SAPPHIRE FOODS INDIA LIMITED,MUMBAI vs. OSD TDS CIRCLE 2(2), MUMBAI
What did the Tribunal hold?
The Tribunal held that since the year-end provisions were made for accounting compliance and the payee was not identifiable at that stage, TDS provisions are not triggered until the liability crystallizes. Consequently, the matter was remanded to the AO for verification of TDS deduction and deposit in the subsequent year.
What were the facts?
The assessee, engaged in hospitality services, made year-end provisions for expenses like interest, rent, and professional services without deducting TDS. The AO treated the assessee as being in default under Section 201(1) and levied interest under Section 201(1A), treating Rs. 5,70,50,582/- as the amount for which no TDS was deducted.
What were the issues?
Whether TDS provisions are triggered on year-end provisions where payee is not identifiable at the time of provision and whether interest under Section 201(1A) is leviable before actual crystallization of liability.
Which sections of the Income-tax Act were involved?
Section 201(1),Section 201(1A),Section 40(a)(ia),Section 194A,Section 194C,Section 194I,Section 194J,Section 133B(2),Section 221(1),Section 271C,Section 145
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- Karnataka in Subex Ltd. v. Deputy Commissioner of Income-tax15 citing148 Taxmann.com 271 · 2023 · HC
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IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “C”, MUMBAI
BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER AND SHRI ANIKESH BANERJEE, JUDICIAL MEMBER - A.Y. 2016-17 - A.Y. 2018-19 - A.Y. 2019-20 - A.Y. 2020-21 - A.Y. 2021-22 - A.Y. 2022-23 - A.Y. 2023-24
Saphire Foods India Limited vs O TDS Circle-2(2), Mumbai 311,3rd Floor, Cumballa Hill, MTNL 702, Prism Tower, A Wing Mindspace, Link Road, TE Building, Pedder Road, Mumbai- Goregaon West, Mumbai-400 400 026 062 PAN: AANCS5595A APPELLANT RESPONDENT
Assessee by : Shri Ajit Jain & Shri Siddhesh Choughule
Respondent by : Shri Virabhadra Mahajan, (SR. DR) (virtually present)
Date of hearing : 15/10/2025 Date of pronouncement : 07/11/2025 PER BENCH: This group of appeals filed by the assessee against the order of the Learned Commissioner of Income-tax (Appeals) / ADDL / JCIT(A), Ranchi [for brevity, the “Ld. CIT(A)”] order passed u/s 250 of the Income-tax Act, 1961 (for brevity, “the ACT”) for A.Ys 2016-17 to 2023-24, date of order 24/05/2025. The impugned orders emanat
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