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| The Tax Publishers2020 TaxPub(DT) 3640 (Del-Trib) : (2020) 185 ITD 0353 INCOME TAX ACT, 1961
Section 40(a)(ia)
Where assessee failed to deduct tax at source on full amount paid or payable during year under consideration in relation to shipment expenses, disallowance under section 40(a)(ia) was justified because in the context of section 40(a)(ia) term 'payable' would include 'amounts which are paid during the previous year'.
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Business disallowance under section 40(a)(ia) - Applicability of provision to amount actually paid during relevant year - Term 'payable', whether includes amounts, which were paid during previous year -
Assessee made payments to a company on account of shipment expenses. AO alleged that assessee failed to deduct tax at source and made addition by disallowing 30 per cent of expenses. Held' Provision of section 40(a)(ia) would cover not only amounts which arc payable as on 31st March of a previous year but also amounts which are payable at any time during the year. Statutory provisions are amply clear and in the context of section 40(a) (ia) term 'payable' would include 'amounts which are paid during the previous year'. Since assessee failed to deduct tax at source on full amount paid or payable during year under consideration, disallowance under section 40(a)(ia) was justified.
Followed:Dy. CIT v. Ama Medical & Diagnostic Centre (2014) 45 Taxmann.com 405 (Lkw-Trib.) [2014] 63 SOT 136
REFERRED :
FAVOUR : Against the assessee.
A.Y. : 2015-16
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