomes exigible in view of first proviso to S. 40(a)(ia). 4.2. We, accordingly, consider it appropriate to restore the matter to the file of the AO to verify the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t stands clarified that the recovery of the tax liable to be deducted and deposited u/c. XVII is subject to the same having been not paid direct by the payee, which in the instant case is being claimed as not applicable as the latter has no liability to tax for the relevant year, of course, after including the amount under reference paid/payable by the assessee. Further, true, the decision in Hindustan Coca-Cola Beverages Pvt. Ltd. (supra) is in respect of liability u/s. 201(1), i.e., recovery of tax deductible at source, and itself based on a Board Circular, cited and reproduced therein, and not qua a disallowance u/s. 40(a)(ia), which is toward the computation of the assessee's income u/s. 28. So, however, it cannot be denied that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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