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| The Tax Publishers2019 TaxPub(DT) 5814 (Del-Trib) INCOME TAX ACT, 1961
Section 40(a)(ia)
Where assessee submitted that expenses were purely reimbursement of expenses given on behalf of its clients which was reimbursed and it filed before CIT(A) a certificate in Form No. 26A of the Chartered Accountant of Air India certifying that amount paid to Air India by assessee was credited by Air India in its books of accounts and was taken into account the return of income filed by Air India, therefore appeal of Revenue was dismissed.
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Business disallowance under section 40(a)(ia) - Payment to resident without TDS - Payee already filed return and disclosed income -
Assessee was engaged in business of aviation related services like ground handling, transportation of cargo and other related services and made payment on account of ground handling services which have been booked under the head, 'flight handling charges'. However, AO held that assessee was liable to deduct TDS in terms of section 194C and therefore, he had made disallowance under section 40(a)(ia). Held: Second proviso to section 40(a)(ia) read with first proviso to section 201(1) which was inserted in the statute with effect from 1-4-2013, is a beneficial provision and has to be given retrospective effect. Assessee's case was that, it was purely reimbursement of expenses given on behalf of its clients which was reimbursed. It filed before CIT(A) a certificate in Form No. 26A of the Chartered Accountant of Air India certifying that amount paid to Air India by assessee was credited by Air India in its books of accounts and was taken into account the return of income filed by Air India. Therefore appeal of Revenue was dismissed.
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
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