ASSOCIATE ENGINEERS,PURBA MEDINIPUR vs. A.C.I.T.,CIRCLE-27(1), HALDIA

The present appeal has been preferred by the assessee against the order dated 28.11.2019 of the Commissioner of Income Tax(Appeals)-7, Kolkata [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act(hereinafter referred to as the ‘Act’).

The only grievance raised by the assessee, in this appeal, is regarding disallowance made by the Assessing Officer u/s 40(a)(ia) of the Act for non-deduction of TDS on certain payments. 3. At the outset, the ld. Counsel for the assessee has submitted that the respective payees have duly taken into account the aforesaid payments received by the assessee in their income-tax return. He, in this respect, has relied upon provisions of proviso to section 40(a)(ia) read with section 201 to submit that as per the provisions of the Act, if the payees has taken into account the amount of receipts from the assessee while submitting their income tax return, then no such disallowance is attracted under the provisions of section 40(a)(ia) of the Act. The ld. Counsel for the assessee has further submitted that two of the payees had income less than taxable limit and they have duly furnished Form 26A in this respect, which were duly filed before the Assessing Officer to show that while computing the income, they have taken into account the receipts from Assessment Year: 2013-14 Associate Engineers the assessee. The ld. AR, therefore, has submitted that the matter may be restored to the file of the Assessing Officer to verify the aforesaid contentions made by the ld. Counsel on behalf of the assessee. The ld. DR has not objected to the same.

In view of the above discussion, the impugned order of the ld. CIT(A) is set aside and the matter is restored to the file of the Assessing Officer with a direction to verify the contentions raised by the assessee regarding the non-applicability of the provision of section 40(a)(ia) as the payees have duly taken into account the amount received from the assessee for the purpose of computation of income. The Assessing Officer after considering the above contentions raised by the assessee will pass a speaking order in accordance with law.

In the result, the appeal of the assessee is treated as allowed for statistical purposes. Kolkata, the 26th April, 2022.